An eye for an eye

Diamond Motors and Classic may have caught the market by surprise but seasoned foreign used car dealers are countering with a move of their own. Both Diamond and Classic Motors may be in for unexpected competition on their own turf. Used car dealers, sources say, are thinking about entering the new car market to compete with automotive giants like Neal and Massy, Toyota and Ansa McAL automotive. According to the Vice President of the Pre-owned car dealers association, Barry McKenzie, this move may be in the works to level the playing field. “Used car dealers may decide to get into the new car market soon,” he said. “Traditionally we stayed in used cars, but with new car dealers entering the foreign used car market, we might need to even the playing field and import new cars from our suppliers. But obviously this market will not be a major focus for us,” said McKenzie.

His expectation is that other new car dealers will opt to enter the used car market because of the tremendous potential. “More parts will become available to our clients making it easier for us to sell the cars,” he said. In the past Mitsubishi and Honda parts were hard to find for roll on roll off cars because Diamond and Classic refused to sell to used car owners. Now that they are in the business, they have no choice. “It is a win-win situation for us,” said McKenzie. However, McKenzie felt the trend of new car dealers leaping into foreign used would not last long. He said big conglomerates cannot survive on the small mark up that the smaller dealers are accustomed to making. As a result, McKenzie said those who decide to enter, will not stay long. “Only the strong will survive, the market is becoming very saturated,” said McKenzie.

But Borde has a different view. He feels that coupling the expertise and the experience of a well-established group like Ansa McAL, will give people the re-assurance that they are getting good quality. “People were skeptical of the foreign used from our experience because they were not sure of the legitimacy of the people they were buying from. Now that we are involved in it, I am sure that will change,” said Borde. Ian Arrindell, CEO of the Neal and Massy Automotive group, said his company has been giving the foreign used market serious consideration for some time. He was quick to add that they had no plans to enter the market in near future, however. Borde’s philosophy is, “If you must lose sales, then it is better to lose sales to yourself.” As far as Borde is concerned, the used cars will hold the larger market share for some time, since lower and middle income earners are still unable to purchase new cars.