Cepsa Auto Team

Toyota’s 25 years in central KentuckySqueaky CleanCharging UpChain ReactionE-mail this storyPrint this articleFacebookTwitterDiggLexington, KY – The recession of recent years has been a rough ride for central Kentucky auto dealerships, but for the most part, the hope is that the worst is behind them.

Business at Jack Kain Ford is “much better than it was a year ago,” said President Jack Kain. “The outlook of people is better. Most of them feel safer about their jobs now.”

By contrast, Kain said, 2006, 2007 and 2008 are three years he would prefer to forget.

Kain’s position as head of the National Automobile Dealers Association gave him a clear picture of the economic downturn.

“Nationally, we lost about 3,000 dealers (selling all makes of cars). Usually, we would lose about 200 to 300 (in the same time period), and some of those are lost because of mergers.”

advertisementKain termed the recession’s effect on the car business a “wipeout.”

“It had such a ripple effect,” he said. “It hurt suppliers, service stations, other businesses.”

Keeping his dealership locations in Versailles, Ky., and London, Ky., afloat wasn’t easy. “Unfortunately, we had to downsize,” Kain said. “We said to our employees, ‘If you’ll work with us, we’ll cut wages, (but) we’ll keep your job.’ Most of them did. A few of them left.”

“We cut back everywhere we could and everyone had to work harder,” he said. “People did multiple jobs.”

Knowing that there were fewer customers, new car buyers came expecting better deals. Customers with older cars “did not do anything (repairs) they could put off,” Kain added.

Still the company looked toward the future.

“We sent our people to a lot of schools when we were not as busy, so they’d be more proficient at taking care of customers,” Kain said. “It really worked.”

Now, as customers have returned and business has improved, “we’re almost back to 100 percent strength, down only one or two employees. Pay is back and they’re getting bonuses again,” Kain said.

The service department added employees because customers want to keep their cars maintained so they will last longer.

“The average age of a car on the road is a little more than 10 years. Before the recession, the average age was somewhere around eight years. That’s a 20 percent slowdown (in new car sales),” Kain said.

At one time, Kain said, imports had a great advantage over domestics for those customers who wanted to keep their cars a long time, but that has changed. In addition, people are now more inclined to buy from American companies.

“Detroit is making as good a car as imports. There’s a tendency now for people (as they reflect on what the country has been through) to say that if the American car is just as good, they’ll go toward (buying) the American car,” Kain said.

Kain predicted that the imports will come back, but “they’ll have a battle on their hands.”

Brian Smith has been general sales manager at Glenn Auto Mall for 18 years. The dealership sells the GMC truck and the Buick, Hyundai, Nissan and Infiniti car lines.

Smith said that business at his dealership has been “absolutely tremendous.”

“Our business last year was one of the best,” he said.

Smith attributed the high sales volume to the imported cars the dealership sells.

“Our Hyundai business has grown tremendously. It’s one of the hottest car lines in the car industry,” he said.

The dealership did not have to lay off any employees during the recession. The manufacturers of its different car lines offered extra incentives, which sales people passed on to customers.

“Hyundai was proactive,” Smith said. “The company gave customers an assurance that if they became unemployed after buying a new Hyundai, then the dealership would buy back the car.”

The federal Cash for Clunkers program also helped sell cars for Glenn.

“We really did well, with people trading in (gas guzzlers) for more fuel-efficient cars,” Smith said.

Quantrell Cadillac Volvo Saab and Subaru was also lucky enough to not have to lay off employees during the recession.

“We survived it,” said Bill Bridges, president of the dealership.

Bridges said that the added incentives from car manufacturers helped the company’s sales. Another reason, he added, was that “we picked up the Subaru franchise in 2010.”

Bridges described business at the dealership today as “much improved over 2008 and 2009.”