Long overdue: Give dealers some say
Keith Crain is editor-in-chief of Automotive News.
Recently I spent time with the board of directors of the National Automobile Dealers Association.
I have always been impressed by the dedication that those directors have, representing the interests of thousands of automobile retailers across the country. They are hardworking dealers who take time to represent the rest. It's not an easy job and too often is not understood or appreciated.
But it seems automobile dealers don't understand how powerful they are -- with the federal government or among the various manufacturers they represent.
The potential for good is far greater than what many think is possible. So I'd like to see American automobile dealers show their strength a lot more.
And it is about time for many manufacturers to appoint an automobile dealer or two to their boards. Considering the composition of today's corporate boards, it seems logical for an automaker to include one of its own dealers.
As part of a shareholders agreement at General Motors, the UAW's VEBA health care trust, which is one of GM's largest stockholders with 10 percent of the stock, designated Steve Girsky as a board member with consent from the Treasury Department, which owns 32 percent of GM's stock. It seems ridiculous for GM's many dealers not to be represented.
Ford says its dealers are its most important constituency. A couple of dealers would be a great addition to the Ford board. And Chrysler would benefit from having some of its dealers to add retail insight.
I don't believe that it would be a conflict of interest for a company to have its own dealers on the board. They could do a great job representing all the shareholders with invaluable insight.
When you think of the investment and the experience of dealers, you can't help but wonder why the car companies didn't do this long ago.
It seems that when there is a takeover attempt, the aggressor inevitably is allowed to put a couple of people on the board.
Well-chosen dealers would be able to represent the shareholders with a point of view that isn't represented today.
There are many dealers today who could do a great job on a car company's board without any conflict of interest. In fact, the interests of the company and the dealer would be much the same.
I am not sure how a company would pick the dealers for its board, but it is possible -- and long overdue.
After more than 100 years, it's time to add a few dealers.
You can reach Keith Crain at firstname.lastname@example.org.