Okay, so onto the news of the day. Many of you have probably seen the recent stories about smart’s sales decline and concern about the future of the brand. Well, it’s true that our sales are down from where they were when the brand first launched. But let’s look back at smart’s first two years and put things into perspective. In 2008, when the brand launched in the U.S., the sales total of 24k far exceeded the initial forecast of 14K-16K. The pent up demand and soaring fuel prices at over $4 per gallon all contributed to the brand being able to sustain tremendous momentum even as the rest of the auto industry began to dramatically decline. So, in 2009, while every other manufacturer was reporting significant year-over-year sales declines, smart did not feel the impact of the economic crisis and industry fall until about this time last year. smart simply overachieved that first year, and sustained that momentum much longer than others in the industry. Although some makes are able to broadcast that sales are higher now versus the dismal performance last year, I would have to say that 2010 is still a tough year for everyone.
So, is smart going away? Far from it. In fact, we are just getting started in the U.S. market. We have a refreshed 2011 model coming this fall, an electric smart car headed to the market and plans for future models through an alliance between Daimler and Nissan-Renault. There’s a bright future ahead for this brand. Is this a brand for everyone? Probably not. Then again, we don’t think of our owners as just everyone.
Last edited by forestacademy; 09-03-2010 at 09:47 AM.
Say smart will close up shop in the US and get a thousand opinions on what smart should do.
Finally get a response from smart USA about all the rumours and nothing.
I guess what smart USA (a division of Penske) has to say has no effect on opinions around here
Forest, dude... put the poo down, step away from the poo... it's still early in the morning, maybe folks are at work working, unable to do personal browsing at the office. As for myself, I slept in.
I'll start. I am ecstatic that smart USA (a division of Penske) has addressed our worries and concern. Finally. It will be exciting to see the evolution of the brand here in the States, as well as overseas.
but I do get what you're saying. Doing our own ad campaign for example... come on. Well intentioned, but likely fraught with unintended consequences.
Say smart will close up shop in the US and get a thousand opinions on what smart should do. Finally get a response from smart USA about all the rumours and nothing. I guess what smart USA (a division of Penske) has to say has no effect on opinions around here
Quote:
Originally Posted by MikeB1
I'll start. I am ecstatic that smart USA (a division of Penske) has addressed our worries and concern. Finally. It will be exciting to see the evolution of the brand here in the States, as well as overseas.
Playing devil's advocate, would we really expect them to say anything other than this?
Considering a fair amount of dealers are Penske owned, they are not subject to the whims of a local owner seeing a decline in sales. Those dealers will bee kept open if Penske sees a future for the brand, thus keeping the smart viable in the states.
I'm choosing to be optimistic, because like everyone else here, I love my car and I've spent a lot individualizing it to make it my own. (I started to write that it represented a large investment, but I'm old enough to know that a car isn't really one of those things.)
Last edited by MikeB1; 09-03-2010 at 10:30 AM.
Reason: deleted poo
Truth is, it's not much diferent than what Kim told us at Nationals. All the nay-sayers talking about smart only selling 400-600 cars a month, that's about what they were forcasting originally. 2008 was a banner year for smart, "perfect storm" so to speak. I think her analysis is right on. smart & Daimler on working hard on next generation smarts. I know smart center Indianapolis is planning for the future of smart. They tell me smart is planning new things, they just aren't at liberty to discuss yet(as ALL manufactures say). As was posted elsewhere here, the auto industry isn't out of the woods yet, sales are at their lowest point in years. smart isn't immune to this either, they just don't have the massive beaurocracy to support while weathering the storm.
The truth is, I think Penske is being "smart" about this, keep overhead low, keep the organization small and lean, and you can adapt when the market changes.
I don't want to turn this thread into a "why isn't smart advertizing" thread, I think right now mass media advertizing isn't in their best interest. They are placing the product in strategic places. I'm getting a lot more "how do you like your smart?" questions now, instead of "what is that?". The product is gaining recognition, and in this economy, they don't have the multi-million dollar advertizing overhead either. I think that's a good thing. smartUSA is located in the back of the smart center in Bloomfield Hills, they don't have some grandiose corporate headquarters like all the other manufactures.
Personally I believe smart will survive, and in the coming years they will grow and prosper.
Speaking with my dealer, Bergstrom is not one to give up all to quick. They have a Porsche dealer up in the fox valley that is even more lonely for the sales staff. Most folks who buy them do so back home in the high end showrooms in Chicago. They stick around just in case they need some service and the occasional sale.
I can see the lean operation in Milwaukee. They are close to the Chevy dealer under the same Owner and share Financing, and reception with them. All they have on staff is the brand manager, a brand specialist (sales), and a pair of service guys so they can take time off once in a while. By making the building to LEED silver specifications they also have reduced the overhead to keep the doors open. Operating costs are quite low.
What I did notice last time I was there was the state of the old Hummer dealership next door. While it had closed as a hummer dealer before smart opened their doors, it was converted to a used car showroom for the same dealer group. When I was there last, it was sitting empty. It will be the site of an upcoming car show sponsored in part by the dealer.
I guess what I'm getting at is, now that these dealers have the franchise, and it is quite difficult to take them away once they have there foot in the door, They can run a lean dealership with support from the individual dealership owners.
If they look like the lights are off and no body is home, well that is in part by design. Part of the LEED building standard is Lighting based on need. If the lights don't need to be on, why waste the Electricity. Even Walmart is doing that now.
Thanks for getting this out to those who don't (and won't) do the smart USA soundboard.
Kim's comments are well crafted and I especially liked this spin:
So, in 2009, while every other manufacturer was reporting significant year-over-year sales declines, smart did not feel the impact of the economic crisis and industry fall until about this time last year. smart simply overachieved that first year, and sustained that momentum much longer than others in the industry.
I'm not certain whether this leaves us with the glass half full or half empty as much as it seems to be in a sippy cup?
nice 'spin'. still, facts don't lie. sales are DOWN and for a brand that still has very few vehicles on the road (in comparison to Honda, Toyota, GM, Ford, Chrysler, etc....), the smart centers will still be, well....smarting.
they need income to operate. they cannot survive by selling 6 or 7 cars a month.
I really WOULD like to see them survive, but they should NEVER have been set up in the beginning as, for the most part, stand-alone dealerships. it was a receipe for failure. makes me wonder just how long some smart centers will be allowed to 'bleed' money from the mother store until they're cut off.
at some point these dealers are going to have to say 'enough is enough' and if something doesn't change soon, smart centers will start dropping like flies.
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