by Jon LeSage, Editor of Used Car Market Reports, the Industry’s Only Weekly Summary of Vehicle Remarketing
For independent dealers, there have been two major trends bringing revenue opportunities and increased challenges in managing accounts – subprime loans and the Buy Here Pay Here (BHPH) segment. Independent dealers are experiencing the fast growth potential of working with these customers, and that the sales and finance process has to be well structured to avoid big problems.
As Chris Macheca, Executive VP of Operations at PassTime USA, explains in this video, it’s important to be consistent in everything you do with subprime loans. Regulators want to see that financing is being done consistently with all customers, and that they’re being treated fairly.
The BHPH market is facing its own wave of new regulations, and independent dealers are having to spend more time on compliance issues through conferences, and as members of state associations and the National Independent Automobile Dealers Association. PassTime dealt with these issues at NABD’s 2013 conference in May as a key exhibitor and featured presenter at the BHPH Dealer Academy and National Conference. The company also exhibited at the NIADA convention last month.
Independent dealers are gaining a lot of experience and expertise at sourcing the best vehicles for the BHPH market. This year, there are a lot of trade-in vehicles coming to market as consumers use their assets to finance new vehicle purchases through franchised dealers. Remarketers are seeing a lot of aged vehicles in the auctions and online channels and are learning a lot more about buying and selling reliable vehicles.
There’s also the process of making the best sales transactions with customers and retaining the working relationships. BHPH customers are more likely to be late in payments, and dealers are looking at their options.
As Macheca wrote in his column recently, one problem dealers have faced is having their GPS tracking devices tampered with. PassTime’s new tamper detection feature will send notification and location information if the device is removed from a vehicle, and it does so without the need for a battery. Serving this customer base has its challenges, and independent dealers are looking for technology solutions to build trustworthy clientele and deal with problems that can arise.
