Jaguar dealers await arrival of all-wheel-drive model

On Jan. 1, the Jaguar Business Operations Council and the Land Rover Business Operations Council merged to form the Jaguar Land Rover Retailer Cabinet, a move that might rally some Jaguar dealers and roil others.

That's because neither stand-alone Jaguar dealers nor stand-alone Land Rover dealers are allowed to sit on the consolidated group, which acts as a sounding board to the manufacturer. But they are welcome to participate on subcommittees that address day-to-day issues -- such as advertising and marketing, fixed operations, used vehicles and customer service -- that affect Jaguar dealers.

Michael Levitan is chairman of the newly consolidated dealer group and dealer principal of two Jaguar stores in New York. He discussed Jaguar and its dealers with Staff Reporter Arlena Sawyers.

Jaguar sales were down in 2012 compared with 2011. How is business for Jaguar dealers?

Jaguar business is flat right now. We're awaiting the arrival of our all-wheel-drive vehicle, especially here in the Northeast. We've seen some four-cylinder engines. Six-cylinders are the ones that will be available with all-wheel drive. A handful of dealers might have seen some already; I have not seen the all-wheel drive yet.

We have seen tremendous marketing strides, but we still struggle with awareness. That is obviously hampering our sales and not driving the traffic that needs to enter the showroom. We have beautiful cars, we have competitive pricing, but we're not reaping the rewards. We've seen an increase, but we think with the introduction of all-wheel drive we'll see a marked improvement.

What can be done to beef up the marketing?

I think the manufacturer has beefed up the marketing. The awareness level is increasing; their online presence has dramatically increased; their Web traffic has increased. They've retooled television commercials.

They are being more tactical in the way they are using their funds; when you have a limited budget, you need to work more efficiently. So I think they're headed in the right direction.

The Jaguar and Land Rover dealer councils have merged. What is your role in this new group?

I am a member. [Editor's note: After this interview, Levitan was elected chairman of the new body.] I was on the Jaguar Business Operations Council; I was not the chairperson of that group. I was on the Land Rover Business Operations Council and served as chairman for that group for, I believe, six years. I transitioned off that; it's been two years.

The Jaguar Land Rover council is to be made up of Jaguar Land Rover retailers. It's the voice of the retailer. It's not a committee that rubber stamps stuff, but it doesn't necessarily mean, though, that everything we say to the manufacturer, we get.

We represent the dealer body; we are there to help and give opinions and suggestions to the manufacturer from a dealer perspective.

What would you like to see this group accomplish?

From a 30,000-foot view, I'd say dealer profitability for sure is the No. 1 priority of this group, and that quality remains high and at the forefront of the manufacturer. Both brands have been up and down with quality issues. And that we represent the dealer body the best way possible to help guide and grow the business and make it viable for all.

For the Jaguar brand, it's getting that awareness up, driving that traffic and being the filtering system for the councils underneath us which get more into the minutiae of the day-to-day.

Do Jaguar executives listen to what council members say?

The simple answer is yes. I've traveled with the management team; I've been to grass-roots meetings. We are there to help guide them and I think they are very open-minded about listening to the retailer. Unfortunately, at times it doesn't appear that way.

The reformation of this council, or cabinet as they call it, is one of those things.

If you're a stand-alone Jaguar dealer or a stand-alone Land Rover dealer, you're not going to be able to serve on this council. That eliminated a percentage of good dealers that we've had on the council before who are passionate about the business. But because they don't have dual brands, they have not been asked to serve. The stand-alone dealers are not happy about it.

You have two dealerships that have both Jaguar and Land Rover. Have your stores always been dualed, or did this happen in recent months or years?

It happened in recent years. We had Land Rover in Southampton and we acquired the Jaguar store and put it in an empty facility that we had. That's going back, probably to 2005. Economically, it made good sense to put those two together.

We owned a stand-alone Jaguar store in one location in Huntington and a stand-alone Land Rover store eight miles away. We brought them together about five years ago. Again, having the brands come together made good sense from an economic standpoint, and it was a good branding decision. It raises the awareness of Jaguar by having it with Land Rover.

So we are in the process of just finishing our new Jaguar Land Rover facility in Huntington.

You have one stand-alone Land Rover store, so it seems you need Jaguar to go with it. With other manufacturers that want brands to dual, most dealers want to be the buyer, not the seller.

I'm sure the manufacturer would love to have common ownership, but they are not forcing it -- nor would they be able to force it, quite frankly.

There is a Jaguar dealer in my market, where our stand-alone Land Rover store is. He's a large Jaguar dealer. Conversations may happen, but that doesn't mean the end result will be a buy-sell for somebody.

How are stand-alone Jaguar and stand-alone Land Rover dealers reacting to this? Is there resistance?

We've had some initiatives go well. There was one recently right here in the metropolitan area that happened where a Land Rover dealer took Jaguar and built a new facility. And there are others, I'm sure, that are not going well. I'm not privy to the ones that aren't going well. I know about the ones that ultimately are put together.

Why does it make sense for Jaguar and Land Rover to be together in a dealership?

When you think about it you have a company that is globally called Jaguar Land Rover. Though its vehicles are manufactured in different plants, the company management, the company hierarchy, is a Jaguar Land Rover company.

We sell SUVs for Land Rover and luxury cars for Jaguar. It's no different than Mercedes or BMW having on their showroom floor SUVs and sedans. It's not that one brand takes something away from the other brand.

Jaguar dealers have said they want a small sedan to compete with the BMW 3 series. Is there one in the wings?

The manufacturer can better advise you of what their plans are, but from the retailers' side of the business, there is a desire to have a smaller luxury, Jaguar sedan.

What about a crossover?

Again, the manufacturer can advise.

But no doubt, it would give the stand-alone Jaguar retailer the opportunity to enter a segment they are not in today.

For a multibrand Jaguar Land Rover dealer -- although I am sure they would like to have a crossover vehicle -- it's not as imperative because they do have vehicles that kind of fit that niche.

We have today the Land Rover LR2. We have a new Range Rover Evoque which would fit into that category. I'm sure it's on Jaguar's radar but those are the kinds of discussions that are held in confidence until they would discuss it with the entire retailer body.

It is surely a desire to have such a product because it is a void and we believe it would be incremental business for the Jaguar dealer.

The F-Type roadster is scheduled for early 2013. When is the coupe coming?

The manufacturer can tell you that. We're anxious and hope we get a coupe, but we're happy with what we've seen so far with the convertible F-Type. It's a beautiful car.

Are Jaguar dealers, in general, profitable?

I can't speak to all Jaguar dealers. I know my own situation. For me it's a profitable brand. We want to ensure that profitability is as high as it can be, but I would never speak to the profitability of a retailer that I'm not aware of. That type of data is not given to the retailer. I'm sure there are retailers that are very profitable and others that are struggling.

How do you feel about the cancellation of the C-X75, the $1 million-plus hybrid sports car?

Anything that is a concept is a concept. It did what it was supposed to do -- it got a lot of attention.

Are Jaguar dealers making money in new-car sales?

First of all, it's all accounting. So, again I'm a Jaguar dealer, and to me it's a viable brand. I would like to see our volumes increase; I would like to see our awareness increase. As volume increases and awareness increases, we'll be more profitable than we are today.

Do you participate in Jaguar's certified used-car program?

Every used car we sell in the Jaguar brand is a Select Certified car.

Are they doing well?

Again, awareness is a key to that. If your new-car business is down slightly, there's no doubt that the pre-owned goes down as well. If awareness is down for the new-car side, awareness is down for pre-owned.

Are there efforts to push dealers to redesign their dealerships under an image program?

Not a program per se but there is signage that is required. They do have a facility requirement that you should keep your facility to a standard. I'm building a new facility and probably the day it is completed, some of those things will be outdated. They evolve over time. I've been doing this facility -- between permits, zoning, planning -- it's been three years. From the start of it to the end of it, things evolve and things change. The things I do today the next dealer will do a little differently. It won't be the same.

They have a design element they are trying to achieve, but they are not holding a gun to anybody's head to make you do it.

What are dealers doing to attract more service business, and is Jaguar doing anything to help?

The manufacturer has several programs they support. We're trying to increase the number of units operating in your area, so customers continue to come back in whether it be through direct mail, whether it be through an e-mail campaign.

They look to vendors to help you enhance your profitability and opportunities in the service drive themselves.

How can vendors help?

There are tools the manufacturer may not have but they may reach out to a vendor and make a deal for the manufacturer to co-op and share some of the expense over a period of time. Say there is a company that has a process, a software program to help follow up with a customer and it has a cost associated with it. The manufacturer might co-op a portion of that to help the dealer.

Is the manufacturer doing anything to help dealers attract more F&I business?

We have a business office that is there to help customers understand everything that is available for their automobile. Again, every dealer is different. We have a process in place to make sure 100 percent of our products are shown to customers 100 percent of the time. ... It's not done in a hammer-type situation. It's done to educate and help the consumer. Along the way, it helps enhance profitability. But I will only sell products and services I deem have a value to the end-user.

What about social media?

That's an area I'm not comfortable with, but I make sure I have a marketing department that is on top of that. I don't play in it; I don't pretend I play in it, but I do my best to understand it. But I surely leave it to somebody else. I've sat in meetings for eight hours talking about social media, and when I leave my head is spinning.

I don't have a Facebook page; I don't tweet; I don't say I "like" something. I just don't do those things, and yet on the manufacturing side there are plenty of people who do.