Goldman Sachs is not impartial
My first inclination upon reading 'Doom looms for traditional dealers, analyst declares' in your Feb. 14 issue was to tear apart the clearly flawed conclusions in Goldman Sachs' theory on the Internet and automotive retailing.
But there is an element to the report that is even more misleading than the numbers and analysis.
In this case, Goldman Sachs is not an impartial analyst but is, rather, an investor. Third-party auto broker CarsDirect.com lists Goldman Sachs among its major financial backers.
It is not surprising, given its financial interest, that Goldman Sachs would concoct a theory that could misguide investors and consumers.
As anyone with a real-world knowledge of automotive retailing knows, it is a mistake to minimize the contribution of the dealer. Goldman Sachs' theory completely ignores the value of dealers' knowledge of local market conditions, and it underestimates the ability of entrepreneurial dealers to compete and adapt in a changing marketplace.
Most important, Goldman Sachs ignores the important role dealers play in satisfying millions of customers each year.
The Goldman Sachs report is nothing more than a veiled attempt to promote its self-interests. It is unethical of Goldman Sachs to present such a biased theory without disclosing the obvious conflict of interest.
Is my opinion biased? As a dealer since 1956, I suppose you could say that. But at least I'm open and honest about it.
HAROLD B. WELLS
Shaky residuals hurt leasing
Haven't the automakers learned their lesson yet? When will they fix the major problem with leasing?
For far too long, leasing has been promoted and pushed on payments and too-high residuals.
The funder loses an average of $1,700 on cars coming off lease because the residual was set way too high.
We must educate the public about leasing and make residuals more accurate. If the trend continues, we all lose.
Leasing is more about service: Serve the customer. Independent leasing companies have been taking care of their clients for years.
Regarding 'Net could spark boom in leasing' in your Jan. 31 issue: Getting back to reality is the only thing that can help the car business.
Let's put realistic residuals on cars. It's time to get the price of a new vehicle back to earth. Leasing has allowed prices of new vehicles to climb way too fast. Profit is a good thing, but too much of a good thing isn't good.
SCOTT A. MILLS
Sales and Marketing
Highland Heights, Ohio