Nissan Dealership finds Profitability in Car Rental Venture
May 21, 2019
And with the right software, the market transition is seamless
It turns out there’s still plenty of room on the car rental bandwagon. Although the market is still dominated by three conglomerates with years of experience in the field, automakers are edging their way into the sector. And now one Nissan dealership in Illinois has been tinkering with the business model with success.
For nearly two years, Mike Connolly, the general manager at Orland Park’s Zeigler Nissan dealer has been taking advantage of an in-house car rental revenue stream. The returns on such a venture has already accounted for nearly 10 percent of Zeigler Nissan’s annual revenue. What’s more, it’s growing at a rate of between 20-25 percent a year.
“I view it as a separate profit center, in addition to new, used, finance, service and parts,” said Connolly to Automotive News. “A rental operation, if done right, can be that extra profit center in the dealership.”
Connolly didn’t even have a car rental in mind when he was coming up with ways to further engage customers with all those Nissans gracing his lot and showroom. He came up with the idea of extending test drives beyond the minimal drive around the block. The idea was to have prospects get behind the wheel for longer, even up to three days during a long weekend to get the full experience of a vehicle before buying it.
The next step was to monetize that test drive and before he knew it, he had a full-scale car rental fleet happening, starting with 25 vehicles, a fleet that has since mushroomed to 80.
While Connolly’s dealership shifting into the car dealership market seemed accidental, it’s a natural progression, said Rob Hano, Director of Sales and Marketing at Bluebird Auto Rental Systems. He addressed that very topic in The Case for Your Dealership to Open A Rental Department, a piece he wrote for Fixed Ops Magazine in 2015.
“Clearly, a dealership based rental operation can be a success,” said Hano, citing recent instances of car rental deregulation and a steady decline in dealerships across the country as two conditions that are ripe for such an opportunity.
He added that dealerships are in a better position than most businesses to venture into car rentals, with an office infrastructure and a ready automobile inventory already available to make that leap. Additionally, Hano stressed that vehicle rental software, such as the products offered by Bluebird, are affordable, user-friendly and easy to integrate with the rest of a dealership’s accounting and management systems.
“There are countless dealerships across the U.S. that have been tremendously successful running substantial rental divisions,” added Hano. “And dealership owners and management are a very unique group in our country. They are more willing to share information with their peers than most in a friendly and open fashion.”
Better software. Better support. Better value. For over thirty years, Bluebird Auto Rental Services has been supporting its many, many happy customers around the world. Our flagship product, RentWorks, provides all the tools you need to run every aspect of your car rental business or service loaner department from the front counter to the back office.
Call us today toll-free at 800-304-5805, or email us at email@example.com and we will be happy to walk you through Bluebird’s Auto Rental Services.
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