On the heels of its latest acquisition, Keffer Auto Group is proving that growth is possible even in a challenging retail climate. On today’s episode of Inside Automotive, CEO Jim Keffer discussed how the group navigates industry headwinds, from shifting consumer demand to tariff concerns, while continuing to expand its footprint.
The group recently acquired a Chevrolet store in Minnesota. “Chevy is a great brand, and we think it will continue to do well,” Keffer said, noting recent strong regional growth. He added that the Minnesota location was less about geography and more about partnering with a trusted operator. “Our home model really is built more around the person than the location,” he said.
“The business is as good as whoever we have operating it.”
State of the market
Despite affordability pressures, several of the group’s brands are posting strong sales, with some hitting record volumes. Keffer cautions that higher volume doesn’t always equate to higher margins. “You have to stretch sometimes to get that additional volume,” he said, emphasizing that performance ultimately depends on leadership inside each store.
A people-first ownership model
Keffer Auto Group’s operator-focused philosophy dates back to 1974, when Keffer’s father entered the business through a 10-year buyout arrangement. Inspired by that experience, the company continues a pay-it-forward approach, giving general managers and other qualified operators the chance to buy into dealerships and eventually become full owners.
“We actually sell them out on 10-year buyouts,” Keffer explained. Operators also participate early in service contract profits, giving them the resources to transition into full ownership. “People are the most engaged when they are involved not just as a leader, but as an owner,” Keffer said. He added that this structure often leads to performance improvements far beyond a traditional corporate-run model.
Navigating industry pressures
Further, Keffer addresses the current challenges from EV policy changes to tariffs. On EVs, he said, “It’s the bear in the woods. You don’t have to run faster than the bear… you just have to run faster than your friend.” On tariffs, he notes, “Prices are already up… there is a certain limit on budgets everywhere. Used cars become more important than it’s ever been.” This emphasizes that resilience among dealers and manufacturers is critical to staying profitable.
Keffer remains optimistic about the second half of the year, despite current challenges, stating, “The second half of the year, we expect to be better because we need it to be.”
