Dealers! Stop and think before you over-staff

Automotive News | February 16, 2012 - 3:34 pm EST

Roger Penske is looking to hire a few good people -- but there’s an asterisk.

An anticipated sales spurt this year has Penske and many private independent dealers considering hiring. And as skilled service technicians retire faster than new ones enter the work force, hiring in that area makes sense.

But industry consultants have urged caution about dealers growing too quickly. Dealers have made cost-control gains and should avoid expanding too much or too fast in case sales fail to soar.

Ah, but dealers are such optimists, you say. I agree, but the good ones are also pragmatists and realists.

That brings me back to Penske. He’s the well-known, energetic and blunt-speaking chairman of Penske Automotive Group, the second-largest U.S. dealership group.

This week Penske Automotive reported profits grew 67 percent in the fourth quarter and hit a record $177 million for the year. I asked Penske what those profits will mean for the company’s job creation in 2012.

“We’re going to increase people,” Penske said in his no-mincing-words style. “With the growth, we need more technicians and we need more salespeople.”

Penske Automotive is slated to open two dealerships in California later this spring and summer. Those stores will need staffing.

But Penske showed restraint in finishing his answer.

“We’re adding shifts to areas where we don’t want to expand a facility,” Penske says. “You’re going to try to get utilization from your existing people first.”

Now that’s what I’d call a pragmatic and realistic optimist.

Jamie LaReau covers dealers for Automotive News.Jamie LaReau covers dealers for Automotive News.

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