Car Dealer Group Makes Most of New Lease on Life

In 2008, on the eve of the recession, the 15-dealership Cardinale Automotive Group was feeling good about itself, recalls CEO Erich Gail. A year later, “we were on our butts; we were insolvent.”

Annual auto sales had dropped from about 16.2 million units in 2007 to 10.6 million two years later. Cardinale, based in Seaside, CA, and plenty of other dealerships were feeling the pain. Three hundred California dealerships closed during that period as auto sales in the state dropped about 800,000 units. 

“We were a text-book case of not being prepared,” Gail says.

Cardinale survived the near-death experience. “We were given a new lease on life,” Gail says. Armed with that, it has become a different business operation than it had been.

“Our guiding principle is that we develop outstanding relationships – not just good ones – where everyone wins: the factory, the dealership and the customer,” Gail says at a recent Automotive Customer Centricity conference in Los Angeles.

But doing that is laborious. “We are not an easy place to work,” Gail says. “You come in to work. We want to be faster today than we were yesterday.”

The speed part matters. Gail has sold thousands of cars over the years, but he says he came to realize it’s important to see the process through the customer’s eyes. Many customers think the process takes too long.

If it takes four hours for a heart surgeon to open up a patient’s chest and perform an operation, it shouldn’t take longer for a dealership to sell someone a car, he says.

But first there’s the matter of getting them in. Cardinale tries to do that through effective appointment-setting, says its CEO. “We have the manager pick up the phone and confirm the appointment. We’re always driving for the appointment. It is a touchpoint. It’s critical. Managers shouldn’t consider themselves too important to call.”

And the message should stir shopper excitement, he says, giving an example: “Your visit at 4:15 p.m. about the Audi you’re interested in will be awesome.”

About 80% of Cardinale customers keep their appointments, and about 80% of those who show up end up buying a vehicle. “It didn’t start out that way,” Gail says.

Managing appointments is done through the group’s customer-relationship management system, he says. “CRM is our North Star. I look at it 50 times a day.”

The group this year ranks No.2 on the WardsAuto e-Dealer 100.

The company also trains daily online and off. “General managers need to be in on it. We role-play. We also read books on how to be a better human being.”

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