Dealerships Make Right Moves

David Wilson decided in 1998 that Scottsdale, AZ, was the perfect spot to sell Toyotas and Hondas.

The president of Wilson Automotive Group credits his Scottsdale team at Right Toyota and Right Honda for building the dealerships into regional sales and service leaders.

Wilson’s group, based in Orange County, CA, is No.17 on the WardsAuto Megadealer 100. His business model is to put top managers in the driver’s seat of the 16 individual stores in California, Arizona and Mexico. Many of them are partners.

After the economic downturn of 2008 and 2009, the massive Toyota recalls of 2010 and the Japanese tsunami-related product shortages of 2011, Wilson group leaders learned to manage leanly.

“We got tough, but we also got fit,” saysJay Francis, partner and vice president with Right Toyota and Right Honda. Although no one was laid off, there was a hiring freeze, and employees who left weren’t replaced.

“We managed our database of customers and took time to improve our employees’ skills and product knowledge,” adds Zachary Ivanhoe, general manager of Right Toyota. “We buckled down and cut our expenses. And everyone rallied.”

A big winner in the Wilson portfolio is Right Toyota, No. 36 on the WardsAuto Dealer 500.

Total Wilson group revenues for 2011 were $1.3 billion, an increase of 3.4% over 2010. The Scottsdale Toyota store, alone, posted $92 million in 2011 new-car revenues; Right Honda, $72 million. Other Wilson stores also are on the WardsAuto 500.

Dire economic conditions have plagued the metro Phoenix region. The state still has a nearly 10% unemployment rate. Parts of Scottsdale are affluent, others severely depressed. 

Despite the product shortages, Ivanhoe calls 2011 a comeback year.  “It was the beginning of the road back and beyond.” 

Product shortages eased about four months ago when Asian manufacturers got back on track. They went from 15 to 36 days’ supply, Francis says. But even in flush times they try to keep inventory to about 45 days for all brands. 

“As the model year changes, if you’re not inundated with inventory, it makes it a lot less painful,” says Francis.

David Wilson launched his career more humbly in 1983 as general manager of Toyota of Orange in Southern California. He bought 25% of the dealership; by 1985, he owned the dealership outright. Sales increased from 2,500 vehicles a year and $30 million in revenue to 8,000 units and nearly $100 million.

Growth came quickly for the dealership group of mostly Asian brands.

When Toyota introduced its Lexus luxury brand to the U.S. in 1989, Wilson opened one of the nation’s first stores in Tustin, CA. In the early 1990s, with threats of tariffs on all import vehicles, Wilson bought Ford of Orange, his only domestic dealership; Mazda was added to that site a few years later. 

In 2006, he and partners opened Newport Lexus, a $75 million showplace in Southern California. When Toyota wanted to expand Mexican markets, Wilson opened Puerto Vallarta Toyota in 2007.

“His philosophy is very simple,” says Vikki Murphy, a group vice president who rose from assistant ranks. “Happy employees make for happy customers.”

Known for his Horatio Alger-like rise (his father was a rodeo rider, his mother sold Tupperware), Wilson, a native of Iowa, holds many distinctions including philanthropic awards.

The group has no plans to open new stores now. But Francis says: “I bet in the next 10 years, we’ll get some new stores. There are a lot of good people waiting who would be good partners.”

He describes Wilson this way: “He has a steel-trap mind, is always fair and exciting to be around. I learned everything at Toyota of Orange and copied that in Scottsdale.

“Dave Wilson constantly is working on stuff, but he wants the right stuff.”

ally-dealer-banner.jpg