When Charles Tapp, vice president of remarketing at Banc One Credit Co., set out to learn what dealers want, he instead discovered what they don't want.
When it comes to off-lease vehicles that dealers buy, Tapp learned, for example, that dealers don't want the oil changed because they are going to change it themselves.
They don't want mismatched tires, even if they're new. And if the paint job isn't top-notch, don't bother.
Tapp got the scoop from dealers and managers of 20 franchise dealerships or dealership groups who agreed to serve on a dealer advisory council that met in Phoenix in November.
What Tapp is learning - the company also is polling dealers in auction lanes - will help Banc One save money on unnecessary reconditioning and services.
Tapp said the company eventually could cut its reconditioning expenses by 7 percent to 10 percent. It plans to redirect the funds into services that dealers do want, such as vehicle transportation assistance.
Banc One sells about 90,000 off-lease vehicles at auction annually at an average price of $14,000 per vehicle, Tapp said.
'We found that some things we do, they don't want us to do,' Tapp said. 'If (a vehicle) had a bad tire, we'd replace it with a good one. They like dentless paint repair. But when it comes to painting, if it's not high quality, they said don't do it.
'We want more people in our lanes buying our cars.'
Tapp said the dealers and managers that attended the meeting are among Banc One's largest and/or best customers who:
Buy vehicles over the Internet.
Buy vehicles at physical auctions.
Buy vehicles that consumers return to the dealership at lease end.
Generate a large number of loans and leases.
Tapp said Banc One quizzed the council in several areas besides reconditioning. Promotions, communications, Internet selling and sales programs were discussed.
Tapp said he also found that dealerships are willing to do more to help consumers at the end of the lease. Many consumers don't know what to expect or how much they will be charged for things such as a cracked windshield or bald tires.
Troy Bosco, lease manager at Burt Arapahoe Ford in Englewood, Colo., near Denver and a Banc One council member, said advising customers at lease end keeps them happy and creates repeat business.
'We work with a lot of repeat and referral customers,' said Bosco, who bought 250 to 300 off-lease vehicles from Banc One since October 1999. Of the 300 to 450 new and used vehicles his dealership sells monthly, more than 20 percent are through leases.
Clean, low mileage
Rich Hodges, general manager of Driver's Way, a used-car store in suburban Birmingham, Ala., said he agreed to be on the council because Banc One has a desirable portfolio of clean, low-mileage sport-utilities and mid-sized cars.
He said there is no reason for Banc One to recondition the vehicles he buys at auction. Driver's Way vehicles must be thoroughly inspected and reconditioned, and the store would rather do the work itself, Hodges said.
All Driver's Way vehicles carry a three-day, no-questions-asked money-back guarantee; may be exchanged for another vehicle of equal or greater value within a 30-day/1,000-mile period; and come with a 90-day warranty.
'We prefer to buy noncertified; we're going to certify them again anyway,' said Hodges, who retails about 200 used vehicles a month.
Driver's Way is owned by Auto Investments, a holding company that handles Mazda in Birmingham; Chevrolet in Jacksonville, Fla.; and Volkswagen and Mazda in Middletown, N.Y.