With model year 2013 in full swing and with the number of fuel-efficient vehicles out there keeping sales moving, you might wonder why dealers worry as much about car sales as they do. There's really a simple logic too it: if you don't meet your quota of cars sold for a specific period (a month, a quarter or a half-year), then you are committing a form of automotive hari-kari. You are sacrificing your dealership on the hopes that someone will come in an buy what the factory gives you.
Simple fact of automotive life
There are certain models that are automatic winners out there now – hybrids, plug-ins, alternative fuel vehicles such as the natural gas Honda Civic – and there are others that people won't tough with a stick, even if that stick is has $100 bills all over it. Vehicles like the Suburban or Tahoe or Expedition, while they are more efficient than earlier models, still really can't hack the numbers people are seeking.
For example, around town, people want their vehicles literally to sip gas (at $3.59 per gallon this afternoon who can blame them) while they also want their comfort, too.
It's quite a dilemma and Detroit has solved it in some innovative ways:
Barges are still barges
It is true that American car buyers want their big, or ultra-big vehicles, but they also want them to sip gas. This means that the industry has developed engines that start their day as eight-cylinder powerplants, shutdown two cylinders when the vehicle reaches cruising speed and then shuts down two more when they cruise along.
The 6-5-3 engine is similar in concept and the 5-cylinder is industry's answer to those who want the economy of a four but the power of a six (turbocharging and supercharging have their issues).
With that said, vehicles like the Tahoe or Suburban or the Expedition (Ford) are still oversized barges that, while they are required to handle better thanks to recent National Highway Traffic Safety Administration (NHTSA) actions mandating traction control and automatic stability system, they are still guzzlers, especially around town.
Playing the number game
That's why, when you see new-car ad for a rather large SUV, you will see the highway mileage figure emphasized. Oh, the around-town figure is there, as well, but you'd better have great eyesight to see the 4 pt type it is set in.
To the industry, as a whole, it's a big numbers game that they hope people will buy. And, if they won't then they throw money at it so that they will move the slow-moving lines or larger SUVs.
If they do not, then when the factory analysts start looking at allocations for the 2014 model year, which is rapidly approaching, and they look at which dealerships move which cars and which don't, those dealerships that have inordinately large numbers of huge, battlewagon-style SUVs are thrown right under the bus.
Allotments of popular cars cut
What happens here is that after looking closely at the figures, the analysts look at those dealerships that move a broad spectrum of vehicles, from the tiny all-electrics to the huge SUVs and they find that their allotments of the popular-selling vehicles are increase. Meantime, those dealership that can't give a huge SUV away and have huge inventories are the last on the allotment list so that the dealership has to go out and find popular cars to sell.
They will, of course, try to sell the dealership from which they are seeking several cars one or two of their heavy-duty SUVs, thus moving the headache to another dealership, while the first dealership is still paying full boat for the efficient car.
That's why dealers are so aware of what's selling and what isn't and it is something you can use to your advantage if you are looking to lease or buy a new vehicle.