Recession power session how the tough get going

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Recession power session how the tough get going

  1. 1. Recession Power Session: How ‘The Tough Are Getting Going’ Lenny McGinley VP, Dealer Sales Autobytel Inc.
  2. 2. Survey.com Survey Methodology • Survey.com was commissioned by Autobytel to conduct a survey examining how auto dealerships are responding to the current economy and high gas prices: • Examine impact the current economy and high gas prices has had on overall sales • Explore how dealerships feel about the future of smaller, more fuel-efficient vehicles • 200 nationally representative dealer responses • Data was collected from August 25, 2008 through September 8, 2008. 2
  3. 3. Overall New Vehicle Sales vs. a Year Ago Sales Down 55% Good News: Stayed about the same 18% 45% of dealers reported new vehicle sales were flat or up versus a year ago Sales Up 27% 0% 10% 20% 30% 40% 50% 60% Source: Survey.com, September 2008 3
  4. 4. Overall New Vehicle Sales vs. a Year Ago Import vs. Domestic Story More GM Dealers Report Sales Increase than Toyota Dealers… % of dealers report sales increase/decline 79% 80% % of dealers report sales decline 78% 72% 78% 65% 70% 77% 60% 76% 75% 50% 74% 73% 40% 73% 30% 72% 20% 15% 71% 12% 70% 10% Import Domestic 0% Toyota GM Decline Increase Source: Survey.com, September 2008 4
  5. 5. Overall New Vehicle Sales vs. a Year Ago Who’s Up? Who’s Down? Honda 50% Kia 37% Hyundai 50% Hummer 33% Nissan 40% Chrysler 26% Source: Survey.com, September 2008 5
  6. 6. Overall Used Vehicle Sales vs a Year Ago Good news: 61% of dealers % of dealers report sales reported used vehicle sales were increase flat or up versus a year ago 45% 41% 40% Sales Down 40% 35% 32% 30% Stayed about 25% 25% the same 20% 15% 10% Sales Up 36% 5% 0% 0% 10% 20% 30% 40% 50% Import Domestic Source: Survey.com, September 2008 6
  7. 7. Fuel Sipper Sales Up This Year Has your dealership seen an increase in sales of smaller, fuel-efficient vehicles over the past year? Yes, somewhat/significant 88% increase Stayed the same 11% 9 out of 10 dealers saw an increase in smaller, fuel- efficient vehicle sales… 50% have seen an over No, sales have gone 20% increase down 2% 0% 20% 40% 60% 80% 100% Source: Survey.com, September 2008 7
  8. 8. Whose Fuel Sipper Sales Are Up This Year Whose fuel sipper sales are up this year? Import 59% Domestic 49% Hyundai 88% Honda 69% Nissan 67% 0% 20% 40% 60% 80% 100% Source: Survey.com, September 2008 8
  9. 9. Small Cars Driving Sales Health 73% of dealers reporting 10% or more Top brands spiking small increase in sales report significant increase vehicle sales reporting 20% in small vehicle sales or more sales increase 0 0% 1-9% 11% • Nissan 79% 10-19% 35% 20-29% 26% • Honda 62% 30-39% 13% 40-49% 5% • Hyundai 50% 50-74% 9% 75-99% 0% 100% or m ore 1% 0% 10% 20% 30% 40% Source: Survey.com, September 2008 9
  10. 10. Who/What is driving new vehicle sales decline? Which factor has had the single largest impact on declining new vehicle sales across the industry? High Gas Prices 38% Housing Market/Credit 37% Crunch Inventory Mix 10% THE MEDIA! “The media scaring the public with all the negative press” Other 16% 0% 5% 10% 15% 20% 25% 30% 35% 40% Source: Survey.com, September 2008 10
  11. 11. Who is Blaming Who? • GMC dealers most likely to blame Gas Prices • Nissan dealers most likely to blame Credit Crunch 70% • Toyota dealers most likely to blame Inventory Mix 60% 60% 53% 50% 43% 42% 40% 38% 37% 35% 32% 31% 31% 30% 27% 26% 20% 20% 20% 16% 13% 9% 10% 8% 7% 0% 0% 0% ia C da ta n et M sa ge K yo on ol G is od To vr H N /D he ep C Je y/ hr C High Gas Prices Housing Market/Credit Crunch Inventory Mix Source: Survey.com, September 2008 11
  12. 12. F-E Vehicle Shift Permanent or Just Another Phase? Do you think the recent industry-wide shift to smaller, fuel efficient vehicles is permanent? YES! 46% Gas prices will stay high and market will continue to be about fuel efficiency. NO! 49% It’s just part of the current cycle; gas prices will decline and trucks/SUVs etc. will make a comeback. • 65% Honda dealers see it as permanent vs. 22% of Chevy • 67% Hummer dealers see it as part of cycle Source: Survey.com, September 2008 12
  13. 13. Fuel Efficiency Driving Consumer Behavior? Do you agree with this statement: “Fuel Efficiency is the #1 concern for car shoppers today – and the top factor in their vehicle selection”? No! Yes! 46% 55% • Import dealers more likely to say yes: 58% • Domestics more likely to say no: 42% Source: Survey.com, September 2008 13
  14. 14. When Will It Be Over? Or Will It? When do you think the new vehicle market will significantly recover or really start to turn around? Later in 2008 9% First half 2009 29% Second half 2009 34% 2010 13% 2011 3% Over half of dealers don’t see turnaround until 2nd Q Not in the forseeable future 2% 2009 and Beyond Not sure 10% 0% 5% 10% 15% 20% 25% 30% 35% 40% Source: Survey.com, September 2008 14
  15. 15. When Will It Be Over? Or Will It? Most Optimistic Brand? Most Pessimistic Brand? • Nissan – 27% see turnaround in 2008 • GMC – 40% 2010 - 2011 50% 47% 45% 40% 38% 38% 38% 38% 36% 35% 31% 31% 30% 32% 30%30% 28% 30% 28% 27% 25% 21% 21% 20% 16% 15% 15% 15% 15% 13% 13% 13% 13%13% 10%10% 10% 10% 11% 10% 8% 8%8% 8% 7% 7% 6% 7% 5% 5% 5% 4% 4% 5% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% ta M ai C ge da a an Ki M nd G yo od on ss G To yu /D Ni H H ep Je y/ hr Later in 2008 First half 2009 Second half 2009 2010 2011 C Not in foreseeable future I am not sure 15
  16. 16. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? Most Important thing to help during downturn Better follow-up processes and processes to convert leads into sales 50% Targeted, measurable Internet marketing 21% The #1 focus for (leads, used, etc.) a dealership is follow-up processes Used vehicle sales 17% and lead conversion processes Service and aftermarket sales 13% 0% 10% 20% 30% 40% 50% 60% Source: Survey.com, September 2008 16
  17. 17. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? Greater Focus on Follow-up Processes and Lead Conversion 100% 90% 80% 67% 70% 62% 63% % of dealers 60% 54% 50% 47% 50% 46% 40% 30% 20% 10% 0% ia an ai da M ta ge K nd G yo s on od is yu To H N /D H ep Je y/ hr C Source: Survey.com, September 2008 17
  18. 18. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? Greater Focus on Targeted, Measurable Internet Marketing 50% 45% 40% 35% 32% 27% % of dealers 30% 25% 23% 20% 15% 15% 13% 13% 10% 6% 5% 0% ia an ai da M ta ge K nd G yo s on od is yu To H N /D H ep Je y/ hr C Source: Survey.com, September 2008 18
  19. 19. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? Greater Focus on Used Vehicle Sales 50% 45% 40% 35% 31% % of dealers 30% 24% 25% 20% 15% 12% 11% 13% 10% 8% 5% 0% 0% ia an ai da M ta ge K nd G yo s on od is yu To H N /D H ep Je y/ hr C Source: Survey.com, September 2008 19
  20. 20. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? Greater Focus on Service and Aftermarket Sales 30% 25% 20% 17% % of dealers 15% 15% 13% 12% 13% 11% 10% 7% 5% 0% ia an ai da M ta ge K nd G yo s on od is yu To H N /D H ep Je y/ hr C Source: Survey.com, September 2008 20
  21. 21. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? 1. Increasing or Standing Firm on Internet Spend 91% 2. Focus on Better Process to Convert Leads Into Sales 77% 3. Making Internet Bigger Part of Budget 69% 4. More Focus on Used 58.5% Source: Survey.com, September 2008 21
  22. 22. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? 91% Increasing or Standing Firm on Internet Spend 100% 100% 92% 100% 91% % of dealers increasing or standing firm on 88% 90% 79% 80% 75% 70% 60% Internet spend 50% 40% 30% 20% 10% 0% ia an ai da M ta ge K nd G yo s on od is yu To H N /D H ep Je y/ Honda, Hyundai and Nissan hr C top 3 brands increasing spend… top 3 in sales increase 22 Source: Survey.com, September 2008
  23. 23. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? 77% Focus on Better Process to Convert Leads Into Sales % of dealers focus on better process to convert leads 100% 88% 90% 81% 80% 80% 73% 76% 73% 75% 70% 60% 50% 40% 30% 20% 10% 0% ia n i a M ta da e nd sa K G dg yo un is Ho To Do N Hy p/ ee /J ry Ch Source: Survey.com, September 2008 23
  24. 24. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? 69% Making Internet Bigger Part of Budget 100% 100% % of dealers significantly/somewhat 90% 80% 75% increasing Internet spend 69% 67% 69% 70% 58% 60% 50% 50% 40% 30% 20% 10% 0% ia an ai a M ta ge nd K nd G yo s od is Ho yu To N /D H ep Je y/ hr C Source: Survey.com, September 2008 24
  25. 25. When the Going Gets Tough, the Tough Get Going What are dealers doing to weather the storm? 58.5% More Focus on Used 100% 90% 80% % of dealers put more focus on Used 80% 74% 69% 70% 66% 63% 60% 54% 50% 50% 40% 30% 20% 10% 0% ia n i a M ta da e nd sa K G dg yo un is Ho To Do N Hy p/ ee /J ry Ch Source: Survey.com, September 2008 25
  26. 26. Summary • Over half of new car dealers seeing sales decline • Domestics more impacted than Import dealers • F-E Vehicles driving sales increases • Dealers split on cause between high gas prices and housing/credit crunch • 63% believe industry will recover sometime in 2009 • 91% standing firm or increasing Internet spend • Majority of dealers report that more intense and effective lead follow up #1 key to survival Source: Survey.com, September 2008 26

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