"We made money selling [new] cars 10 years ago," he said, but that's changed. "The manufacturers, through various marketing programs, are deliberately driving down the front-end profitability on the cars. The manufacturers have changed the game, saying to retailers, 'You can't make money selling cars anymore. Everything you make has to be downstream.' And if you want to have control of your destiny and grow, then you have to say, 'I have to be innovative and creative in the way I make money downstream, in ways I traditionally have not made money downstream.'"
Jackson blasted automakers that use stair-step or target-based bonus programs. "That target is set in an arbitrary, capricious, opaque, discriminatory way. We have enough stores that we can say, 'OK, let's square this circle and see, does this box?' Well, it doesn't box. They're arbitrary, they're capricious and it's opaque. There's always a missing piece to the puzzle that you can't solve. It's very disruptive in the marketplace, and it's very difficult to deal with.
"It's basically unfair to customers because you create a perception that something's available in the marketplace that's really not. Because certain players, based on their target, are at one price and others have another price. It's a multi-tier pricing system, and you're asking customers to figure it out. And it's exactly the opposite of what a customer wants. It's three-card monte, find the weenie. That dissatisfaction is being observed by many in the industry. Aggressive practitioners have the lowest residual values because it's basically a corrosive program."