Any business operator has heard the term executive head hunter, but what about “hood hunter”? That’s the role that T.J. Johnson, a 40-year automotive sales veteran who thought he was retired, finds himself in with Smart Motors in Madison.
The historically unique condition of the automotive market prompted Smart Motors to lure Johnson away from his days of leisure, as shortages in new, pre-owned, and used vehicles have given the terms “sticker shock” and “empty lot” a magnified meaning. Automobiles, especially increasingly popular electric and hybrid vehicles, are in high demand but hard to find, and the better pre-owned vehicles quickly are taken off the market.
What’s an auto dealership to do? Well, one thing all businesses can do is realize that there is still value in the experience and skills of retirees, especially when a pandemic makes a labor shortage even shorter and when finding relevance in “retirement” is a genuine human need.
Johnson, who has been called to hunt used vehicles for the Madison dealership with the title vehicle acquisition manager, points the finger of blame for the vehicle shortage at COVID’s impact on the global supply chain and the computer chip shortage, which will take some time to address as the U.S. builds more domestic semiconductor plants.
He also notes the ripple effects of having modern vehicles so dependent on those chips. “Typically, you get 50% of your trades from new-car deliveries, sometimes up to 70%,” Johnson explains. “What’s really affecting the trades is the shortage of new cars being sold, and the other thing is the rental car companies aren’t turning cars as often because they aren’t getting new ones either. So, there are fewer cars on the secondary market as well, and there aren’t many lease turners.”
Taking inventory
Prior to the pandemic, Smart Motors would have available roughly 200 cars, trucks, and SUVs, but that has been whittled down to between 90–100. According to Johnson, used cars in the $10,000–$20,000 range with around 100,000 miles are “incredibly desirable,” but they are so hard to come by that when the dealership is able to purchase one, it’s usually driven off the lot by the new owner in a matter of days.
Adding to the degree of difficulty is that the market for previously owned trucks, even trucks with low mileage, is softening because of higher fuel costs.
Johnson, who was able to retire for about 18 months, returned in August 2021 with the goal of purchasing 50 or more used vehicles each month. He’s either met or been close to reaching that goal every month, and he believes the market can and will return to normal. The only question is when.
What’s holding things up? Johnson, who sold Cadillacs, Toyotas, and other models during his four-decade long career, has a theory. It’s related to dedicating a position solely to the task of securing used vehicles. The fact that he has the proverbial “one job” enables him to be an occasional traveling buyer rather than wait for people to bring in their used vehicles, and he claims the in-person process — from the first “hello” to the finish line of handing the customer a check — can be done in less than 45 minutes. An even faster option, if face-to-face dealing is not a preference of sellers, is a Smart Motors’ webpage where sellers can get an offer in a matter of minutes.
“Most dealerships that buy cars, most traditional dealerships, have managers doing it, and they have other tasks to do. I’m able to devote undivided attention to that customer coming in,” Johnson states, adding that he also makes house calls. “This morning, I went to Edgerton and bought a car on a referral from an older gentlemen who couldn’t drive it in, so I think we’ll probably always have a position like mine because it’s another avenue to get vehicles that we have shown to work.”
Perhaps the reluctance of some dealerships to create such a position is based on outdated belief that consumers with used cars think they will get a better deal if they themselves handle the transaction, but Johnson says that’s no longer the case — not in this market. Conditions are such that consumers can get real bang for their buck by selling their used cars to a dealership.
Prices certainly are getting right. Research by iSeeCars.com found that in July 2022, the price tag of used cars went up an average of 10.9% over the same month in 2021, and the upward price pressure is magnified for the cars of the future. Amid the surge in gas prices over that same 12-month time period, electric used car prices soared 56.7% and used hybrid prices jumped 30.5%.
Closing the deal
Other than talking to the media, Johnson is on Facebook, he’s sending emails to Smart Motors’ customers, running newspaper advertisements, and he’s fully engaged in networking to take advantage of the following he’s built over 40-plus years of selling cars. Asked how much longer he wants to do this, Johnson replies with a hearty laugh, and then he explains how enjoyable the job is. “I would say at least a couple of more years because it’s fun,” he says. “I’m helping people solve problems, and they can get rid of their used cars. A lot of them don’t want to go the Craigslist or Facebook [Marketplace] route because there are so many scam people out there.”
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