Paul Walser, chairman of NADA, says “he wakes up every morning with a new surprise” as the state of the industry remains in a state of flux.
Everything from low inventory levels and skyrocketing prices to supply chain challenges, inflationary pressures and semiconductor chip shortages plague the industry. But Walser says dealers overall are doing well in staving off inventory shortage challenges and keeping profitability high.
However, he says dealers have trimmed marketing efforts, which are traditional high-ticket items with low margins.
Walser predicts inventory challenges will affect floorplans for the future. And says he doesn’t believe dealers should return to having too much inventory.
He explains consumers know about the inventory shortages and come to dealerships with the expectation that they’re going to have to wait for their vehicles and will not receive the same incentives they received in the past.
“I do believe the worst is behind us,” he says. says Walser. He warns a return to normal may take several months.
Walser says OEM relationships with dealers have improved because of the crisis because everyone is in this situation together. He stresses he’s proud of what NADA has done to connect NADA and OEM associations. The groups hold weekly meetings to discuss electrification, direct sales, cyber security, data sharing, and customer service.
NADA remains involved with the Chrysler Minority Dealers Association helping its efforts to provide training and opportunities for advancement. A major diversity and inclusion effort is on the horizon, which Walser says will be a “game changer.”
Still, the industry must solve the LIFO issue. Over 50% of dealers use the LIFO method of accounting. NADA has requested temporary relief from The Treasury Department for dealers to return to normal times.
As for the upcoming NADA convention, Walser says “This is going to be the best convention we ever had had. There are some new and fun initiatives. This is going to be the show of all shows.”
For more information visit: www.nada.org
Originally posted on Auto Dealer Today