Car Dealers Hope for Better Sales
Sales soared in 2011, but have been more modest so far this year.
For Northeast Ohio car dealers, 2012 so far hasn’t brought a repeat of the big sales of 2011, when consumers returned to the market after a terrible 2010. But they’re optimistic things will pick up as the year goes along.
As a 21-county region, Northeast Ohio car dealers sold 47,855 cars through March — about 1.8 percent more than the same period last year, according to the Greater Cleveland Auto Dealers Association.
That’s a more modest gain than in other U.S. markets, where sales jumped by 20 percent over the same period, according to a National Auto Dealers Association report. But area sales managers don't focus on such comparisons. Their confidence in a slowly improving economy and a loosening loan market hasn't wavered.
If the GCADA's prediction for the rest of the year holds true, dealers are in for a repeat of a robust 2011, when area sales jumped 20 percent over the previous year.
"I think we're going to duplicate it and do better," said GCADA President Louis A. Vitantonio. "Our market is continuing to turn, and people's stability in jobs and the economy is better — not certainly where we want it to be, but better than it was in previous years, which means people are going to spend a little money on that big purchase."
Last year wasn’t good for all brands. Local Toyota dealers suffered first from a series of recalls that damaged the brand and then from the effects of the tsunami, which constricted supply just as sales started to recover.
Matt Gile, general manager of Motorcars Toyota in Cleveland Heights, hopes that two new Prius models and the typically top-selling Camry help him forget last year, when at times he had fewer than 50 cars available to sell. He’s got about five times that figure now.
"It's hard to be in the car business when you don't have cars to sell," Gile said. "This year, we finally have inventory and the market's back … Banks are back to buying more deals, and the incentives are really good."
Gile said excitement surrounding the annual Cleveland Auto Show in late February and early March usually helps boost March sales, but this year regional sales of all brands actually fell 4 percent. Still, 16 brands sported increases during the year's first three months, including Kia, Chrysler and Ford, the area's best-seller, which accounted for 8,874 vehicles.
At Fiat of Strongsville, by contrast, the only way to go is up; the dealership is one of 130 Fiat dealerships to open in the country last year. It had been 27 years since the brand was sold in the U.S.
Paul Podnar, a Fiat specialist in Strongsville, said that was exciting and complicated, all at once.
"It's not like you're opening a Ford dealer; you're bringing a brand that's been gone for 30 years," he said. "Lots of education goes into it, because most people don't realize how big Fiat is."
To rebuild brand recognition, Fiat of Strongsville held a number of promotional events including a cookout on the sales lot, and debuted a new Fiat 500 model with Gucci leather seats at Tower City Center, Podnar said.
While local auto sales figures for March aren’t as robust as the national stats, as The Plain Dealer reported in April, local dealers now say they’re not worried.
The GCADA’s Vitantonio said he has little concern for such comparisons, and that hiss member dealers feel the same way.
"It's not important," he said. "They're concerned about what they control, which is how their store performs. You have Detroit and some big markets that have a lot of sales based on people who work in the industry. You can't compare yourself to that.
"We're more concerned about the reports we put out for our 21 counties."
Besides, he added, 2011’s numbers might have looked rosy because 2010’s were so bad. The combination of pent-up demand and the desire for fuel-efficient vehicles will be the determining factors this year, he said.
"It may be an alternative fuel vehicle or just one that (offers) more miles per gallon," Vitantonio said. "That's the factor that will lead us to higher vehicle sales.
"I think there's going to be a shift in this segment going forward for the remainder of 2012."