Firing on all Cylinders

Registrations of new cars in Hawaii hit a 10-year high in 2004 and are expected to remain strong for at least the next couple of years. This year may be a record-breaker for Pflueger Automotive Group, which is projecting a 20 percent increase in gross sales over $130.7 million in 2004.

Photo: Jimmy Forrest

Part of Pflueger's projected double-digit growth is due to the acquisition of the Cadillac, Hummer, GMC and Buick brands this year and opening a new dealer site at the old Schuman Carriage Co. location on South Beretania Street.

However, much of the growth is also due to overall consumer demand for new cars, driven by a good economy. President Alan Pflueger says that, given the recent good performance of the construction and real estate industries, Hawaii auto dealers should continue to do well in the near future.

HB: What's your feeling about what the consumer mindset is now?

A: I think people here in Hawaii have been holding back for so long and the economy's back and Hawaii is hot. There's a tremendous amount of growth and people want to go out and enjoy a new car.

HB: There are some forecasts for continued strong new vehicle sales in the Hawaii market over the next several years. What do you think will cause that to change?

A: I think you are looking out at really the economy slowing down, just like any point in history, when the economy is strong, businesses are strong and they go hand and hand. When things slow down, people start watching their spending a little bit more and I think maybe they buy more used cars and more economical cars.

HB: What's the feeling in the industry about Mayor Hannemann's proposal to raise the vehicle weight tax from two cents a pound to three cents a pound for noncommercial vehicles to fix potholes?

A: Obviously, from my perspective, anything attached to cars from a tax point of view - we're opposed to it. But if you got out there and you look at Hawaii and you see all the potholes that are out there right now - we've had a lot of rain - the roads need it. I wish they'd find that revenue from some other source, but I'm sure he's thought about it and planned it out well to where it's not going to hurt the automotive industry in Hawaii.

HB: How do car dealers view what's happening in the Hawaii's ocean transportation industry?

A: I've heard some good and bad things. I think you've got some competition coming in with the new carrier. I hear their boats are great. I've heard some exciting things - that we should be receiving cars quicker from the transition standpoint of when they're shipped and how they're offloaded and brought to the dealers. The only negatives I've heard are from local companies that process the vehicles on the docks to the local dealers. I think maybe [those companies] are getting squeezed out.

HB: What are the biggest challenges for the auto industry in the near future?

A: I would say a lot of attention will be brought about by higher gas prices and the push for alternative fuels and hybrid vehicles and the transition in that direction.

HB: At some point, won't there be too many cars on Oahu?

A: As far-fetched as that might sound, my parents drove around in a horse and buggy and I bet they never imagined that they'd see this many cars and cars doing what they do today. I think from Hawaii's standpoint, some sort of transit system is in Hawaii's future, but I wouldn't be surprised if my kids and my grandkids saw cars traveling like airplanes one day. You never know what you might see.

HB: What are the hot new trends in the industry?

A: You're looking at alternative fuel sources and hybrid vehicles. Performance seems to be coming back quite a bit in the automobile industry and you are seeing a lot of high technology. There are a lot of cars out there now that are very computerized and it takes a little time to just learn all the features of the car

HB: Car sales usually go in cycles. Where are you in this current one?

A: I'd say we're probably halfway through a very good cycle. I think we're going to go hand in hand with the construction market and I see construction being strong for another four to eight years.

HB: Anything you are particularly excited about?

A: There's a lot of thought going into cars now days. You've got emerging markets - Korea has really stepped up and China has emerged. I think you are going to see those markets grow quite a bit as far as them manufacturing and exporting product internationally. That's going to put pressure on the existing manufacturers to create better products and I think the people that benefit the most are the end consumer. So it should be pretty exciting. You can walk into a dealership today and think that this is the latest, greatest vehicle in the whole world, but realize that where we're at today is the horse and buggy compared to what our grandkids are going to be driving.