When Lodivico Roman moved to Los Angeles in 1981 from Quezon City in the Philippines, he spoke little English. So he bought his first car, a new brown Chevette, from a Grand Chevrolet salesman who spoke his language--Tagalog.
Last week, Roman was back. “I have a friend who sells cars here, a salesman, and he gives me a good price,” said Roman, who was buying a silver ’87 Corsica heavily loaded with options, the third car he’s purchased at Grand Chevrolet.
Once again, the deal was made in Tagalog--one of 50 languages and dialects spoken by a multicultural sales force assembled by Filipino immigrant Eminiano “Jun” Reodica. Unable 15 years ago to borrow money for a used car, Reodica is now a U.S. citizen and successful automobile entrepreneur. He owns Grand Chevrolet in Glendora and its affiliate Grand Motors, which sells cars from a network of 25 small offices rather than from a car lot.
Doesn’t Rely on Advertising
At this unusual operation in the San Gabriel Valley, Reodica and his sales force have sought to target and identify prospective Asian and other immigrant auto buyers, approaching them in their own language through office colleagues and friends, and offering car loans to those with little or no credit history.
Rather than advertise and wait for car buyers to walk in the door, Grand Chevrolet and Grand Motors do no television advertising. Speaking everything from Spanish and French to Cantonese and Korean, his sales agents go out and personally solicit clients, especially Asian Americans.
Reodica’s operation has paid for a local exhibition of 70 famous Filipino paintings, sponsored a parade float in Little Tokyo during the annual Japanese cultural festival of Nisei Week and made large contributions to the construction of two local churches.
About three-quarters of the two companies’ 450 employees are Asian, most of them Filipino, Reodica said. Applicants for sales jobs are asked to list all civic, religious, athletic, ethnic and alumni organizations to which they belong, and assemble a list of 2,000 names of friends and associates to whom they might be able to sell cars.
“It’s a matter of closely identifying ourselves with the cars and being visible in the community,” Reodica said, adding that, “We try to figure out what makes people support each other and makes them stick together.”
“I didn’t choose Grand Chevrolet, they chose me,” said Opeta Palaita, a Carson resident who bought a used, blue ’83 Volvo last Wednesday. “I knew one of the salesmen, and a lot of friends at the church, they bought cars here.”
Filipinos account for about 40% of car sales. Other Asian nationalities make up another 20%, while the remainder of sales are made primarily to other first-generation immigrants and blacks.
The language factor is critical, says Jacques Nassar, a sales manager at Grand Chevrolet. “You are a different person . . . when you talk to (the customer) in his own language. They feel very close and they end up buying.” The Beirut-born former international freight company executive speaks fluent Arabic, French and Greek, and says he can sell a car in four other languages if necessary.
“Most foreigners aren’t very familiar with (leases),” said Fred Khachi, an Iranian-born Grand Chevrolet salesman who speaks fluent Arabic and Persian. “When they speak to an English speaker, they can’t understand the concepts. “That’s one of my target markets, advertising in Arabic and Persian newspapers in the Los Angeles area,” he added. “I saw an opportunity, why not take advantage of it? It’s an untapped market.”
Sales agents for the two dealerships sold 9,388 cars last year--and spoke 50 languages and dialects to do so, Reodica said. Total sales this year should reach about 11,000 cars or $120 million, he said.
Grand Chevrolet, located at 820 So. Grand Ave. in Glendora, is a traditional auto dealership with a General Motors franchise to sell Chevrolets. Last year, the company sold about 2,000 cars, Reodica said.
Less than a mile from the dealership is perhaps the most unusual part of Reodica’s enterprise, Grand Motors. Headquartered at 1301 So. Grand Ave., it has no franchise. Instead, the company acts as a broker, selling cars of all makes and models, from Pontiacs to Porsches, through 22 sales offices in Southern California and three more in Vallejo, Stockton, and Daly City in Northern California.
Most of the sales offices hold only one or two cars. Customers order their vehicles from catalogues by make, model, color and options, and Grand Motors buys it at near the wholesale price from another dealer. The fixed overhead costs of renting and keeping up a sales office total about $5,000 a month, compared to $5,000 a day for a conventional dealership with a lot full of cars, Reodica said.
“Grand Motors is a used car dealership with a twist--it carries current-year models,” said Reodica.
The heavily Asian American communities in which most of the sales offices are located represent an increasingly sought-after market for Southern California auto sales forces. “Every dealer has a push to get into the Asian Pacific sector of the market.” says Richard Kim, president and co-owner of Kim-Hankey Hyundai in downtown Los Angeles. The biggest deterrent for dealers, however, is “is the language barrier,” he said.
The sales offices are unique for auto dealers in the Los Angeles area, Kim said, in large part because few customers except Asian immigrants seem willing to patronize them.
Auto dealerships are rare in Asian countries, and most cars are ordered from catalogues. “They get used to buying their car that way, so when they come here, they do it that way.”
Kim said sales offices have shortcomings compared to dealerships. “They go to a little dinky office with a table and a telephone,” he said.
If marketing is the colorful exterior of Reodica’s success, credit is the engine. Grand Motors and Grand Chevrolet finance 90% of all sales through Grand Wilshire, a separate credit company whose stock is held by Reodica and about three dozen of his employees and managers.
Though they often lack credit histories, Asian immigrants represent excellent credit risks, Reodica said. “Not only do they have the education, they have the work experience and they come here willing to compete. . . . The typical immigrant will have two jobs, and the wife has two jobs, so the couple I sell to has four jobs.”
They sometimes also may pay a high price. Interest rates range from 3.9% on some new cars to 21% for some used cars sold to customers with especially poor credit, Reodica said.
Although Grand Wilshire lends to clients considered risky by banks, few loans have gone sour. Between 2% and 2 1/2% of borrowers fall behind on their payments, and less than 0.5% default, Reodica said.
“That’s right on the national average. He seems to be calling the credit quite good,” said Jim Bolger, national manager of commercial automotive financing for Stamford, Conn.-based General Electric Credit Corp. Last June, GECC extended a $250-million line of credit to Grand Motors, easily the largest credit line it has offered an auto dealership, Bolger said.
“He will step up and finance these people, and a lot of banks do not,” said Andy Chang, owner and president of Alhambra Mitsubishi.
Immigrants often have trouble borrowing money because they lack credit histories, Reodica said. He speaks from personal experience. In 1972, while working as an attendant in the showroom of General Motors’ Detroit headquarters, Reodica was refused a loan by General Motors Acceptance Corp. Only after buying a $99 television set on $50 credit was he able to take out a loan for a ’65 red Volkswagen Fastback.
Today, Reodica drives another red car, a new $38,000 Jaguar XJ6.
Reodica was born in the Philippines, earned his bachelor’s degree in accounting there from the University of the East and went to work for the local subsidiary of Colgate-Palmolive. He quit the company and moved to the United States in 1971 because he found little hope of promotion to senior management without U.S. citizenship.
Several months of unemployment followed. After an unsuccessful effort to find a senior position in marketing with a U.S. firm, he pared his resume from 25 pages to one and began applying for work as a busboy. “My wife was crying all the time, my children were still in the Philippines. They were 2 and 1 years old.”
His first U.S. work was as a GM showroom attendant. “It’s only a shade over a porter; the only one lower is the one who really cleans the cars in the garage,” Reodica said.
Within four years, however, he became vice president of a Southern California General Motors dealership. In 1978, he mortgaged his home and took out several loans to buy Grand Chevrolet. Now, Grand Motors and Grand Chevrolet have total assets of about $24.1 million and total liabilities of $15.7 million, he said.
Reodica is please about what has happened. “California is a favorite among Filipinos because of the weather, because of the melting-pot environment, the atmosphere,” he said. “It’s so easy to blend into the mainstream in America.”