Lexus dealerships go deluxe, offer on-site pampering

first_imgLexus, Toyota Motor Corp.’s luxury division, rewards dealers that make such large investments to help them offset some costs. By the end of 2008, about $1billion will have been spent in remodeling or building luxury Lexus dealerships over a three-year period in the United States, said Mark Templin, group vice president and general manager for Lexus. AutoNation is building seven other luxury dealerships, though none is as large as the West Palm Beach location, Maroone said. Edward Yruma, a JP Morgan analyst, said many auto manufacturers have been seeking facility upgrades. “The premier brands are looking for premier facilities,” Yruma said. “All of the auto retailers have showpiece stores where they have sunk a lot of capital into them.” Chris Denove, a vice president for J.D. Power and Associates, called the move a gamble because it’s not guaranteed that AutoNation will get enough business to justify the added expense of the amenities, possibly forcing it to pass some costs to customers. He noted that some people will drive longer distances to check out the dealership, while others may not care about the added amenities, preferring to get their loaner and leave rather than sit in a massage chair while their car is being fixed. “It’s easy to sit back and think that Lexus buyers will pay,” Denove said. “We find every day in our research that luxury buyers are the most aggressive, price-sensitive buyers on the market.”160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! WEST PALM BEACH, Fla. – Walk into the new AutoNation dealership, and you’ll find more than just a pot of coffee on a hot plate, rigid chairs and some stale doughnuts. Customers at the gleaming new $40 million Lexus of Palm Beach can browse for cars or wait for an oil change while noshing on biscotti at an Italian-themed cafe, surfing the Web at a computer station with free Internet access, taking a load off in a massage chair and ogling a 500-gallon aquarium. Open for about two months, Lexus of Palm Beach is biggest in the family of dealerships owned by AutoNation Inc., the nation’s largest auto retailer. The Fort Lauderdale-based company is betting that customers looking for an upscale car such as a Lexus will be drawn to luxuries usually found in expensive hotels or restaurants, such as marble floors, flat-panel TVs in waiting areas, and valet parking. It’s also a clear attempt to lure customers amid a sales environment made difficult by the troubled housing market and tighter credit conditions. AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREWhicker: Clemson demonstrates that it’s tough to knock out the champ“The goal is to create a destination for luxury buyers,” AutoNation President and Chief Operating Officer Mike Maroone said at a “grand opening” this week. “There’s a lot of stress in the economy. Fortunately, a number of the luxury buyers, I won’t say are immune from that, but are not as impacted the way our entry-level buyers would be.” The 180,000 square-foot facility holds 700 vehicles, including 25 in the showroom. The air-conditioned repair shop has 67 service bays, and the technicians’ lounge has a flat-screen TV. “That makes a big difference in the ability to draw talent,” said Cliff Brush, the dealership’s general manager. Sales have increased because of the new facility, Brush said. In November, the new store sold 335 vehicles, up from the 199 vehicles sold at the older dealership in November 2006, Brush said. last_img