By: Matt Anderson
One industry is bouncing back nicely from the recent economic downturn in the Kennesaw area. Auto dealerships are seeing sales numbers that are, slowly but surely, creeping toward their 2007 figures.
The increase is sufficient enough to bring a smile to Eddie Davis’ face. “You can sense it. When you come into work, there is a different vibe today than there has been the last two years. We (car salesmen) are not playing solitaire on our computers as much as we were.”
Davis, a salesman at Towne Center Nissan, remembers all too well the frustration and disappointment that poisoned the atmosphere around the dealership beginning in 2008, “I always liked my job. If you came in with the right attitude, worked hard, and did things the right way, you were going to be successful. That’s how it always was in our business, but not the last couple of years. There was literally nothing you could do to move a vehicle.”
The economic crisis that gripped the country in 2008 had an effect on almost every conceivable industry. Auto dealerships were not immune. In the wake of the recession, many dealerships were forced to shut their doors including Bill Heard Chevrolet in Kennesaw. Heard was the largest Chevrolet dealer in the country before having to shut down all his dealerships in 2008.
The dealerships that have survived now hope to thrive. The early signs are promising. Town Center Nissan sold 61 more cars in September of this year than they did last September.
Andre Browne, a colleague of Davis’ at Town Center Nissan, has spotted a series of trends that he believes represent the future of the American auto industry. “First of all, the biggest thing that has changed and will continue to change is people are switching to small cars. For so long, SUVs dominated the American roads, but now electric, hybrids, and other non-gas guzzling smaller cars are in style.”
Browne continued, “Another big thing to keep your eye on are all the huge sales and discounts being offered by dealers. For the first time in a long time, there is positive momentum in our business and dealers are going all out to maintain the positivity. That means big-time promotions and great news for the consumer.”
The final trend that Browne has witnessed first-hand is a renaissance in used-car purchases. Browne reasoned, “When it is harder for people to get a loan from the bank, it becomes that much more difficult to finance a new vehicle. That increases the demand for pre-owned vehicles.”
Davis is also noticing an increase in used car requests from his customers but proposes an alternate theory for the uptick, “I think we are living in uncertain times, but deep down people are generally optimistic. So what they are doing is purchasing a used car as a stopgap measure and will return to buying new cars when they have more faith that the economy is stabilizing.”
A report issued by auto industry researcher J. D. Power and Associates bears witness on the national level to what Davis and Browne are experiencing here in Kennesaw. In 2007, 15 million new light vehicle sales were reported. That number dropped precipitously to 9.2 million in 2008, the lowest total since the turn of the millennium. Based on the figures being reported in the last three month window concluding in September, 2011, J. D. Power forecasts that number to climb to the neighborhood of 12.6 million new light vehicle sales for 2011.
“The uncertain global environment, specifically the debt troubles in Europe, continue to be the major source of downside risk in the U. S. economy and automotive markets, explained John Humphrey, senior vice president of automotive operations at J. D. Power, “Until a level of stability is reached globally and consumer confidence is returned, the United States automotive selling pace is not expected to return to pre-recession levels.”
Manufacturers are trying to counteract the negative financial numbers by offering cars with lower price points than before the economy soured in 2008. The combination of rising, unstable gas prices along with a growing sentiment in society toward going green via conservation, auto shows are filled with entrants that are overwhelmingly hybrid, electric, or otherwise get great gas mileage.
Davis is not overly particular about the kinds of cars manufacturers decide to make. His only concern is whether the end product results in sales at Town Center Nissan, “I love cars. It is my life’s passion. Three years ago I would have hoped for the manufacturers to go in a direction that I find aesthetically pleasing. Now, I just don’t care. Just give me a product I can push.”
Brown echoes his colleague’s sentiment, “Owning a car is a huge part of the American Dream. That is absolutely the best part of my job, the days when I have the opportunity to put a young man or a young woman in their first car. I don’t care how; I just want more of those days.”