Moreno builds an empire by rocking the boat

If there's a profile of the typical car dealer -- the local small-businessman who's content to run a family store and know everyone in town -- then Bernie Moreno is not a typical car dealer.

A native of Colombia who grew up in Florida and attended the University of Michigan, Moreno spent 12 years working for Herb Chambers' big dealership group in Boston before striking out on his own in 2006, acquiring a Mercedes-Benz store outside Cleveland.

Since then, he has scarcely slowed down. He heads an expanding empire, now called Bernie Moreno Cos., which owns 18 dealerships in Ohio, Kentucky and Massachusetts and generates more than $900 million in annual revenue. And Moreno, 49, is pushing for more. He has been awarded a new Infiniti point in Coral Gables, Fla. -- held up for now in a legal battle -- and is on the hunt for further opportunities.

"Anywhere between Miami and Boston, if it makes sense," he said in an interview.

Moreno represents a new breed of auto retailer -- young, ambitious, aggressive, willing to invest big and able to drive heady sales growth. And that makes him the kind of dealer some automakers will go to extra lengths to help, just to get him on their team.

"Bernie is now being chased by every manufacturer out there," Jeffrey Harris, a regional vice president for Infiniti USA, testified in the case related to the Coral Gables point. "There's only so many good dealers out there, and every manufacturer wants to get the best. Bernie is absolutely one of the best."

Perhaps what makes Moreno stand out most with manufacturers is his willingness to challenge the conventions of auto retailing.

Franchise laws? Most dealers see them as the foundation of their existence. To Moreno, they are a "crazy system" that "protects bad dealers."

"If you have a [dealer] who is lousy, [the manufacturer] can't do anything" to force him or her to improve the store, staff or sales.

Some dealers, he said, use franchise protections to frustrate manufacturers' efforts to grow by adding points. "They don't like to compete in the showroom, so they compete in the courtroom."

Moreno is embroiled in a legal battle stemming from a protest against the awarding of the Infiniti point in Coral Gables. The owners of South Motors Infiniti, a neighboring store, also had sought the new point, but Nissan agreed to give it to Moreno and pay him up to $4.4 million over seven years to help him ramp up. South Motors contends the subsidized store will hurt its business.

The payments to Moreno are part of a strategy by the company to support dealers with big growth plans by giving them special access to executives, awarding them new points and sometimes providing hefty financial help. In Ohio, Moreno has acquired two Nissan stores and three Infiniti locations near Cleveland since 2011. Nissan is providing up to $6.6 million over five years to help.

Moreno said the payments from Nissan just help him cover high facility and relocation costs and don't really give him any advantage over neighboring dealers.

Moreno is a member of the National Association of Minority Automobile Dealers, but he testified in the Coral Gables case that he doesn't see himself as a minority and rarely goes to the group's meetings. After he became an Infiniti dealer in 2010, he attended a NAMAD meeting in Nashville. He said he was "bored through the entire meeting."

But it was there that he heard about the Coral Gables point. His minority status also came into play in his purchase of his first store, Mercedes-Benz of North Olmsted, in suburban Cleveland.

Mercedes was inclined to help him get started as a minority dealer principal, and convinced the seller, Penske Automotive Group, to give up the store for a "drastically reduced price," Moreno said in a 2014 hearing. In exchange, Mercedes awarded Penske an open point elsewhere in the country.

Before he bought it, Mercedes-Benz of North Olmsted was selling about 200 cars a year. Now, it retails more than 1,800 annually, according to Moreno.

His formula for high-volume sales is straightforward. He buys stores and moves them into big, posh facilities. For one Infiniti store near Cleveland, he spent $200,000 on an opulent grand opening.

He also looks to relocate close to competitors. His airy Infiniti store in Akron was built down the block from a Lexus point. He bought a suburban Nissan store and moved it to a gleaming new building near the Cleveland airport -- a few doors down from a big Toyota dealership. In Coral Gables, the Infiniti point he is trying to secure is supposed to open across from a Mercedes location.

He's also relentlessly upbeat. He tells staffers that whenever a customer says "no," take that to mean he or she just needs more information to get to "yes."

Staffers also get commandment cards with 10 dictates. The first: "Thou shall have fun." Others urge them to be good listeners and respond immediately to clients.

Moreno said he came up with the idea once when he considered the Bible's Ten Commandments. They tell people what not to do. Wouldn't it help, he thought, if you tell them what they should do?

He declined to provide a full list for publication, saying: "We keep those proprietary."