Bill Perkins strides across the spacious showroom floor of Detroit’s Cobo Center right on the riverfront. As the frigid January winds howl outside over the icy waters of the Detroit River, the 6-foot-5 entrepreneur appears to be everywhere at once–speaking with the media one minute, pressing the flesh with Mayor Dave Bing the next, doing whatever it takes to make the North American International Auto Show a success.
He did his job well. As chairman of the NAIAS, one of the largest auto shows in North America, the Louisville, Kentucky, native was ultimately responsible for the show’s success. “Attendance was up from 730,000 last year to 770,000,†Perkins says with a smile. At times, the 2.4 million-square-foot Cobo Center nearly burst at the seams as the press, auto enthusiasts, and the general public buzzed with excitement over new offerings from major automakers.
It looks as if the domestic auto industry has got its mojo back. “I think a lot of people thought that the love affair with the automobile was over, but I think it’s alive and well,†Perkins says, beaming. Over the past year, he’s traveled to cities both near and far, including Chicago, New York, Paris, Geneva, and Tokyo, to promote the auto show. Perkins, who marks his 40th year in the industry this year, used the opportunity to promote his own enterprise. “You get a lot of exposure in that position, which can also help you in your own business.â€
Perkins isn’t just the 2012 NAIAS chairman. He’s also CEO and president of Bill Perkins Automotive Group (No. 12 on the BE Auto Dealers list with $118.3 million in revenues), a pair of auto dealerships in the metro Detroit area. While globe-trotting, he still has to keep his eye on the business back home. Fortunately, sales are picking up, and the slow but steady climb out of the automotive downturn of 2008—2010 is continuing. With two locations that sold 2,079 new and 2,834 used cars last year, business is improving. “We did very well in used cars,†says Perkins. “We didn’t sell as many new cars as we wanted to, but we made it up in other areas, like service, parts, and body.â€
Bill Perkins Automotive Group, which sells Chevrolet vehicles exclusively, epitomizes the resilience of the U.S. auto industry. As automakers continue to emerge from their worst downturn and reposition themselves for growth, demand for the dealerships’ Chevrolet cars, especially the top-selling Chevrolet Cruze and Malibu, has helped Perkins Automotive steer clear of the wreckage caused by the Great Recession and sputtering recovery. The company is now back on the growth track. For its tenacity, Black Enterprise has named Bill Perkins Automotive Group its 2012 Auto Dealer of the Year.
(Continued on next page)
40 YEARS IN
Perkins began his career in the auto industry in 1972, after graduating from Western Kentucky University and enrolling in graduate school, having been recruited to work in the marketing department at General Motors. Over the next 15 years, he held several positions at the automaker: auto distributor, product manager, sales communications coordinator. It was during his stint as a district sales manager that Perkins first considered going into the retail side of the business. “I signed one of their first African American dealers, Cecil Willis, out in Los Angeles,†recalls Perkins. “He always used to say to me, ‘You know, you’d make a very good dealer.’ So over the years, as GM started to go through downturns, they would reorganize. I realized that my goal of becoming president of GM was not going to happen. So I left.â€
In 1988, Perkins opened his first dealership, Perkins Pontiac Buick in Kansas City, Missouri. As Perkins struggled to bring the business to profitability–the shop lasted only a year under his ownership–Motors Holdings, the dealership financing arm of GM, bought him out. Perkins would spend the next three years or so working as a general manager and finance manager for dealerships in Pittsburgh and Detroit, before purchasing a Dearborn Pontiac and Nissan dealership in 1993. He would eventually open Taylor Chevrolet in 1998 and Merollis in 2001. The Dearborn location was sold in 2000.
Perkins understands that businesses and industries evolve over time, and that it’s imperative for executives to keep abreast of those changes. “The one thing that stands out for me that has helped him go through this downturn is that Bill is a student of the business,†says Eric E. Peterson, U.S. vice president corporate-diversity for GM. “He wants to learn, he wants to grow, he wants to find out what’s new, what’s evolving, and how he can create a competitive advantage in his stores with his people.â€
ROUGH ROAD
The past three years have presented Bill Perkins Automotive Group with its greatest challenge. In 2009, in the midst of a global recession, GM announced that it would discontinue its Pontiac line. At the time, Perkins’s Pontiac dealership made up some 60% of the company’s revenues. “What they did to dealers left a bad taste in my mouth,†admits Perkins. “You spend your whole life doing something–then all of a sudden the manufacturer that you depend on for your livelihood, for your business, makes a decision that takes it away from you, and there is nothing you can really do about it.â€
Making matters worse, GM had announced plans to reduce the number of its dealerships by 2,600, and Perkins wasn’t sure if he’d be losing more than his Pontiac franchise. But rather than stew on it, he and his management team took action. On the plus side: He owned outright the properties on which the dealerships stand, and he carried very little debt. But still, they had to devise a way for the company to survive without those Pontiac revenues.
(Continued on next page)
The team did the following:
– At one location, reduced headcount from 163 to 150 employees
– Invested $200,000 to increase the number of used vehicles from 30 to 45
– Instituted contests and other incentives to reward employees who achieved sales objectives
– Focused on customer service and competitive pricing. “If a customer is not able to get into the dealership for service, we will actually pick up the customer’s car at their home or work or wherever they are, and drop off a loaner car if needed, and we’ll take the car back to them–just to make it more convenient for the customer,†says Mark Montante, general manager of the company’s Taylor Chevrolet location.
These difficult but necessary moves helped keep expenses down while generating new revenues. And as surviving automakers re-emerged stronger, Perkins Automotive rebounded. “When you look at it from a business perspective, having fewer guys to compete against in a market, and then here’s a corporation that’s been able to shed a lot of its debt, allowing them to take their money and put it into new and improved products, it was tremendous,†he says. “I have to admit, I am in a much better position as a dealer now than I was before the GM bankruptcy.â€
MILLION-DOLLAR OVERHAUL
Though things were dismal, to put it mildly, Detroit slowly emerged from the worst of the crisis. In fact, 2012 sales are looking strong, according to George Magliano, senior economist at IHS Automotive, a provider of industry analysis, forecasts, and data on the auto industry worldwide. “The first quarter was excellent, well beyond expectations,†Magliano says, estimating that light vehicle sales for the year will reach $14.2 million. This is a far cry from the $11.6 million reported for 2010 and $12.7 million for 2011. “Outside factors like the U.S. economy or the global economy can threaten to derail this thing. But the strength of the industry that we’ve developed over the last year and into this year is excellent. We’re in terrific shape.â€
In 2009, while reorganizing under bankruptcy protection, GM developed a rebranding plan. Called the Essential Brand Elements program, its goal was to enhance the customer experience. Under the program, dealerships would undergo facility improvements that included new entrances with updated signage; brighter, modern showrooms featuring a customer greeting station; and lounges with free Wi-Fi. GM, in turn, would pay dealerships a stipend to help offset the renovation costs. “They decided that, OK, we’re developing products that people actually want to buy. It’s not just about the deal and the price. But when you look at the marketplace and the facilities that those products are housed in, they need upgrading,†says Perkins.
Perkins Automotive invested $2.5 million to bring its two locations up to GM’s specified standards. A common entryway featuring the Chevrolet blue arches and gold bow tie was installed, glass windows running nearly floor-to-ceiling, and gray tiles of a specific dimension were among the renovations made. “They want the walls painted certain colors, so that when you walk into a Chevrolet establishment you know what you’re walking into,†says Perkins. Improvements were also made to lighting and furniture–all done while the dealerships remained open for business.
(Continued on next page)
PERKINS 2.0
While the 63-year-old Perkins doesn’t expect to retire anytime soon, a succession plan is in place. His 24-year-old son, Monte, currently general manager for the company’s Merollis Chevrolet location in Eastpointe, Michigan, is being groomed as his successor. “It took a while for me to realize
After graduating from Northwood University in 2010 with a degree in automotive marketing management, the younger Perkins went through the National Auto Dealer Association’s Dealer Development Academy, a yearlong program. “I pretty much grew up in the car business,†says Monte. “My father started me off pulling weeds and washing cars. As soon as I got my driver’s license I became a porter. I would help on dealer trades and driving the parts truck.†While in college, Monte interned at an automotive group in North Carolina, and upon graduating he worked in Perkins Automotive Group’s Internet department.
As a general manager, Monte oversees the Merollis dealership, but he still meets regularly with his father, understanding that he has a lot to learn from the elder Perkins. “When we’re in a meeting, something will come up, and you get an idea in your head–you have a problem that you’re trying to solve, and I’m going at it just from one angle. He’ll always come up with a completely different angle that I didn’t even see,†says Monte. “That’s something that he’s teaching me. You have to go at it from different angles sometimes. That’s really the biggest thing that I can learn from him–the way he handles himself and the way he handles situations.â€
Looking ahead the Perkins team is optimistic, believing that the auto industry will continue to mend. But one lesson that’s been learned over the last half-decade is that nothing is guaranteed. “It’s ever changing,†says Monte. “You have to keep an eye on what’s going on. You can’t be left behind. I think that, for a moment there, Detroit got left behind in the innovation. I think we’ve got to keep our eye on what’s important, and that’s what the customers are driving.â€
With the 2012 North American International Auto Show over and done with, Perkins will refocus on doing what he does best: selling cars and positioning the business to thrive, no matter how bumpy the road may be.