Mohawk Honda, a dealership located in Schenectady, New York, has significantly increased its acquisition of second hand cars directly from its service drive. In March alone, the dealership acquired 75 used vehicles, a remarkable rise from their previous monthly average of 25 to 30. This improvement followed a strategic overhaul of their staff, processes, and compensation plans.
General Manager Greg Johnson explained that the dealership processes about 3,000 customer-pay and warranty repair orders each month. His goal is to encourage 15% of these customers to request vehicle appraisals and then convert 20% of those into acquisitions. This approach sets an upper limit of roughly 90 cars acquired per month.
The process starts when customers check in for service; an automated text message is sent asking if they would like an appraisal for their vehicle. If a team member can engage the customer personally while they wait, they pause the automated message and handle the appraisal face-to-face. If not, the system quickly responds with an estimated appraisal value within two minutes, based on data from Manheim Market Report and Kelley Blue Book.
To support this program, Mohawk Honda employs two dedicated exchange consultants whose sole role is to engage with service customers in a friendly manner. These consultants then connect interested customers with sales staff who work to close the deal. Johnson also emphasized the importance of routing returning customers back to their original salesperson to maintain continuity.
A key factor in the program’s success was revising pay structures. Initially, service advisors were not compensated for vehicles acquired through this program, which led to resistance since it felt like a loss of income. After introducing payments tied to internal sales for these advisors, they became highly motivated and actively directed customers to exchange consultants.
The dealership also uses automotiveMastermind software to identify customers with strong equity positions before approaching them. When appropriate, exchange consultants present full deal structures upfront rather than vague offers. Johnson highlighted that transparency with customers about their trade-in values and new deals greatly improves conversion rates.
Mohawk Honda’s efforts have paid off handsomely. The dealership now ranks fourth nationwide among Honda dealers for certified pre-owned vehicle sales this year, up from ninth previously. Johnson believes many dealers miss out on significant sales by avoiding this direct service drive acquisition approach due to fear of disturbing customers.
He noted that customer pushback is minimal; out of every hundred customers approached, only about one asks not to be bothered. Johnson encourages dealers to “roll out the red carpet” for service customers considering an upgrade, reminding them that acquiring used cars from known local sources is often more cost-effective than buying at auction.
Overall, Mohawk Honda’s revamped second hand car acquisition program demonstrates how dealerships can leverage service interactions to boost used car inventory efficiently while enhancing customer experience.
