With pent-up demand fueling vehicle sales, dealerships are racing to add salespeople.
Peter Clifford moved to the Twin Cities in December, after nearly a decade’s hiatus from the business of selling cars, and applied for jobs at 18 dealerships.
He picked a good time to go back to the sales floor — he got 17 offers.
Dealerships across the Twin Cities and the country are hiring, as sales recover from a recession that hit the automotive industry hard and early. Clifford settled at Carlson Toyota in Coon Rapids, a place swarming with new salesmen in white shirts and ties, jockeying to shake the next customer’s hand.
“If I could find 30 good salespeople today, I would hire all of them, maybe more,” said Lisa Thornton, human resources director for Morrie’s Automotive Group, which has 10 stores in Minnesota and another in Wisconsin.
Car and light-truck sales in the United States plummeted from 16.1 million in 2007 to about 10.4 million in 2009, ultimately forcing the bailouts of General Motors and Chrysler. But auto buyers have been returning in greater numbers and sales have climbed. At the current pace, U.S. auto sales would hit 15.5 million this year.
That means dealerships will likely sell 5 million more vehicles in 2013 than they did five years ago, said Jeremy Acevedo, an analyst for Edmunds.com. “You’re going to have to have the movers and shakers there to get those off the lot,” he said.
Auto and parts dealerships have hired about 27,000 new “movers and shakers” over the past 12 months, according to the Bureau of Labor Statistics. In Minnesota, the trend is more pronounced, with employment at auto stores and parts dealers growing 7.7 percent — about 2,200 jobs — since the low in 2010.
Rising auto sales are good for a broad swath of the economy that includes a vast network of parts suppliers, and dealerships and service businesses.
“If the car business is good, just about everything follows,” said Curt Folstad, the general manager at Carlson Toyota who hired Clifton.
Carlson has expanded its sales force from 15 to 23 in the past six months. Morrie’s, a larger firm, has hired 150 new people in the past two years.
Sales and hiring are up because of pent-up demand, said George Magliano, a senior economist at IHS Automotive. While it’s good to see the housing market take a turn for the better, the real driver of auto sales is that the average car or truck on the road is 11 years old, he said. Consumers are deciding to replace their vehicles despite the perceived fragility of the economy.
“This is largely driven by the baby boomers, the older people who have jobs, and who can afford to go out and buy a new car,” Magliano said. “To add to the impetus, the older cars are not very fuel efficient.”
So a customer may be looking not just to replace their car, but to replace it with a more fuel-efficient model. And older buyers with more money are more likely to buy bigger, more powerful and more luxurious models than young buyers.
The dealers that survived the recession are doing quite well as a result, Magliano said, and they will continue to hire.
“The people base of the dealership is extremely transient,” he said. “They come and they go. When things pick up, they go out there looking for people.”
The only prerequisite, said Thornton and Clifford, is the ability to connect with people.
Earlier this year and just few weeks on the job, Clifford saw a customer wander onto the sales floor at Carlson. The man held a buzzer, which told Clifford he was waiting for mechanics to change the oil in his car. He wasn’t there to shop.
But Clifford chatted him up and discovered he drove a 2003 Toyota Highlander. It was snowing outside that day, and Clifford had an idea.
“Did you know,” he said, tongue firmly in cheek, “that today we’re offering a snow-day special? You can leave your Highlander and your oil change bill in that service center and drive away with a brand-new vehicle.”
The customer, a pastor of a nearby church, laughed. But he was listening. “You know, I probably do deserve to start kicking some tires and have a look,” Clifford remembers him saying.
Three hours later, the pastor left with a brand-new sport-utility vehicle.
“The economy’s fine,” Clifford said. “Every time the door opens is another opportunity.”
Adam Belz • 612-673-4405 • Twitter: @adambelz