A Car Salesman

Toyota Recalls

So this morning Toyota is considering recalling more cars.  Specifically, they are gong to be recalling the Toyota Corolla, the number one selling car, for a power steering problem.

The stupidity of big companies never ceases to amaze me.  It has become abundantly clear that Toyota knew about the problems they are currently having.  They were aware of them and they ignored them.  As far as I am concerned that makes them culpable in the deaths of those people driving their cars.

Everyone keeps talking about other big recalls.  The one with Mitsubishi was horrible.  And there is of course the Ford Firestone recall.  And this is the recall that Toyota should have been looking at.  I was working for Ford during that recall, and here is the primary difference.  As publicity grew around that problem, Firestone repeatedly refused to release failure rates of the tires, even to Ford.  Certainly Ford should have gotten those numbers sooner, but Firestone a big company and a partner of Ford's kept saying "Oh yeah, we'll get that for you".  These companies had worked together for forever, and William Clay Ford is married to a Firestone, why would Ford doubt them?

   

Time Magazine on the Ford Firestone Recall

CNN Article

Then there was the famous meeting, where Ford got the numbers.  Ford came out of the meeting and immediately recalled all the ATX tires. They found the proof of the problem and they acted.  But, what was abundantly clear to anyone looking at the charts was that Firestone had a problem.  They had a problem, fixed it under the radar and never told anyone about it, including Ford, until people started crashing, and they were forced to.  
 

 

Ford took the brunt of the blame for the problem, but nobody calls it the Ford recall, it is the Firestone Ford recall.  And, Ford's sales after the recall was issued quickly leveled back off, the consumers didn't want Firestone's and if you fixed that they were willing to buy.  Ford's blame was lack of oversight of a product they bought from someone else.  Firestone lost their biggest customer Ford, and has been struggling since to bring the company reputation back.

So what should have been learned from watching that struggle?  People (the consumers) in America, don't mind if you stand up and take the blame.  What they despise are the companies that try to get one over on you.  That will take a long time to repair.

Remember the Tylenol recall?  They stood up and said we will make it right, as soon as they found that there was a problem!

Are You Serious

  The Car Business is Slow, But it isn't THAT SLOW!

Yesterday, for the third time this week I had a customer offer to buy a truck on our lot if and only if we would take another $7,000 off the price.  Mind you at the moment we are selling our cars and trucks at employee prices and then the customers get the rebates.  So we are selling the trucks for less than we own the trucks for and then Ford cuts us back a check for selling the vehicle.  The money that Ford gives back to us is somewhere between $500 and $2500 depending on the vehicle.  So if we took $7000 it would COST US at least $5500 to do this.

ARE YOU SERIOUS?!?!?!?!

Itstarted on Monday when we tried to get a 2008 truck from another dealership.  We do not have any 2008 F-150's left on our lot, because we are sold out!  It ended up that we could not get the truck from the other dealership, because they sold it!  When we tried again to find another truck that met the customers needs, there was not one available, the Midwest was SOLD OUT!  The customer became irate because we couldn't find another truck for him.  He argued that we should sell him a new 2009 F-150 for the same price, the price difference was about $6,000.  My reply is listed above, and I asked him why he thought we would even consider it.  He said you need to make sales, your boss will do it.  I kindly (maybe not so kindly) informed him that we wouldn't do it, because obviously we were selling F-150's, we and the rest of the Midwest was sold out of the truck he wanted.  He left saying "I can't believe you won't do it!"

Tuesday, I had a customer come in and drive a brand new F-150, his mom works at the Ford plant in town, and has for 25 years.  He wanted to look at the new F-150, so I showed him some numbers after he drove the truck.  As a Ford employee's son he could buy the truck for almost $10,000 off.  He called back on Wednesday and said he would buy the truck if we would take another $6,245 off.  Where he came up with the number I have no clue.  But again I was forced to respond, "Are you serious?" 

A customer that I have been working with for almost 6 months, he has been looking for a very specific vehicle.  He wants an F-250 Harley Davidson, we have been workingwith him for so long, that the one we have on our lot we ordered for him if we couldn't find the one he wanted before it came in.  When it came in, he kept saying, I want to see what the rebates do next month.  So he can buy this specific truck at the employee price minus the rebates, it is certainly the best deal of the year.  Yesterday he calls me and tells me he will be up on Friday to buy the truck, if and only if we took an additional $7,000 off.  Are you serious?  I told him not to bother.  He said, "You are going to have that truck forever".  I reminded him that we only had 3 2008 Super Duty trucks left, but he still was shocked when I would not take another $7,000.

Why would we take a loss of Thousands of dollars to sell a car? I know sales are down, but losing money is not how you stay in business.  Ford is selling all of their cars and trucks at employee prices and that is less than we own them for.  Our income per car and truck has already been cut to the bone.

Times are tough, but this isn't a fire sale.

The Boys are Back in Town

The Boys From Detroit Come Out Firing!

 

This time they drove to Detroit in their Hybrid vehicles.  Only one of them driving an actual production model, Alan "the Man" Mulally drove an Escape Hybrid from Detroit.  The other two drove prototypes.  They bumped up the $25 Billion to $34 Billion, but they knew what they needed.  The other incredible thing about the plan is that $15 Billion is for lines of credit forthe future, $9 Bil for Ford and $6 Bil for GM.

GM is in dire need of cash, and Chrysler is close behind.  Ford does not need money at the moment, but wants to line up money in case it needs it in the future.

The plans that they presented to congress are detailed and seem to well thought out.

The Ford Way

The GM Plan

The Chrysler Plan

Dear Congress,

Give them the money and let us get back to work.

What a Time to be a Car Salesman!

I have been selling cars for 14 years and the business has never been this hard.  With gas at $4.00 a gallon and the crash of resale values for anything with a V8, this has been a difficult time.  The car business didn't just start to slow down, the business for all domestic car dealers has been slowing over the last 2 years.  In the last year it has declined for everybody.

Car sales have been very good to me over the years, I have made a lot of money.  I started selling cars out of necessity, not because I love cars.  I lost my business and needed a job that I could make money at "right now", while I looked for a job in the corporate world.  What I did not realize was that I was going to quickly start making so much money that I could not afford to quit.  The average salesman that is new to car sales; lasts 4 months, makes almost no money and then goes into the mortgage business.  My third month selling cars, I made over $7,000 and I was hooked. 

I guess that I got into the business at the right time.   I have sold Ford's almost exclusively over the past 14 years, at primarily 3 dealerships.  My first dealership was a horrible place to work and I only stayed there for 11 months.  Since then I have worked primarily at 2 dealerships. I have been at the one I am currently working for over 6 years and do not plan on moving.  I did try selling Toyota's for a month and hated that.  My clientele is Ford based, so that is where I stay.  After 14 years I have a good base to sell to and it has been very beneficial.

I have seen a lot of crazy stuff over the years.  The craziest things have not been from the dealerships, they have been from the customers and the salesman.  So I am going to tell some stories, talk about the industry, and answer some questions that my customers have asked me over the years.