ESA Senior Partner Adam Armbruster sits down with top CPO retailer Rick Ricart of Ricart Automotive to discuss trends and strategies in the auto market, specifically with regard to Certified Pre-Owned vehicles.
More than 2.6M CPO vehicles were sold in the US during 2017. This is one key area where smart dealers are addressing the continuing challenge of profitability.
Just a sampling of the CPO discussion between Adam and Rick:
ESA: CPO is such a common term in the industry, but do most auto buyers know it in the same way as a dealer?
Ricart: No. The non-premium OEMs have never educated the public to the level necessary to make CPO a “brand.” Some luxury brands have done a much better job of educating, marketing and building value before the customer arrives.
All other programs are based on switching a customer in the showroom. CPOs won’t sell themselves, it takes commitment, processes, and consistent message delivery.
ESA: You’ve been the No. 1-selling CPO dealer in the U.S. How did you accomplish this feat?
Ricart: Our team will scold me if I don’t clarify the rankings: No.1 CPO for the past 4 years, No.1 franchised used-car dealer for 2 years running.
We started six years ago, it took 2-3 years of sustainable growth to get to our current levels. We call it “Certified Velocity” and we took a hybrid business model of quality, velocity and treating our Used Car Factory (a pre-owned vehicle outlet) as a stand alone franchise.
Quality means we certify everything. We create a culture of success through training and process. We treat the employees and the customers better than do some new-car franchises. We market, merchandise and deliver the correct messages consistently.
ESA: Why don’t more dealers actively display and advertise CPO?
Ricart: We tried manufacturer-specific CPO programs multiple times before we found what works for us. The OEM programs are all alike, and every dealer is not. Some dealers certify the vehicles, place them either in the used-car inventory or “between” new and used, price them above market value due to certification fees and over-reconditioning charges, and wait for the customer to arrive. That’s a recipe for failure.
Read the full interview on Wards Auto:
Certified Pre-Owned Vehicles ‘Don’t Sell Themselves’ | IdeaXChange content from WardsAuto