SAN FRANCISCO, Jan. 24, 2015 /PRNewswire-USNewswire/ -- In his first keynote address as chairman of the National Automobile Dealers Association, Bill Fox delivered a message to critics of the franchised dealer network.
"The automotive franchise system is the best and most efficient method of bringing new vehicles to the driving public," Fox said today in remarks at the NADA Convention & Expo in San Francisco. "The franchise system breeds competition that benefits consumers, manufacturers and local communities alike."
Fox, a multi-franchise dealer in upstate New York, highlighted the economic impact of the nation's new-car dealers.
"We sold more than 16.4 million new cars and light trucks in 2014. We saw total sales of more than $700 billion—more than 15 percent of all retail sales. We employ more than 1.2 million people in well-paying jobs averaging $53,000 per year that cannot be exported. That adds up to a $55 billion payroll. And we generate $13 billion in taxes," he added.
NADA has forecasted sales of nearly1 7 million new cars and light trucks for 2015, and "more sales mean more employment and more opportunity in the retail-auto industry," he said.
"Dealers are fierce competitors that drive consumer costs down and ensure superior customer service. And we advocate for our customers on warranty and recall claims with manufacturers. For dealers, the return is a mere 2.2 percent on sales. Does that sound like we aren't competitive? Not to me."
Fox added that new-car dealers support thousands of local charities and are the face of manufacturers in every town throughout America.
"It was dealers who survived wars, recessions, a depression, oil embargoes and manufacturer bankruptcies," he added. "We survived all that because we are leaders—not followers—of change. This is the industry that changed everything. The reality is that dealers are catalysts for change."
In response to critics who complain about state franchise laws, Fox said that "these laws, which vary from state to state, have a common objective: They seek to level the playing field between dealers and the manufacturers—for the benefit of the citizens of those states."
"Franchise laws create price competition that saves consumers money," he added. "It's a fact that if a consumer wants a Chevy, he or she benefits when two or more Chevy dealers compete for their business.
A recent study looked at car sales in Texas where researchers found that when multiple dealers compete to sell a car to a customer, the average price of a Toyota Camry dropped $450. Take away dealers, take away competition and consumers pay more."
The auto industry has survived because it is rooted in dealer innovation and value, Fox said.
"Dealers have adopted the Internet because we know we often make our first impressions digitally. We've adopted technology that includes our customers in the sales process more and more," he said. "We are innovative and we offer the consumer what they want and need—value."
The NADA convention, which runs Jan. 22-25, is expected to draw more than 23,000 attendees from across the global auto industry.
Considered the "Automotive Industry Event of the Year," the NADA convention includes dealer-manufacturer franchise meetings, hundreds of educational workshops for dealers and their managers, hundreds of exhibitors at the Expo and numerous networking events.
NADA represents more than 16,200 new-car dealerships with both domestic and international franchises. For more information, visit www.nada.org.