In spite of a downturn in new vehicle sales last year in Canada, dealers in the Tilbury Auto Mall believe their co-operative efforts continue to yield results.

Overall, new vehicle sales in Canada last year were down 3.7 per cent from 2003, according to sales figures compiled earlier this year by The Canadian Press. A total of 1.534 million vehicles were sold in 2004, compared to 1.593 million units in 2003.

General Motors sales were down 2.4 per cent in Canada, while Ford's fell 11.7 per cent and DaimlerChrysler by one per cent.

The Tilbury Auto Mall was not immune to the slump, with a combined average drop of 6.65 per cent, although Tilbury Chrysler saw an increase in sales of 2.53 per cent, or 12 units.

Peter Tiahur, Business Edge
Lally Ford's Vince Lally has seen the power of Tilbury Auto Mall advertising reach throughout the Municipality of Chatham-Kent.

The Tilbury Auto Mall, which was formed in 1995 in the southwestern Ontario town of Tilbury about 40 kilometres east of Windsor, includes Lally Ford Sales, Tilbury Chrysler, Gary Mackie Chevrolet and Andre Lanoue Pontiac Buick.

"The four of us get along so well together," Mackie Chev co-owner Brian Lowes says about the co-operative that includes fellow owners or co-owners Vince Lally of Lally Ford, Tom Mayhew of Tilbury Chrysler and Craig Lanoue of Andre Lanoue Pontiac.

"We advertise together, we go to certain functions together. We're all about the same age so it just works," says Lowes.

The mall has been an evolutionary process.

Mackie Chev moved to its location beside the Andre Lanoue dealership in 1989, while Tilbury Chrysler moved to the other side of the street in 1994. Lally Ford moved in next to Tilbury Chrysler in early 1995 and the Tilbury Auto Mall was physically under way.

"In the beginning, we were pretty unorganized," Mayhew says. "But we're organized now. We all have the same goals and it's pretty much a gentleman's agreement between us."

According to Mayhew, Vince Lally was the first to approach the other dealers about joining together in a collaborative effort.

"I was convinced there was an advantage to us all being together," says Lally, who had read about auto-mall success stories in bigger locations such as Edmonton and Mississauga. "There'd be more draw for the consumer."

One of the original goals was to minimize the costs of advertising while promoting the auto-mall name to the surrounding areas of Windsor, which has a population of about 200,000, and the rest of the Municipality of Chatham-Kent, which has a population of about 100,000.

"We wanted to do bigger and better advertising at a cheaper price," says Lowes. "Gary Mackie Chevrolet could not do some of the TV commercials we do unless the four of us did it together."

"I would not be doing TV advertising if I had to go in alone," says Lally. "With all of us, we only have to pay 25 per cent each."

The advertising on Windsor CBC and CHWI television stations has given the mall profile, although sometimes people identify it as one extensive dealership rather than four separate lots.

Pontiac dealer Lanoue recalls answering a question in Windsor by saying he was from the Tilbury Auto Mall and the questioner then saying he had bought a car from him.

"So I asked him what he bought and he said he bought a brand new Chrysler," Lanoue says. "Well, he did buy a car from the Tilbury Auto Mall, but he obviously didn't buy it from me."

Tilbury, which is the westernmost community in Chatham-Kent, has a population of about 4,500. Because of its small size, the majority of residents travel to nearby Chatham, Windsor and London to do much of their shopping - but not for cars.

"It's a town of only 4,500 people, so they only account for a small amount of my business," says Mayhew. "But I do know that the car buyers in Tilbury support my business generously."

The other dealers also make most of their sales to out-of-town buyers.

"I'd say 35 per cent of our buyers are from Tilbury and the other 65 per cent are from the surrounding areas," says Lanoue.

Lowes agrees: "Our sales to people coming from the east of us have really picked up. You wouldn't believe how many people we have coming in from places like Port Lambton and Sarnia."

Depending on where people live, Mayhew says, they can drive to Tilbury in the same amount of time as it would take to get to a Windsor car dealer. "And when you get here, all the car lots are in the same location. You don't have to drive all over the city," he adds.

The auto mall also has made its mark on the Tilbury economic scene, West Kent Coun. Bryon Fluker says. "When you get four small businesses like these together and put them in the same area, you really have what I would call a small industry."

Lowes says between them the four car lots have more than 100 full- and part-time employees.

Other small towns in the Essex-Kent area have made similar co-operative efforts, but have not been as successful as the Tilbury mall.

Jack Gisi of Jack Gisi Pontiac Buick GMC in nearby Leamington says another dealer purchased land with the intention of starting an auto mall, but nothing has materialized.

Ken Knapp of Ken Knapp Ford in Essex says that while he shares advertising costs with other dealers in town, there are no intentions of relocating together.

"There's two major factors they don't have that we do," Lally says. "One is how close in proximity we are to each other. The other factor is that it takes a great deal of compromising and co-operation between all the dealers. And we've been able for 10 years now to work co-operatively."

While there are four used-car dealerships in Tilbury, there are no plans to expand the mall concept to include them, even though two of them are close by, because the auto-mall dealers do not see them as a fit. "It has to be a brand name," says Lowes.

Fluker and the auto-mall dealers agree that businesses, especially in small towns such as Tilbury, need to work together.

"Partnerships are always a good idea," says Fluker, who was Tilbury's last mayor before the 1996 amalgamation of Chatham-Kent. "Partnerships share costs like advertising costs and it just makes for a good small-business plan."

"You can get so much more bang for your buck when you can all sit down," says Lowes. "We all have the same problems, so we can try to get the problems solved.

It would definitely work for anybody."

- with files from The Canadian Press

(Dave Richie can be reached at richie@businessedge.ca)