NADA leaders talk facility upgrades at the Detroit auto show

Brick-and-mortar issues are on Bill Underriner’s mind as much as shiny new cars and trucks -- even when walking the floor of the Detroit auto show.

Underriner, the outgoing chairman of the National Automobile Dealers Association, was at the show Monday. When I asked him what’s a hot topic for dealers this year, he talked dealership design. For example, he is building a new store that will put his service department, rather than the showroom, front and center.

Underriner says NADA will release part two of its facility upgrade study at the NADA convention in Orlando next month. That study will specifically address two issues that the first one did not:

1. What should the dealership of the future look like?

2. How do dealers get a return on investment after making those upgrades?

“Do we need these great big bricks and mortar to sell cars?” Underriner asks rhetorically. “Are we going to have the manufacturers deliver the cars on a more timely basis? Right now, the wait time is six to eight weeks. Is that going to be shrunk with new automation where the dealer can get the car quicker? In that case, do we need as big a parking lot [for new cars] as we have?”

Last February, NADA released a long-awaited study of automakers’ facility-renovation mandates. It concluded they cost too much, produce uncertain results and matter little to shoppers.

Part two examines if a dealer will actually get a return on the money they spend if they build a new building, Underriner says.

“How many more cars are you going to sell and how much more service will you get from a $3 million upgrade?” as Dave Westcott, NADA’s incoming 2013 chairman for 2013, puts it.

NADA will release the answers to those questions at a press conference on Saturday, Feb. 9.

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