Pub. 1 2012-2013 Issue 1

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S S P R I N G 2 0 1 2 16 new jersey auto retailer improve from six to eight times a year. Parts gross profit will remain highest on most non-maintenance parts, and a variety of other factors will allow dealerships to maintain parts gross profit percentages. The service department will continue to be the most profitable department for dealerships. This is in spite of a reduction in the maintenance requirements, extended maintenance intervals, and more manufacturers covering maintenance items under the new vehicle warranty. The growth over the next decade will be in customer repair work. This will not be due to a decrease in quality but an increase in the average vehicle’s age, the com- plexity of systems and several new propulsion systems that will have limited repair expertise in the marketplace. Also assisting service department profitability will be increas- ing reliance on remote diagnostics, where vehicle monitoring systems will alert the driver of an error and automatically upload data files to the manufacturer and dealership. Such systems will also develop to the point that, under warranty repairs, required parts will be sent automatically to the dealership. Having a stream of information being fed to the service department directly from the vehicle will also aid the write-up process. This will allow the dealership not only to have electronic com- munication with the vehicle but also with the customer. Much of the repair order will be pre-populated upon arrival at the dealership, which will free up time for the service advisors to build a relationship with the customer. Dealership Facilities and Structure Dealerships will be looking to have faster throughput of inven- tory, cleaner “retail” environments and more efficient opera- tions. Future dealerships must sell more vehicles, with fewer salespeople at lower operating costs. This will likely cause dealership locations to shrink in physical size and footprint. Future dealerships must sell more vehicles, with fewer salespeople at lower operating costs. strategic vision of dealerships  continued on page 18 WE CAN HELP. CALL TODAY, FOR A FREE CONSULTATION. (973)790-8800 Alan E. Ginsberg, CPA Sal DiBello, CPA aginsberg@brunodibello.com www.brunodibello.com In a JAM when it comes to taxes? RELIABILITY • QUALITY • PERFORMANCE AUTOMOTIVE TAX SPECIALISTS Now more than ever, your dealership needs a financial resource with a real understanding of your business and personal financial needs. One that provides flexibility to support your sales efforts and growth strategy. When you work with PNC’s Dealer Finance group you gain access to a broad range of banking and financial services including floorplan financing, retail financing, treasury management and wealth management. All of theses services are available from a dedicated relationship management team that lives in and understands your market. For more information on how PNC and its Dealer Finance group can help you drive your dealership forward, please contact Jim Kimble or Ed Koch at 856-489-2839 for floorplan financing and Steve Garton at 800-433-0067 for retail financing. PNC and ACHIEVEMENT are registeredmarks of The PNC Financial Services Group, Inc. (“PNC”). Banking and lending products and services and bank deposit products and investment and wealth management and fiduciary services are provided by PNC Bank, National Association, a wholly-owned subsidiary of PNC and Member FDIC . Services such as public finance advisory services, securities underwriting, and securities sales and trading are provided by PNC Capital Markets LLC, a registered broker-dealer and member of FINRA and SIPC. Lending and leasing products and services, including card services, trade finance and merchant services, as well as certain other banking products and services, require credit approval. ©2012 The PNC Financial Services Group, Inc. All rights reserved. CIB PDF 0212-008-65405 STAYINg IN THE PASSINg LANE strategic vision of dealerships  continued from page 15