NADA 2023

Insights From Autoteam America's Buy-Sell Summit

A consolidated look at the discussions from Autoteam America's Buy-Sell Summit.
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Insights From Autoteam America's Buy-Sell Summit

We spent the day at Autoteam America’s 29th Annual Dealer/CEO/CFO Forum and 10th Annual Buy-Sell Summit. We heard from top-tier industry leaders like Alan Haig, Rob Cochran, Paul Walser, Karl Schmidt, John Murphy, Jonathan Smoke, Paul Metrey, Rich Sox, Tom Doll, and our very own Paul Daly. We learned, learned some more, and when we thought we were done, we learned a bit more. Here are just some of the  insights we picked up from the day:

Three of the biggest disrupters to retail automotive:

  1. OEM direct and dealer online selling.
  2. Consumer acceptance of alternative powertrains like EVs.
  3. Impact of alternative powertrains on fixed operations.

Baller dollars. Though gross profits per vehicle fell slightly in Q3 of 2022 to 6K, they are still higher than years previous ($4,693 in 2021 and $2,725 in 2020). 

Demand remains high, but supply is well below where it should be. This drives customers to shop online. OEMs are working hard to catch up, but it may still be a while before things balance.

Quality talent is the secret sauce! 
Attracting dedicated, high-performing talent is a major focus, especially as the birthrate declines and the workforce shrinks. Average turnover within the industry is still far too high, sitting around 20-30% last year. Allowing your brand to act as your organizational conscience and clearly communicating company culture and consistency is key.

Allowing for dynamic autonomy can drastically elevate the trust a worker feels within their organization, and continued education can boost engagement. If the employees don’t believe in or feel inspired by the brand, neither will the consumer.

Make authentic connections. Bryan DeBoer, CEO of Lithia, said it best: “It’s all about the customer. It really is that simple.” Making authentic connections and building client confidence is crucial. This is something that consumers can’t get with an online buying experience and what can help differentiate dealerships from online retailers.

When it comes to giving back, small is agile. While corporate entities have to play by corporate rules, local dealerships don’t have the same restrictions. They have the flexibility to choose whichever organizations they want to support, which can go a long way toward creating community-specific engagement.

Digital retailing. The pandemic accelerated digital retailing, and it isn’t going anywhere. According to recent data, nearly all customers begin their car shopping online. Even if that trend only lasts another 5 years, nobody should miss an opportunity to be where the customers are.

Cars are getting older, so service is getting more important and specific. 12.2 is the average age of vehicles currently being driven. As cars improve in quality and safety, that age is sure to increase. Dealerships can leverage this trend by offering specialized service packages.

Consolidation = growth. It reflects a desire to increase market presence, enter new markets, and access new technologies and capabilities. Alan Haig, CEO of Haig Partners, says this is the biggest trend he sees.

Sharing Success. Though it may not always be easy, aligning with OEMs and vendors can help dealerships in the long run. Constructive partnerships will always be more beneficial than contentious ones. Work with brands that work with you.

Auto dealers continue to face mounting challenges, but for those staying alert and focused on the customer, it is still a pretty good time to be one.

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