LOS ANGELES -- Isuzu executives say they can keep U.S. operations intact even though dealerships will have only one vehicle - the Ascender - to sell for the next two years.
In October, Isuzu's 360 dealerships sold 692 Ascenders. That's an average of about two vehicles per store.
So the future seems grim, but the company says a new mid-sized SUV is due in the 2007 model year. The company also plans to reduce the dealership count to 250, which should boost per-store sales. Meanwhile, dealers must concentrate on other parts of their business to survive.
"I think we can survive short term because we have a large population of vehicles in service," says Scott Lasher, owner of Lasher Isuzu in Sacramento, Calif., and chairman of the dealer council.
Lasher says he sold 70 units in September and 43 in October, but notes that most of those sales came from the Rodeo, which ended production in July. The Rodeo and the Axiom were cut from production in July at the Subaru of Indiana plant in Lafayette, Ind. No other product is scheduled until a 2007 SUV.
Isuzu had sales of 23,994 through the first 10 months of the year, and Rodeo sales made up 60.9 percent of that total.
Chip Letzgus, spokesman for American Isuzu Motors Inc., says the company told dealers that production of the new SUV is scheduled to begin in the fourth quarter of 2006 at an Isuzu plant in Thailand.
Letzgus says the number of dealerships has been cut from 433 to 360. He also says that through August the average dealership gross was $1,160 a unit, compared with $904 during the first eight months of 2003.
But rising per-vehicle grosses are a small piece of the puzzle with only the Ascender to sell.
"That will be our focus for '05: how to sell the Ascender," Lasher says. "I don't think we know the potential yet, but what if we sell 2,000 a month, 3,000 - that's 36,000 units" per year.
In an earlier interview with Automotive News, Terry Maloney, president of Isuzu Motors America, said the company could be profitable selling fewer than 40,000 units annually.
Letzgus says the company will focus most of its traditional advertising where Isuzu sales are strongest - from Phoenix to Florida and up the East Coast.
He says the company will redirect more of its budget into Internet marketing and direct mail to get conquest sales.
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