By Desiree Homer
Penske Automotive Group Inc. is one of the country’s largest new model retailers. With their size and scope reaching across regions, the company pace can be a barometer for many other dealers. CEO, Roger Penske, released a statement last week indicating that Penske’s overall retail performance is improving. He’s encouraged by the numbers so far, and the Penske numbers can be an inspiration for other dealers looking for signs of growth again.
Steady Improvements Are Ongoing for the Retail Giant
The Penske Automotive Group Inc, much like the rest of the nation’s dealers, saw considerable declines in March and April traffic due to pandemic shutdowns. In April, Penske saw a 52% drop in parts and service growth, along with a 50% hit in sales. Come May, those numbers, although still down, had come up. Recapping the company’s May performance, Roger Penske shared new and used vehicle sales were only down by about 25%, and parts and service sector profits were only down 39%. The steady growth, Penske says, is attributed to the early reaction to the pandemic, to “reduce costs and preserve our liquidity position.” The first week of June looks promising and is already improving across the pond, with U.K. sales jumping nearly 50% compared to last year, as well. He predicts June will post even stronger here in the states in terms of rebound numbers, and it’s this kind of announcement that offers hope to other dealers nationwide.
What’s Good for Penske, May be Good for Everyone
Seeing growth in numbers for a retail giant like Penske can offer insights to trends the rest of the country’s dealer owners can look to expect as well. Remote selling is certainly aiding in the rebound, and dealerships are improving their online and remote service offerings. Mike Boyd, the founder of iReconCars and auto industry veteran of over 23 years, talks to Dave Cantin about the need for dealers to be, “honed in,” and insisting dealers need to be getting their “front line cars ready,” in a recent Dealer News Today podcast. The demand is coming, and the profits are soon to return.
Taking Cues from the Big Fish
In the ocean, smaller species of fish will often swim in tandem with or along the backs of larger, more predatory species. In this analogy, Penske is the larger fish, and the rest of the medium and smaller dealer groups can watch how the giant moves and rebounds to help predict their next steps. When the big guys see a return to normal, and in some cases, better numbers than those from the previous year, it can be encouraging. Penske is leveraging all the best in online engagement tools and making data-driven decisions with each market location. Dealers and dealer groups can follow suit to reach similar, growth, and profit results.
How is your dealership faring in terms of revenue from April to May? If you’re seeing similar growth or more than the trajectories shared by Penske, you’re probably on the right track.