Hyundai's Wilhite: Dealer Woes Stem from Factory

By From Automotive News| Jan 18 2007
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DETROIT -- Hyundai Motor America COO Steve Wilhite says many of the problems auto dealers face today are the fault of automakers. "When sales objectives aren't met and we've hit new rebate highs, we often respond by adding more dealers," Wilhite said today at the Automotive News World Congress in Dearborn, Mich. "Instead of tackling individual performance problems through counseling or intelligent market representation action, we compound them. This creates more competitive pressure, which doesn't necessarily better serve the customer," Wilhite added.營n fact, it causes a cascade of problems for the dealer: lower profitability, diminished investment and reduced ability to attract and retain good people, he said. "Most dealers could make more gross profit and achieve higher margins selling sofas, jewelry or home appliances from a low-rent warehouse," Wilhite said. Wilhite said he has set a target for Hyundai dealers to have a 2.5 percent return on sales by the end of 2008. U.S. auto dealers earned an average of 1.6 percent return on sales last year, Wilhite said. Hyundai also has joined the NADA-24 customer-survey unit to query Hyundai buyers by telephone. The survey asks buyers one question: "On a scale of 1 to 10, how likely are you to enthusiastically recommend your dealership to your friends, family and associates?"
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