The automotive industry is facing major shifts in affordability, regulations, and technology. In today’s episode of Inside Automotive, Tom Castriota, 2025 NADA Chairman and owner of Castriota Chevrolet, shares key insights on recent dealer wins, challenges like tariffs and EV mandates, and how AI and advocacy will shape the industry’s future.
The rollback of California’s aggressive zero-emission vehicle (ZEV) mandate marks a significant victory for dealers and OEMs who faced struggled to meet the 35% EV sales target for model year 2026. This legislative success involved close collaboration between NADA, government officials, and the administration, culminating in the signing of related congressional acts at the White House.
Tariffs continue to present a significant challenge for the industry. While the NADA supports the administration’s goals to rebuild U.S. manufacturing and strengthen strategic industries, the association is actively pushing for a transitional “bridge” period to help dealers and manufacturers adjust before tariffs fully impact vehicle prices.
"We're asking for a bridge. We support the President’s two philosophies... bring strategic industry back to the United States... and rebuild the U.S. economy through the industry base."
Affordability remains a pressing concern as the average new-vehicle price approaches $49,000. Many households earning around $65,000 annually cannot comfortably afford these prices, especially given current interest rates pushing monthly payments up to $900. This economic reality limits potential growth in new-vehicle sales volume. Although some dealers advocate for prioritizing profitability per vehicle over volume, OEMs focus on increasing production utilization, aiming for sales well above current levels near 13 to 15 million units.
Chinese EVs pose a global challenge due to significant government subsidies, creating an uneven playing field. Castriota acknowledges that many U.S. dealers would welcome affordable Chinese brands but warns that these heavily underwritten imports threaten domestic OEMs and the established dealer networks.
The rise of direct-to-consumer sales models, like Volkswagen’s Scout, raises legal and franchise system issues. NADA stands firmly behind state franchise laws and supports ongoing lawsuits in key states, serving as the voice of dealers in protecting the franchise system’s integrity.
Looking ahead, Castriota emphasizes the growing importance of AI for dealer competitiveness. NADA plans to train members on effective AI applications to improve operations while maintaining compliance and service quality.
Dealer-led grassroots advocacy also plays a crucial role in securing bipartisan legislative support. Castriota highlights influential allies like Senator Bernie Moreno, who strengthen dealer representation at the federal level.
