Auto dealers strive for name recognition. But that is a non- issue for Vandergriff Chevrolet in Arlington, TX.
The Vandergriff name has been synonymous with Chevrolet since 1926 when W. T. (Hooker) Vandergriff opened a dealership in Carrollton, TX.
He later expanded that business into nearby Irving and Grand Prairie and in 1937 opened Vandergriff Chevrolet in the then-small community of Arlington, sandwiched between Dallas and Ft. Worth, a vast area generally known as the Metroplex.
Hooker’s son, Tom Vandergriff, worked in the family business for years but found his true calling as a politician and city booster.
As mayor for more than 25 years, a one-term U.S. Representative and Tarrant County judge, Tom Vandergriff is credited with bringing to Arlington Major League Baseball’s Texas Rangers, the Six Flags Over Texas amusement park and a General Motors assembly plant. He died in 2010 at age 84.
“There never has been, nor will there ever be, a figure of such prominence in Arlington (as Tom Vandergriff),” says Terry Box, business writer for the Dallas Morning News.
Victor Vandergriff, an attorney and grandson of Hooker, along with a group of investors, purchased the family’s interest in the dealership in 1989 and steered it through the recession of the early 1990s.
The store operated from its original location in the shadow of the Dallas Cowboys’ stadium until moving to a new 90,000-sq.-ft. (8,361-sq.-m) facility along Interstate-20 in 1996. The Van Tuyl Group, one of the nation’s largest dealer groups with 27 stores in Texas and 69 overall, acquired the dealership in 1997.
Vandergriff Chevrolet ranks No.184 on the latest WardAuto Dealer 500 with 2,494 units sold in 2011 and total revenue of $90 million. Also on the list are Vandergriff Acura (No.361), Honda (No.146) and Toyota (No.169).
The Chevrolet dealership is in the heart of Texas truck country. The 4-county Dallas-Ft. Worth area accounted for 109,596 truck registrations in 2011 and 176,908 car registrations, according to The Freeman Metroplex Recap.
“Texas is such a great market,” says dealership General Manager Rick Cantalini, a Massachusetts native who bought into the deal in 1999 after selling Fords for 18 years.
“There’s continuous population growth, and people drive a lot,” he says. “Texas fared a lot better than most of the country (during the recession).”
Cantalini says Chevrolet’s car lineup is popular, but the Silverado pickup is his best-seller, even though it’s the oldest-generation pickup on the market today. “That’s a bit of a challenge,” he says. “Our new Silverado is a year away. No doubt when we get it we’ll be the freshest and we’ll be at the head of the food chain again.”
Shutdowns for re-tooling at GM’s truck assembly plants, including the SUV factory in Arlington, in advance of the ’13 pickup launch could jeopardize Chevrolet’s rise to the top, but GM plays down that possibility.
“We’re building inventory on our current trucks to carry us through the down weeks,” says Chevrolet spokesman Tom Wilkinson. “We don’t plan on losing any sales.”
Cantalini is stocking up on the current Silverado to weather the change. “We’re taking any available, even though it might throw off my current days’ supply,” he says. “We can still compete very well with the features and the look of our truck, even at the end of its model cycle.”
Vandergriff Chevrolet currently sells about 140 new cars per month, including one or two Volt extended-range electric vehicles.
“I’d like to sell five,” Cantalini says. “It’s a marvel of engineering but a political football. We sell them to people who are interested in the Volt; not really a lot of existing Chevrolet customers, but early adopters and high-income folks who are environmentally-conscious and admire technology.”
The dealership sells 90-100 pre-owned vehicles each month, but Cantalini has his eye on increasing that to 125. His strategy is to manage used-car inventory well and never have aged units.
“We watch our Internet pricing very, very closely…to make sure we’re competitive,” he says. “It’s a full-time job, because if you’re not priced competitively you won’t get any leads.”
Vandergriff didn’t set a record for net profit in 2011, but it was close. “This year, we’ll easily exceed it,” Cantalini says. “It’s going to be hard to beat those ‘Keep America Rolling’ deals (that GM established to keep the market alive after 9/11) we had back in 2001 and 2002.
“But my immediate goal is to get back up to 200 Chevrolets a month. Back in those days, we were doing 350-400.”
Those sales numbers are significant, and they point to the strength of the Dallas-Ft. Worth market, especially considering that Vandergriff sits only 20 miles (32 km) south of Classic Chevrolet, the largest-volume Chevrolet dealer in the country. Classic is No.6 on the WardsAuto Dealer 500 with total 2011 sales of 6,878 units and revenue of $320.3 million.
“When you’re a Chevy dealer in this market, it’s a tough business,” says Box of the Dallas Morning News. “If Vandergriff is able to peek out of the shadow of Classic, they’re succeeding.”
Like all dealers, Vandergriff suffered when credit dried up in 2008 and 2009, but Cantalini says that’s behind him now.
“For a while no bank reps were calling on you. Then all of a sudden they were calling and telling you what their niche is and how they can help you,” he says. “The truth is, automobile financing is a profitable business for these banks and captives and they want the deals. The cost of money has come down a little bit and people have their loss ratios in order, so they’re jumping back into this.
“We saw all the banks dropping leasing and balloon-payment options like crazy back in 2008, but now those products are being introduced again and they’re not worried about the residual risk. If it’s managed well, it’s never a problem.”
Cantalini says leases never have been popular in Texas, though he hopes to see that change.
“Last month, leasing was 8% of our transactions,” he says. “GM averages about 2% in Texas, so we’re significantly better than everyone else. I think I can push that to 10% to 15%. Chevrolet is dedicated to get more into leasing and they have some very attractive programs. Having the customer come back in three years is way better than having them finance for 72 months.”
Vandergriff Chevrolet just completed a $1.5 million renovation that complies with Chevrolet’s Facility Image Design Program. In addition to the GM-spec blue exterior arch, new modular furniture and carpet, the facility now sports a new air-conditioning system, lighting and windows.
“It’s a dramatic effect that’s really going to make our presence on the highway a lot stronger,” Cantalini says. “The visual impact looks like we spent much, much more.”
Many dealers balk at such investments, but Cantalini is positive. “In my situation, I needed renovation. What they suggest with furniture might be a little more expensive, but I was fine with all of it. My million-five included some other things like building repairs and leasehold improvements.”
The new look is complemented by a double-sided billboard adjacent to the dealership that Cantalini has locked down as part of the $130,000 monthly advertising budget that he manages without an ad agency.
Cantalini bought an underperforming Hyundai franchise in 2006 and runs it out of the same location in Arlington. “It was kind of a slow go at first, but now we’ve grown into quite a contender,” he says, noting that Vandergriff Hyundai is second in sales in Tarrant County with 100 new and 60 used sales per month.
“Our customers embrace import cars, but those who consider imports are also considering American cars,” he says. “I think that’s a testament to Chevrolet quality equaling or exceeding the imports’.”