AutoNation, the national car retail distribution company, continues to announce record earnings – even as U.S. auto companies slide inexorably into bankruptcy. Kneejerk analysts point to deep discounting by desperate domestic auto manufacturers as a key driver of the retailer’s success. What they fail to acknowledge adequately is that AutoNation is intensely focused on one key issue: customer advocacy:
* AutoNation uses its website to help its retail customers make better educated decisions with much more information transparency. Clearly they recognize that increased consumer buying confidence will eventually translate into reduced pressure on prices.
* The AutoNation Value Proposition emphasizes an approach to car buying that better meets consumers’ needs - no haggle pricing, multi-brand selection, immediate availability, reduced search time, and product quality assurance.
Commenting on the decline of the Big 3 auto makers, Mike Jackson (AutoNation CEO) has excellent words of advice about their need to focus more resource and energy on product innovation versus the price reduction treadmill: “plain vanilla simply doesn’t work if you’re in a share fight”…