Allocation system, SUV shortages rile Land Rover dealers
LAS VEGAS -- Dealers at the Land Rover meeting said vehicle allocation and balanced supply throughout the year are their biggest concerns, prompted in part by shortages of the new Range Rover Evoque compact SUV.
The factory can't immediately resolve supply issues, executives said.
Land Rover dealers want a more balanced supply, said Michael Levitan, vice president of Long Island Automotive Group, which owns three Land Rover and two Jaguar stores in suburban New York.
John Symes, president of Symes Automotive Group, said demand is strong worldwide for the three- and five-door Evoque, but many dealerships -- including his Land Rover Pasadena store in California -- have none. Symes said he has a two-month order backlog.
"Ours is a small niche franchise and we have a lot of small dealers," Symes said. "When cars get scarce, their earnings can be minimal."
Dealers continue to press Land Rover executives for remedies "but we do not want an oversupply," he said. "We would always want to be a truckload short, but right now the shortage is a lot more."
During the recession, oversupply created an allocation problem that still irks smaller dealers, Symes said.
Dan Muggli, who runs Land Rover Portland in Oregon and is chairman of the Land Rover Business Operations Council, complained in an earlier interview that Land Rover isn't distributing cars fairly. "It's possible to do a better job of distributing the cars on a fairer basis, particularly to the dealers outside the New York/New Jersey area," he said.
Jack Devine, vice president of retail operations for Land Rover, defended the brand's allocation system, telling dealers the New Jersey/New York region was up 17 percent last year. That compares with a nationwide sales increase of 20 percent, a Land Rover spokesman said. "The area recovered earlier than the rest of the country. Last year, the rest of the country picked up," the spokesman said.
The Florida region grew the most last year, up 31 percent over 2010, followed by 29 percent for Dallas, 26 percent for the San Francisco area and 25 percent in the Boston market.
Symes, a medium-sized dealer with sales of about 500 new vehicles a year, said the allocation problem dates to 2008-09 when sales were slow nationwide. Land Rover had high inventory, teetering near a 100-day supply, he said.
Dealers were told marketing will continue at the current pace.
The meeting was attended by about 80 dealers and top management of Jaguar Land Rover North America, including CEO Andy Goss and Chris Marchand, executive vice president of operations.
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