As we publish this week’s issue, a huge area in south Texas is still underwater. We here at Automotive Buy Sell Report have those affected by Hurricane Harvey in our thoughts and hope they are able to return to some semblance of a normal life soon.
The impact of the storm on the Texas economy will be huge, and Texas is the second-largest vehicle market in the U.S. after California. It is the largest pickup market. Initially, the news is sober – forecasts were for August to be the first month in many to see growth in new light vehicle sales. Now, Edmunds estimates two percent fewer vehicles will be sold in the U.S. as a result of the hurricane.
In the longer term, however, the effect of the storm on new vehicle sales may be positive. Consumers will need to replace lost vehicles, and pickup sales should also surge as rebuilding begins and construction companies buy vehicles.
Dealers will also face an arduous rebuilding process – we wish them the best.
This week, I profile a dealer based right here in Southern California. Jon Gray, owner of Orange Coast Auto Group, told me that money wasn’t a barrier to expanding his group. While “the money equation is certainly relevant, it seems in this environment it is not difficult” to get financing provided one has the foundation, he says. For Gray, the people equation – making sure a potential acquisition fits the Orange Coast culture – is tougher and more important. Read about his recent acquisition of a Nissan dealership in this issue.
Sticking with the theme of dealership culture, this week we also revisit a piece by Dan Schneider of The Rawls Group that discusses the importance of doing cultural due diligence before an acquisition, and of assessing if you have the people power to run another dealership in a way that will keep that all-important customer satisfaction high.
There is also, of course, Transaction News.
Enjoy!
