Major changes are ahead in how cars are sold in the Tri-Cities and in who will sell them after Bill McCurley announced Tuesday that he has bought two more dealership sites.
McCurley Integrity Dealerships has bought Tri-City Honda in Kennewick and Lithia Ford in Richland, he said.
The purchases fit into his company’s vision of growing business by adding new franchises and allowing his trained workers, many of them longtime employees, to get opportunities for growth, McCurley said.
It’s also about maximizing efficiencies and providing competitive pricing to customers, said McCurley, who’s been selling cars in the Tri-Cities since 1981.
His operation generated more than $4.1 million in sales and use taxes for the state last year, plus about $1.1 million for local government agencies in the Tri-Cities. The firm’s state B&O taxes totaled more than $441,000.
McCurley said he’s seen the ups and downs in the auto sales business, but he remains inherently optimistic about the strength of the Tri-City economy. The infusion of almost $2 billion by the federal government at Hanford will further help the economy grow, he said.
He declined to cite a purchase price in what he described as a complex deal that “was over four months in the making.”
He said he will keep the real estate and the equipment at the Richland location, but the Ford franchise, automobiles and parts inventory will go to Legacy Ford, helping it consolidate the Ford franchise in the Tri-Cities.
He plans to remodel the former Lithia Ford site to be the new home of McCurley Integrity Honda and eventually to move his Mercedes Benz dealership from the Pasco Autoplex to the former Honda location on Clearwater Avenue.
He said he is working with Mercedes Benz, which recognized McCurley as one of its top 10 U.S. dealers in 2007 and 2008, to develop an upscale “Autohaus” dealership there.
He said the Clearwater site is too small to run the Honda dealership he envisions, so he’ll soon start remodeling the Richland site in consultation with Honda to rebuild to Honda’s 2010 standards. He expects the project to be completed by fall.
He said his son Mason will run the Honda dealership with the help of several former Lithia employees, using the proven McCurley business model.
It’s about relying on sales volume and maximizing the potential of a dealership’s different business units to generate savings and passing them on to customers, he said.
“If you could move inventory in 30-45 days, you can sell vehicles a lot cheaper than others,” he said.
Centralization of back-office functions also will help keep prices low, McCurley said. Under Lithia, the Honda dealership sold an average of 40 cars a month in the first quarter, and his forecast is 150 vehicles a month. “We’re confident,” he added.
Competitive pricing will help him retain local customers and attract others from neighboring areas, McCurley said. Regional customers coming to the Tri-Cities will invariably end up spending money on other things as well and boost the local economy, he said.
“It was no secret we were in acquisition mode,” said McCurley, whose last acquisition was in 1993 when he bought John Shumate Cadillac, Pontiac and Mazda. He began talking to Lithia as early as last summer, he said.
Locally owned and operated dealerships have more accountability than a dealership run by a corporation and also don’t have corporate overhead, said Josh Dykes, who owns Legacy Ford and is excited about consolidating the Ford franchise.
It levels the playing field, said Dykes, who hired about seven employees in the last 10 days, some of them from Lithia Ford.
“We’ll be able to deliver Ford products and customer service better than it has ever been delivered before. That’s our challenge. And that’s what we are up for.”
* Pratik Joshi: 509-582-1541; email@example.com; Business Beat blog at www.tricityherald.com.