Acura Standalone Dealerships Going Away?
#1
Burning Brakes
Thread Starter
Acura Standalone Dealerships Going Away?
Sorry if this has been discussed recently, but it seems from my recent buying experience in Indiana (one salesperson and a manager running the store) that there are changes coming to how/where Acuras are sold. There was talk some years ago about Acuras being sold at Honda dealerships, but nothing came of that. However, given the rapidly declining sales of Acura sedans, and the lower profit RDX being the top selling Acura now, how can the dealerships stay open? Any thoughts?
Last edited by Rexorg; 06-21-2018 at 02:25 PM.
#2
Team Owner
I think there is much we don't know about the dealerships and their profit margins and what not... And we can only speculate.
#3
16’ RLX SH-AWD
A good dealership makes its money to pay for overhead from the service department. Great experience at the service department and likewise through Used car sales and new car sales help to feed the service department.
Dealerships with empty bays in the service department could be a sign of a struggling business.
Dealerships with empty bays in the service department could be a sign of a struggling business.
#4
Drifting
Join Date: Apr 2018
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eggs ackly.
A crossover SUV can’t cost measurably more than the sedan upon which it is based, yet they can get far more for one. How much more does a $70K BMW cost to make as opposed to a $45K Acura or a $30K Honda? Even taking a look at the price delta between the Tech and the Advance. From a production cost aspect, it likely doesn’t even cost half of the price delta.
We really have no idea what the profit margins are, but it is clear that the capital cost of entry is very high, and people and consortiums that have that level of capital sure do want a return on that capital. I expect that they get it.
#5
Burning Brakes
Many, many years ago I saw an interview with a GM exec (John DeLorean maybe) and he was asked why a Cadillac cost $5K more than a Chevrolet but it only cost $1K more to build. His answer - 'Because people will pay $5K more'.
#6
Suzuka Master
^^^
Yup, go to Amsterdam and Europe and the taxi are MB. Put a few extra features in, improve the touch materials and have a nice showroom, treat people better and people will pay more even if the real cost to make is not linear.
Yup, go to Amsterdam and Europe and the taxi are MB. Put a few extra features in, improve the touch materials and have a nice showroom, treat people better and people will pay more even if the real cost to make is not linear.
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#8
its about the cost of keeping a dealership running. The owners of a Acura dealership may almost likely owns a Honda dealership. Operating them independently could be costly especially if one does not sell as much. This is why you never see independent dealership for Dodge or Jeep...
That being said, unless it's pressure from the dealership requesting Acura to combine, I can't imagine Acura themselves want to do this, essentially diluting the brand image.
That being said, unless it's pressure from the dealership requesting Acura to combine, I can't imagine Acura themselves want to do this, essentially diluting the brand image.
#9
Suzuka Master
I do not see Acura folding their dealers into Honda, look at hoe Hyundai realized they need to do standalone Genesis dealers. No one is going to take a brand as a serious luxury or premium brand when it is sold next to a Civic.I was shopping a G80 Sport and went to 3 different "Genesis" dealers co-located at Hyundai and the experience sucked. That alone turned me off from pursuing the car. The thought of dealing with a Hyundai dealership that was designed for volume vs. customer service was very apparent. This is why Genesis in Canada you can basically order the car online and they deliver it and you never ever have to step foot in a dealership, they will come get the car for service and you don;t even have to know where the dealership is. Even in US if you buy a Genesis you never have to see the dealer after you take the car, same thing they will come get your car for service.
#10
Drifting
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I do not see Acura folding their dealers into Honda, look at hoe Hyundai realized they need to do standalone Genesis dealers. No one is going to take a brand as a serious luxury or premium brand when it is sold next to a Civic.I was shopping a G80 Sport and went to 3 different "Genesis" dealers co-located at Hyundai and the experience sucked. That alone turned me off from pursuing the car. The thought of dealing with a Hyundai dealership that was designed for volume vs. customer service was very apparent. This is why Genesis in Canada you can basically order the car online and they deliver it and you never ever have to step foot in a dealership, they will come get the car for service and you don;t even have to know where the dealership is. Even in US if you buy a Genesis you never have to see the dealer after you take the car, same thing they will come get your car for service.
I don’t get how that kid has any chance of moving Genesis cars. The dealership experience of that grade of car must be much higher to compete. It has also been said that Stinger sales are hurting because of the Kia dealership experience.
#11
Drifting
A good dealership makes its money to pay for overhead from the service department. Great experience at the service department and likewise through Used car sales and new car sales help to feed the service department.
Dealerships with empty bays in the service department could be a sign of a struggling business.
Dealerships with empty bays in the service department could be a sign of a struggling business.
But I think you're onto something about used car sales. Those are great for keeping the service bays humming.
I think Acura is working too hard to differentiate their models from mainstream Honda to allow them to be sold at Honda dealers. I bought my first Honda car ( brand new 1984 Prelude ) from a Honda motorcycle dealership. Honda moved on. Different market segments expect different levels of service and customer experience.
Last edited by Wander; 06-22-2018 at 08:17 AM.
#12
Burning Brakes
I know some of the service facilities are shared because I have dash cams in all our vehicles and when my wife takes her Honda in for basic service (oil, filter, etc.) it's always been taken over to the Acura building while the more involved stuff has always been done at the Honda site. Don't know if that's planned or just a matter of which 'techs' are available to do the work. I don't remember ever seeing an Acura in the Honda service bays.
#13
Nuke
Honda dealerships have gone upscale in my area, very close to matching the Acura experience. Coffee bar, internet lounge, salepersons don’t bother you. I could imagine Acuras being sold in the same building although they recently completely renovated the Acura dealership in my area. There are 3 Honda dealerships and 1 Acura in Brampton, all within about 20 minutes. I could see Acuras being sold in in the Honda shops where Acura dealerships are distant though.
#14
Same here. My local dealership in Ohio just did a complete renovation. I was told that Acura wanted them to upgrade their facilities. Now the place looks like a fancy Starbucks.
#15
Suzuka Master
I got a thing from Hyundai to take a test drive and get a debit card, so I went to a dealership to take a test drive. There was a Genesis there, and I said I wanted to test drive it per the offer. The floor manager asked what I was driving, and I said ‘that blue 535 there.’ He sent me out with a floor salesman that looked about 14. I took the test drive, and went back with the salesman to his desk. The kid whips out a ‘four square’ and starts trying to remember how to use it. The floor manager sees my face watching the kid and comes over. He asks me what I thought of the car, and I said I was favorably impressed by several things, more than I expected to be, but the car feels like it weighs 500lbs too much. You guys are getting there, I said. He said, yes, he thinks so, and that there are new models coming out. We shook hands and I left.
I don’t get how that kid has any chance of moving Genesis cars. The dealership experience of that grade of car must be much higher to compete. It has also been said that Stinger sales are hurting because of the Kia dealership experience.
I test drove the G80 Sport 3 times and loved it, but not enough just yet. The seats were a tad firm and I could never find ideal comfort settings. The car plows too much into corners due tot he excessive weight and honestly the staggered wheels were a huge turn off. I get 17K out of UHP tires with regular rotation, can;t imagine how often I would be replacing rubber on a heavy car like that where I can only rotate on axle.
I had similar experiences, each sales person new less about the car than I did. They were all novice sales people and were not trained in selling an up-trim car.
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Madd Dog (06-22-2018)
#16
WayTooManyAcuras
It's been my impression that these dealerships make most of their money on service and reselling off-lease and trade-in cars. I would bet that if they keep the 2017 RDX I am trading in that they will make more profit on reselling that car than they do on the 19 RDX I am buying. However, I have absolutely no clue, so I might lose the bet. Still, everytime I bring my car in for service, especially a 15K or 30K service, and walk out of there with a $400-$500 bill for an oil change, THAT'S where I think they make their money.
#18
Burning Brakes
My neighbor is the manager of the used car operation for a Cadillac dealer and he has said that more than once. The bulk of their profits are used cars and service. He's had more than one opportunity to move over to the new car side of the business and declined because he could make more money where he was.
#19
Sorry if this has been discussed recently, but it seems from my recent buying experience in Indiana (one salesperson and a manager running the store) that there are changes coming to how/where Acuras are sold. There was talk some years ago about Acuras being sold at Honda dealerships, but nothing came of that. However, given the rapidly declining sales of Acura sedans, and the lower profit RDX being the top selling Acura now, how can the dealerships stay open? Any thoughts?
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Madd Dog (06-22-2018)
#20
Summer is Coming
In my area the local Honda dealership outgrew they place and are building a new and far larger dealership about half a mile away. Just a little distance from the Acura dealership which is a fairly good sized dealership. Anyway, my point is there is just not enough physical space to combine both Honda and Acura dealerships into the same space. Not enough room for cars, sales floor space, service departments. Just wouldn't fit even if for some reason they wanted to. And these two dealership have separate owners so that is not going to work anyway. Some dealerships owned by the same owners in smaller markets may combine but not by any formal direction from Acura or Honda.
#21
Drifting
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Both my local Honda and Acura dealerships are owned by the same family (who also own many other brands). The stores are not near each other, and, so far, this family does not move locations. Their Honda dealership moved maybe 200 yards when they outgrew the old space 15 years ago, and the Acura dealership has never moved at all. This family’s dealerships are neighborhood fixtures. I live near the Honda dealership and have had at least one of their Honda’s in my driveway for the past 30 years. You virtually never see a Honda driving around that is not from them.
Acuras I have gotten were from them too, and that is where I went to check it out, even though they are not the closest. That dealership is a class operation, and I think that is because they have been in the car selling business for 100 years as of 2019, and the family seems to take the long view.
Acuras I have gotten were from them too, and that is where I went to check it out, even though they are not the closest. That dealership is a class operation, and I think that is because they have been in the car selling business for 100 years as of 2019, and the family seems to take the long view.
#22
Instructor
As others have already said, that would only hurt Acura's brand image, which is already hurting. Also, every dealer I went to in Chicagoland has been renovated within the last 2 years, so that would make no sense to start shutting them down. Personally, I hope that never happens, and if it does, then they should just kill the Acura brand all together.
Last edited by copmagnet82; 06-23-2018 at 11:33 PM.
#23
One area Acura dealership was bought by some type of conglomerate. It’s no longer ‘independent’ but it remains ‘stand alone’ and I’m sure most people don’t know it’s not independent of family owned now.
#24
Team Owner
Both Acura dealers in my city have had money dumped into them. One dealership moved into a new building, maybe 3 years ago. The other had extensive renovations done, maybe two years ago. I doubt they're disappearing.
#25
I don't see Acura mandating consolidation, but I see no harm in allowing them to be combined under one roof where it makes sense to do so. There are a lot of sales and service cost synergies between Honda and Acura after all. And like it or not, Acura dealerships are not ranked very high anyway. Porsche, Audi, Cadillac and others (including Buick) have higher dealer satisfaction ratings, and those brands don't require dedicated dealerships.
My local Honda dealership is excellent. I need to drive an hour to get to my nearest Acura dealership, and the experience is never better than average. I'd be much more inclined to return to Acura if I could buy from the local Honda dealership.
My local Honda dealership is excellent. I need to drive an hour to get to my nearest Acura dealership, and the experience is never better than average. I'd be much more inclined to return to Acura if I could buy from the local Honda dealership.
#26
The 2019 RDX seems to be the first sign of Acura really building the brand towards the future. I expect to see a totally redesigned MDX next year, an RDX hybrid, the compact CDX they have in China, plug-in electrics and other developments we don't have any idea about yet (Acura is notoriously secretive). They're pumping a lot of money and talent into redefining the brand. I've owned 4 Acuras, and this new RDX is truly a huge step forward (just like the original MDX, which basically invented the luxury crossover). If the new RDX keeps sailing off the lots, Acura will be fine.
#27
Acura remains a peculiar brand for Honda. Honda never really seems to know what to do with it. It's a brand no one outside of North America really buys into. My dad has own a Legend ( a true classic Acura) and I drove an Integra. Those were the cars that defined Acura and sealed the brand as value luxury.
I agree 2019 RDX is a major step forward and a positive one IMHO. However, when comparing to its EURO competitors or even their Japanese brothers, Acura still has a lot of catching up to do.
btw, I would hardly categorize MDX as a crossover let alone the first one in that segment. I believe that title goes to the X3.
I agree 2019 RDX is a major step forward and a positive one IMHO. However, when comparing to its EURO competitors or even their Japanese brothers, Acura still has a lot of catching up to do.
btw, I would hardly categorize MDX as a crossover let alone the first one in that segment. I believe that title goes to the X3.
#28
Drifting
If MDX isn't a crossover, what is it? I think you're conflating "CUV" with crossover. Hint: If it's unibody construction like a car, not body-on-frame like a truck, but it looks like an SUV, it's a crossover. That's the definition. Now they come in all sizes, but they started out midsize.
I changed camps from Jeep Grand Cherokee to Acura MDX, and never looked back.
MDX was revolutionary for its all-weather capabilities on-road. A good argument can be made that Acura lost its way somewhere after 1st-gen MDX, but that vehicle made Acura relevant.
I changed camps from Jeep Grand Cherokee to Acura MDX, and never looked back.
MDX was revolutionary for its all-weather capabilities on-road. A good argument can be made that Acura lost its way somewhere after 1st-gen MDX, but that vehicle made Acura relevant.
#29
You are right, I did get my term mixed up. It's been a while since I've heard unibody vs body-on-frame. It's a specification that no one talks about it anymore.
#30
As per Wikipedia: "The BMW X3 is a compact luxury crossover SUV manufactured by German automaker BMW since 2003."
#31
Burning Brakes
As per NADA: "The MDX represented Acura's first all-out assault in the premium crossover utility vehicle marketplace. Debuting in 2001, the first generation Acura MDX featured a seven-passenger cabin and standard all-wheel drive."
As per Wikipedia: "The BMW X3 is a compact luxury crossover SUV manufactured by German automaker BMW since 2003."
As per Wikipedia: "The BMW X3 is a compact luxury crossover SUV manufactured by German automaker BMW since 2003."
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