The Car and Truck Fleet and Leasing Management Magazine

Postpone the Shootout! It's Status Quo Yet for a While!

June 2005, by Ed Bobit - Also by this author

Eight out of 10 guys who hit you over the head on the streets have learned their trade in prison.-Melvin Belli

You can get much farther with a kind word and a gun than you can with a kind word alone.-Al Capone

(It's strange that men should take up crime when there are so many legal ways to be dishonest.) I'm convinced that every boy, in his heart, would rather steal second base than an automobile.-Justice Tom Clark

When I came back to Dublin, I was courtmartialed in my absence and sentenced to death in my absence, so I said they could shoot me in my absence.-Brendan Behan

 

Last October I was caught in a vulnerable moment and predicted to the industry (and the world) that a day of reckoning between the factories might be in our future. I compounded the questionable prediction by pointing out that domestic over-incentivizing, volume selling of a nameplate to fleet, and lack of design imagination could spell trouble.

How very silly of me. There was an inordinate amount of factory (domestic) field people who called (heaven forbid if they ever voiced their concerns in writing) and genuinely asked about my mental condition in their own discreet way. After catching a number of these calls, I decided that I was operating at least two quarts low.

Their mantra held that there was no way the so-called imports could match the rich fleet incentives. They literally laughed at me when I pointed out that the leading import had as much as $ 1,000 on their mid-size car. My detractors joined in boisterous laughter, eking out phrases like "chicken feed," "chump change," and similar descriptions. I should have known better.

My whole premise for sticking my abused foot into my now large mouth was that the mid-size car giveaways were gnawing away at the badge's used values at trade-in. Except at Chrysler, at the time, where the 300C was an immediate knockout and earned Fleet Car of the Year honors, the mainstream fleet sedans weren't very exciting. And everyone was playing "Let's Make a Deal."

Even though the domestics get more than 95 percent of the commercial fleet business, there were enough storm warnings that I felt that even the hot imports would behaving trouble selling retail in the '05 model year. When this happens, it's automatically time for them to look at fleet, which they've virtually ignored (except for rental sales) to augment slower retail sales. Why couldn't I have seen the future better?

A guy I know has been trying to buy a Toyota Land Cruiser (that's a luxury SUV to the uninitiated and quite pricey) for a week now. He wants a black one with a leather interior; the rest is optional and he has the money. He cannot find one in stock in all of Southern California. There are only two black ones, and they both have the wrong color interior. Can you believe it?

There were more than 6,000 sold last year, and the dealer gross on this product is next to egregious. Just so you know, out here in "weird land" (So. Cal.), there are as many Toyota dealerships as there are bars in Hurley, Wisconsin. My point being that dealers have not yet satisfied the local retail appetites.

At a recent Fleet Advisory Board meeting, I was idly discussing selection influences with several new factors blurring the fleet buying scene. Some fleet managers are still musing about missing the Astro for next year, the impending line closing for the Taurus, and other challenges. It surprised me when my fellow board member asked if I knew how he could obtain 50 or 75 Honda Odysseys, which he really wanted. I told him I'd see what I could do since I have an occasional lunch with Dick Colliver (executive VP, sales and marketing), a top dog at Honda.

 

Now I know that Dick takes pride in his dealer meetings, make meetings, and announcement previews. He also makes sure that he departs with a phrase something like, "And we don't do fleet!!!" Bui, I asked him anyway; what the hell.

He thought about five seconds and simply said "No." He related that they don't "do fleet;" he's only got a 20-day supply of Odysseys; and even if a buyer could find a dealer to vary from MSRP, the other delivering dealers don't have any idea what a drop shipment is. Retail is still doing quite well at Honda.

So I must, in all candidness, postpone the shootout: probably for a while since the imports are still grabbing market share. Fleet managers, keep your present supplier contacts in good shape 'cause there won't be a shootout yet. (Do I dare say that it's coming?)

 

 

Twitter Facebook Google+

Comments

Please note that comments may be moderated. 
Leave this field empty:
 
 

Fleet Incentives

Determine the actual cost of owning and running a vehicle in your fleet. Compare vehicles by class and model.

FleetFAQ

Fleet Management And Leasing

Merchants Experts will answer your questions and challenges

View All
Sponsored by

Founded in 1955 and located in the Washington, D.C. metropolitan area, the American Automotive Leasing Association (AALA) is a national industry association composed of commercial automotive fleet leasing and management companies.

Read more

Blog

Market Trends

Mike Antich
Avoid Repeating Past Inefficiencies: Build the Truck to Match Today’s Application

By Mike Antich
I asked one fleet manager how he spec’ed replacement trucks for his fleet application. He related that many years earlier an OEM rep spec’ed out his trucks and he has been using the same formula ever since. While this may work in some cases, specifications should be defined by today’s fleet application to ensure the replacement truck is designed to accommodate current operational requirements rather than trying to make your operation conform to trucks spec’ed for yesteryear’s requirements.

Conduct an Efficiency Audit to Eliminate Waste in Your Fleet Budget

By Mike Antich

View All

Driving Notes

Amy Winter-Hercher
2017 Subaru Impreza

By Amy Winter-Hercher
The redesigned 2017 Impreza has been built on Subaru’s new platform that improves stability and reduces road noise and vibration. The fuel-efficient, all-wheel-drive Impreza makes for a good commuter vehicle — available in either a sedan or hatchback.

2017 Mazda CX-5

By Eric Gandarilla

View All

Nobody Asked Me, But...

Sherb Brown
Yes Virginia, There is Depreciation

By Sherb Brown
Depreciation is a necessary evil in our industry. Knowing your risks and knowing your OEM partners won’t make depreciation go away but it can make it more manageable.

Are You a Fleet Manager or Are You Just Managing a Fleet

By Sherb Brown

View All

Data Points

Dylan Brown
Does Telematics Branding Translate to Adoption?

By Dylan Brown
We asked over 750 fleet professionals questions about the prevalence of each provider in the market and their brand recognition.

How Fleet Size Dictates Telematics Needs

By Dylan Brown

View All

In Memoriam: Coach's Insights

Ed Bobit
Thinking of the Newbies of the Future

By Ed Bobit
A lot has changed in the past 10-15 years, so we can only imagine this momentum will continue into the next decade-plus. How will this change impact the fleet manager of tomorrow?

Managing a Car vs. Work Truck Fleet

By Ed Bobit

View All

STORE

Up Next

More From The World's Largest Fleet Publisher