The relationship between dealers and OEMs in our industry is crucial for mutual success. However, as we all know, conflicts frequently arise as OEM policies can negatively impact dealers’ businesses. In such cases, it becomes essential for dealers to advocate for themselves and find avenues to communicate their concerns effectively. There are various opportunities and strategies for dealers to make their voices heard.
Opportunities for Communication
Dealers have several opportunities to communicate with OEMs and convey their concerns effectively. These include engaging with their OEM reps, participating in the various franchise councils, and attending the many meetings that occur throughout the year. Those are important avenues for communicating and collaborating directly.
That said, as a member of the ADA in your respective state, you are able to convey your message at a different level. Through the association, OEMs are made aware of the franchise laws in the specific state they operate in. Associations are also there to remind OEMs where and when they may be operating out of the various governing statutes.
OEM Priorities and Dealer Alignment/Conflict
Understanding OEM priorities is crucial for dealers to identify areas of alignment and potential conflicts. Right now, the hot-button issue is EVs. OEMs have committed to producing large numbers of EVs over the next decade or two, driven by demands from the current administration. Whether that all comes to pass or not, remains to be seen. Where this priority can and does create conflict is through the requirements being put on dealers to sell these vehicles. This includes everything from the facility requirements OEMs put on dealers to the distribution methods themselves. Much of this is being played out as we speak, and we have seen firsthand how overwhelming and invasive these plans can be.
Get Attention and Seek Recourse
When OEM policies negatively affect business, dealers and associations have several options to get the attention of OEMs and seek recourse. Associations play a vital role in advocating for dealers. By regularly corresponding with dealers and OEMs, associations convey concerns, propose changes, and negotiate on behalf of members. The benefit is that these concerns are voiced by the association itself, avoiding the individual dealers’ fear of retribution by the OEM.
The other place where dealers/associations can get the attention of the OEM is in the courts. Legal action can be an effective way to challenge unfair OEM policies, and the association’s main responsibility is to protect dealers’ rights and lobby for legislation affecting their interests.
Support Open Dialogue Through Organizations
To open effective dialogue with automakers and strengthen their own collective voice, dealers can join and support various organizations. These include metro associations, state associations, and the National Automobile Dealers Association.
Membership in metro associations provides dealers with opportunities to collaborate with OEMs on auto shows and other local events. This involvement helps establish relationships and facilitates dialogue.
Your state association serves as the intermediary between dealers and OEMs, advocating for dealer interests and building relationships with legislators. This provides an important platform for communication on a state level.
Finally, membership in NADA offers dealers a powerful platform for national advocacy, ensuring their concerns are heard by OEMs, policymakers, and other stakeholders.
It is essential for dealers to advocate for their interests when faced with OEM challenges. By utilizing various communication channels, actively engaging with associations, and seeking recourse through legal/legislative means, dealers can effectively address issues with OEM policies. Open and constructive communication between dealers and OEMs is crucial for long-term success. By actively advocating for themselves, dealers can ensure that their voices are heard, and their concerns addressed, leading to a stronger and more resilient industry as a whole.
