Whether the challenge is rising interest rates or tariffs on imports, dealers must turn to Washington and monitor policies and regulations that impact the auto industry.
Mack McLarty, vice chairman of RML Automotive in Dallas, said storm clouds are brewing for the industry — and some of them are coming from the White House.
"The federal government impacts our industry, there's no question about it," McLarty said Thursday at the Automotive News Retail Forum: NADA. "Each presidency faces certain challenges, but these times are in many ways unprecedented."
McLarty, who was White House chief of staff for the first 18 months of President Bill Clinton's administration, also spoke about how the auto retail industry prepared him for his political career.
On the federal government shutdown, a threat to disrupt the auto industry, McLarty said: "We'll be much better off if we get this behind us." A day after McLarty's remarks, President Donald Trump announced a deal to reopen affected agencies through Feb. 15. One of those agencies, the EPA, was forced to delay emissions certification for some 2019 and 2020 cars and trucks.
On another front, Trump is threatening to impose tariffs on light vehicles made overseas and sold in the U.S., a move that could upend business for import dealers.
The entrepreneurial spirit of auto dealers is unparalleled, McLarty says, and as profit margins compress and retail consolidation increases, dealers will find a way to adapt with the changing landscape.
Bloomberg contributed to this report.