Good Things Can Happen When Kids Run Dealership

Dealer Bernie Moreno is full of ideas, and once shared some in a letter he wrote as a teen to GM’s chairman.

Tom Beaman, Contributor

April 14, 2015

7 Min Read
ldquoNeed to make car buying amazingrdquo Moreno says
“Need to make car buying amazing,” Moreno says.

Bernie Moreno is a man who knows what he wants. When the Bogota, Columbia, native was a high school freshman in south Florida, he wrote a 1982 letter to the late General Motors Chairman Roger Smith.

The teen offered his opinions on vehicle quality, merchandising (dealers should display car colors with in-showroom movies, not just paint chips), and the benefits of aluminum engines.

Moreno also announced his goal to one day become GM chairman.

“It’s not often I receive a letter from someone who is planning to take over my job,” Smith replied. “You are to be congratulated for knowing exactly what it is you want to do once you complete your high school and college education. I’ll try my best to make sure that General Motors is in good financial shape when you join us 11 years from now.”

Moreno also suggested merging Chevrolet and Pontiac and renaming the single entity M-1 Motors, an homage to M-1 aka Woodward Ave., Detroit’s main drag.

Smith offered a prescient response: “What we might be looking at in the future is a rationalization of our overall product lineup to possibly eliminate some redundant car lines.” GM killed Pontiac as well as Saturn and Hummer in 2009. Oldsmobile’s demise came earlier.

Moreno later moved to Michigan “to be close to the car companies” and worked at Automobile magazine in Ann Arbor while studying at the University of Michigan.

“When David E. Davis, Jr. left Car and Driver and went across town to start Automobile, I literally went over, knocked on the door, and said, ‘I want to work here,’” Moreno recalls.

He became the magazine’s “motor gopher,” making sure each editor knew which test car they would be driving each day and that those cars were serviced, gassed, cleaned. “That was the greatest college job one could ever imagine,” he says.

Former Automobile editor Jean Jennings recalled Moreno’s time at the magazine in a column for automobilemag.com.  

“He immediately made himself invaluable,” she said. “No matter what we asked Bernie to do, he had already assigned it to himself and finished it.

“Wait! How did the radio presets just happen to be on my favorite channels? Bernie somehow figured out what every single editor liked and would reprogram every test car’s radio every single day based on that evening’s driver.”

Moreno’s other summer job was at GM’s Saturn customer-enthusiasm department. When he graduated in 1989, he got a permanent position as a team leader in the company’s customer assistance center in Spring Hill, TN, and later, as a field consultant in New England. Saturn was another 2009 GM casualty.

A chance meeting with Massachusetts-based megadealer Herb Chambers in 1993 led to a 12-year tenure during which Moreno served as general manger of Saturn of Warwick (RI) and ultimately, vice president of the Chambers organization.

When Mercedes-Benz approached Moreno in 2005 to buy the assets of the underperforming Mercedes-Benz of North Olmstead (OH) from the United Automotive Group (now Penske Automotive), he jumped at the opportunity.

“When I moved here from Boston, about a dozen guys came with me,” he says. “That made a huge difference in establishing our culture. “I was 37 at the time and I was the old guy. The other guys were 25, 26 and 27.

“We were a bunch of kids that really wanted to run a dealership, and get as close to perfection as possible. We’ve never achieved it, but that’s what we strive to do every day, and I think our clients appreciate it.”

Moreno and his team increased store sales from 200 new and 50 used cars in 2004 to 1,780 new and 1,400 used in 2014. “You have to take advantage of every opportunity that comes your way,” he says. “We can’t afford to lose one single, solitary client.”

Today, Mercedes-Benz of North Olmstead ranks No.57 on the WardsAuto Dealer 500 with total revenue of $159,202,390. It has been recognized as one of Mercedes’ “Best of the Best” for nine consecutive years and is a J. D. Power and Associates Certified Retailer.

While the average Mercedes store has a 21% share of its competitive set, Moreno says Mercedes-Benz of North Olmstead normally captures around 30%.

Moreno’s Collection Auto Group was renamed the Bernie Moreno Companies last month.

It consists of the original North Olmstead business and two other Mercedes-Benz stores in Fort Mitchell, KY, (near Cincinnati) and Burlington, MA; and Porsche, Volkswagen, Mini, Acura, Buick-GMC, Sprinter, Smart stores in the Cleveland area. Also there are Moreno’s two Nissan stores and three Infiniti dealerships.

He also owns North Olmstead Motorsports, which sells Aston Martin, Lotus, Rolls Royce and Maserati. Another Infiniti store is planned for Coral Gables, FL.

The group, of which Moreno is the sole owner, sold 13,587 new and used cars in 2014 and projects total 2015 sales to reach 17,000.

As Moreno expanded his operations, not everything went according to plan.

“We were the first and only Saab image dealership under the new owner program and had just built a new $3.5 million facility.”

Victor Muller, the head of Saab at the time, attended the grand opening in March 2010. “Thirty days later the company went bankrupt,” Moreno says, adding “Saab kicked our butt.”

But the Saab facility became a Mercedes pre-owned center, he says. “It allowed us to grow that business to the next level.”

Mercedes-Benz of North Olmstead today works out of nine buildings on nine acres (3.6 ha) with a total of 56,000 sq.-ft. (5,152 sq.-m).  “We started with 20,000 sq.- ft. (1,840 sq.-m) and in 2008 we knocked down that building and rebuilt a 30,000- sq.-ft. (2,787- sq.-m) Mercedes-Benz Generation One Autohaus image store,” Moreno says.

“Everybody thought, ‘Oh my gosh, these guys are crazy. They’re making the building way too big.’ We opened in September 2008, just one week before Lehman Brothers filed for bankruptcy. It was a $10 million renovation, so it was crazy.”

But the auto industry has recovered nicely. Forecasts for the luxury-car segment in particular call for continued strong growth.

For Moreno, key growth elements are employee training and customer care. At Mercedes-Benz of Burlington, all employees have been hired and will undergo a month of training before a single customer enters the dealership.

“(Mercedes-Benz USA President and CEO) Steve Cannon is a very focused on improving the customer experience through training,” Moreno says. “He’s worked with the dealers hand in hand to make that happen.

“Every single person we send to the new brand-immersion course in Alabama comes back just absolutely bleeding Mercedes-Benz. The Mercedes executives listen intently to the feedback the dealers give them.”

Employee satisfaction leads to customer satisfaction, he says. If a business takes care of its employees, “they’ll take care of your clients the same way. You have to give them growth opportunity, look out for them, set an example, and be willing to do anything you’re asking them to do.

“We’ll soon have 1,000 people in this company. You have to set an example and create a culture for them to emulate.”

In 2011 Moreno won the Midwest Region Entrepreneur of the Year Award from Ernst & Young and was selected as Distinguished Business Executive of the Year in 2014 by Sales and Marketing Executives of Cleveland. The Cleveland Plain Dealer has repeatedly listed the Collection Auto Group as one of the “Best Places to Work.”

Moreno says purchasing a car at a dealership should be memorable.

“We need to make car buying an amazing experience that you’ll remember for a lifetime,” he says. “The Ritz-Carlton should be saying it wants to be like Mercedes-Benz dealers, not Mercedes-Benz dealers saying they want to be like the Ritz-Carlton.”

When that switch occurs, “we’ll know we did the right thing.”

Company Profile

Who: Bernie Moreno, president

What: Collection Auto Group just renamed the Bernie Moreno Companies

Franchises: Mercedes-Benz, Porsche, Volkswagen, Mini, Acura, Buick-GMC, Sprinter, Smart Nissan and Infiniti.

Flagship store: Mercedes-Benz of North Olmstead (OH), No. 57 on the WardsAuto Dealer 500 with total revenue of $159,202,390.

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