Don't Abandon the Ship (or the Land Barge!)

Auction prices and wholesale values of large vehicles are falling faster than a rock off a cliff. Full size pickup trucks and SUV's are loosing money faster than a compulsive gambler at a crap table. And the experts predict it is only going to get worse.

Ford has delayed the introduction of its '09 F150 by two months, to help dealers move existing inventories of new 08's. The June 23rd edition of Automotive News features an article on page 1 entitled " 'Like House of Cards', Used Trucks Fall." Automotive Re-marketing recently listed vehicles that had the sharpest drop in wholesale values. Is there any good news left out there?

Despite all the "bad" news, there's some good news deep within. Consumers still need larger vehicles, and dealers should not completely abandon these vehicles. Particularly in regard to sub prime customers, some of these folks need a full size pickup or SUV in order to work, and not having ANY of these vehicles on your lot could easily cost you a sale.Now I'm not saying you should stock your lot chock full of V-8's and mammoth trucks, but with these vehicles showing a tremendous spread between wholesale and NADA Trade-in, you may be able to structure deals significantly enough behind book to get a lender interested in the loan.

Lately we've seen spreads running in the thousands between Black Book and NADA trade. The opportunity is there to move some of these units, especially if you can buy them substantially behind book, which is a likely scenario these days.

Keep an open mind when it comes to the"land barges". Stock a few and you'll not only have a vehicle a customer may want and need, but the opportunity to structure a profitable and attractive deal for both the dealership AND the lender!