Dealership Valuation Damaged by Mercedes Recalls

Auto Recalls Damage Dealership Valuation

Recently, Mercedes-Benz recalled one million vehicles; this will undoubtedly damage the valuation of many Mercedes dealerships. When dealership valuation is affected by recalls, resulting in a loss of money and resources then hiring an automotive expert may be the best option to help the dealership recover from the loss.

Mercedes-Benz Recalled One Million Vehicles

Any car manufacturer can be vulnerable to recalls. Mercedes-Benz knows this all too well. After over 50 Mercedes vehicle fires (caused by a defective fuse) were reported, Mercedes recalled one million automobiles. Jeremy Korzeniewski, a contributor to autoblog.com, wrote, “A total of 307,629 of those recalled models and 30 of those fires were reported in the United States. Cars on dealer lots that are not yet in the hands of customers ‘will not be sold until they can be outfitted with the additional fuse,’ a Mercedes-Benz spokesman told Automotive News. Affected models include the CLA-, C-, and E-Class sedans, and GLA- and GLC-Class crossovers.” These recalls may not devastate Mercedes, but the auto manufacturer will certainly feel the sting of dealership valuation damage caused by the huge number of recalls.

How Recalls Affect Dealership Valuation:

Auto recalls, such as the ones recently made by Mercedes, can seriously bring down dealership valuation. Here are two reasons for this:

1) When recalls make it into the news, auto manufacturers’ reputations are questioned. This means that dealerships carrying the brand of vehicles that were recalled may be avoided by customers for a period of time, out of fear. When customers are sparse, so are sales, and dealership valuation becomes depressed.

2) Recalls cost money. For example, in Mercedes’ case, lots of vehicles need an additional fuse to be installed in order to be safe. When you consider the thousands of Mercedes vehicles that need a fuse, as well as the cost of parts and labor, it’s easy to see that large numbers of recalled vehicles cost companies a heap of money. This also equals damaged dealership valuation.

An Automotive Expert Helps Increase Dealership Valuation

An auto dealership’s valuation may be damaged, but it doesn’t have to be doomed. An automotive expert can help dealerships recover their losses and heal from tragedies such as serious recalls.

Bryan Parker is an automotive expert who has vast experience in the area of dealership valuation and is a prime choice for bringing clarity and solutions when dealership recalls ensue. Call today for a free consultation.