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Old 07-19-2013, 02:51 PM   #1
McB OP
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Pierce NE Chevy dealer - 500+ car auction

At the end of September, the inventory of Lambrecht Chevrolet, closed now for 17 years, will be auctioned off. Over 500 vehicles, including a bunch of 50s and 60s Chevrolets that have never been titled; and all of the cars he took in trade but didn't resell. Amazing...............

http://www.vanderbrinkauctions.com/a...php?detail=135

http://blog.hemmings.com/index.php/2...p-for-auction/
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Old 07-19-2013, 06:37 PM   #2
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Old 07-19-2013, 07:21 PM   #3
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How could they have kept so many brand new vehicles? Did they own their inventory free and clear?
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Old 07-19-2013, 07:42 PM   #4
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Here's the story as related by his daughter. He and his wife are still alive, by the way, at 95 and 92.

http://www.thetruthaboutcars.com/201...et-collection/
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Old 07-19-2013, 08:12 PM   #5
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How would they have unsold vehicles? Well, maybe the Vegas which are actually piles of rust on the floor with Vega emblems. But, even if you sell the car at a loss, you still have more money than if you keep it. Can you write off unsold inventory? I thought dealer inventory was supplied on credit, called a floor plan.
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Old 07-19-2013, 09:41 PM   #6
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Great story.

The cars in the auction photos look very rough.

Would still be interesting to go.
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Old 07-19-2013, 10:20 PM   #7
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Originally Posted by Anorak View Post
But, even if you sell the car at a loss, you still have more money than if you keep it.
I don't think that was his business model. From what I've read, you went in, he wrote down a number, and that's what he'd sell the car for. No negotiating. People flew in from other countries to buy cars from him. That little 3-person dealership won multiple sales awards from GM. If he'd started marking down cars at the end of the model year, it would have destroyed the dealership, because people would start waiting for the deals.

The other thing he'd do is take a trade, but if he didn't feel right about selling it again, he'd just haul it out to the farm. That's the source of the bulk of the inventory.

The local hotels are filling up already, so get your reservation in and grease the trailer wheels if you're going. It'll be too rich for my blood, and the few cars I'd want from back then aren't part of the inventory, anyway.
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Old 07-19-2013, 10:30 PM   #8
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Originally Posted by troidus View Post
I don't think that was his business model. From what I've read, you went in, he wrote down a number, and that's what he'd sell the car for. No negotiating. People flew in from other countries to buy cars from him. That little 3-person dealership won multiple sales awards from GM. If he'd started marking down cars at the end of the model year, it would have destroyed the dealership, because people would start waiting for the deals.

The other thing he'd do is take a trade, but if he didn't feel right about selling it again, he'd just haul it out to the farm. That's the source of the bulk of the inventory.
I read the article, too. There are 52 cars on the list with less than 30 miles. My understanding is that dealers use a credit system often provided by the manufacturers called "floor plan" to acquire their inventory. He could have paid cash and owned his inventory but any unsold cars he kept were a liability. They would take up space and depreciate.
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Old 07-19-2013, 10:52 PM   #9
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I read the article, too. There are 52 cars on the list with less than 30 miles. My understanding is that dealers use a credit system often provided by the manufacturers called "floor plan" to acquire their inventory. He could have paid cash and owned his inventory but any unsold cars he kept were a liability. They would take up space and depreciate.
I would bet that on average those 52 cars cost $3000 each. That's not a huge hit over 50 years, and if his business model did rely on people not expecting an end-of-year sale, it would be completely worth it.
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Old 07-19-2013, 11:26 PM   #10
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Originally Posted by troidus View Post
I would bet that on average those 52 cars cost $3000 each. That's not a huge hit over 50 years, and if his business model did rely on people not expecting an end-of-year sale, it would be completely worth it.
There were no other dealers who wanted what he had? A successful business isn't built on holding on to unsold depreciating assets. There are a lot of variables.

Part of my question is how did he acquire inventory? Cash or credit. The answer to that would possibly help answer the question of why did he keep the cars.
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Old 07-20-2013, 01:08 AM   #11
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He's in BFE, so transfers would cost a fair bit. And, AFAIK, dealers prefer to do inventory swaps, rather than buy a car outright, and the guy already had an unsold car.

Since he got his start so early, my guess is that he bought his inventory outright rather than pay GM interest on it. That would have given him a lot more flexibility WRT sale price and cars on hand.

It seems like most of the leftovers were from the 50s and 60s, so by the 70s he probably had a pretty good handle on his local customers and knew what they'd want, resulting in fewer leftovers.

Whatever he did seems to have worked. Now some lucky SOBs have an opportunity to score some low-mileage rides. Won't be me, but I'd give it a whirl if he had a '67 Impala convertible or a '70 or '72 Chevelle convertible. (The '71 never sat well with me.) Even a '67 Corvair could be cool.
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Old 07-20-2013, 01:13 AM   #12
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He could have paid cash and owned his inventory but any unsold cars he kept were a liability. They would take up space and depreciate.
I don't think he cared. If it didn't sell, he kept it. That you or I, or accountants, or MBA types, didn't think that was a good idea meant nothing to him. The guy liked cars. If he didn't sell it, he kept it.

There are lots of people on this forum with a garage full of bikes that depreciate every week. They would have more money if they sold them. They just take up space. You may say "But Lambrecht was in the car business". Yes, and he seemed to do just fine at it, without your advice. He did it for 50 years before selling his dealership rights. He could afford to keep the cars and he did. I doubt he ever used floorplan financing, it reduces his costs if he doesn't.

He didn't try to maximize profit on cars he sold either, so he probably didn't give a crap about ROI or "leverage" as long as he had money in his pocket at the end of the week. Why does it bother you so much that he made less money than he could have if he'd done things your way?
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viverrid screwed with this post 07-20-2013 at 01:21 AM
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Old 07-20-2013, 04:43 AM   #13
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If Lambrecht had sold cars like everyone else does, there wouldn't be a story. Likewise, if he'd done it 'his' way and gone bankrupt, there also wouldn't be a story. There are a lot of people scratching their heads wondering how he did it, and why. A few weeks from now 500 cars are going to auction because he did. Amazing.
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Old 07-20-2013, 04:58 AM   #14
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Betcha Wayne Carini shows up....
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Old 07-20-2013, 08:25 AM   #15
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I don't think he cared. If it didn't sell, he kept it. That you or I, or accountants, or MBA types, didn't think that was a good idea meant nothing to him. The guy liked cars. If he didn't sell it, he kept it.

There are lots of people on this forum with a garage full of bikes that depreciate every week. They would have more money if they sold them. They just take up space. You may say "But Lambrecht was in the car business". Yes, and he seemed to do just fine at it, without your advice. He did it for 50 years before selling his dealership rights. He could afford to keep the cars and he did. I doubt he ever used floorplan financing, it reduces his costs if he doesn't.

He didn't try to maximize profit on cars he sold either, so he probably didn't give a crap about ROI or "leverage" as long as he had money in his pocket at the end of the week. Why does it bother you so much that he made less money than he could have if he'd done things your way?
I'm curious. If he was such a pragmatic businessman, why would he let an asset deteriorate? Perhaps it's because I'm a gearhead. Instead of being used and enjoyed, the unsold cars have been sitting for decades gathering dirt and in decline. What condition are the cooling systems? The brake systems? The fuel systems?

Apparently, he wasn't in it for the money if he had space to let 500 cars sit. In the end, it's his business and it apparently worked. I'd just like an explanation, not speculation on why he has 50 unsold cars.
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"Yeah, that guy sure is terrible at touching moms"
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