Eric Barbosa, vice president of variable operations at Cavender Auto Group, is intentionally “overpaying” on service drive trade-ins to boost used car inventory and deepen the group’s customer relationships.
“You're going to pay more for that car if you go to auction. Why wouldn't we give it to the customer while they're here or in the service drive,” Barbosa told Daily Dealer Live hosts Sam D’Arc and Uli de' Martino. “I would overpay if I could on every one of them and get them in.”
By the numbers: Cavender routinely targets “from 95 to 100%” of book value on desirable service vehicles, aiming “to get as close to 100% on some,” because they see those units as cheaper and stickier than anything they could chase at auction.
And while paying near or at book value sounds expensive, Barbosa's logic is that auction fees, reconditioning surprises, and transport costs often push total acquisition costs above retail book anyway.
But with his approach, customers often stay in the dealership’s sales cycle.
To operationalize this, Cavender has launched the “Cavender Comparison” inside the service drive.
“Basically, when the customer goes to the drive, they get a text,” Barbosa explains. “That text will give them a comparison offer of a current vehicle… and a comparison offer to trade out of it or a purchase offer.”
The tool, which was the brainchild of the group’s CEO, Rob Cavender, also provides customers with an anticipated future value.
The goal is to make every service visit a live appraisal opportunity without relying on a traditional salesperson pitch.
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Between the lines: The key, explains Barbosa, is knowing that these service drive offers are designed to draw in customers who often weren’t shopping at all when they pulled into the lane.
“They're not in market and you’ve got to give them a reason to get in market,” he said.
Barbosa acknowledged that Cavender's buy-center and service acquisitions team have been underperforming, which is why they recently implemented the Cavender Comparison tool to improve service drive acquisitions. Given how new the tool is, quantifiable results weren't available during the interview, but the group plans to track metrics in the coming quarters.
Bottom line: Despite the unknown factors, Cavender’s logic on service drive trade-ins is clear: the same premium that would’ve gone to an auction now becomes a relationship investment, helping reduce auction dependency and building long-term equity and goodwill with existing owners.
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