Staluppi Group is in Buy Mode

The Staluppi Automotive Group is looking to add more stores to help offset increased interest rates and advertising expenses.

Cliff Banks

June 15, 2006

3 Min Read
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John Staluppi has 12 dealerships (one more than last year) on this year’s Ward’s Dealer 500 ranking, spread throughout New York and Las Vegas.

The overall organization generated $1.8 billion in revenue in 2005, ranking 14th on the Ward’s Megadealer 100.

Sales at Staluppi’s New York stores were down slightly this year, although his Atlantic Automall dealership ranks 17th on this year’s Ward’s Dealer 500, strong enough to finish fifth in new vehicles sold, with 8,389 units.

Meanwhile, the Las Vegas dealerships, Planet Hyundai (154th) and Planet Nissan (204th), run by his son, John Staluppi Jr., both saw revenue rise in 2005 and should have a 10% increase in 2006, Staluppi says.

But with business down in the Northeast, he says the group is cutting expenses and looking for new ways to advertise.

“We really are starting to become more process-driven here,” he says. “We have a ways to go, but we are getting better. There are a lot of old-time people in the industry with a lot of bad habits.”

Top 25 by New Units Sold

Dealer500Rank

Dealership

NewUnits

1

1

Longo Toyota

23,689

2

6

Dave Smith Motors

9,379

3

49

Rick Case Honda

8,795

4

5

Galpin Ford

8,599

5

17

Atlantic Automall

8,389

6

8

#1 Cochran

8,047

7

4

JM Lexus

7,328

8

25

Power Toyota Cerritos

7,181

9

11

Courtesy Chevrolet

7,115

10

7

Longo Lexus

7,083

11

43

Toyota of Orange

6,532

12

27

Norm Reeves Honda Superstore

6,445

13

34

Millennium Superstore

6,355

14

39

Ira Toyota

6,281

15

16

Midway Chevrolet

5,949

16

2

Fletcher Jones Motorcars

5,927

17

44

Power Toyota Tempe

5,683

18

31

Al Serra Auto Plaza

5,657

19

154

Planet Hyundai

5,629

20

51

Sterling McCall Toyota

5,447

21

52

Koons Tysons Toyota

5,435

22

40

Criswell Chevrolet

5,313

23

28

Akins Ford Dodge Jeep Chrysler

5,309

24

45

Fred Haas Motors, Ltd.

5,234

25

23

Michael Cadillac, Inc.

5,223

As a result, his company is looking to recruit the right kind of people, with the right attitude and work ethic and then train them on the new processes, he says.

One new process is developing and managing Internet leads, “because that is less expensive than traditional advertising,” Staluppi says. “We spend a lot of money on advertising, and that is one of the biggest areas we can do better on.”

Ironically, Staluppi is looking to add stores to help reduce his advertising expenses. He believes having more dealerships in the mix can provide deeper discounts.

“We are in a buy mode right now, “ he says. “We are trying to increase our business and are looking at markets where we can add three or four stores. I think we can get to 30 or 35 dealerships, up from the 22 we have now.”

Staluppi says he hopes to acquire some premier dealerships from brands such as Mercedes-Benz and BMW.

Meanwhile, the group is reducing the amount of inventory it keeps on hand to approximately 1,000 units a month, mainly because it paid more than $700,000 in floorplan interest in the year’s first quarter.

When asked if the increase in interest rates, coupled with the slight turndown in sales, concerns him, Staluppi laughs. “I was in this business when interest rates went to 21%,” he says.

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