Ed Bobit: Can We Save the Species?

If you're like me at all you've always wondered about where the hoards of protesters find the time to congregate and walk around with signs depicting current consciousness. Out here in California we are seemingly blessed with an abundance of those type of folks who carry the flag for saving everything from the mammoth whales to the pocket mouse, spotted owls, El Segundo butterflies, Delta smelt, pup fish, and condors.

My question is related. Is there anyone ready to march to save the fleet dealer species?

Yes, dealers still officially sell every one of the 2.5 million new cars and one million new light trucks sold into fleet each year. That's the good news. The not-so-good news is that it's hard to find the old-time reliable dealer anymore. In the name of progress, evolution, and sharper negotiation, a new breed has emerged.

Little did anyone suspect that when Wheels shipped their first drop-ship car in October 1952 that our fleet world would change so much. That was an era when unit costs were $2.500-$3,000, the dealers held the one percent holdback and obtained $2-300 for the purchase. There were dozens of fleet-minded dealers who excelled in service and preppmg, took trade-ins with ease and gave the corporate drivers full instructions with their new vehicle.

In the mid-'60s the rental companies got smarter and were dealing for $150 over invoice. It was still good business.

Without a doubt the most significant innovation occurred in 1972 when LPI (a Purchase, NY lessor later merged with Gelco) buyer. Ron Trapani, worked out a sub-code system with factory approval and direct purchasing (and the "selling" dealer as an almost silent partner). This move presaged the eventual mergers among fleet management companies and economies of volume followed with sharp supplier negotiations. By the late '80s fleet dealers were grossing about $50 over invoice and pressure to share the holdback which had increased to two percent.

In 1990 the factories were committed to widespread rental buyback programs which increased volume markedly with three cycles per year, in some cases. The sub-coded dealer, often in some remote area and not able to spell F-l-e-e-t, was always found to handle the transaction for a few bucks over net/net/net. It was like the Polk Brothers selling appliances in the Chicago area as a pioneer discounter.

Whether it's the selling dealer or the delivering dealer on a courtesy delivery, life is lean today. The lessor or rental firm buyer has the assignment to buy for bottom line. Let the 'seller' beware.

One dealer told me recently that he lost a delivery to a lessor to another dealer 30 miles away for $5 on the CD. Even though the corporate driver lived less than a mile from his dealership.

The buyers have little sympathy. They say all you have to do is screw on the antenna, punch on the wheel covers, and check the dipstick as the car is washed. No one seems to care that if it isn't test driven prior to delivery and the overdrive isn't functioning, the driver is back two days later, loses time (and patience), and gives the factory a bad name. Lessors used to personally visit the dealerships to ensure good propping and delivery standards. Few do any more. Driver complaints are expected and sloughed off.

Someday someone just may find some accounts that are willing to pay for service and may well save money in the process.

Let's find a way to save the quality service-minded fleet dealer.