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Monday, November 19, 2007

the Auto Retail Informer November 19, 2007

Auto Retail Informer Intro November 19, 2007

"In 1900, in the U.S., there were only 144 miles of paved road (and only 8,000 motorized vehicles,) and most Americans (94%+) were born at home, without a telephone, and never graduated high school. Most (86%+) did not have a bathtub at home or reliable access to electricity."

Source: Steve Jurvetson, the J-Curve

Highlights:

• Understanding need (part 1)
• It begins with the economy
• Automotive News article starting to suggest large dealer groups do have a competitive advantage

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Understanding Need (part 1) (11/19/07)

Today, there are roughly 4 million miles of public roads, roughly 240 million vehicles (more than one for every licensed driver,) 99 out of every 100 babies in America are born at the hospital, there are 130 telephone subscriptions per 100 people in the United States, over 70 out of every 100 Americans have internet access and have graduated from high school.  And 99 out of every 100 U.S. households have a refrigerator, cooking appliance and color television.   

Contrast that with today's opening quote!

When you think about the advancements that have occurred over the last 100 years it is nothing short of amazing.  And the pace of change continues to accelerate. 

Now I have said that the way to adapt/handle capital deployment decisions in ...

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Auto News Article Suggests Economies of Scale Exist (11/19/07)

Automotive News (Donna Harris) had an interesting article today about Robert Garf raising private equity money to expand his business.  But I thought the most interesting part of the article was at the end.  Where it discussed a private dealer who sold his Ford dealership to Garf.  Here is the important part:

Last month, Mark Vukovich sold Dewey Ford in Ankeny, Iowa, to Garff Automotive for an undisclosed price. Garff now has four dealerships in the Des Moines market.

Vukovich, 52, says he had planned to get out of auto retailing in a few years. But Ford's declining U.S. market share accelerated his timetable.

"The future of the single-franchise owner in metropolitan areas is dim," Vukovich says. "Consolidators have h ...

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