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05-20-2014, 10:25 AM | #31 | |
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At some point the supply of inexpensive used cars will increase and their prices will fall. The question in my mind is - will the new car stores still cater to the lower end of the market when prices/demand fall or will they exit that market and start wholesaling their low ACV trades again? My bet, FWIW, is most new car dealers who currently sell used cars in the lower tier of the market will continue to do so even if the prices/demand for these vehicles declines. I think a lot of the fears about the reliability of the older vehicles and the potential damage they could cause to a dealer's reputation have decreased. |
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05-27-2014, 06:59 PM | #32 |
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Only an 8 hour drive for me to get to a market that isn't as nuts. Leaving at 4 AM tomorrow.
Just went over the record today. Combined a total of 33 retail units sold. ONLY because I could get the inventory. I'll ride the wave as long as I can, certainly not expecting a pattern, but hoping. A good month for us is 20. Someone working at the Volvo store told me I've sold more than them new and used combined this month, and they have at least 10x the inventory. |
05-28-2014, 10:56 AM | #33 | |
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Hopefully your willingness to work hard and buy cars from outside of your market will continue to pay off. Concerning the comment about the Volvo store, that's very interesting. I can't imagine the store can be profitable if they're only selling about 30 new/used per month but have the overhead associated with a store that carries 300+ vehicles in inventory. While I know I could easily look it up with Google, off the top of my head I can't even remember who owns Volvo now. I know Ford sold Volvo off just before the Great Recession and I think it was to a somewhat obscure company from China. (I remember Ford sold Jaguar and Land Rover to Tata from India, but I don't think Tata bought Volvo.) |
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05-28-2014, 06:51 PM | #34 |
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Short post since it's from my phone... but Volvo fell into the hands of Geely in 2009.
It has been a tough go for Volvo as of late. With most lines staying steady or increasing sales Volvo is regularly down year over year. |
05-29-2014, 09:06 AM | #35 |
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Used car values on them have dropped drastically also...dealers are scared of them because of the cost of repairs if needed...particularly a/c and electrical issues....the control panel modules seem to have lots of issues
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06-02-2014, 10:44 AM | #36 | |
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I can see why a dealership might be somewhat reluctant to take a Volvo in on trade or buy one at auction. In addition to the repair/reliability issues you mentioned I also think the customers who shop for used Volvos are a bit quirky and they'd probably be more inclined to buy a used Volvo from a franchised Volvo dealer. |
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06-07-2014, 11:37 PM | #37 |
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Total retail cars for the location for May was 36. Never dreamed that possible with a 30-40 car inventory. Other than the mountain of paperwork, I have little to complain about.
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06-08-2014, 07:00 PM | #38 |
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We also turned 100% of our inventory in May... average daily inventory of 70, total sales of 71. I never shy away from Volvos... thanks to wholesale values dropping drastically since their 2008 troubles and 2009 Chinese takeover they make for a cheap but still prestigious car.
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06-09-2014, 09:47 AM | #39 | |
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That's an impressive sales figure given your inventory - I doubt there are too many used car dealers who are able to do a 100% turn. |
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06-09-2014, 09:53 AM | #40 | ||
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I never really liked Volvos because at least in the Seattle area it seemed like the typical Volvo buyers were a bit quirky and high maintenance. The sales process was slower than what it would be for most other used car customers. That said, if the price of Volvos has fallen to the point where someone who was shopping for a used Camry could be switched to a used Volvo maybe it could be a "win-win" for both the customer and the store. (Assuming that the Volvo doesn't turn out to have reliability/repair issues.) |
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06-09-2014, 06:07 PM | #41 |
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Yes, the Volvo sales process is quite slow. Before my CDJR days I did some time at a Volvo dealership, and the pace is much slower. Customer is definitely quirky, and you have to been down with lots of tweed jackets and pipes. Just joking, but it definitely holds true in some cases.
I shouldn't have made that comment about Volvos yesterday. Just had to make the choice to wholesale a 2008 S80 3.2i FWD with only 100,000 miles due to a myriad of common Volvo electrics issues. $1800 estimate plus some blend door actuator problems that had to go to the local Volvo store for further diag. |
06-10-2014, 02:03 PM | #42 | ||
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To the extent there are not too many Volvo stores I'm guessing that the grosses should be higher. I'm also guessing that Volvo didn't have any stair-step incentives that forced their stores to chase volume regardless of gross. Quote:
It would have been hard to justify spending $1,800+ on repairs/recon and then still have the risk you'd have to wholesale the car at auction where prices are weak if you couldn't find a retail buyer. |
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06-10-2014, 09:06 PM | #43 |
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Volvo grosses were OK, but not great. My entire time with Volvo was during the era of Ford ownership, so they were eligible for A/Z/X plan. Ford would reimburse you back to invoice on the A/Z/X deals.
Holdback and delivery allowance combined to a whopping total of 2% of base MSRP. I woudl have to imagine that the figure is greater now, but I don't have many Volvo contacts these days. New car profits were also hurt pretty regularly by service loaner requirements. We were required to have 2 loaners based on our sales volume, and these are almost always basic V50 or S40 wagons, which are not the most desirable vehicles. Over the years, I averaged $1,400 front-end per copy... not impressive, but Volvo has been a struggle for a decade plus, and especially when you think that while most OEMs post major gains, Volvo posts 25% sales losses each month, month in and month out. |
06-11-2014, 10:21 AM | #44 | |
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If your experience is typical of most Volvo stores I can imagine life must be stressful for most Volvo Dealer Principals. Low sales volumes combined with weak grosses and declining market share would definitely be depressing. |
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06-11-2014, 04:12 PM | #45 |
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Volvo is a struggle. The good thing is that only a handful of Volvo stores around the country are single point stores. Most have plenty of other franchises around to pay the bills. And service loyalty/retention is very high among Volvo customers.
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