HispanicBusiness

Ambitious in Lancaster

Recent efforts to boost in-county vehicle sales can be traced to an aggressive set of marketing campaigns launched three years ago in Lancaster.

Hoping to reinvigorate its own economy, the city put together a local stimulus program that included a sales rebate on vehicle purchases. The rebate, funded in part by the city's redevelopment agency and marketed within and beyond city borders, offered buyers a gift card good toward purchases in Lancaster, in an amount equal to the car or truck's registration fee. The incentive lasted for only a few months in early 2009.

Sales attributed to that particular program amounted to $27 million, including goods purchased with the gift cards, said Luis Garibay, the city's senior project coordinator.

Two years later, in early 2011, the city partnered with the Lancaster Auto Mall Association to begin an advertising campaign that highlighted refund offers applicable to the purchase of new and used cars in the city. A city spokesman said the television, radio, print and billboard campaign was targeted specifically to Tehachapi, Mojave and Bakersfield.

Garibay said he was unaware how much money the city has spent on the advertising campaign, which he said is ongoing and is funded largely by city car dealers.

Reaching outside one's own market is generally considered a breach of etiquette, said John Pitre, general manager of Bakersfield's Motor City Auto Center and former president of the Greater Bakersfield New Car Dealers Association. Moreover, he said some vehicle manufacturers forbid their dealers from doing it.

Don Fleming, owner of Valencia Acura and president of the Santa Clarity Valley Automobile Dealers Association, said members of his group have every right to advertise in Kern County, though he was unaware whether any do so. Fleming said he personally chooses not to.

"It seems to me we ought to take care of our own backyard before we go anywhere," he said.

But Morrison, at the statewide association, said advertising across county borders might be expected in tough economic times.

"I think you'll see that, as local governments are starved for revenue, you'll see that more and more," he said.

Bakersfield responds

Last year Pitre and other Bakersfield car dealers approached City Hall with proposals to promote local vehicle purchases.

One idea was to adjust the city's local preference program. The dealers asked City Manager Alan Tandy to increase the 1 percent benefit Bakersfield businesses receive when they submit a bid to supply city government.

City Councilman Russell Johnson helped champion this effort, which earlier this year resulted in the City Council raising the local business benefit to 3 percent.

"It sends a message that, hey, the city of Bakersfield is committed to local businesses," he said.

A separate proposal pushed by local car dealers was a bit stickier. They wanted the city to emulate Lancaster's gift card program.

Bakersfield officials studied the Antelope Valley incentive and concluded that it could not be copied here, mainly because of limitations within Bakersfield's now-defunct redevelopment program.

In turn, the delegates from Bakersfield's auto mall asked whether the city might be able to help with some advertising or otherwise chip in for sales incentives.

To Pitre, the proposal looked mutually beneficial: The more money the city invested in promoting local dealerships, the more its own sales tax revenues would increase.

But Tandy, the city manager, said there just isn't enough money to support that kind of thing. What's more, he said the city has no expertise in advertising.

"We don't do retail," Tandy said.

Local dealerships are staying on message nonetheless, making the point at every opportunity that buying local means supporting your own community.

Pitre said that means jobs as well as city services. He noted that Bakersfield car dealerships employed 3,800 people at the end of last year, including sales people, parts staff and mechanics. That's up 9 percent from 2010, he said.

Beck, the general manager at Bakersfield Hyundai who now serves as president of the local new car dealers association, pointed out the added benefit that buying a new vehicle in town means it can be warranty-serviced locally as well.

That's not even counting the good-neighbor discount.

"The best deals we reserve for people that are local," he said.