Frank Rodriguez has a penchant for salsa music and fishing in the Caribbean. But these days he spends most of his waking hours at work.
"Right now, everything I do outside work seems like an extravagance," said Rodriguez, a multipoint dealer in Orlando, Fla. "We're making money, but we're also watching every penny. It's all about preserving cash right now."
While his wife leans toward country music around the house, Rodriguez keeps his XM radio glued to CNBC for economic reports.
Rodriguez's Greenway Automotive had revenues of $444 million in 2008 and sold 25,377 new and used vehicles at 13 stores in Florida, Tennessee and Alabama. The company ranks No. 42 on Automotive News' list of the top 125 U.S. dealership groups.
Eight of the stores are Kia dealerships, but Rodriguez's base of operations is his flagship Greenway Ford in Orlando. Greenway's Chrysler store in Atlanta was among the nearly 800 that the factory identified for closing last month.
Rodriguez started his career selling cars at an Atlanta store in 1979 and worked his way through dealership management positions. In 1995 he bought an interest in an Orlando store owned by Detroit retailer Hoot McInerney. In 1998, Rodriguez and his partner, Carl Atkinson, bought out McInerney.
Rodriguez spoke with Staff Reporter Lindsay Chappell.
How is business?
Our first quarter was actually great. May did very well for us. Surprisingly, both of our Ford stores had good months. Memorial Day weekend was the best we've had in a while. We did 50-plus cars over the weekend. And our Orlando Chrysler store had a big upswing since the announcements of closings was made. It just had one of its best months in a long time.
What accounts for that?
I think there was a dark cloud hanging over our employees as they wondered whether they were going to be around. Employees are always skeptical. And the news that the store would survive brought some euphoria. Now there's a good, happy feeling of being survivors. The closures of other Chrysler stores here in Orlando are also bringing some business our way.
So in that regard, the closings mean you will pick up business.
Yes, although that's not how I'd like to win business.
What changes have you made in your marketing in this environment?
We've really scaled back our advertising because we believe that in a market like this, it doesn't matter how much money you throw at it. People who need to buy a car are going to come in, whatever you do. You're not going to create incremental sales, so it's a crapshoot.
We've also gone 100 percent print. Newspapers are just struggling, and you can cut some great deals with them. A year ago, we weren't doing any print; it was all electronic, mostly TV. Now we're all print. I think it's working.
What's happening in your parts and service departments?
We've taken a pretty dramatic hit there. We're down by 20 percent in gross sales from a year ago. Part of it is that Ford's warranty business has really dropped off due to their gains in quality. That's been happening over the past 10 years, but especially in the last year or two. And it's also that people in all brands are deferring service in this economic market. If somebody's air conditioner goes out, they're just driving around in the heat. Customers are skipping maintenance.
And you have a large service department.
Yes, we have 72 service bays at our Ford store. Combined service, parts and body shop, we probably have 110 people.
When will that business come back?
I'm not convinced it will. We hope it will, but a troubling issue is the decline in units in operation. Since 2000, we haven't been selling the number of Fords we were. Back then we were selling 500 new Fords a month. Now a good month is 100. We were probably in the 150-to-170 range before the fuel crisis hit. We're still going strong in used cars. And I'm still bullish on Ford, but it's just not as strong as it used to be.
The F series is still the number-one-selling truck in the world. Trucks will come back as soon as the economy does. We'll regain some of that business.
You have 13 stores in three states. What synergy have you created among them?
Each store has an equity partner who manages it day to day. We do all payroll out of Orlando and also all human resources. We operate a centralized business development center out of our Orlando Dodge-Chrysler-Jeep store that handles all incoming calls for sales and service at all dealerships. It's very seamless. It's a cost benefit, but it's also a continuity issue. We can make sure all of our customers are handled the same way.
What opportunity do you see still out there for Internet marketing?
In my opinion, the real opportunity is in how we handle customers. If we can't handle them by telephone properly, we're not going to do it properly by Internet, either. To me, the Internet is just another telephone line into the dealership. Most people who contact us by Internet eventually pick up the phone and call us anyway. So it's not an issue of technology; it's an issue of treating customers properly.
How easy is it to get customers financed?
Things are getting a little better. More people are coming back into the market every week. But it's still a lot more difficult to get a deal finalized than it was a year ago. There are a lot more steps to every deal. The lenders do a lot more investigating. We do a lot more paperwork on the front end. Some lenders want to interview the customers instead of just taking the documents. I think time will heal all this.
What are you doing to help?
One thing is making sure we get every piece of documentation we can possibly get upfront. Especially if they have a marginal credit score. The more you can get upfront, the less your chances of having a customer driving around in your car for a week without being approved. Do more work upfront. It's awfully hard once the customer has driven away. And the other thing that's helping is getting as much cash down as possible.
You said there was a feeling of euphoria at your Chrysler Orlando store after the closings were announced. Does an optimistic attitude among employees help business?
I think it does. Your people have to want to put on their boots and go to work every day. Every employee we had at our Chrysler store was feeling the pain. I'm sure it was the same at every Chrysler store in America. And when you're down, you just don't deliver.
You lost Atlanta but kept Orlando. Is there a tale of two cities there? Why Atlanta and not Orlando?
Atlanta's a tough market. We knew that three years ago when we went in there. It's hard to move the needle in that market. It's very overdealered, and the cost of marketing is expensive. We've never failed at anything we've ever tried, so it was a very sad day for us all around.
Orlando is a more fragmented market. It doesn't have as many Alpha (Chrysler-Jeep-Dodge) stores. The closings in this market were two Dodge single stores and two Chrysler-Jeep stores.
Were you expecting the cancellation notice in Atlanta?
No, I was very surprised. The process was so secretive. I couldn't find a single person who knew what was going to happen. I still don't really understand why it happened. In the three years we owned the store, we hit every marketing plan we had. There was a Chevy store on one side of it, a Ford store on the other, and a Toyota and a Honda store across the street. So it was where it needed to be. We don't know why, and they won't tell you why.
Will you challenge the decision?
We have put money toward that cause. I can't comment on it.
You also operate Ford stores in China with a local partner. How is that venture going?
We just opened our third Ford facility there. We have three satellite stores off of those. We only sell three models: the Focus, the Mondeo and the Fiesta. But with only that product line, we sold 260 new Fords last month. Service is really taking off now. We're going to expand our presence there.