St. Louis native Ray Mungenast will represent 10,000 import-brand dealerships as 2012 chairman of the American International Automobile Dealers Association.
Along with his two brothers, he heads the Mungenast Automotive Family, which owns five auto dealerships and one motorsports store in the St. Louis and Alton, Ill., areas.
His father, Dave Mungenast Sr., founded the dealership group in 1965 when he opened its first storefront, a Honda motorcycle dealership. From there, the group branched out into autos, opening a Toyota store in 1967 and later adding Honda automobiles, Acura, Lexus, Hyundai and Scion.
The middle child of the three brothers, Ray Mungenast got into the family business in 1985 working at the Honda motorcycle store. He completed training at the National Automobile Dealers Association's candidate academy in 1986 and went to work at the family's Acura store in 1989.
He got his first glimpse of Washington's policy world in 1992 when he traveled there with his father to attend an AIADA congress. "I've gone every year consecutively since then," Mungenast said.
His father, a motorcycle racing champion, part-time Hollywood stuntman and member of the American Motorcyclist Association's Motorcycle Hall of Fame, was AIADA chairman in 1998; he died in 2006.
Ray Mungenast, 50, spoke with Staff Reporter Christina Rogers about his goals for the 2012 term and challenges facing import-brand dealers.
Q: 2011 was a challenging year for some Japanese brands. Can you summarize where the situation stands now?
A: I think it is clearing up here a bit. The unique things we dealt with as Japanese dealers, meaning the earthquake and tsunami, those are certainly not mainstream challenges you deal with. Hopefully, those are not in our immediate future and we can get back to the normal challenges of doing business: the economy and some other things. I believe we are on somewhat of a recovery period. I believe it will take some time to get back to the years we enjoyed in the early 2000s and that timeframe.
Was last year a teaching moment for the industry? What are dealers taking away from this?
So much of it is how you choose to look at it and deal with it, but I think we always become better dealers in the challenging years. In the good years, it's easy to let off a little bit and become complacent. It's the challenging years that lean you down and make you better and make you tougher and stronger.
As far as inventory constraints, do you feel the Japanese have overcome this?
I don't think they have fully recovered yet, but I think they're well on their way to recovery.
What's the 2012 outlook for your members?
Overall, I think there are some signs the economy is trying to improve and buyer confidence is starting to come back. Not that it's back by any means. But there are some positive signs on the horizon that things are trying to get better. The housing industry is starting to show some positive signs. The stock market has stabilized. There are several segments that look like they're trying to get better.
The domestic automakers have made some gains during this recovery. How are your members responding and how does this change the sales landscape?
I think competition and an even playing field are always good for all the manufacturers wherever they exist in the world. A healthy ebb and flow is only going to make each manufacturer stronger.
What are some key goals for your term as chairman?
We have to continue to maintain a healthy balance of our board members, both experienced people like myself who are somewhat in the middle and younger dealer candidates that want to serve in Washington. I'd like to see that we get a few younger generation people on our board. We want to continue to work with dealers and the manufacturers to maintain relationships with our elected officials, so they understand the importance of maintaining a health business environment.
How are dealer relations with the manufacturers changing as the industry regains its momentum?
As sales environments improve, they'll want dealers to invest in people and their facilities, and properly done that can be healthy.
How are manufacturer requirements changing? What is being demanded?
I can't say specifically that they're moving on it. I can't comment on that specifically.
The National Automobile Dealers Association has opposed new fuel economy rules being pushed by the Obama administration out of concern that they could increase new-vehicle costs. Does AIADA have a stance on that?
AIADA's stance is that we want one national fuel standard and not a patchwork of state rules. In other words, we want a consistent, fuel standard. Our other stance is that we want the legislative and regulatory authorities to consider all factors, including the environment, safety and vehicle cost before establishing these or any standards.
Does AIADA share NADA's concerns about higher vehicle costs?
The goal is to have a fair, rational standard that will improve the environment and that the manufacturers can meet.
What are some of the key policy concerns heading into 2012?
One of the oldest issues we still have on our books is taxes and the death tax. We remain committed to the complete elimination of the federal estate tax because of the chilling effect it has on economic activity and the distress it places on family-owned dealerships, like our own in St. Louis.
Infotainment and distracted driving laws -- those are things we're monitoring. Certainly, the [U.S.-]Korea Free Trade] act; that's one we supported.
What are your thoughts on infotainment and distracted-driving regulations?
As an association, we support the efforts of the manufacturers to work with the regulators to build smarter, safer cars. This is primarily a manufacturer issue, but that's the association's stance. We want to help them as much as we can.
What are your thoughts on the Trans-Pacific Partnership agreement? Will it benefit your members?
At this point, it's too early to say how it may benefit our members. As you know, the United States is leading TPP in the hopes of creating a broad trade and economic framework in that region. As the world's third largest economy, Japan should be undoubtedly a part of it. The association's stance always has been that we support an expanded global marketplace. We believe that TPP can lead to economic growth in the U.S. and for our trading partners. It will probably be a work in progress during my term. It will be something we will definitely work toward. I'd like to see it be approved and become a reality, but it may take longer than that.
What do you think of the UAW's plan to organize the transplant automaker factories? Part of that plan is to pressure the companies by targeting import-brand dealerships.
The association's viewpoint on it is that definitely the UAW has a right to organize international brand plants. And the plant workers have the right to join or not join the union. The UAW's theory is that picketing the dealerships will sway plant workers' decisions, and we think that seems far-fetched and could cause real damage to dealers, their employees and the communities they serve. We also feel the UAW needs to concentrate on selling itself to the workers, not causing economic harm to America's small businesses.