Lifted Truck Dealer Coalition: Inside the Numbers


Over 12 years ago, I was the Internet Manager for an auto dealership that sold Rocky Ridge Trucks. A gentleman came into the dealership shortly after we got a shipment of Rocky Ridge Trucks in and said, "I bought my truck six months ago and didn't want to take a bath on it in trade, but I want it to look like the one of those, referring to the Rocky Ridge Trucks we had on the lot. He was willing to pay out of pocket to ship his truck to Georgia, be without it for at least two weeks, and have it upfitted and shipped back. Unfortunately, Rocky Ridge could only do new trucks, and the gentleman left dejected. Immediately, I thought to myself, how many other people would've bought a new lifted truck if they were aware that the product and option existed when they were ready to purchase? The visit by this gentleman is what got me focused on the new lifted truck problems in the marketplace. The fact that its growth remains untapped and unproven has kept me focused on the new lifted truck market for so long. At the dealership, I went by the nickname "Internet Dave," here's a video I did there. "Why we are YOUR Rocky Ridge Truck Headquarters!"

The Numbers

The yearly Total Addressable Market (TAM) of new vehicles that could be sold as "new lifted" is over 3M. This includes trucks and SUVs. I estimate the growth of the new lifted truck/SUV market to be 5-7%, 150K—200K vehicles a year. Side note: At the peak of the conversion van market, just over 200K new conversion vans were sold in the US. With the Lifted Truck Dealer Coalition, our target growth is 200K new lifted vehicles a year retailed by our coalition dealers.

Those are some big numbers. Let's take it down to an individual dealer's rooftop level. Ask yourself how many new vehicles your dealership sells in a year that could be sold as "new lifted." I project growth to be 5-7% of the total market, and although 100% of new dealers could sell "new lifted" vehicles, the majority will not, so the percentage of your new inventory that could be sold as "new lifted" is much higher than 5-7%, it's more like 30%+! What's that number? If your average additional total deal profit per "new lifted" vehicle sold is $5K, how much additional profit is that to your dealership a year?

The projected Lifted Truck Dealer Coalition's yearly growth of new lifted vehicles retailed in a year is 200K units. If our coalition comprises 1K dealer rooftops, that's 200 units per rooftop per year, times $5K additional unit dealer profit, which equals $1M in additional profit per year per rooftop. $1M additional profit per dealer rooftop times 1K dealer rooftops equals $1B total additional dealer profit that's untapped and waiting to be had! If half my projections are correct, that's still $500M in untapped additional dealer profit!

Lifted Truck Dealer Coalition


 

Comments

Post a Comment

Popular posts from this blog

Bombshell Omission Regarding FOX Factory CEO Mike Dennison's Q4 2023 Earnings Call

Image
 I do not own FOX Factory stock. FOX Factory Holding Corp. held its Q4 Earnings call on February 22, 2024, at 4:30 PM. I am focusing on FOX CEO Mike Dennison's two comments during that call. “And then in AAG, again, fantastic growth over the last couple of years with the upfit business. I mean, it was 40% for two years back-to-back. And so that growth is fantastic in the upfit business. But this year, definitely slower just because we’re not getting the right chassis. We’re not getting enough chassis. And then you have dealer floor plan financing just really inhibiting dealers from taking more risk and putting the product on their lot. And so that’s having a pretty significant influence on us, and quite frankly from a margin standpoint as well.” The upfit growth was an anomaly driven by dealers' inventory situation post-COVID. If you recall, dealers could not keep trucks on their lots, so they contacted upfitters and snatched up any available chassis they had. The consume...
Read more

FOX Factory Projected to Sell Off SCA Group Within the next 18 Months!

 I do not own FOX stock. Offloading SCA Group I expect FOX to sell off their SCA Group and retain the Tuscany upfit brand within the next 18 months, and here's why.  During the four years FOX has acquired the group, the auto market has experienced well-reported massive swings in their business during and immediately post-COVID.  With things returning to "normal" regarding inventory levels, the glaring problem with the new lifted truck market is now visible to everyone.  That is the obscurity problem; no one knows the market exists, even though new lifted trucks have existed for over a decade.  As I mentioned in a previous blog post , FOX's acquisition of the SCA Group was a lousy investment.  With the current aged new lifted truck inventory and dealer contraction with stocking new lifted trucks, FOX faces massive headwinds in the truck upfit segment.  It makes no sense for them to continue to operate multiple upfit brands that carry large overhead...
Read more