Selling Cars Different in and Within Idaho

MCCALL, ID – Family business roots run deep for some dealership people in this state, such as David Taylor and Kevin Hanigan, president and executive vice president, respectively, of the Idaho Auto Dealers Assn.

Hanigan’s grandfather started a dealership in 1925. Taylor’s grandfather did the same in 1928.

“My whole life is what I do,” says Taylor, who represents Chevrolet, Buick and Cadillac in Rexburg. “I’ve always wanted to be in the car business.”

Hanigan’s career path was different. He was a banker and mortgage lender in Portland, OR, for 10 years before his dealer brother, talked him into joining the family business.

He became general manager and was a minority partner of Hanigan Chevrolet in Payette before this year taking on the administrative duties of running the state dealership association.

“The greatest job in the industry is to be an association executive working with some of the greatest people in our country,” he says. “Car dealers are awesome.”

Taylor at one time owned five stores in southeast Idaho and Utah. He sold a store in Rigby. His brother now owns the Utah store. He is selling a store in St. Anthony to the general manager.        

“As of late, I’ve come to the recognition that operator-owned local dealerships are the best run as well as the best places to work and best places to buy a car,” he says.

Relatively large geographically, Idaho is a state of 1.6 million people. It has about 120 dealerships.

Taylor and Hanigan spoke with WardsAuto at the dealership association’s annual convention. Here is an edited version of the interview.

WardsAuto: What’s new with your trade group?

Taylor: We’re in a transition period. Kevin has replaced Trent Wright, who was our IADA director and political liaison. Trent got wooed away by the bankers association. So we went on a quick hunt. I called Kevin and he took the job.

WardsAuto: Is it different being a dealer in Boise, the state’s capital and biggest city, opposed to other parts of the state?

Taylor: Some things are different.

WardsAuto: Such as?

Taylor: The processes at the smaller dealerships are different; the way you turn over a customer, manage things and grind it out.

There’s a different process in a larger market. If customers walk out of a metro store, there are no “be-backs.” They are not coming back. You try to stop them.

In a rural store, like the ones we operate, although it is not quite the same as it used to be, we still know all of our customers. We deal with them on their terms, not ours.    

WardsAuto: What’s not the same?

Taylor: The competition has changed. There’s a race to the bottom. Not only with General Motors, whom I represent, but all brands. The Internet is the great leveler. Information is really flowing. People have access to everything. Dealers attempting to gain market share are doing it with price. They are giving it away up front, so they have to wring it out at the back end. 

WardsAuto: Does a dealer in a small or rural market have less competition since customers can’t go down the street to another dealer because there is no other dealer down the street?

Taylor: That’s not the case in our state. We’ve got lots of competition.

Hanigan: Someone can leave (Taylor’s) town, and be at three other Chevrolet dealerships in 20 to 30 minutes. I’ve always felt the competition isn’t so much with other manufacturers’ brands but with another Chevy dealer or another Ford dealer or another Mazda dealer.

Taylor: Excuse the expression, but some dealers have dropped their pants in order to create additional market share for themselves. Sooner or later, we’re going to have to re-embrace the selling process. What value will my store add to customers? Am I worth anything to them? If not, if I don’t have any value, they might as well go online and have the vehicle shipped to them by UPS.

WardsAuto: Are most dealers in Boise?

Taylor:  You’ve got core areas like Boise, Coeur d’Alene, Lewiston, Twin Falls, then southeast Idaho, which is Pocatello on up to St. Anthony in the Upper Snake River Valley. Those are the main markets.

WardsAuto: What are people buying here?

Hanigan: Trucks. Just like elsewhere.

Taylor: But you can’t discount looking on the road and seeing what’s passing by. If we’re selling trucks, we think only trucks are being sold. But a lot of cars are sold in this state. If you are not selling them, you better ask yourself why not and what you need to do to get into that segment.

It’s more attractive to sell trucks. They are more profitable. They’re accessorized more; people can load them up. Their trade-in values are greater. Everything about trucks is fun right now, until gasoline prices go through the roof. Then people will swing back.

But as a dealer you’ve got to be in the car market, too. What’s that college kid driving? What cars are on the college campus?

WardsAuto: How is the Idaho market different from some nearby states such as California?

Taylor: Well, we hope everything about this market is different than California.

Hanigan: We try not to emulate California.  

Taylor: The regulatory environment, the consumer environment, everything is different here than what they are dealing with there. We depend on a lot of repeat business. It’s repeat or die. If those people aren’t our friends, if they are not satisfied with us, if they don’t come back, then we’re gone. That’s the reality.

Hanigan: Even Boise is only 200,000 people. It’s not a huge market. In some smaller markets, the dealership is one of the biggest employers in town. It’s a pillar of the community and people depend on it. As a small-town dealer, you are not going to make a gazillion dollars, but it’s a good life. You can make an impact.  

You are known in the community. You run into your customers at the grocery store. You’ve got to be able to show your face. You can’t do stuff just to sell a car that can occur in some places. You’ve got to sell a car, live with yourself and be proud of what you do and how you do it.

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