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 Tracking And Telematics

Todd Ewing from Fleetmatics will answer your questions and challenges

View All

 

Fleet Management And Leasing

Merchants Experts will answer your questions and challenges

View All

 

Sponsored by

Most car dealers who sell used vehicles must comply with the Federal Trade Commission's (FTC's) Used Car Rule. In fact, car dealers who sell more than five used vehicles in a 12-month period must comply with the Rule.

Read more

Blog

Market Trends

Mike Antich
Human Nature Prone to Take Advantage of Docile Autonomous Vehicles

By Mike Antich
The co-existence between autonomous and human-controlled vehicles (along with others who use public roads) will bring new issues into play, primarily because self-driving vehicles will be built to be inherently law-abiding and risk averse. As we approach this new era, the question is how seamlessly will autonomous and human-controlled vehicles co-exist? One thing is certain, as we trail blaze new ground, so too will we trail blaze new problems.

What Fleet Managers Can Learn from a Navy SEAL

By Mike Antich

View All

Driving Notes

Paul Clinton
2017 Ford F-150 with 10-Speed

By Paul Clinton
While higher-gear transmission have traditionally been reserved for European luxury sedans, Ford's application of the gearbox to its leading seller is so inspired a choice that it almost feels inevitable.

2017 BMW 540i

By Paul Clinton

View All

Nobody Asked Me, But...

Sherb Brown
Remembering the Coach

By Sherb Brown
Three years have gone by since our founder Ed Bobit passed away. In many ways it feels like an eternity but in other ways it feels like he was just here yesterday. He was a larger-than-life force and left quite an impact on me, and on the fleet industry.

The House of Electric Vehicles

By Sherb Brown

View All

Data Points

Dylan Brown
Demand More From Your Fuel Card Provider

By Dylan Brown
The advantages of tracking driver spending can't be overstated, as the data provided can help fleet managers assess if drivers are efficiently purchasing fuel, as well as identify high-performing vehicles and drivers who can serve as examples to the rest of the fleet.

Does Telematics Branding Translate to Adoption?

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