I don't know anyone who has a good idea what this automotive economy is going to do in the next couple of years.
Every economist I talk to gives me a different answer as to the near-term and long-term viability of auto retailing. Their opinions are all over the map. None of them seem to agree.
Meanwhile, if you talk to knowledgeable auto retailers, they all seem to have one thing in common. Everyone is convinced that they better keep their eye on their used-car lot. That is where the action is going to be.
Savvy dealers have always known how important used cars will be to their bottom line. Some of the big public dealership groups have proven it for all to see with their latest earning reports.
If you want independence from factories, then you'll quickly understand how important used cars are becoming. As more and more cars come off short-term leases, there is a huge inventory that is playing havoc with retailing. And some of the factories are making off-lease vehicles enticing with special deals and warranties.
It is hard to resist, whether you are a dealer or a customer.
There was a time when most, if not all, new-car dealers came from the used-car ranks. It was, and remains, a great way to learn the business.
Those used-car dealers became some of the best new-car dealers in the nation.
I fear for those second-generation dealers who have no idea what it's like to live by your wits as a used-car dealer.
No one can predict the future, certainly not in the new-car business. But one thing seems a sure bet, and that is the viability and the profitability of used cars.
If you don't have the sharpest used-car manager on the block, you better start looking. And if you already have the sharpest manager, then get some golden handcuffs. Everybody is going to want your talent.
It does not matter so much what the economy is going to be doing. Keep your eyes on the used-car department. It could well be your salvation.