Thursday, 2 February 2012

Carmakers expensive corporate standards for dealer networks are expected to come under heavy fire in a report out Saturday.

The report will be released at the National Automobile Dealers Association (NADA) Convention & Expo in Las Vegas.

More than 20,000 new car dealers, including 1,500 international dealers from 36 countries are attending the event. Motor Trader is present as part of a dealer delegation organised by motor business specialist ASE.

Industry analyst Glenn Mercer, who conducted the study, will present the findings and answer questions.

It is said to the first of its kind to take an in-depth look at manufacturer programs that require new-car dealers to invest billions of pounds in facility upgrades.

“New-car dealers who have been hit hard by the economic recession need less financial pressure—not more—especially when faced with tough decisions to remodel their dealerships,” said Stephen W Wade, chairman of the National Automobile Dealers Association in October when the study was launched.

“These costs have a significant impact on dealer balance sheets, in many cases severely straining them and in some cases even persuading a dealer to leave the business rather than commit such large sums.

“Surprisingly, little hard evidence exists as to the return-on-investment, either to the automaker or to the dealer,” said Wade, a multi-franchise dealer in Utah and California.