As I write this, I am sitting in the press room at AutoMobility LA, the new name for the Los Angeles Auto Show. It is a reflection of the growing importance of technology in the auto industry. There are ramifications of that trend for dealerships, and some of them are discussed in this week’s story about the latest report by Glenn Mercer for NADA.
I happened to hear him present his findings twice, once at the China Automobile Dealers Association last week in Zhuhai in southern China, once this week at the AutoConference LA (the new name for the NADA/JDPA-sponsored annual conference) here in Los Angeles.
One of the conclusions of the Mercer study is that the factories will have much more control over dealerships in 2025. Many dealers might argue that the factories have plenty of control over dealers now. Dave Conant, owner of The C.A.R. Group and a panelist at AutoConference LA, points out that “the control [the factories] have in general is huge.” He mentioned how image programs give the manufacturers huge control over dealership cost structures, and that dealers have very little control over rent increases as an example.
He also says he figures it will be awhile before the complete sales transaction is done on the internet. But, says Conant, so much of the transaction is already completed online that dealers must be “much more forward leaning” in the sales process. The buying experience has to be changed so the consumer is willing to stay on the lot and learn about the vehicle, he says.
Also this week, we have a column by frequent contributor Joe Aboyoun on the perils of an improperly completed franchise application. Hint: It relates to the dreaded right of first refusal.
We also have Transaction News. Enjoy!
