Page 40 - BusinessWest July 10, 2023

Ben Sullivan, seen here with a Kia Sportage plug-in hybrid, said electric cars and plug-ins comprise a growing percentage of sales at the company’s many dealerships.
Staff Photo
but also opportunity, in the form of new and intriguing products (mostly those electric models), some improved incentives from the manufacturers, and some lingering, pent-up demand.
Other trends include a still-challenging used-car market — meaning challenging for dealers who struggle to find cars and challenging for consumers, who continue to face limited options and high prices — as well as steadily rising SUV sales and a growing willingness among consumers to order a vehicle rather than pick one off the lot.
Carla Cosenzi, president of the Tommy Car Auto Group, which includes Hyundai, Genesis, Nissan, Volkswagen, and Volvo dealerships, said she and her team, like most in this business, entered the year with conservative expectations, because of those challenges listed above, and two quarters into 2023, they are meeting them.
“It’s been such a volatile market, with inventory constraints, interest rates, and what’s happening with
the economy, so we just made a conservative projection and figured we could always adjust if we needed to,” Cosenzi said. “We projected to increase sales over last year, which we always do, but not by a lot.”
Ben Sullivan, chief operating officer at Balise Motor Sales, concurred. He told BusinessWest that, after three years of decline, to one degree or
another, and a 2022 that was essentially flat, 2023 was seen within the industry as a year when, despite higher interest rates and inflation, dealers would do some catching up.
And they have, he said, although limited supplies have impacted the degree that they can do so, with some brands impacted more than others. He noted that, while there are still some supply-chain issues, the bigger challenge now is getting the cars to the lots.
“There’s still some fragility in the supply chain,” Sullivan said. “On top of chips and COVID lockdowns, which, for most part, have passed in the global supply chain, now what you’re dealing with are labor shortages at ports and shortages of rail cars — there’s
a particular type of rail car that carries vehicles. And on top of that, at the end of this year, the domestic manufacturers will be renegotiating their AUW contracts.”
“People like to feel and touch and experience what they’re going to be driving, so there’s definitely an opportunity
to lose market when you don’t have the right inventory and your competitor does.”
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40 JULY 10, 2023
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