Desperate Times, Desperate Measures and Trust

While traveling through Asia, Alexander the Great fell ill. Everyone was afraid to treat him, as they feared that, if they failed, they would be blamed for the King’s death. However, one physician was willing. While Alexander waited for the physician to prepare the medicine, he received a letter informing him that this physician was not to be trusted and planned to kill him. Alexander told no one. When the physician came into the room with his medicine, the King took the medicine from him while handing the physician the note. As the physician read the note the King drank the medicine. The physician was horrified and threw himself down at the bedside of the King. The King replied calmly that he had complete confidence in the physician. The King recovered within three days.

 

I share this story because you could draw a parallel to the auto industry and the trust consumers place in the dealer that any vehicle they buy from you is safe. What would have happened if Alexandra’s doctor had bad intentions? I love our auto industry community and know full well that most dealerships have good intentions when selling a vehicle. My message is to ensure current conditions do not force you to make bad decisions when it comes to recalls and vehicle safety.

 

COVID-19 has had a huge impact on many dealerships across the United States with significant financial damage. Lack of inventory has become a major problem. A recent article in Automotive News shares how dealers are struggling to acquire inventory. In one case, a dealer was literally at a one-day turn and in the article states, “We get 10 off the truck, we sell 10 the next day.” That is a pretty quick turnaround considering service, recon, and detailing for a front-line sale. The article does not mention whether these truck acquisitions are for on or off-brand. However, it would certainly be a tight schedule if a safety recall were involved.

 

Used vehicles are the money-makers at most dealerships. The ability to buy a vehicle at auction; via trade or from another dealer; and then sell it quickly gets dealerships back into the black quickly.

 

In my opinion, there are a couple of simple things that may help when choosing which vehicles to buy.

 

  • Be aware of any open safety recalls on the units you are considering for purchase at auction or at the time of trade-in. Several software options make this process simple or a free search on the Internet. If you are looking for a unit for a quick turn, you may want to pass on those vehicles. Sure, you can legally sell vehicles with open safety recalls, but remember that your reputation is at stake, and you could have financial liability under state laws that govern unsafe products. Currently, consumers can be even more emotional about the purchase than usual and you could, potentially, place your dealership at risk for expensive litigation should something go wrong.

 

  • If you do acquire a vehicle with an open safety recall, be prepared to complete it before the sale. While there is nothing wrong with buying a vehicle with an open safety recall (especially if it is a bargain), you would be wise to factor in the time it will take to complete that repair. If you are willing to hold the unit for a little while to fix the recall, that’s great!

 

The moral of this story is that it always makes sense to be responsible for the vehicles you sell to consumers. Your customers will hold you to that standard. It is a great point for customer relations leading to more positive customer reviews, CSI, and increased profitability – a win-win!

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