Advantage: Car Buyers Selection Is Standard at Auto Malls

By Roeder, David | Daily Herald (Arlington Heights, IL), May 2, 1996 | Go to article overview

Advantage: Car Buyers Selection Is Standard at Auto Malls


Roeder, David, Daily Herald (Arlington Heights, IL)


Byline: David Roeder Daily Herald Business Writer

In Kenosha, Barrington and North Aurora, you can witness the evolution of that wary creature known as the car buyer.

Power is shifting to that species, which for years has felt outsmarted the moment it ventured into a dealer's showroom.

Today's dealers are more likely to offer coffee and child care, even a cafeteria, to put customers at ease.

No-haggle pricing may be a trend that has peaked, but the locations mentioned symbolize something possibly more important to the car buyer: the ability to compare different makes, if not side-by-side. then almost.

In Kenosha, the Mauro Auto Mall is a marketing Murderers' Row, a succession of 13 car franchises lined along I-94. At Motor Werks of Barrington, buyers can wander among BMWs, Saabs and Mercedes - Hondas for the frugal.

Or there's the North Aurora Auto Mall, East-West Tollway and Orchard Road, a compound that's adding its fourth independent dealership. They advertise together as a "one-stop shop," reducing everybody's cost, said Ron Czalbowski, general manager of Saturn of North Aurora.

"Auto malls definitely are something you'll see more of," said Czalbowski, who also runs a Saturn dealership in Naperville.

It's all a matter of business capital chasing consumer demand. Selling cars is becoming a higher stakes game dominated by larger operations.

"We're seeing individual dealers owning more and more franchises. This consolidation will continue" as smaller operators sell out, said Jerry Cizek, president of the Chicago Automobile Trade Association.

But as dealers pursue their Darwinian dance, new kinds of competition may emerge. Retailers such as Circuit City and Wal-Mart are experimenting with used-car stores and buying clubs, like CarMax, aimed at selling large numbers of vehicles by offering low prices, much as they do at their discount stores.

Some experts said that if the concept works, it could be tried with new autos.

"The retail car business is no different from other retail businesses. The consumer will have a number of alternatives," said Paul Tamraz, president of Motor Werks.

Dealers will survive and prosper, but only the ones with the best in price, selection and service, he said.

Tamraz was echoing the message about 50 representatives of local car dealers heard in April at a talk given by industry guru J. David Power III. His J.D. Power and Associates issues the widely followed quality and consumer satisfaction rankings of car models.

Power noted that the number of dealers today is less than half the 50,000 of 1950 and the slide will continue. The car makers are encouraging the trend where they think two or three marginal franchises can become one strong one, Power said.

Because of price pressures, "the majority of dealers are not making much money on new cars," he told the forum at the Ritz-Carlton Hotel in Chicago. …

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