Below is the text from the article in the Birmingham News:
Supply and demand equals great deal today
By Toni Walthall
Birmingham News Staff Writer – Promotions
The law of supply and demand is at work to make this possibly the most lucrative market for car buyers in years.
Last year, soaring gas prices and the economy drove many consumers to curtail spending, which resulted in an abundance of shiny new vehicles dotting many car dealership lots.
The increase of supply has forced manufacturers to lower prices and to offer generous deals to spur business and to lighten inventories.
“My family has been in business a long time. We’ve had very limited manufacturer rebates even as recently as 18 months ago,” said Bruce Limbaugh, president of Limbaugh Toyota. “There are so many opportunities for car buyers now – cash back rebates and special low interest deals. We have factory-to-dealer incentives that aren’t advertised that lets us help people with trade-ins. The opportunities have been unheard of.”
According to data (based in terms of consumers’ monthly income) from the U.S. Department of Commerce’s Bureau of Economic Analysis, new vehicle prices have not been this low since 2001.
Industry analysts told car dealers at their national conference in New Orleans that the weakened economy has resulted in a lack of merchandise being produced here and abroad, but they concede that buyers willing to spend money now are going to get a remarkable deal because of the current drop in demand.
Manufacturers are striving to entice reluctant spenders with deep rebates, which are determined by region.
Consumers should check with car dealers to find out about local rebates. Deals in Birmingham may be better than those posted on manufacturer Web sites, according to Limbaugh. A quick Internet search reveals that most major auto manufacturers are offering serious cash-back rebates ranging anywhere from $500 to $5,000 and zero percent interest on some deals.
“I genuinely don’t mean that as a sales pitch. It’s basic economics,” said Limbaugh.
“Supply and demand is an interesting thing. The factories have cut back so far on productionto match demand. The deals are here now, but I think as the selection thins out customers are going to run short on desirable vehicles. Now is the time to take advantage of it. Six months from now, we may not have the supply we have now. The debate to buy now versus buy later has real implications.”
I think every dealer out there is very clear on ‘supply’, but what I want to comment on is how you generate ‘demand’. Bruce Limbaugh has stepped up in the 1st Quarter with a TV presence promoting those great deals created by ‘supply’.
In a mid-January ‘grassroots’ promotion, his dealership hosted ‘Survivor’ auditions for the local CBS affiliate; they were featured not only in 6 & 10PM newscasts, but also a front-page newspaper story with color photos.
(Link to press release: Toyota Dealer Hosts CBS42 ‘Survivor’ Casting Call)
In addition to that, Bruce has utilized both Direct Mail and email blasts to his owner body. Bottom line – in a very soft local market, Limbaugh Toyota is ahead of last year’s pace, and seeing increases in both daily and weekend traffic.
It’s a tough audience out there, and to spark demand you have to stay in front of them. What’s that old saying? “Lead, follow or get out of the way!” I believe Option 1 is the answer, and Bruce Limbaugh is proving it.
John Paul Strong
John Paul Strong combines his two decades of automotive marketing experience with a team of more than 140 professionals as owner and CEO of Strong Automotive.