The Industry's Leading Source For F&I, Sales And Technology


Peoria Kia: Facing the Downturn Without Fear

May 2008, F&I and Showroom - Feature

by Joan Shim - Also by this author

Despite the economic hardship that has hit Arizona, one Phoenix-area dealership has remained strong. Michael Crawford, general manager and 20-percent owner of Peoria Kia, said the dealership managed to perform even better in this market than it did in 2006.

With the S&P/Case-Shiller Home Price Indices reporting Phoenix home prices down 18.2 percent in January, and the Arizona Department of Revenue reporting retail sales — a telling indicator of consumer confidence levels — down 10.2 percent the same month, it's difficult to maintain a positive outlook on business. But not for Crawford, who remains optimistic about what lies ahead for his dealership.

"We are definitely in an economic slowdown, but it is a great opportunity to prove how good of an operator you really are," he says. He is confident that his dealership's strengths in F&I — structuring deals and lender relationships — and overall focus on the customer will secure continued success even in the downturn.

Optimism like that is admirable in an area where auto sales were down 8.4 percent in 2007, per Department of Revenue figures, and with 11,700 people dropping out of the labor force in February 2008. And on top of all this, financing is getting trickier as consumers' debt-to-income ratios rise and credit scores get clobbered by mortgage defaults and foreclosures.

But Crawford has a good reason for his positive outlook. Peoria Kia's overall sales revenue was up $1 million and F&I revenue was up $500,000 in 2007. Some might say Crawford has an edge over other dealers in the economic slump because he retails Kia vehicles, which are known for their affordability. But even among Kia dealerships Peoria Kia excels, ranking first in Arizona and sixth in the Western U.S. region for overall profit in 2007.

Intelligent Deal Structuring

Peoria Kia has a team of four finance managers, all of whom are trained in all aspects of F&I, from special finance to Internet sales. The team is led by finance director Michele Kemeri, whose extensive background in banking has served her well in indirect lending.

Crawford says it's this team's "intelligent understanding of how to structure a deal" that has allowed them to be aggressive while still getting deals bought.

"I was talking to a dealer the other day and he was telling me they were having a tough time; they ended up unwinding 60 to 70 deals at the end of the month because they got aggressive," Crawford says. "Meanwhile, we had zero unwinds last month, and that's with deals with FICO scores in the 300s."

In order to structure deals well, finance managers must be properly trained in reading credit bureaus, Kemeri explains. Beyond reading the credit score, "we go through the credit bureau line by line to see what credit issues they have," she says. Details of delinquencies, tax liens and bankruptcies can all be buried within a report, she adds, and should be brought out and discussed in the finance interview.

The customer interview is the next critical step in the dealership's process. Kemeri says it's important not to get hung up on the score when discussing the report with the customer, as the upsides are what lending institutions need to know about. "Look at the past," she recommends. "So they're a little high on their credit card ... How long have they had that credit card and how long have they been paying well on it?"

With lower-credit customers in particular, the finance manager asks for information that shows financial stability. How long have they lived at their current residence? How long have they had their current job and how well does it pay? Do they have a second job or income source? Do they have a trade-in with some equity in it? Is there a family member who can cosign or help out? "You have to find the positive in every deal, and nine times out of 10 you can find it," Kemeri says.

"You have to get all the facts to make the lenders understand that this is a person and not just a score, and build a case for the customer," Kemeri continues. In fact, she will often call the lender’s analyst to talk him or her through the deal she has just submitted. That’s because Peoria's finance team often needs to build a case for their customers, many of which have FICO scores that average between 550 and 625. A growing number, she adds, are also slipping below 550. "The lower end is growing," Crawford says.


  1. 1. bettyjo Hawley [ April 17, 2016 @ 06:37PM ]

    You have the worst sales employees. Jay Morgan shows nothing but disrespect to your customers. I,will take my car to another kia dealership for service. You should concidea very seriously replacing him.

  2. 2. Khaled Farighi [ February 10, 2017 @ 01:14PM ]

    Hello everyone, I purchased a new Kia this past Sunday, the salesman guaranteed me I would receive a military rebate (I'm a marine combat veteran) 3 days later I returned to provide a copy of my DD-214, I was told by Ron swift directly that my service did not qualify me for the military rebate. He also told me the deal is complete and I could give the car to the bank and except a "repo" on my credit report.


Your Comment

Please note that comments may be moderated. 
Leave this field empty:
Your Name:  
Your Email:  


So Here's the Deal

Ronald J. Reahard
Selling to Short-Term Owners

By Ronald J. Reahard
The magazine’s F&I pro responds to a question about how to build value in F&I protections if the customer says he plans on paying off his loan long before the term expires.

(Video) Selling High-Mileage VSC Plans

By Ronald J. Reahard
How do you sell a $3,000 VSC on an $8,000 car? Top trainer offers a four-step process to ensure every customer gets the protection they need.

Selling Warranty Compliance Plans

By Ronald J. Reahard

Handling the ‘Last Car’ Objection

By Ronald J. Reahard

Done Deal

Gregory Arroyo
Resolution Needed

By Gregory Arroyo
The editor shares some insider information regarding the industry’s efforts to get the Defense Department to reconsider last month’s interpretive rule regarding the sale of GAP and credit insurance to military consumers.

Rescinding the CFPB’s Auto Finance Guidance

By Gregory Arroyo
The editor debunks a few myths about the Consumer Financial Protection Bureau, then explains why the industry is on the brink of repealing the bureau’s auto finance guidance.

Still a Work in Progress

By Gregory Arroyo

It Is Unwise to Lower Your Defenses

By Gregory Arroyo

Mad Marv

Marv Eleazer
Chargeback Prevention

By Marv Eleazer
How do you respond to a customer who wants to cancel the F&I program you sold them? His Madness digs into four common reasons consumers give for wanting out of a protection plan.

Your F&I Backup Plan

By Marv Eleazer
Equipment failures can’t stop an F&I manager who is prepared for any contingency. His Madness lists four backup plans you can implement today.

Love It or Leave It

By Marv Eleazer


By Marv Eleazer

On the Point

Jim Ziegler
Sharpen Your Survival Skills

By Jim Ziegler
‘Da Man’ has a plan you can use to survive the collapse of the car business and remain profitable through the dealer apocalypse.

Sales Rock Stars Still Exist

By Jim Ziegler
Da Man says $40,000-a-month sales rock stars still exist. He says you’ll find them on YouTube and Facebook Live.

The New Stooges

By Jim Ziegler

Is Your Quick Lube Driving Away Business?

By Jim Ziegler