There are other things going on in the auto business:
- Cars have gotten better
. The engineering of things like 100,000 mile oil changes means "make
it up on service" doesn't cut it as much as it used to
. They just last longer, so turnover is lower than it used to be
. The leasing game is pretty much over; a car loan beats a lease, and
no one gets a car loan anymore because they use home equity instead.
- The Interwebs have really changed things:
. Price transparency: you can tell more easily if you're getting
a "good deal"
. "Mobile" inventory: I want a blue one, but you don't have one; in
the past, I'd settle for your green one. Today I want you to trade
your green one to the guy in Fresno who has a blue one ...
. Fleet pricing: the biggest guy in the area has better deals
All that has translated to thin margins. I'm actually surprised that they sell as many cars in the US as they do.
/jordan