- Dec. 25, 2022
-- In the 1980s, car dealerships faced a unique set of challenges as interest rates soared to unprecedented levels. With rates hovering around 20%, many consumers were hesitant to take on the burden of auto loans, leading to a downturn in sales for dealerships. But despite these challenges, some dealerships were able to not only survive, but thrive during this difficult period.
So, how did they do it? Here are a few strategies that car dealerships used to navigate the high interest rate era of the 1980s:
- Offering attractive financing options: Some dealerships offered their own financing plans, with rates that were more competitive than those offered by traditional lenders. Others partnered with credit unions or other lenders that were able to offer more favorable terms to consumers.
- Focusing on used car sales: With new car sales slowing down, many dealerships turned their attention to the used car market. By offering a wide selection of quality used vehicles at competitive prices, dealerships were able to attract budget-conscious consumers who were hesitant to take on the burden of a new car loan.
- Diversifying their product offerings: In addition to selling cars, some dealerships also started selling other products and services, such as car insurance, extended warranties, and maintenance plans. This helped to generate additional revenue streams and cushion the blow of slower car sales.
- Investing in marketing: With competition fierce, it was important for dealerships to stand out from the crowd. Many dealerships ramped up their marketing efforts, using a variety of tactics such as print and radio ads, direct mail, and even television commercials to get their message out to consumers.
- Providing top-notch customer service: In a challenging economic environment, it was more important than ever for dealerships to offer excellent customer service. By going above and beyond to meet the needs of their customers, dealerships were able to build loyalty and maintain a steady stream of business.
By implementing these strategies, car dealerships were able to weather the storm of high interest rates in the 1980s and emerge even stronger on the other side. Whether you're a car dealership owner or manager looking to navigate tough economic times, these strategies can serve as a useful guide for helping your business thrive.
If you need help navigating these challenges, don't hesitate to reach out to us at CarSherpas. Our team has extensive experience in the industry and can offer practical guidance and support. We hope you'll reach out Nick@CarSherpas.Com