Main Street News

The market for buying a car has changed significantly in recent years. Between the effects of the pandemic and other major shifts, the industry’s sales are not what they used to be. Lann Rubin II, founder and owner of North East Ford in Millerton, NY, shares about the current state of the car market and how these fluctuations have impacted his approach to his business.

Practical market adjustments

In general, Lann explains that because the prices of new vehicles have risen and leasing has fallen out of favor with manufacturers, used car prices have gone up, too.

Seven or eight years ago, Lann might sell a basic vehicle for a couple thousand dollars down, and anywhere from $250 to $400 a month. But now, most people can’t afford it, and he clarifies that even with a golden credit score, you’re still paying a lot when purchasing a vehicle. “Even if you’re putting $10,000 down,” he says, “$800 or $900 a month is hard for a brand new truck. And stresses on low-income people are far worse.”

It has also become more difficult for people to purchase cars thanks to interest rates. Because of all these factors, the cars that do get traded in are all the more difficult to resell, having 150,000 miles or more. Lann observes that it used to be the opposite, with less wholesale cars being sold. “Out of ten trade-ins, two have mileage I can resell,” he states.

Indeed, with customers trying to hold out for resale money, many people have waited so long that they’re forced to buy a new car because their current vehicles now have 150,000 to 200,000 miles. “Even municipalities,” he notes, “are keeping cars with 200,000 miles or more.”

This effect has influenced the amount of service being performed. Additionally, Lann sees construction starting to flatten, with trucking companies not as busy as they were. “You would think when things would slow a bit, you’d get cheaper deals,” says Lann.

And even with the demand on his service center at North East Ford, Lann points out that there are still fluctuations because he has only been able to get so many technicians. So, despite being slightly overloaded with work, he shares that his service center isn’t yet expanding.

Sales trends & a new business approach

On the whole, North East Ford is selling more used than new cars. When it used to be about a 50/50 split of used versus new sales, it’s now closer to 65 or 70/30, according to Lann. “It might not be true for the whole country,” he adds, “but we get a lot of local support. When people are tired, they think of us. We’ve been buying people’s cars for so long.”

But looking at a national shift, the pandemic, Lann says, made Wall Street and major companies realize the correlation between reducing inventories and increasing stocks. “The new way of business is to be lean and mean when it comes to inventory—not just with vehicles,” he points out.

Thus, when it comes to the type of car that’s quick to get, a Ford Explorer or F150 would be an easy choice. But premium vehicles would have minimal inventory and thus take many months to acquire. The same goes for more unique equipment and parts. “Sometimes you can get the transmission but not the gaskets,” observes Lann. “It’s very weird right now.”

Additionally, Lann says that when the pandemic opened companies’ eyes to this new approach to inventory, this meant that “hundreds of cars and $5000 rebate days will never come back.” He describes the new “hold the line” mentality: despite the slowing of the industry, companies are more insistent on prices. “Many have dropped sticker prices, because they don’t want people to get an appetite for a rebate or discount.”

And while last year’s United Auto Workers strike no longer has a huge impact on his work, Lann does notice that supply lines for parts have been affected in a lasting way. Because of this, he keeps extra inventory around just in case it’s needed.

The importance of supporting customers

Another aspect of the market, the customers themselves and their expectations, has only become more important with the influx of delivery services (in all respects, especially food) post-COVID. 

Because of this, Lann places particular emphasis on his pickup and delivery service, in tandem with maintaining responsive lines of communication with customers and ensuring he meets their needs to establish appreciation and trust. He also clarifies that by taking an active role as an owner, he’s seen a ton of positive results because he’s constantly involved. So many customers are desperate for a reliable source of assistance, and Lann notes that it goes a long way to fill that gap for people.

Through his pickup and delivery method for car servicing, he currently averages 200 vehicles a month, a figure which keeps growing since North East Ford is one of very few dealers using this model. “Customers care about those kinds of services because most people will pay $20 for a $10 sandwich if it’s brought to them hot,” says Lann, explaining that people are expecting this type of amenity now.

Thanks to the pickup and drop-off servicing option, a lot of necessary services for his customers’ cars are getting done sooner, which makes it easier in the long run—a well-maintained car will need less work done in general. 

Not only do customers really enjoy this choice because going to the dealer constantly can be a hassle, but sometimes there are deals available with it, too: “We do them in a chain. So, you have to say, ‘I can do Thursday for a free oil change because we’re in the area.’” As Lann puts it, “We are the Grubhub of the car business.”

North East Ford is located at 182 Route 44 East, Millerton, NY. For more information, you can visit their website www.northeastfordmillerton.com, or give them a call at (518) 224-7343. For updates, you can find them on Facebook and Instagram at @NorthEastFord!