Harebrained idea of the day: "Preloved" efficiency dealerships
There's a market out there for old, efficient cars. And somebody is going to figure-out how to fill it.
Let's face it, cars used to be more efficient: The Honda CRX HF from 1990 was rated at 50mpg, and was a simple, dead-reliable transportation appliance. Cars also used to be less expensive and less complicated.
Here's the secret--new cars can't be made like cars from 20 years ago. Regulations won't allow it. Today, you must have airbags, side impact beams, stability control, etc.
For years, the enthusiast market has been finding these gems (like my E30) and holding on to them for a half-million miles or so. The vast majority of folks aren't enthusiasts; they just need.cheaper, reliable, more efficient cars. Seems like somebody could fill that need.
I see several tiers to this:
- At the dealership level, you could pay top-dollar for good used examples, scouring the online resources available targeting efficient vehicles--Older Civics, Volkswagen TDIs, MB Diesels, etc. Then, make efficiency your marketing tool. Specialize in servicing these jewels, too, because there's lots of money in parts & service.
- The next tier up is a reconditioning shop...many cars have solid bodies (particularly from the South, or California), but need an engine overhaul or replacement. Most of their engines are still in production. Bring the car up to 8/10 or 9/10 condition with a new engine and transmission, and sell it for $6k to $7k. If I could walk in somewhere and buy a CRX HF with a brand new engine for $6k, I'd be there tomorrow, title to the Camry in hand.
What you're playing here is the lag in the market. Eventually the engineers will refocus on efficiency and start producing new models that get 40+mpg again. At that point, you'd be out of business. But for a narrow time, you could pull off-the-shelf stuff and have a brisk business getting people out of their SUV's and into more efficient cars.
My suspicion is, used-car lots are making a killing on these efficient vehicles already.
Let's face it, cars used to be more efficient: The Honda CRX HF from 1990 was rated at 50mpg, and was a simple, dead-reliable transportation appliance. Cars also used to be less expensive and less complicated.
Here's the secret--new cars can't be made like cars from 20 years ago. Regulations won't allow it. Today, you must have airbags, side impact beams, stability control, etc.
For years, the enthusiast market has been finding these gems (like my E30) and holding on to them for a half-million miles or so. The vast majority of folks aren't enthusiasts; they just need.cheaper, reliable, more efficient cars. Seems like somebody could fill that need.
I see several tiers to this:
- At the dealership level, you could pay top-dollar for good used examples, scouring the online resources available targeting efficient vehicles--Older Civics, Volkswagen TDIs, MB Diesels, etc. Then, make efficiency your marketing tool. Specialize in servicing these jewels, too, because there's lots of money in parts & service.
- The next tier up is a reconditioning shop...many cars have solid bodies (particularly from the South, or California), but need an engine overhaul or replacement. Most of their engines are still in production. Bring the car up to 8/10 or 9/10 condition with a new engine and transmission, and sell it for $6k to $7k. If I could walk in somewhere and buy a CRX HF with a brand new engine for $6k, I'd be there tomorrow, title to the Camry in hand.
What you're playing here is the lag in the market. Eventually the engineers will refocus on efficiency and start producing new models that get 40+mpg again. At that point, you'd be out of business. But for a narrow time, you could pull off-the-shelf stuff and have a brisk business getting people out of their SUV's and into more efficient cars.
My suspicion is, used-car lots are making a killing on these efficient vehicles already.
Comments
Post a Comment