NADA chief blasts factory 'intrusion'
DETROIT -- The chairman of the National Automobile Dealers Association criticized manufacturers last week for "intrusion" into dealers' operations by requiring facility renovations and creating two tiers of pricing for retailers.
"Two-tier pricing and mandatory facility upgrades are symptoms of a bigger overall problem: manufacturer intrusion into dealers' businesses," NADA Chairman Bill Underriner said during a speech to the Automotive Press Association.
Underriner restated NADA's view that stair-step programs, which pay dealers escalating bonuses as sales targets are hit, hurt brand values and dealers' relationships with customers. Dealers who aren't paid the bonuses are at a disadvantage relative to dealers who receive them, creating an unlevel playing field, NADA says.
NADA assembled a task force this spring to examine the controversial two-tiered pricing and factory image programs. Underriner said the group is developing a list of actions to take on the stair-step issue.
On the facilities issue, Underriner said the task force by year end will have developed metrics to measure the return on investment in factory image programs.
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