Tag Archive | "Sales"

Spending on New Cars Hits All-Time High, Even as Loans Stretch to Record Lengths


While May might not have brought the big uptick in sales we’ve seen in recent months, preliminary data suggest that automakers took in record revenues, with the average transaction price of new cars, trucks and crossovers sold last month climbing by at least 4%, reports The Detroit Bureau. 

All told, U.S. buyers spent a record $52 billion for their new vehicles in May, in part, due to a sharp, year-over-year decline in incentives, according to several firms that track monthly sales data. A separate study suggested that motorists are covering those higher costs by stretching their loans out longer than the industry has ever seen, an average 67 months.

“New vehicle sector and segment preference indicates consumers are confident about the economy and their finances,” said TrueCar President John Krafcik. “Not only are these shifts to premium brands and utilities telling from an economic indicator standpoint, they signal sizable revenue gains automakers should reap this year.”

The data tracking firm estimated that the typical vehicle had an average transaction price, or ATP, of $32,452, up 4% rom May 2014. Lower incentives played a role, but manufacturers have also seen buyers show more confidence by loading up on options and by trading up to higher-level vehicles. TrueCar estimated sales of premium brands jumped 10.6% during the first four months of 2015 compared to just 4.8% for mainstream brands.

BMW and its Mini subsidiary, saw prices jump in May by 6.5%, according to a separate analysis by Kelley Blue Book. Mazda saw a similar increase, while Ford and General Motors prices climbed a more modest 4.3% and 4.2% respectively. Toyota’s average price rose just 2.3%, even though it trimmed incentives by more than 10%, year-over-year.

With only a handful of exceptions, notably including General Motors, Hyundai and Kia, most makers trimmed rebates and givebacks as the U.S. auto market continued to gain ground. And analysts noted that the modest overall sales numbers for May actually misrepresent the market’s momentum, as the peculiarities of the industry’s reporting system counted fewer so-called “sales days” last month than in May 2014.

The surge in spending also reflects a year-long shift from fuel-efficient small cars and alternative-power vehicles to larger passenger cars, pickups and SUVs.

“With the national average price of gasoline down nearly a dollar per gallon on average from one year ago, truck and SUV demand remains strong, elevating average transaction prices,” Karl Brauer, senior analyst for Kelley Blue Book, said in a statement.

The steady climb in new car prices might come as a surprise to those worried about relatively stagnant middle-class earnings and the rising wealth gap. In reality, most new car buyers today register on the upper end of the middle-class spectrum. Even for compact cars, industry research often shows household income levels approaching six figures.

And buyers are simply stretching out their purchases to hold down monthly payments – while also encouraged by continuing low interest rates. Gone are the days of three and even four-year loans. Borrowers extended their loans terms during the previous quarter to 67 months on average, longer than ever for new cars, according to Experian Automotive.

“While longer term loans are growing, they do not necessarily represent an ominous sign for the market,” said Melinda Zabritski, Experian’s senior director of automotive finance.

On the plus side, the trend allows consumers to buy more vehicle without busting the household budget. On the downside, however, it means they likely have to keep those vehicles longer in order to avoid being upside-down on loans when trading in, cautioned Zabritski. That could foretell slower future growth of the automotive market.

Posted in Auto Industry NewsComments Off on Spending on New Cars Hits All-Time High, Even as Loans Stretch to Record Lengths

Audi Edges Past BMW to Lead Luxury-Car Sales Race in April


Audi was the world’s biggest seller of luxury cars in April, edging out BMW AG’s namesake brand and fast-growing Mercedes-Benz, reported Bloomberg.

Bolstered by U.S. demand for the Audi Q5 and Q7 sport utility vehicles, the Volkswagen AG unit’s deliveries rose 2.5 percent to 152,850 cars last month, compared with BMW’s 5.6 percent increase to 148,896 autos. Daimler AG’s Mercedes remained the fastest growing of the world’s three biggest luxury-car brands, posting an 11 percent gain to 148,072 cars.

“We’re seeing growth at a good pace,” Audi Chief Executive Officer Rupert Stadler told reporters on Tuesday at a presentation of the revamped Q7 sport utility vehicle in Verbier, Switzerland. “We started the year with a very decent first quarter.”

BMW has vowed to defend its annual lead in global premium car sales, even as key models such as the 7-Series sedan age. The three German luxury-car brands are adding all-new models to widen their appeal and gain an edge over rivals. BMW is rolling out the van-like Gran Tourer this year, and Mercedes plans a pickup truck by the end of the decade.
Through the first four months of 2015, BMW held onto its No. 1 ranking, with sales up 5.5 percent to 600,473 cars. Audi’s deliveries increased 5.2 percent to 591,050 vehicles, while Mercedes demand jumped 14 percent to 577,674 autos.

Audi will expand its SUV offerings with the new subcompact Q1 next year and the full-size Q8 by 2019, Stadler said. The Ingolstadt-based carmaker expects SUVs to account for about 40 percent of total vehicle sales in 2020 compared with 32 percent now.

Those new additions could be critical. Competition in China, the manufacturer’s largest market, is set to intensify as growth moderates. Stadler forecast industrywide demand in the country to rise about 8 percent this year, which is still faster than many other major markets.

Posted in Auto Industry NewsComments Off on Audi Edges Past BMW to Lead Luxury-Car Sales Race in April

GM Expects to Fall Short of 2017 Electric Vehicles Target


General Motors Co said it will fall short of its goal of having 500,000 GM vehicles on U.S. roads by 2017 that are powered by some form of electricity, reported Reuters.

The No. 1 U.S. automaker said in its annual sustainability report that lower gasoline prices and a “surge” in model offerings from all automakers contributed to the lower-than-expected sales for electrified products, including plug-in hybrids, pure electric vehicles and vehicles with the eAssist system that boosts fuel efficiency in gas-powered cars.

“For our commitment to electrification, our forecasted outlook currently projects us, along with the broader automotive industry, falling short of expectations for 2017,” GM said in the 2014 report released on Thursday.

“GM is committed to electrification … but consumer demand for these vehicles has not kept up with our initial projections,” it added.

The company said it counted 180,834 electrified GM vehicles on U.S. roads last year, up from 153,034 such vehicles in 2013.

GM Chief Executive Mary Barra outlined its 2017 target in November 2012 when she was the automaker’s global product chief. At the time, Barra said the company’s plans called for the eAssist system, which boost fuel efficiency as much as 25 percent in some gas-powered vehicles, to be on “hundreds of thousands” of vehicles annually by 2017.

GM, like other automakers, needs more fuel efficient cars as the industry pushes toward more stringent U.S. requirements that will be in place by 2025.

Electric vehicles have failed to catch on with consumers due to high prices, disappointment with electric driving range and an under-developed charging infrastructure. Low gas prices have fueled consumer demand for larger vehicles, including full-size pickup trucks and SUVs.

In 2013, The U.S. Department of Energy backed off President Barack Obama’s goal of putting 1 million electric cars on U.S. roads by 2015.

GM is developing an all-electric vehicle, the Chevrolet Bolt, with an electric driving range of 200 miles and production is expected to start in 2016. It will sell for about $30,000 after a federal tax rebate.

The automaker also this fall is introducing a redesigned version of its Chevy Volt plug-in hybrid that has an increased electric driving range of 50 miles and sells for almost $1,200 less than the current version of the car.

Posted in Auto Industry NewsComments Off on GM Expects to Fall Short of 2017 Electric Vehicles Target

Toyota Flags Third Year of Record Profit on Strong U.S. Sales, Cost Cuts


Toyota Motor Corp said it will crank net profit up to a third straight record this year as cost cuts and rising U.S. sales offset weaker business elsewhere, building on bumper earnings last year powered largely by foreign-exchange gains, reported Reuters.

Reporting net income jumped 50 percent in the quarter ended March, the world’s top-selling automaker said on Friday it expects net profit to rise 3.5 percent to 2.25 trillion yen ($18.75 billion) in the year that began in April.

The forecast assumes the dollar will be worth 115 yen on average this year. That’s conservative compared with 120 yen currently, implying Toyota’s net profit for the year may yet come closer to the 2.44 trillion yen average estimate of 27 analysts polled by Thomson Reuters.

For the past few years, President Akio Toyoda has called an “intentional pause” for the company founded by his grandfather. The strategy seeks to ensure sales growth stays at a sustainable pace, free of the overcapacity and quality problems that plagued the company in previous years.

“I think we are at a stage where we can move on to putting into practice what we have been preparing during the intentional pause,” Toyoda said at a news conference in the capital.

Toyota is looking to overhaul the way it designs and manufactures cars under a new initiative called Toyota New Global Architecture (TNGA), which aims to slash development and production costs and allocate part of the savings to making its cars more appealing. Advanced safety devices would be among features it plans to add to cars.

The first car developed under TNGA specifications – widely expected to be the next-generation model of the Prius sedan – is due for launch later this year. The first full-scale “simple and slim” TNGA factory will be built in Mexico in 2019.

The forecast for earnings growth this year came as Toyota projected overall vehicle sales will drop 0.8 percent to 8.90 million. But it expects lucrative sales in North America to grow 4.2 percent to 2.83 million, cushioning the blow of weaker sales in Asia, as well as Russia and the Middle East, which have been hit by falling oil prices.

Toyota expects operating profit to edge up 1.8 percent this year to 2.80 trillion yen, giving an operating margin of 10.2 percent – among the highest in the industry.

It expects cost cuts to contribute 265 billion yen, while currency losses will knock off 45 billion yen as a weaker Brazilian real and Russian rouble offset windfalls from a stronger dollar, which boosts the value of U.S.-based earnings when converted back into yen.

Posted in Auto Industry NewsComments Off on Toyota Flags Third Year of Record Profit on Strong U.S. Sales, Cost Cuts

VW’s Audi Sales Up 2.5 Percent in April to 152,850 Cars


Volkswagen’s Audi luxury division said on Friday sales increased 2.5 percent in April to 152,850 cars and sport-utility vehicles, the highest-ever level recorded for any month in the carmaker’s history, reported Reuters.

Sales in Europe edged up 0.9 percent as gains in Italy and Spain offset a 42 percent slump in deliveries in Russia to 2,116 vehicles, Ingolstadt-based Audi said.

In the Americas, sales were up 12.7 percent, bolstered by a two-thirds increase in Brazil to 1,856 cars and a 37 percent jump to 3,219 cars in Canada.

Posted in Auto Industry NewsComments Off on VW’s Audi Sales Up 2.5 Percent in April to 152,850 Cars

Being Productive at Work? It’s a Key to Your Success!


Great question, because being more productive is your key to success. There are primarily two things that control your productivity at work each day:

  1. Your activities (what you do)
  2. Your skills (how well you do them)

Your daily goal is to stay busy doing productive things your entire shift. Continuous activity keeps your momentum going, and that means more success.

Whether it’s making prospecting calls and getting more appointments, doing your follow-up and getting referrals or appointments, talking to Service customers and showing them a new vehicle and getting a demo or sale, or talking to a walk-in customer and demonstrating and closing another sale – it’s ‘staying busy’ doing productive activities that increases your sales and income.

Again, it’s your activities plus improving your skills at each of those activities.

Most people need to improve their work habits and their skills, and you can easily do this in just a few minutes each day. Plus there’s a side benefit to improving your skills and habits; your attitude dramatically improves and that affects everything you do, too.

Start Here … To start making improvements in your work day and in your skills, first you have to find out exactly what you’re doing now so you can measure your actual improvements.

Keep a ‘work log’ each day for 30 days, and you’ll quickly find out how many hours of your shift you’re actually doing something productive that will affect your sales and income.

‘Waiting’ Isn’t ‘Working’

When we remind salespeople that waiting isn’t working, the average person in class and in our surveys admit they only work about 3 hours of a 9-hour shift, and that’s probably pretty accurate.

On improving your skills, even if you aren’t using our VSA® to track everything, just pay attention. After each sale and attempted sale, replay everything that happened and write things down.

If you will, you’ll quickly start seeing where you lost control, got trapped talking price, or missed an opportunity to handle an objection or close the sale.

Not sure you can see yourself going from wasting most of your day to becoming super productive by tomorrow?

That’s OK, let’s look at two plans on how to break the habit and become more productive a few steps at a time.

Let’s assume you’re only really working 3 hours, too. In those 3 hours you’re talking to customers, chasing paperwork on deals, etc – you’re busy doing something to sell a car.

To improve, starting tomorrow, if you prefer the slow route…

  1. Take 5-10 minutes to train on selling every day on prospecting or unsold follow-up.
  2. Make just five 5-minute phone calls (actual contacts) every day to prospect or follow up someone who didn’t buy.

The math on your productivity improvement:

With the training and the calls, adding some time to log your contacts and put your notes into the system, you’ve added another 45 minutes or so to your productivity each day!

But wait – there’s more great news. If you make those five actual contacts (dials don’t count), that’s 25 contacts the first week. Plus, because you’ve been training on improving your prospecting and follow-up skills, you’re getting more referrals, more appointments, and more be-backs.

If those 25 contacts were to unsold customers, 1/3 of them will come back into the dealership and 67% will buy on the spot. That’s 8 more people next week on the lot to talk to than you had this week. Plus, these 8 will be 5 times easier to close than your regular walk-in prospects.

The Productivity Math … You were already working 3 hours, you added another 45 minutes, and next week you have another 8 people to talk to. That means your actual productive time at work will dramatically improve.

Not even counting the extra time you’ll spend with those other 8 be-backs, by the end of next week, you’ll be working 50% more each day. And guess what happens to your sales and income when you are 50% more productive? Exactly!

Your sales and income will soon go up 50%, too.

Take the fast track (a more serious commitment)…

  1. Keep training and learning how to sell in the next 30 days.
  2. Make 10 of those 5-minute contacts, and also go meet just 3 people in service each day and use the referral script.

Changing habits takes a continuous effort until the new, more productive habits replace the old ineffective habits. Most people figure it takes about 30 days to do that, but in our workshops we always recommend you spend 60 to 90 days of focus instead, just to be sure a new habit sticks. Go for it!

Posted in SalesComments (0)

Page 5 of 24« First...34567...1020...Last »