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driven to succeed
Story and photo by Susan O'Connor

During his 30-plus years of owning and operating car dealerships in Northeast Arkansas, Don Cavenaugh has been able to not only survive but prosper in an industry where many were not as fortunate. His keen ability to anticipate industry trends and evolve accordingly have served him well.

“If you didn’t grow and change and adapt, you got left behind,” Cavenaugh said.
At a time when most rural new car dealers have closed their doors, Cavenaugh is a mega dealer, with six new car franchises and two stand-alone used car dealerships.

His entrée into the car business began with his father’s purchase of the tiny Ford dealership in Black Rock in the spring of 1978. A farmer by trade, Charlie Ray Cavenaugh was recovering from a heart attack and had leased his farmland, sold his equipment and started a used car lot when he heard about the availability of the Black Rock franchise. At the time, Don was 26 years old and living in Jonesboro. He attended Arkansas State University, but being entrepreneurial by nature, ran a car wash on Nettleton Avenue and sold Electrolux vacuum cleaners.

Cavenaugh joined his father in the business and together the pair very successfully ran Cavenaugh Ford until 1988, when another heart attack took the life of the elder Cavenaugh. With a decade of experience under his belt, Donald took the helm and began a methodic expansion.

“I wanted to expand — add some franchises,” he said. His first acquisition was a Hyundai franchise in 1994, near the beginning of that nameplate’s entry into the U.S. market.

“I was at a Ford meeting having lunch with Steve Littrell, the Ford dealer in Blytheville at the time. I said, ‘What are you going to do with that Hyundai franchise?’ He said, ‘I’ll sell it to you.’ I didn’t pay much for it. Basically it was the purchase of parts, equipment and signage. I opened the Hyundai store on Gee Street.”

Cavenaugh said Hyundai sales were a little slow at first, but the introduction of a 100,000-mile warranty and some new models was a turning point. Customers began to take note of the franchise and sales started to increase.

“Hyundai has been a real strong brand. They’ve got a lot of good products, and it ranks well in consumer reporting. Price wise it is a little less expensive than Toyota or Honda, but with comparable product quality.”

At that time, Cavenaugh had expanded his used car business with an off-site location. His phone began to ring, as struggling rural new car dealers looked for buyers. “I really didn’t go out knocking on any doors,” he said. “People knew I wanted to expand.”

And, the strong trend among the big three U.S. car manufacturers to consolidate small stores had begun. In 1997, he bought a multi-franchise store in Walnut Ridge, acquiring GM and Chrysler/Dodge/Jeep. The next year, he bought out longtime Walnut Ridge Ford dealer Jimmy Snapp.

He bought the Jonesboro Lincoln Mercury dealership in 2000, and purchased a Kia franchise in 2005. In 2006, Hyundai awarded the Hot Springs franchise to Cavenaugh. His oldest son, Blake, runs that store. Of his seven children, Cavenaugh said only Blake is interested in the car business.

“I guess they saw how much work goes into this business,” he said. “I’ve always worked a lot of hours. It is demanding, but it has been good to me. I’ll say that. I couldn’t have done anything else and done any better. I don’t ever plan to retire. The day I die, I’d just as soon be at my dealership as anywhere else.”

His latest acquisition is Blackwell Baldwin Ford in Jonesboro. With encouragement from Ford, Cavenaugh remodeled the Highland Drive location, and consolidated his Black Rock Ford store and Jonesboro Lincoln Mercury business under one roof. Business had been good, he said, even with last year’s downturn in the economy.

“I think there is a bright future in the car business because people love their automobiles,” he said with confidence. “They love to get in them and go for a drive. I don’t think it will change in my lifetime. Even if gas prices rise, the mix of vehicles people own may change, but people still need them for recreation. They still want to pull their boats. And farmers and construction workers still need their trucks, no matter the price of fuel.”

What is biggest change in the business in the last 30 years? Cavenaugh said it is the Internet, definitely.

“The Internet has widened the footprint — really changed the landscape of the business, allowing customers to compare what they are interested in before buying. It has opened up your inventory to the public.”

All of Cavenaugh’s new and used inventory, along with prices, is available online, as well as current advertising. If a customer requests a quote online or needs more information, special Internet salespeople answer in a timely manner. Also, new car reps visiting dealerships are a thing of the past, and program car auctions are handled online, as well.

Even in a virtual world, Cavenaugh said taking care of the customer is paramount to success.

“You’ve got to keep good inventory and trade aggressively. You’ve got to let the customer know you are interested in doing business with them because even with fewer dealers, competition is still tough. Your competition may be 200 miles away. The bottom line is, you’ve got to take care of your customer.”