Going Green Dealerships

“Going green” is nothing new. Some OEMs and dealers have been engaged in environment-minded efforts for some time. In a year when EVs outsold manual transmissions for the first time (Q3 of 2019, by nearly two to one), the trend toward dealerships making novel and clever strides toward sustainability might be seen as a sign of the times, the beginning of a paradigm shift towards a more efficient “new normal”.

While reducing contribution to climate change is a fairly mainstream notion these days, the American automotive industry has generally not been seen as leaders in the green movement. As more consumers make purchasing decisions based on beliefs, a number of dealerships are changing those perceptions with intelligent initiatives to reduce their footprints.

These dealerships are finding ways to reduce expenses and improve customer experience while cleaning up their environmental act. Going green as a dealership has progressed far beyond keeping a hybrid or two in stock, sometimes to a surprising level of detail: do you use recycled wood name tags?

Solar Power & Dealerships: A Natural Match

There are many ways to approach running a business sustainably, but when we hear the phrase “going green”, solar panels are often top-of-mind. While dealerships seem to be perhaps a little late to the party when it comes to widespread use of solar energy, that may be changing: Freedom Solar Power has installed panels at eight dealerships in their home state of Texas, many in the last two years.

According to CFO Kyle Frazier, investment in
solar makes such economic sense that the environmental benefits are almost an afterthought,
and dealerships are prime candidates to take advantage of solar power:

“Auto dealers offer the ideal circumstances. Car lots are almost always owner-occupied real estate with plenty of roof space to accommodate a meaningful amount of energy. More owners are realizing that going solar has less to do with generating renewable energy and more to do with generating attractive returns on their cash. Clean energy is the positive by-product of investing in solar. Solar happens to be an investment that generates cash in a very real sense. It produces kWh which is no different than pulling oil out of the ground. It’s this ongoing annuity that allows them to fuel future investments. The average cost savings for our clients is several hundred thousand dollars with a typical payback of 4-6 years.”

Given the climate of the region, some dealers are using solar panels to improve the customer experience by using solar to help beat the Laredo heat for consumers browsing the lot.

“Another trend we’re seeing is an interest in solar carports, and Sames Automotive is one of the dealerships leading the way. Carport structures with solar solve two problems at once for Texas dealerships given our long, hot summers,” Frazier said.

Sustainability Beyond Energy

According to Frazier, “Several of our clients have ambitious sustainability goals beyond solar power, including Lost Pines Toyota, which is the only LEED Gold-certified dealership in the Austin area, and Austin Subaru.”

“LED lighting has been a big trend in automotive,” Frazier continues. “Due to the lot requirements for presenting inventory and security, there is considerable energy demand in lighting. We’ve heard positive results from LED retrofits. Other sustainability initiatives we’ve seen dealers implement include programs for energy efficiency (smart thermostats and large fans in the service department); water conservation (car wash water recycling); and waste reduction (paper and plastic elimination and recycling).”

Lost Pines Toyota of Bastrop, Texas is one dealership that has committed to a broad range of eco-friendly measures to make their dealership sustainable.

“We started our green initiative when we first opened the store back in 2012. Part of the construction included reducing noise pollution by eliminating the need for an overhead PA system, installing a rainwater collection cistern which in turn irrigates the native landscaping, and an automated energy management system to adjust the HVAC and lighting for optimal performance,” Lost Pines’ Cody McCormick tells MD.

Reducing, reusing and recycling, as well as using iPads in the service department, help Lost Pines toward a goal of going completely paperless. This dealership has taken a commitment to “going green” to a truly impressive level– they even wear recycled wood nametags instead of plastic.

“‘Going Green’ is slow to be adopted in our industry, however it is spreading as it has such benefits not only for the environment, but in some cases the entire area’s power grid. Besides the solar initiative, dealerships can make the most impact going eco-friendly, solely based off the amount of paper that can be consumed, service facilities’ oil and chemicals used, and personnel uniforms. Having recycled name tags is just one thing that helps cut even the smallest bit of plastic usage down. We all have a responsibility to preserve our own environment,” McCormick says.

According to McCormick, Lost Pines’ customers seem to appreciate the dealership’s investment as part of a green community. “They are proud to be a part of the community we share, and are excited to see a car dealership take such initiatives to protect the community in such a unique and eco-friendly way.”

Taking the First Step

Maybe your dealership isn’t quite ready to go all in just yet when it comes to going green, but that shouldn’t be a reason to not take steps in that direction. Incremental movement can build forward momentum, and a first simple step could be the start of a longer journey toward sustainability.

Reducing your footprint on the surrounding environment goes hand in glove with the long tradition of dealership involvement in making communities better, and often as not makes long-term fiscal sense as well: these days, a commitment to being green means saving green, too. What could be a better win-win than making the world a little bit better and saving money doing it? The ROI on green initiatives isn’t just in cost saving, though. The public, including customers, is more concerned with the environment than ever, and those customers want to align with brands and business that reflect their values.

There are many options for where to start, and what measures will have the most impact varies based on location and other factors. It can be daunting to know how to get the ball rolling, but you may not have to go it alone.

Many OEMs have green initiative programs in place for franchised dealers- and many of these programs have been around for some time. Ford launched the Go Green Program for dealers in February of 2010, which includes comprehensive energy assessments and review as well as technical support and preferential pricing. GM’s Green Dealer program began in 2014, providing resources to assist dealers in meeting certification standards. Subaru operates an Eco-Friendly Retailer program for its dealers. These are just a few examples of OEM programs to help dealers go green; contact yours to inquire about what might be offered to assist a sustainability initiative for your dealership.

Whatever steps you’re ready take toward a more sustainable dealership, every little bit will help your environment, your eco-minded customers’ experience, and your bottom line. What more compelling reasons do you need to “go green”?