SEMA panel: Customization moves the metal

Richard Truett
Automotive News
November 5, 2007 - 12:01 am ET

LAS VEGAS — Properly customized cars can move the metal faster and raise profit margins. That was the message at the Automotive News dealer forum panel discussion at the Specialty Equipment Market Association show.

Subaru dealer Bill Kolb Jr., one of the panelists, told an audience of about 250 new-car dealers and dealership employees how he creates his own brand of customized Subaru Legacys by installing leather interiors, special wheels, sunroofs and electronic gear.

Kolb places special badges on the cars, then advertises the cars in detail on his store's Web site. He said his sales volume of customized vehicles went from five new cars a month to more than 180.

"I use accessories and badges to differentiate my inventory. I sell more cars with increased profit," he said during the panel discussion on Wednesday, Oct. 31. He owns Bill Kolb Jr. Subaru in Orangeburg, N.Y.

Hummer General Manager Martin Walsh said Hummer, General Motors' most accessorized brand, plans to increase the ways a buyer can customize an H2 or H3.

The brand will double the number of accessories consumers can buy from dealers; continue rolling out limited-edition models; and launch Hummer Custom Designs, a program that enables buyers to order expensive low-production, high-end models.

"Customization is here to stay. It's not a trend but an expectation. And the profits are there for the taking," Walsh said. The average Hummer buyer adds $1,000 to $2,000 worth of accessories at purchase, he said.

Adding accessories sells vehicles. Even during Ford Motor Co.'s sales slump this year, customized Mustangs, Tauruses and F-series trucks are rolling off the lot at Ciener-Woods Ford in Kernersville, N.C.

Ed Woods, general manager of the store, says the Ford F-series trucks he customizes give him an advantage over other Ford dealers in the area. "You need to make your inventory unique from the competition," he said. Woods adds about $1,000 worth of accessories to the vehicles he customizes.

Tom Carre, of DTC Retail Consulting in Jacksonville Beach, Fla., said 50 percent of consumers that are offered the opportunity to purchase accessories will buy them. He told dealers they need to set up a sales process that motivates salespeople to offer accessories when customers are shopping for vehicles.

"You need a sales plan that offers a sales process 100 percent of the time to 100 percent of your customers," he said.

Carre also gave these tips to dealers:

  • Clearly mark the price of accessories.

  • Change showroom displays of accessories frequently.

  • Sell gift certificates for accessories.

  • Use only high-quality parts, and find a high-quality installer if the items are not going to be put on the vehicle at the dealership.

"Customers tend to forget the great price when something they buy breaks," Carre said. "You have to have good quality."