Inside Automotive with Jim Fitzpatrick, powered by CBT News

How A Chevy Dealer Navigates Prices Over $50K And Keeps Buyers Moving

• Jim Fitzpatrick • Season 1 • Episode 29

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Host Jim Fitzpatrick and guest Dorian Jimenez dig into the realities of affordability, the surprise rise of EV adoption in Oklahoma City, and how service advisors became the most trusted EV storytellers. We also break down used car sourcing, high-mileage financing, and why Q4 still looks strong for Chevy dealers.

• average transaction prices crossing $50,000
• value-focused leasing and entry-level trims
• EV demand from commuters and families
• service advisors and techs as EV evangelists
• pre-owned pricing versus new-car incentives
• sourcing high-mileage trades through service drive
• lender flexibility on higher-mileage financing
• tariff headlines nudging buyers toward Chevy
• steady but cautious fourth-quarter outlook


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Announcer:

Welcome to Inside Automotive with Jim Fitzpatrick.

Jim Fitzpatrick:

Good morning, everyone. Jim Fitzpatrick. Welcome into another edition of Inside Automotive right here at CBT News. As we move deeper into the final quarter of the year, dealers are keeping a close eye on what's shaping today's market and what's to come. Joining us today to share his perspective from the front lines is Dorian Jimenez, who is the owner, dealer, operator of Classic Chevrolet in Oklahoma City, Oklahoma. So thank you so much, uh Dorian, for joining us on the show today.

Dorian Jimenez:

Jim, thanks for having us. I greatly appreciate that.

Jim Fitzpatrick:

Sure. So talk to us a little bit about the market that you're in right now.

Dorian Jimenez:

You know, so um we're in Oklahoma City, which is a uh big area and it's thriving and it's growing. But you know, I'll tell you, customers are the there's still uncertainty right now. Everything is the word value, value, value. Um, the word stretching a dollar, um, it's a little tough, but people are still buying cars. So it's great that to see people still in the buying mood.

Jim Fitzpatrick:

Right, right. That's that's fantastic. I just had an interview with uh one of the analysts at Cox Automotive, and they in their report they mentioned that the average transaction price for the first time has now exceeded $50,000. Um, where is this going? And how much of a role does that play with consumers coming in? Are they are they as you just mentioned, they're pretty concerned about affordability, right?

Dorian Jimenez:

Affordability is a big thing. So, you know, leasing is a big perspective. I'll tell you, we're very fortunate with Chevrolet um as having an introductory model of the tracks that you're buying in the 20,000 range is now affordable because when you look at the pre-on market, if I were to tell somebody, find me a $20,000 vehicle, it's three to four years old and it's 50,000 to 80,000 miles, but I can actually push them on a new car and they're happy with the value on that. And it's within their budget.

Jim Fitzpatrick:

Yeah, that's fantastic. Well, it's so good to see that manufacturers are are stepping up and doing what they can to combat this affordability crisis that we're in the middle of right now. I mean, it is unbelievable. I was on a showroom uh at a Ford store recently, and they had a, you know, they had a Ford F-150, it was loaded up, and the thing was $90,000. That was without any addendum or anything. I'm like, wow, how did how did we do this? This is crazy, right?

Dorian Jimenez:

Yeah, you look, you look at the vehicles now, and it's um the six figures is the norm. And we're not even talking luxury segment, we're just talking the domestic, the big three. Um, but you know, there's still some affordable vehicles. The EVs, um, Chevrolet announced that we're having the Bolt EV coming out, and the price point is is affordable on that. So glad to see that. Yeah, we've got some we've got some SUVs that are affordable as well.

Jim Fitzpatrick:

Yeah. So you're in Oklahoma City, and we hear a lot of people, uh dealers that I've spoken to before said, oh, well, EVs, that's more of the the coastal and and areas and what have you. And you know, our consumers, our buyers are not interested in EVs. They got to drive a long way and they have this and that. So, but you just mentioned, you know, being excited about the EVs. Talk to me about that.

Dorian Jimenez:

So I'll give you an example yesterday. We sold one. So um had a gentleman that has served our great nation 19 years. He is in the Air Force, he has three teenage daughters. His commute from his house to the Air Force base here in Oklahoma is about 21 miles. He's been driving a truck forever and he says, you know what? I'm switching to the dark side. I said, What do you mean? He goes, I want an EV. He goes, I'm just going back and forth. It makes sense. So you're seeing the norm change, and you're seeing a lot of individuals who are true ICE buyers for years and years. But the affordability at the pump, they're like, the EV makes sense. They understand there's not the range anxiety that it used to be. Um, you're seeing more and more people getting it. So I'm impressed with it. I just I'm still a little hesitant on the pre-owned market. I wish we could do better on that, but from a new perspective, we're doing pretty well on that.

Jim Fitzpatrick:

The pre-owned market relative to EVs? Is that what you mean? Yes. Okay.

Dorian Jimenez:

Yeah, because you're seeing the values, like you'll see the Tesla values. They've dropped dramatically. Um, some of the high-end EVs have dropped dramatically. And part of it, it's because the manufacturers have done a great job pushing the new vehicles and having some amazing um lease incentives and buying purchases.

Jim Fitzpatrick:

And um, so on on the EV situation with the tax credit going away now, uh obviously effective uh last month of the 30th of September, we did see a huge spike. I think we got to 12% in EV sales, which was unbelievable. But uh having said that, are you concerned that with the tax credit going away, EVs are gonna drop through the floor or not so much?

Dorian Jimenez:

You know, I I'm proud to be with General Motors and Chevrolet took the initiative and they gave us some added bonus incentive so that we got through the end of the month um to help out. But as we go, we're gonna have to do something um collectively with the manufacturers to help out for the consumer because it has to be from an affordability standpoint.

Jim Fitzpatrick:

Yeah, yeah, for sure. But consumers are coming in and asking, as you just mentioned, about EVs and how they can get into them. One dealer I spoke to um and I've spoken to actually to a m many dealers about this, and that was the notion that today's salesperson on the showroom floor isn't necessarily driving an EV. I think it's less than 10% actually drive EVs themselves. So when somebody comes into your showroom and they say, I'm interested in an EV or maybe showrooms around the country, that salesperson just naturally might have a tendency to move them away from an EV because they don't know it that well, they don't drive it themselves into a nice vehicle. And it from his perspective, he said we gotta get more of the people on the front line behind the wheels of EVs as their daily vehicle. Would you agree with that? And do you have any comments about that theory?

Dorian Jimenez:

Jim Jim, I'm gonna give you a different perspective. I have seven individuals that are technicians, parts, service advisors that are driving it. You want you want to know the best information, and it's not to discredit sales consultants, but you see your sales consultant once every three to five years. You're gonna see your service advisor three to four times a year, potentially. So having those individuals driving EVs in service, that's actually accelerated and help us sell cars on the front line. I bet. Because I'll sit there and I'll tell a prospective client, come back here, let's go visit with one of our Master Techs. Let me tell you why they bought one, what they like about it. And it's it's been eye-opening and enlightening to hear from a technician or an advisor on their reasons why they like the EV.

Jim Fitzpatrick:

Yeah. Oh, that's great. I didn't even think about that. That's a that's a great idea for sure. Wow. And um, so otherwise, uh, the EV adoption is alive and well in Oklahoma City. Then the notion that no, we're out in the middle of nowhere, we're a flyover estate, and we don't sell EVs, that's uh hogwash.

Dorian Jimenez:

So I'll tell you a funny story on that, Jim. So I'm from Dallas, Texas, lived there forever and was in the car business forever. And only I bought this store two and a half years ago, and I was like, great, we're in Oklahoma, true, true old country. EV's not going to be adopted. And some of my sales staff didn't believe in it. So one day I challenged them. I said, hey, this weekend when you're driving, count how many EVs you see on the road. And every one of them came back and go, I saw this many Teslas, this many Hondas, this many Chevrolets. So they're out and about. So it just getting past that notion that people are really into it. So it's not an issue here in Oklahoma.

Jim Fitzpatrick:

Yeah, for sure. On the used side, how has uh how has the demand shifted as affordability continues to be a concern for many? Is that are people more and more going um to consider a used car that typically bought new?

Dorian Jimenez:

You know, that's what you the notion is a consumer's thinking, you know, if I'm if I'm really watching all my dollars, I've got to go pre-owned. All right. What you're seeing on the pre-owned is many times the pre-owns are about the same price as a brand new vehicle. So we'll show them pre-owned vehicles, but oftentimes we're switching them, we're switching to an to a new vehicle. Um you know, sourcing pre-owned has been difficult. So on our service drive, we've done a great job um trying to get our clients to upgrade, trade, sometimes they're even downsizing. I mean, I've had several moms that have been in three three-row SUVs and they don't necessarily need it. So we get them down to a two-row SUV, better fuel economy, and it works within their budget, and that helps us in our pre-own market.

Jim Fitzpatrick:

Yeah, fantastic. I drive into your uh dealership and I've got a 2022 90,000 mile vehicle. Runs great, looks great, but it's got you know 90,000 plus miles on it.

Dorian Jimenez:

I want that car.

Jim Fitzpatrick:

You do want that car? You can I want that car. You want that car and you're gonna sell it on your used car lot.

Dorian Jimenez:

Um I'm gonna sell it. It's you know, I'm gonna sell that car. I'm gonna sell a car that's got a 125,000 miles. Wow, 150,000 miles. What you're starting to see also from a lot of consumers is the old notion is people would get a new car every three to four years. People are keeping their cars six, seven, eight, nine years. Um, and the average commute's above 15,000 miles. So you're seeing that. Consumers are used to that. It's no longer the days of find me that five-year-old vehicle with only 20,000 miles. You're you're not going to find Jim. So people are understanding and they and they see it. So it's fine. And give me that car. So I'll write you a check for that one today, Jim.

Jim Fitzpatrick:

Well, so on the what about on the financing side? Are the banks that are buying that paper, are they concerned about that at all? Because it used to be the car had over 50,000, 60,000 miles. I guess I'm going back, I'm dating myself. They'd be like, yeah, forget it. We're not, you know, we're gonna need half down on that one.

Dorian Jimenez:

Yeah, you know, you're right. From the bank perspective, they're still looking at that. And at first there were some concerns, but they've also adjusted some of their business parameters. And so we're very fortunate who we partner with, and our bank is very helpful on things. Um, of course, 200,000 miles, they're not gonna go for on that. But the 125, 150, 160, we can still get them finance. Um, it's generally gonna be a little bit shorter terms. So that from an affordability standpoint, we tell individuals.

Jim Fitzpatrick:

Yeah, that's okay. That's okay.

Dorian Jimenez:

It's okay on it.

Jim Fitzpatrick:

Hey, the the the Chevy stores that I've spoken to um across the country, and it's been a lot, um, especially since uh the talk of the tariffs, they feel as though their business has kind of picked up because the idea that consumers felt as though, hey, uh, I'm not gonna look at a uh a foreign plate, I'm gonna go to maybe a Chevy, nothing more American than you know, apple pie and Chevrolets, right? Have you do you feel as though as a Chevy dealer you've benefited from that uh that feeling out there, that idea that the tariffs are gonna be, you know, costing a lot more money if we look at a Toyota or a Nissan or a BMW or what have you, and therefore I'm I'm going to Chevy?

Dorian Jimenez:

You know, and no disrespect against news, but news today can create panic or alert, right?

Jim Fitzpatrick:

Oh, yeah.

Dorian Jimenez:

So anything that said consumers are set there, honey, we have to do it now. And you know, and we welcome the business, we're always here to help them. And we literally tell them it's like the stock market. I can't predict what Coca-Cola is going to trade for tomorrow. I can tell you what it is for today. And so when they're coming in, you know, it's great to have the American built cars. Um, you know, and the Chevrolet nameplate, everybody loves. So we have seen an increase in business. Um, some of my uh veterans that come in will say, I'm here to buy a Chevy, I've been waiting, but I want to do it now. We welcome it.

Jim Fitzpatrick:

Uh that's right. That's right. That's awesome. So to wrap up, what's your what's your outlook for the rest of the year? Any bright spots or headwinds that you're either concerned about or preparing for? What does it look like here that we're now that we're in the middle of uh uh of uh uh October and and in you know right in the last quarter of the year?

Dorian Jimenez:

So, you know, the the push in the automotive industry is the fourth quarter. We do everything. It's our playoffs, it's our Super Bowl. Um so our teams are prepared for that. But you also uh have to understand there could be uncertainty. You never know what could happen. Um no one predicted COVID, nobody predicted the financial crisis 07-08. But I I'm optimistic um because the brand that we have, um, the we have the best product lineup right now. Chevrolet has done a great job, and our team's prepared for that. So as long as they can continue to produce the vehicles, we're gonna be okay because the consumer confidence is there. It's not great, but it's there. Um, and you know, the news is helping us also because in certain areas they're saying, go ahead and buy it now because we don't know what this uncertainty is going to be for next year. So I think it's gonna be a great fourth quarter. I don't, it's not gonna be an all-time historic, but I think it's gonna be a great fourth quarter, and we're looking forward to it, and our team's ready.

Jim Fitzpatrick:

You got the right attitude. Dorian Jimenez, owner and dealer operator of Classic Chevrolet in Oklahoma City, Oklahoma. Thank you so much for joining us. I know that our dealer audience will get a lot out of your visit with us. So thanks so much.

Dorian Jimenez:

Thanks, Jim. I greatly appreciate it. Have a great day. Awesome. You as well.

Announcer:

Thanks for watching Inside Automotive with Jim Fitzpatrick.