How buying truck service center helped Calif. dealer diversify, grow thumbnail

How buying truck service center helped Calif. dealer diversify, grow

Posted on

When Melvin Cooper heard that a distressed service center for medium- and heavy-duty trucks was up for sale in 2014 just minutes from his growing Chevrolet dealership, he jumped on the opportunity.

Buying the business, now known as National Truck Sales & Service, has allowed Cooper to free up service department capacity at the Chevrolet store. The operation, which is now profitable, also has helped diversify his growing automotive business.

Cooper, dealer operator of Watsonville Auto Group in California, was familiar with servicing medium- and heavy-duty trucks at Chevrolet of Watsonville, which he acquired in 2008. Cooper had an established relationship with large fleet customers, including the local beer distributor, a school district and several agricultural customers.

The only problem? The Chevrolet dealership, which had two service shops, including one devoted to commercial trucks, was running out of room. So Cooper bought the 15,000-square-foot repair center about 3 miles away and spent between $80,000 and $100,000 to renovate it.

Today, National Truck Sales & Service has seven service bays and nine employees, including five technicians. It offers maintenance such as oil changes, tire rotations and alignments, plus repair work. Despite its name, the operation doesn’t sell trucks right now. But adding that capability for brands such as International and Mack is on Cooper’s radar.

The center services 80 trucks a month, up from about 15 when he bought the facility.

“It’s brought us a part of our business we wouldn’t otherwise be able to reach or service out of a retail dealership,” Cooper told Automotive News. “We don’t have a big enough footprint at our retail dealership to handle the amount of business that we’re doing because these trucks are so much bigger.”

By moving medium- and heavy-duty service away from the Chevrolet store, Cooper was able to expand service capacity for the dealership’s retail customers, which has grown substantially over the years. When Cooper bought Chevrolet of Watsonville, it averaged sales of nine vehicles, new and used, per month. By 2019, sales had increased to 85 per month.

Watsonville Auto Group also has Watsonville Chrysler-Dodge-Jeep-Ram and Watsonville Ford, which Cooper acquired last year, and a vehicle buying center. The group sold 2,693 new and used vehicles combined in 2020 and is tracking to sell around 2,880 vehicles this year, Cooper said.

Each of Cooper’s dealerships has a strong emphasis on commercial vehicle sales — a reflection of customer demand in Watsonville, an agricultural community in Northern California that is home to berry giant Driscoll’s.

Cooper said the group sells about 30 new commercial vehicles per month from its three franchised dealerships, often work trucks and vans for agricultural buyers or plumbers, electricians and contractors.

Cooper estimates only about four facilities similar to National Truck Sales & Service operate within 20 miles. And while there are other franchised dealerships in the area, Cooper said having a separate facility to service medium- and heavy-duty trucks, combined with light-duty commercial vehicle sales at his three stores, gives him an advantage over the competition.

“They don’t have the experience or the expertise to handle [customers’ medium- and heavy-duty truck] needs,” Cooper said.

“When you look at someone like us, we have a broader breadth in the commercial space.”