Major auto retailers like Lithia Motors and Sonic Automotive have continued to grow at a rapid pace, acquiring both large and small dealerships across the country. We recently spoke with Robert Glaser, President of the North Carolina Automobile Dealers Association about the growth of major retailers and how it impacts local dealers. Is the future is still bright for small dealerships or if they should consider selling to one of the larger retailers?
Obviously, 2020 was a volatile year for auto dealers not only in North Carolina, but across the country. Surprisingly, dealers in the state performed strongly and reported robust sales results despite the difficult circumstances. From Glaser’s perspective, the biggest takeaway from how business has changed due to the pandemic, is the emergence of the digital transaction. Dealers really embraced this new technology, kept their employees safe, and addressed the concerns of the consumer.
While many dealers nationwide leaned heavily into used car sales, new car sales very strong in North Carolina during 2020. On average, North Carolina dealers sell half a million new cars every year. While they didn’t hit the record amount of sales seen in 2019, Glaser says he expects dealers to maintain strong momentum in 2021.
2020 also saw hefty M&A activity with the consolidation of mom-and-pop dealers who maybe own one or two franchise locations. However, these consolidation efforts are not cause for immediate concern in Glaser’s opinion. Even in North Carolina’s metropolitan areas like Raleigh and Charlotte, the role of the small town dealer is still vital to the community.
He says, “You can’t downplay the importance of that small consumer, or small dealership in your local hometown. I mean, they’re heroes. They’ve been in those small hometowns for 50, 60, up to 100 years sometimes. And the role they play in that small town is more than just selling vehicles.”
Looking ahead to 2021, Glaser expects the strength of car dealers to continue. However, it is important to stay in tune with what’s happening in Washington, D.C., especially the acceleration of the EV model. Dealers should focus on staying a vital part of the consumer transaction.
Did you enjoy this interview with NCADA’s Robert Glaser? Please share your thoughts, comments, or questions regarding this topic with host Jim Fitzpatrick at jfitzpatrick@cbtnews.com.
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