A group of car salesmen from Minneapolis are taking the Santa Clarita Valley by storm, with Hello Auto Group’s newly opened Kia and Mazda dealerships, along with Subaru on the way.
Karl Schmidt, president of Hello Auto Group, spent 30 years of his career with Morrie’s Auto Group, a group of 17 stores primarily located in Minneapolis, before getting an opportunity to move out west.
Here in the SCV, Galpin Motors had closed the local Mazda store in August 2018, a location that would later become its new Porsche dealership, followed by the closure of Galpin’s Subaru dealership in January 2019.
“Mazda really had what they called an open point — as did Subaru,” Schmidt said. “Once they’re closed, they want to get back into the market.”
After meeting with Mazda representatives, who showed Schmidt the site here in the Valencia Auto Center, he felt it was the perfect fit.
“Ideally, we wanted to be right outside of the metro, within striking distance of the metro, but out in more of a community-based market,” he said. “Our approach really is in doing a lot of community-based marketing, and it’s easier to be a voice in a community like this as opposed to in L.A. where there’s 10 million people.”
Schmidt gathered a group of some of his former colleagues to join him on his new endeavor, including: Chris Morris, vice president of operations; Jason George, service director; and Ron Stettner, general manager at Mazda.
Hello Auto Group purchased Kia of Valencia, along with Nissan, which they closed to open Mazda, and the building directly across the street, which is set to become the new Subaru dealership in late 2021.
“We’ll focus on all three brands: All are a little bit different, but they’re all great brands,” Schmidt said. “We think they fit the community well.”
Coming from the Midwest, Schmidt says the Hello Auto team will bring in a different strategy, which starts with its employees.
“Our community-centric approach starts internally, where we try to build accountability as a group … and get that commitment back and forth,” he said. “In our world, our salesperson is a little bit broader than a lot of other stores.”
Where a customer visiting a typical dealership would meet with a salesperson, manager and financial advisor before purchasing a car, at Hello Auto, the salesperson is empowered to manage the transaction all the way through, with the use of software tools.
“We’re all about one point of contact, where the salesperson meets and greets the customer, shows a car, does the paperwork for them, checks them out and delivers the car,” said Jose Lopez, sales manager at Kia. “So this way the customer’s a lot more comfortable only dealing with one person.”
Each of the customer’s options is then laid out in the software, which the salesperson helps them to work through, allowing each car sale to fit the customer’s wants and needs, Schmidt said.
The same goes for the service department, who also have a software tool that allows technicians to do a video walkthrough for customers, where customers can select the work to be done in the app.
“It’s about building that trust and communicating with customers in a contemporary way,” Schmidt added. “It keeps us fresh and engaged, as well.”
Employees at Hello Auto are currently undergoing training on the software, which is set to be rolled out by the end of the year.
Moreover, the dealership prides itself on taking a one-price strategy.
“People have a tendency to price their customers, not the cars … so we do our homework on the market, and we set the price,” Schmidt said. “And we’re forward with the information, so … if you want to know what the price of the car is, we tell you what the price of the car is.”
Lopez, who worked at Kia prior to the new ownership, says his colleagues are on board with the changes.
“Everyone’s really happy,” Lopez added. “Previous ownership didn’t really care about the community or its salespeople, they just wanted to sell cars. … (Now) the salespeople are happy, they’re appreciative of actually being taken care of.”
Though the pandemic has given the newcomers a “couple of false starts,” Stettner said they’re looking forward to finding ways to get involved in their new community.
“Our whole strategy basically is making sure that our employees are happy, making sure the community feels like we’re good citizens and having some interplay back and forth,” Schmidt said.
The group plans to bring some of its community outreach tactics with them, including setting aside a portion of each car sale and allowing customers the opportunity to match, with money being donated quarterly to a charity.
For the car salesmen, coming to California meant finally being able to call the shots.
“I think we found coming out here we can really do what we wanted to, without having to go to a huge corporation with 50 decisionmakers,” Morris said. “We listen to the community, we listen to our employees and we can build the experience that we want to have. The three of us get in a room, and two minutes later, we can make change.”
“We know what direction we’re going to go,” Stettner added. “And the good thing is if it’s not the right direction, the three of us can look at each other and go, ‘OK, let’s do something else now.’”
Now, they’re hoping to take what they’ve learned to make these three Hello Auto dealerships special.
“We all work here and live here every day,” Schmidt added, “so, we feel like we can really bring a little bit of that old-fashioned touch back to the market that maybe it’s been missing”
