ADP Breaks Out the Bubbly After 2 Big Wins
ADP Dealer Services scored two significant victories after two of the three largest automotive dealer groups signed contracts to consolidate all of their dealerships' technology systems to the ADP platform. AutoNation Inc. and the Sonic Automotive Group are the latest groups to make the move to one DMS (dealer management system), providing ADP with the bragging rights to five out of the top 10 dealer
July 1, 2005
![WardsAuto logo WardsAuto logo](https://eu-images.contentstack.com/v3/assets/blt7121b6ec5c11097b/blt45f10b537a75bb26/65d72d47647c28040affd46b/Generic_image_WA.png?width=1280&auto=webp&quality=95&format=jpg&disable=upscale)
ADP Dealer Services scored two significant victories after two of the three largest automotive dealer groups signed contracts to consolidate all of their dealerships' technology systems to the ADP platform.
AutoNation Inc. and the Sonic Automotive Group are the latest groups to make the move to one DMS (dealer management system), providing ADP with the bragging rights to five out of the top 10 dealer groups. Lithia Motors, Bill Heard Enterprises and V.T. Inc. are the others.
ADP and arch rival Reynolds and Reynolds Co. each control about 40% of the DMS market with about 15 other small vendors fighting over the remaining 20%.
Reynolds did score one win in 2004, when United Auto Group, the second largest automotive retailer, agreed to move all 165 of its stores to the Reynolds system.
Although losing some big contracts, Reynolds President and CEO Finbarr O'Neill points out that the company does supply 45% of the dealerships owned by the companies on the Ward's Megadealer 100 list, a ranking of the top 100 dealer groups.
Ward's first reported in 2004 on the trend of large automotive retail groups converting to one system as Sonic began evaluating its DMS strategy for all 159 of its dealerships.
As large dealer groups began acquiring dealerships, they inherited their computer systems. With so many different vendors, dealer groups soon found themselves with a vast and inefficient array of disparate technology platforms.
Converting to a single system provides dealer groups with the ability to slash costs and become more efficient by simplifying processes and training.
The Asbury Automotive Group and Group 1 Automotive are the only two public groups that have not yet decided to consolidate their systems.
Reynolds supplies about 50% of Asbury's dealerships while ADP and Universal Computer Systems each handle 25%, says Allen Levenson, Asbury's vice president, sales and marketing.
“We have not made the decision to convert yet,” Levenson says. “But I would not rule it out.”
Group 1, meanwhile, was rumored to be close to deciding to migrate all of its systems to ADP, but sources say the decision has been tabled for the time being.
About the Author
You May Also Like