Dealer Associations across the country are hitting the ground running in this new year. On today’s show, we’re pleased to welcome Brian Maas, President of the California New Car Dealers Association, or CNCDA, to give us an update on his Association and we’ll learn a little bit about a ballot initiative they’re working on, in the state.
Maas starts things off by giving us a pulse on how car dealers in his state are feeling in the first month of 2022. While supply shortages continue to put the squeeze on OEMs, car dealers are seeing record profitability. Certainly, dealers don’t want to see this profitability go away too soon, but Maas says what dealers do want, is an increased sense of normalcy. Dealers are used to offering a wide selection of products and have often spent years cultivating brand awareness. However, current retailing conditions have dealerships re-tooling their playbooks.
New vehicle affordability is also a growing concern. The average price for a new car topped $45,000 last fall and recently, Detroit automakers have announced pricey EV pickups for choice customers. Maas says prices this high can potentially alienate an entire generation of car buyers from purchasing a new vehicle or transitioning to an EV.
The association is also monitoring any changes in direct sales initiatives from manufacturers. Currently, direct sales from OEMs are allowed in California as long as these sales do not directly compete with franchised dealers. The franchise dealer system has been effective for over 100 years, says Maas. Car dealers thrive on competition with one another. Eliminating competition could reduce dealerships down to simple warehouses and delivery centers.
|Related: How California dealers are responding to Volvo’s online sales plan – Brian Maas, CNCDA|
As for the CNCDA’s top 2022 priorities, one of the first things on the list is proposing a ballot initiative to re-work California’s Private Attorneys General Act. This act gives employees the ability to file lawsuits against their employers for Labor Code violations on behalf of themselves and the State of California. While employees have every right to the wages and benefits they are owed, often this process is abused and ends up being costly for everyone involved. CNCDA along with other industry associations hope this ballot initiative makes it onto the upcoming state election in November.
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