Circles Weekly · Feb 20 - Feb 26, 2026

Mixed Sales Performance and Aggressive Pricing: Dealerships are reporting a very solid pre-owned month, with strong gross, and fixed operations on fire. However, new car volume is noted as "well off last year". Some operators are lowering new car prices to "$3k behind invoice" to stimulate sales. This week has turned into "a real grind" for some, despite tracking up year-over-year in volume. Cash customers are reported to be price shopping more than usual and seeking vehicles advertised "well below cost".

Used Vehicle Metrics and Warranty Mix: A dealer reported selling 2.5 used vehicles to new with a focus on under $30,000 units. Their average used vehicle last year had 65,000 miles and was a 2022 model year. Operational friction was noted in selling a 3-year warranty for $4,250, especially with "cheaper" warranty companies causing customer and service department pain.

Inventory Tool Utilization and Impact: Experiences with Vauto's ProfitTime are mixed. One dealer reported that it increased volume, turn, and gross after 60 days of 100% alignment. Another stated ProfitTime gives a false sense of security on "Gold and Platinum Cars," potentially pricing dealers "out of [their] market," suggesting its value is situational based on used car desk talent. A specific instance cited a 2021 Telluride with $3k gross in the first 15 days, priced at 98% to market, but sold at 141 days with a -$1700 gross profit. Dealers transitioning from Vauto to Vincue report cost savings of "a couple hundred bucks a month per store" and noted "better data" and "superior product." Vincue users have been on the platform for up to "16 months," with one dealer moving "all 26" stores by mid-year after piloting "three stores 18 months ago" and "12 more 8 months ago."

Dealership Valuation Dynamics: Discussions around CDJR store valuations noted a recent article suggesting they are "only worth the dirt." However, dealers indicated that metro market CDJR stores can still command goodwill unless "heavily over-dealered". While some stores losing money are still transacting with "blue sky," the Texas market, in particular, seems to be "above the average". Valuation is determined by EBT, with reported brand multiples of 5-7x for Honda and 2-3x for CDJR. One store was noted to be making "2 million a year," indicating a strong used car and fixed ops operator.

Winter Weather Impact on Batteries: Dealerships in colder regions are experiencing significant issues with OE 12V batteries this winter, triggering warranty opcode warnings due to sulfation degradation. Honda and Acura specifically have seen "high in battery claims," worse this year, attributed to extended periods of sub-32-degree days.

Tech Video MPI Incentives: Dealers are exploring various incentive structures for technicians to adopt video multi-point inspections (MPIs). Reported incentives include $0.1 per video, $2 per RO with video, and 0.1 hour per RO with video. Another suggestion was $500 a month for over 80% penetration.

"Repair for Life" Programs for Retail Service Growth: The "Repair for Life" program is gaining positive feedback. One dealer reported significant success, moving the needle on retail service, and noting it as a "great reinsurance product". The program involves a small bump in the door rate, earmarked as a premium into reinsurance, with repairs guaranteed for life to the original owner. It is also described as a valuable tool for Active Service Retention (ASR), with "lifetime brakes" being an "incredible value prop," and BDC reps using it to sell declined work.

Managing Third-Party Extended Warranties: There is ongoing discussion on how to treat third-party extended warranties in the service department. Some treat them as "Customer Pay" (CP). One dealer noted that discounting "self-pay contracts" can affect Warranty Labor Rate Increase (WLRI) with OEMs, as the OEM can see the discount. An Oklahoma law reportedly allows for the exclusion of third parties.

Fixed Ops Training and Key Performance Indicators: For sales managers aspiring to GM, a deep dive into fixed ops is recommended. This includes hands-on experience writing service for six months, learning a "RIM" (Related, Immediate, Maintenance) selling process, understanding active walkarounds and deliveries, and mastering key KPIs. These KPIs include gross profit %, Effective Labor Rate (ELR), hours per RO, customer labor sales per RO, flag times, work mix, skill costing, discounting, and key maintenance op penetration. A detailed calculation for a technician's annual gross profit contribution was provided: $150/hr @ 78% GP = $117 GP/hr X 110% efficiency = 55hrs/week X 4.3 weeks = $27,620 labor gross per month. With a 0.55:1 parts-to-labor gross ratio and 10% of labor in shop supplies, this amounts to $45,573 gross per month or $546,876 per year.

Inventory Management System Migration: Dealers are actively transitioning from Vauto to Vincue. Motivations include perceived lack of innovation from Vauto, reported cost savings (one dealer cut their bill in half, moving from Vauto with Conquest and Provision), and a "superior product that is only getting better thru rapid innovation" from Vincue. Dealers reported Vincue offering better data and efficiency, with "every single performance manager" they talked to formerly working for Vauto. Operational friction noted included initial adjustment, "some pricing & inventory feed issues," and new car features leaving "a bit to be desired". ACV was also mentioned, with a demo suggesting it is "every bit as good as Vauto" with additional features like guaranteed trade value, though "Stockwave" remains a key missing feature for auction users.

CRM System Dissatisfaction and Switches: Significant dissatisfaction with VinSolutions CRM was reported, with multiple dealers noting a lack of innovation over "15 years" and the system looking "exactly the way it did a decade ago". One dealer switched to DriveCentric, finding it "phenomenal". Another is leaving VinSolutions due to automatic merging of customers, which creates issues for stores using the same CRM. Dealersocket received a "0% recommendation rating on pulse," and one dealer reported they "refused to provide us with our data" upon switching.

Credit Bureau and Compliance Solutions: Informativ and NCC are being evaluated as credit bureau providers. Informativ impressed with its "total solution" covering ID verification, pre-qualification, red flag OFAC, and finance compliance. NCC is showing "considerable savings," with one dealer reporting potential savings of "$36k a year across 6 rooftops". However, a dealer-reported experience highlighted an inability to pull Equifax data since signing a new contract with NCC. Other dealers previously found NCC "way more expensive than 700Credit", while 700Credit was favored for "better integration with Route One and Reynolds" and its online application. VinSolutions' driver's license scanner initiating fraud checks saved a dealer from a fraudulent customer.

EV Charger Preferences: When considering 50kW EV chargers, Blink 60kW chargers were described as "decent" with few issues, while Chargepoint was a "nightmare" with service contracts costing "more than the chargers themselves". Autel was reported to have "no issues in the 2 years" used.

Operational Friction with Legacy Providers: The dominance of legacy providers like Cox products (VinSolutions, Dealer.com, Vauto) is attributed to their long-standing relationships and the "fear of such a big disruption in daily process" among dealers. Criticism includes "antiquated" templates and user interfaces, lack of equity or opportunity mining, and cumbersome Content Management Systems (CMS). The term "legacy tech 10 years ago" was used to describe their current state, with an observation that they "will keep their dominance by pretending new tech does not exist, ignoring users, and continuing to schmooze owners who have not used a CRM in 40 years". OEM requirements and co-op programs are seen as barriers to adopting "superior product[s] on the market.”

Google Ads Optimization: For Vehicle Listing Ads (VLA), experts advise excluding all other assets from Performance Max (PMAX) campaigns except the vehicle feed, and ensuring conversions are set up correctly to track form leads, not page views, to prevent budgets from being consumed by lower-quality display banners. Optimizing conversion value for form leads versus website clicks is a consideration to aid ranking.

Marketing Agency Performance: Dealer-reported experiences with marketing agencies are varied. Click Here Digital and Strong Automotive Marketing received positive consideration. DealerTeamwork was praised for an "amazing" rep and positive results after switching. Team Velocity was reported to generate "more leads than our DDC website". Conversely, Stream was heavily criticized, with dealers stating, "If you want to light your money on fire, go ahead and hire Stream" due to perceived lack of staffing, ineffective reports, and "burning tons of cash at a premium". C4 was described as doing "some pretty shady things" and tracking "wrong things as conversions.” A general observation was that OEM partnerships lead to agencies losing clients at the same pace they gain them, suggesting "smaller and more personalized is better.”

Advertising Spend Benchmarks and Tracking: A general question was raised regarding average new and used advertising PVR (Profit Per Vehicle Retail), excluding data processing fees. The NADA new survey reportedly has dealers at "$722 on New cars". One dealer tracks total new/used spend, typically running "$450-$590 a car". A strategy involves splitting 3rd party expenses 20% new and 80% used for allocation. Custom spreadsheets are used to track leads, create lead forecasts, and monitor traffic, lead costs, and cost per sale. Clarivoy was noted as a tool for validating and cross-checking vendor reports.

Emerging Marketplaces (Amazon Autos, eBay Motors): Experiences with Amazon Autos for pre-owned inventory are largely negative, with reports of "awful" support, extended onboarding times, and "little to no activity". eBay Motors, introduced at NADA, offers "real verified leads," a $1000 payment if a customer purchases through their digital retail tool, and a $1000 "parking spot" package for 40 units. However, one dealer reported eBay to be "horrific" with "nothing but crazy low-ball offers.”

Impact of AI Overviews on Organic Traffic: Concerns are rising about a "rapid and significant decline in organic traffic and CTR" since Google rolled out AI Overviews and expanded generative search features. Dealers are observing "bigger CTR drops than expected" and a noticeable increase in "zero-click search traffic.”