Doggett Auto Group LLC recently acquired the Lone Star Ford dealership in Houston from Sonic Automotive Group. Doggett Auto Group is a new legal entity, part of Doggett Equipment Services Group. Its formation signals a new direction for the Group.
“We really hope this is the first of many auto dealerships we add to the business,” William L. Doggett, Doggett Equipment Services Group’s general counsel and son of its founder, tells Automotive Buy Sell Report.
Though the Doggett Group has no prior experience running auto dealerships, it has learned valuable and very applicable lessons operating heavy equipment dealerships. Those lessons should serve it well as it grows its auto empire.
“Our strategy has been to take the fundamentals we learn in every business [and] laser focus on the parts and service side,” says Doggett. “We will apply that to Lone Star Ford and apply that to other opportunities as they pop up.”
Doggett Ford, as the dealership is now known, sells a lot of commercial-sized Ford pickups, which fits in well with Doggett’s other businesses.
Doggett Equipment Services includes John Deere construction and forestry equipment dealerships, Freightliner heavy duty truck dealerships, Toyota forklift dealerships, and Link-Belt crane dealerships. They are strewn across South Texas and Louisiana, with one Freightliner dealership in El Paso.
Those businesses face a situation familiar to car dealers: shrinking margins on sales of new equipment.
“The real margins are in parts and service,” says Doggett.
Doggett Equipment Services’ strategy has been to “get as many pieces of equipment into the market as we can [in order] to service them,” he says.
It works very hard to develop customer loyalty with five-star customer service.
“We know if we don’t get the service pieces right, we are only going to sell one unit to the customer,” says Doggett.
The Group also aims to recruit and retain the very best service technicians, says Doggett. To that end, if offers state-of-the-art locker room facilities, first-class training, and world-class benefits.
It also looks to the armed services for hires.
“In all our businesses, we have a big desire to put veterans to work and leverage the training they have gotten in their service career,” adds Doggett.
A flagship facility
On the sales side, a lesson the Group will apply at the auto dealerships is to be involved with the community.
That won’t be hard with Doggett Ford because the auto dealership is located in the middle of the Group’s other Houston operations along the North Freeway.
“We know this community,” says Doggett. “We plan on … aggressively sponsoring community activities.”
The deal to buy the Ford franchise came about after the Doggett Group heard from a broker that Sonic was interested in selling Lone Star Ford so Sonic could do something else with the land. Ford Motor Co. wanted to keep the franchise in the area, however, says Doggett.
“If they lost the point, there would be no coverage north of the freeway,” he says.
In the deal, Sonic kept ownership of the real estate. Doggett will lease it until the end of July, then move the store to a temporary facility for 18 months while it builds a flagship store on a 10-acre plot it was using for storage. A John Deere dealership is located next door, and the Group headquarters is nearby.
It is working with Ford on the new dealership’s design. In what must be music to Ford Motor Co’s ears, Doggett says, “We are ready to make the investment. We have had good success with going above and beyond image standards with return on investment.”
Once it gets its feet on the ground with Doggett Ford, the Group is looking to acquire more auto dealerships. It prefers dealerships located in areas that overlap its existing operations in Texas and Louisiana, says Doggett.
“That being said,” he adds, “we want to evaluate any transaction that is available.”