Blogs from the NADA Convention

A new Gold Rush sweeps over California

Posted 12:45 pm U.S. ET, Jan. 25
blogs Richard Johnson is print editor of Automotive News.
 
SAN FRANCISCO -- George Soros' people weren't the only nontraditional buyers of car dealerships prowling the NADA convention. Rick Kotzen and Ron Sompels, partners at accounting firm Crowe Horwath, held meetings here with several well-heeled groups looking for a piece of the considerable action in auto retailing. In the past year or so, Kotzen says the firm has been in contact with up to 20 so-c ...
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Spending billions but coming up short on the trust scale

Posted 9:00 am U.S. ET, Jan. 25
blogs Krishnan Anantharaman is a news editor for Automotive News in Detroit.
 
SAN FRANCISCO -- Auto dealers are pillars of their communities. They sponsor Little League teams. They fund scholarships for disadvantaged children. They donate vehicles to first responders. They pay their taxes and fly big flags. So why do so many consumers drive out of dealerships feeling uneasy -- even if they got the car they wanted at roughly the price they wanted? What explains the fact tha ...
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Lengthening loan terms get brokers', banks' attention

Posted 12:01 am U.S. ET, Jan. 24
blogs Richard Johnson is print editor of Automotive News.
 
The best handicappers of the U.S. market may be the folks lining up to buy dealerships. They place bets in the form of the multiples of earnings they're prepared to pay for stores. "The goodwill numbers people are willing to pay have probably peaked," says broker Mark Johnson. "If you buy a store, you want to be able to forecast growth. That's how you get the multiple to work for you." You'll of ...
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Could a Super Bowl loss deflate car sales in New England or Seattle?

Posted 4:45 pm U.S. ET, Jan. 24
blogs Nick Bunkley reports on Ford for Automotive News.
 
SAN FRANCISCO -- Cars are emotional purchases for consumers. A Wisconsin dealer told me he got clear evidence of that this week, after the Green Bay Packers were eliminated from the NFL playoffs is heartbreaking fashion. Until then, sales had been going well at Rapids Ford-Lincoln, owner Allen Taylor said. "We were just clicking away all month," he said. Then, the Packers inexplicably blew a 16- ...
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Sometimes success comes from a loving push

Posted 12:00 pm U.S. ET, Jan. 24
blogs Lindsay Chappell is the Mid-South bureau chief in the U.S. for Automotive News.
 
SAN FRANCISCO -- A few months ago, I interviewed a West Virginia car dealer named Mike Wood. You might have caught the article we ran in Automotive News. Wood struck me as a dynamo. He is building a dealership group the old-fashioned way -- long hours. Wearing many hats. Doing without. Getting by on too little sleep. Praying for good weather. Celebrating every little move forward. Buying underper ...
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Money's cheap, so here come the store upgrades

Posted 9:30 am U.S. ET, Jan. 24
blogs Dave Guilford is a news editor at Automotive News.
 
SAN FRANCISCO -- One of the better indicators of the health of a business is its willingness -- and ability -- to make capital expenditures. By that measure, auto retailers are doing well. There’s all the activity at the Moscone Center's multiple halls during NADA 2015, of course. But Chip and Brent Wampler, partners in Custom Facilities of Cincinnati, have an especially clear view of deal ...
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North of U.S. border, big dealer groups emerge on 2 fronts

Posted 11:00 am U.S. ET, Jan. 24
blogs Dave Versical is Automotive News' director of editorial operations.
 
SAN FRANCISCO -- Canada and the United States. Neighbors, yet worlds apart by some automotive yard-, er, metre sticks. The U.S. typically sells 10 times as many vehicles as Canada. GM has long been No. 1 in its home country; Ford rules to the north. But Canada is looking more like the U.S. in one area: Dealer groups are getting bigger. “Consolidation is happening in our country,” sa ...
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Where are you spending your dollars on digital?

Posted 5:00 pm U.S. ET, Jan. 23
blogs James B. Treece is a News Editor at Automotive News.
 
SAN FRANCISCO -- The impact of digital tools on dealerships’ marketing has grown exponentially. Those tools have been a hot topic at the last few NADA conventions. But it may be time for the focus to shift. “Digital marketing has left the building,” Scott Gruwell, general manager of Courtesy Chevrolet in Phoenix, told me on the sidelines of an automotive lenders conference. &ldq ...
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NADA, Tesla, pitchforks and torches -- a missed opportunity

Posted 1:00 am U.S. ET, Jan. 23
blogs
Elon Musk drew a huge crowd last week in Detroit, when he spoke at the 2015 Automotive News World Congress. (GLENN TRIEST)
NICK BUNKLEY:  SAN FRANCISCO -- Jeb Bush and Jay Leno are the keynote speakers at this weekend’s NADA convention, which is great, because car dealers tend to love Republicans and bad jokes. If there’s one thing many car dealers can’t stand right now, it’s Tesla. Yet here they are, thousands of them, spending a few days right in Elon Musk’s backyard. It’s hard to have a dealer ...
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Building a new fortress to protect data

Posted 2:00 pm U.S. ET, Jan. 23
blogs James B. Treece is a News Editor at Automotive News.
 
SAN FRANCISCO -- It may be too late to be paranoid. When it comes to protecting sensitive data against hackers, the days of building thick digital walls and moat are over, said Boulton Fernando, chief security officer at Toyota Financial Services. We should assume the hackers are already inside our preliminary defenses, he said. Now it’s about moving the crown jewels into a safe inside a c ...
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The other side of the digital ad craze

Posted 7:15 am U.S. ET, Jan. 23
blogs Lindsay Chappell is the Mid-South bureau chief in the U.S. for Automotive News.
 
SAN FRANCISCO -- Car dealers will be deluged with talk of digital advertising this week at the National Automobile Dealers Association’s annual convention here Digital ad spending by dealers will increase 25 percent this year, according to a recent forecast by market watchers Borrell Associates. But ad agency owner Terry Lancaster has some different advice for retailers: Don’t be so ...
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Navigating the great digital divide

Posted 3:30 pm U.S. ET, Jan. 23
blogs
AutoNation CEO Mike Jackson says that most customers don't want a fully digital deal in which their vehicle is delivered to their home or office. They want to come into a store, look the car over, maybe even change their minds. (DAVID PHILLIPS)
DAVE GUILFORD:  SAN FRANCISCO -- The data vs. the gut. As auto dealers gather for the NADA convention here in the heart of the United States’ disruptive, digital culture, it’s clear that they have to navigate between those two styles of management. Again and again, speakers at the Automotive News Retail Forum on Thursday explained how they were adapting to the shopping styles of modern consumers, ma ...
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Low gas prices - the good ... and bad for dealers

Posted 8:25 pm U.S. ET, Jan. 23
blogs Richard Johnson is print editor of Automotive News.
 
A lot of auto people can't seem to make up their minds about whether low gasoline prices are in the long-term best interest of the car industry, given that they may not be in the best interest of the economy at large.But none of those people are dealers, it seems. Just ask the dealers at the Moscone Center."It sure doesn't hurt," said Steve Germain, CEO of Germain Motor Co. in Columbus, Ohio. "For ...
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Fox, incoming chair, stumbles and takes on look of a prizefighter

Posted 2:01 pm U.S. ET, Jan. 22
blogs Jim Henry is a special correspondent for Automotive News.
 
SAN FRANCISCO -- Bill Fox, incoming NADA chairman, tripped and fell in San Francisco earlier this week, requiring five stitches in his chin and three trips to the dentist so far for repairs, according to outgoing NADA Chairman Forrest McConnnell. McConnell subbed for Fox in a presentation Thursday at the American Financial Services Association Vehicle Finance Conference. ...
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Why Jeep executives might be praying for more snow days

Posted 1:48 pm U.S. ET, Jan. 22
blogs Larry P. Vellequette covers FCA for Automotive News.
 
SAN FRANCISCO -- There are six basic questions that journalists use to write and explain what’s going on around us. They’re expressed very simply, but on occasion, incredibly hard to answer. Who? What? Where? When? Why? And How? And when you think about Jeep -- specifically the brand that tallied over 1 million global sales in 2014, including 692,348 sales in the U.S. -- most of thos ...
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Industry's rising chorus: Timing is everything

Posted 6:27 pm U.S. ET, Jan. 22
blogs Dave Versical is Automotive News' director of editorial operations.
 
Dealers spoke. NADA listened. So this year’s convention started a day earlier, to get you home for the entire last-week-of-the-month sales push. That nod to time is a rising industry issue. We hear a lot about the 60-minute transaction. The thinking: Impatient millennials will be drawn to stores that can close a deal on a $30,000 car in just twice the time Domino’s delivers a pizza. ...
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Luddites? Really?

Posted 12:01 am U.S. ET, Jan. 22
blogs James B. Treece is a News Editor at Automotive News.
 
Maybe you saw this: Four states received a “Luddite Award” from a Washington, D.C., think tank for laws preventing Tesla from opening its own stores. The four -- Arizona, Michigan, New Jersey and Texas -- collectively were one of 10 organizations or individuals that got the dubious award for having “done the most in 2014 to smash the engines of innovation,” the Information ...
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What keeps leadership dealers awake at night?

Posted 12:01 am U.S. ET, Jan. 17
blogs Jamie LaReau covers the automotive retail beat for Automotive News.
 
DETROIT -- Even in good times, there are things that will keep most dealers awake at night. At the Detroit auto show last week, I sat down with the outgoing chairman of the National Automobile Dealers Association, Forrest McConnell, and the incoming chairman, Bill Fox, to talk about what gives them restless nights. On the surface everything seems wonderful: Many analysts are calling for a 17 mil ...
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No need to panic as big banks pare dealers

Posted 12:01 am U.S. ET, Feb. 12
blogs Jim Henry is a special correspondent for Automotive News.
 
Recent news that Chase Auto Finance and TD Auto Finance are looking to trim their dealership networks brought swift reactions of "Here we go again" from some members of the dealership F&I community.That more or less automatic response is based in part on the stereotype that banks move in and out of auto finance when it suits them.But it's a gross exaggeration to associate what the banks are do ...
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Long loans are a necessary evil, dealers say

Posted 12:01 am U.S. ET, Feb. 5
blogs Jim Henry is a special correspondent for Automotive News.
 
Everyone agrees that superlong loan terms are bad for the industry, but it seems no one wants to give them up first.Long loans -- between, say, 72 and 84 months or even longer -- likely will leave customers upside down at trade-in time, owing more on their car than it's worth. Brand loyalty and dealership loyalty fall off at the end of an extremely long loan term, experts say."Long-term financing ...
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Dealers radiate resolve, not complacency, at NADA

Posted 11:34 am U.S. ET, Jan. 31
blogs David Barkholz is a reporter for Automotive News.
 
If strong U.S. vehicle sales have caused dealers to become complacent, it failed to show at the NADA convention.Dealers flocked to New Orleans for ideas.It's not sexy, but fixed ops software, especially for the service drive, was a hot item.Dealers such as Jeff Kahlig, CFO of Kahlig Auto Group in San Antonio, spent time at the ADP Dealer Services booth learning how ADP's new electronic payment sys ...
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Why one Chevy dealer doesn't fear the Reaper

Posted 9:33 am U.S. ET, Jan. 28
blogs

MIKE COLIAS:  NEW ORLEANS -- Digital marketing tools, slick service apps and fresh F&I strategies were on the radar of many dealers who attended the NADA convention here this weekend.But for Chevrolet dealer Heinke Trapp, it was a date with The Reaper.The Reaper is what you get when you take a stock 2014 Chevy Silverado 1500 and upfit it with beefy fender flares, an audacious domed hood, 8 extra inches of c ...
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Tesla is the latest chapter in factory vs. dealer franchise fights

Posted 10:40 am U.S. ET, Jan. 27
blogs Amy Wilson covers retailing for Automotive News.
 
NEW ORLEANS -- When it comes to Tesla CEO Elon Musk and the franchise system, Connecticut dealer Jeff Aiosa says he's seen this movie before. Manufacturers will keep challenging dealer protection laws, and dealers will keep pushing back.Like many other dealers I've spoken with here in New Orleans, Aiosa believes that dealer franchise laws will hold up despite Musk's threat of a national challenge ...
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New M&A lingo: 'nontraditionals' and 'family offices'

Posted 7:16 pm U.S. ET, Jan. 26
blogs Richard Johnson is editor of Automotive News -- print.
 
Tim Lamb of Tim Lamb Group, whose stand was crawling with acquisitive dealers, says he's beginning to see signs of it.George Chaconas of Performance Brokerage has noticed it "just in the last six months."These deal makers are starting to hear from "nontraditional" dealership buyers.Of course, the market doesn't need buyers; it needs sellers. But owners of those privately held mid- to large-sized g ...
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FTC ad regulators could 'make an example' of 1 dealer in each state

Posted 12:01 pm U.S. ET, Jan. 26
blogs Jamie LaReau covers the automotive retail beat for Automotive News.
 
NEW ORLEANS -- Colorado car dealers take heed and watch those ads.Leaders of the Colorado Automobile Dealers Association outlined the pressing issues for dealers at CADA's breakfast on Sunday morning in New Orleans at the National Automobile Dealers Association convention.One of the big ones is the Federal Trade Commission's announcement that it would be heavily monitoring dealers' advertising pra ...
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Test drives beat walk-arounds

Posted 10:21 pm U.S. ET, Jan. 26
blogs News Editor James B. Treece oversees Automotive News' coverage of auto retailing.
 
NEW ORLEANS -- A few booths at NADA are hopping. Others are nearly empty. The majority have a good number of representatives of that company speaking with a smaller number of dealers and dealership managers who have stopped by.What makes certain exhibits stand out?Hands-on involvement.The exhibition floor has a large number of booths devoted to computer services, whether DMS, CRM or any of the oth ...
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How a Philadelphia dealer might help end the CFPB feud

Posted 3:20 pm U.S. ET, Jan. 26
blogs Gabe Nelson is a reporter for Automotive News and is based in Washington, D.C.
 
NEW ORLEANS -- Kerry Pacifico was a nominee for Time Dealer of the Year. He didn’t win.But the 89-year-old Ford, Mazda and Hyundai dealer can head home to Philadelphia with satisfaction regardless, knowing that his struggle to satisfy fair-lending regulators a decade ago now offers a way for thousands of his fellow dealers to stay in the Consumer Financial Protection Bureau’s good grac ...
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Can dealers push back like it's 1989?

Posted 12:18 pm U.S. ET, Jan. 26
blogs Amy Wilson covers retailing for Automotive News.
 
NEW ORLEANS -- Twenty-five years ago this month, Ron Tonkin rolled into New Orleans ready to take on the automakers.“Like the characters from the movie 'Network,' we're mad as hell and we're not going to take it anymore,” Tonkin vowed as he became president of the National Automobile Dealers Association for 1989.A legend was born. When he died last week at 82, Tonkin was remembered as ...
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Hear that? It's the sound of skyrocketing inventories

Posted 7:31 pm U.S. ET, Jan. 25
blogs Jason Stein is publisher and editor of Automotive News
 
Record profits. Surging sales. And all is big and easy in the Big Easy. Or is it? Not to throw cold water on a hot New Orleans NADA party, but talk to enough dealers on the show floor here this weekend and you'll hear hints of concern. Enough with the comparisons to 2009. Those days are over. Now, some dealers say, let's be mindful of what could come. Consider: Interest rates remain at historic lo ...
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Why George Chaconas is such a busy man

Posted 4:24 pm U.S. ET, Jan. 25
blogs Richard Johnson is editor of Automotive News -- print.
 
NEW ORLEANS -- Sit with dealmaker George Chaconas of Performance Brokerage Services at the Starbucks outside the convention hall, and you discover a busy guy."Well, the dealers just got out a meeting," he says as a herd of well-dressed retailers stream by -- a couple of whom seem anxious to meet up with Chaconas right then and there.A lot of dealers want to check in with brokers at this convention ...
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Why the sales process still wastes so much time

Posted 10:57 am U.S. ET, Jan. 25
blogs Lindsay Chappell is the Mid-South bureau chief for Automotive News.
 
NEW ORLEANS -- It’s frightening to consider how much time is being wasted on the typical car sale.It’s a wonder sales personnel -- or even the dealership, for that matter -- manage to make any money, says retail consultant Mark Rikess.Rikess’ firm, the Rikess Group was hired to conduct an efficiency study of more than 100 dealerships not long ago. Consider his findings:The averag ...
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What happens in 2016 if interest rates rise?

Posted 12:01 am U.S. ET, Jan. 24
blogs News Editor James B. Treece oversees Automotive News' coverage of auto retailing.
 
NEW ORLEANS -- 2014 will be a good year for the industry. But what about 2016?The following draws from speeches at the American Financial Services Association conference, which precedes the National Automobile Dealers Association convention here.Imagine Mae. In March 2013, she traded in a six-year-old car for a three-year-old one. By mid-2016, she's looking to replace it. She's back to working ful ...
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For BMW, a Tesla makes a 'nice snowplow'

Posted 1:09 pm U.S. ET, Jan. 24
blogs Dave Guilford is news editor for Automotive News.
 
NEW ORLEANS -- Quick now: If your automaker were launching a stylish, premium electric vehicle -- or a plug-in hybrid -- chock-full of new tech, who would your main competition be?Might it be the only EV maker of note to survive that segment's shakeout? You know, the company that attracts headlines about twice a week.Tesla, in other words?Ludwig Willisch, CEO of BMW of North America, pooh-poohs th ...
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Despite rosy sales forecast, sharp dealers plan ahead

Posted 7:36 pm U.S. ET, Jan. 24
blogs Dave Versical is Automotive News' director of editorial operations.
 
My colleagues who were here five years ago tell me it was grim. Nothing like the prospect of GM and Chrysler dying to suck the air out of a learn-fest like the NADA convention.So it struck me to read that the association's new chief economist, Steven Szakaly, is predicting three more years of rising U.S. sales - on top of the four we've seen since 2009.Never mind that Mr. Szakaly used to work for ...
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Just whose NADA is this?

Posted 9:40 am U.S. ET, Jan. 24
blogs Lindsay Chappell is the Mid-South bureau chief for Automotive News.
 
If you see Michael Bartsch at the National Automobile Dealers Association convention in New Orleans this weekend, you will probably find him empty-handed.That's because Bartsch, Infiniti's new vice president for North America, says he comes to NADA without an agenda, without a formal presentation for his dealers, and most certainly without a PowerPoint presentation."I think PowerPoints are a defen ...
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Ron Tonkin and memories of the 1989 NADA convention

Posted 9:40 am U.S. ET, Jan. 23
blogs News Editor James B. Treece oversees Automotive News' coverage of auto retailing.
 
NEW ORLEANS -- News of dealer Ron Tonkin's passing took me back to an NADA convention in New Orleans exactly 25 years ago.It was only my second time at NADA's wingding, and what an extravaganza it was!In New Orleans in 1989, Tonkin accepted his election as NADA president with a stem-winder of a speech vowing to stand up to the factories on behalf of dealers. He compared himself to Mike Tyson, sayi ...
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Biggest F&I buzzword at NADA? Compliance

Posted 12:01 am U.S. ET, Jan. 22
blogs Jim Henry is a special correspondent for Automotive News.
 
It looks like compliance will be the No. 1 topic at the National Automobile Dealers Association convention in New Orleans this weekend, judging from the many F&I workshops, trade show displays, and all manner of sales pitches scheduled to take place.The Consumer Financial Protection Bureau, which is campaigning against dealer reserve, is behind much of this interest, of course. Dealer reserve, ...
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