Trade-group chief raps factory-initiated dealership renovation programs and stair-step pricing.
Underriner: Factory top-down control of dealerships will never work.
ORLANDO –Bill Underriner’s last big speech as National Automobile Dealer Assn. chairman touches on one of his favorite themes: auto makers should stop intruding into dealer businesses.
He cites two grievances: factory-initiated dealership renovation programs and stair-step pricing. Those are critical issues for new-car dealers, Underriner tells a general assembly session at theconvention here.
His 1-year term aschairman ends Monday, when David Westcott assumes the position for 2013.
“Factory top-down control will never work,” Underriner says. “It will always fail because it negates our ability to innovate and adapt to local community needs.”
Throughout his term Underriner has criticized auto makers’ facility upgrade programs, particularly standardized ones that require same-brand dealerships to look alike.
“Facility programs focused on brand standardization often fail to pay off,” he says, referring to a NADA return-on-investment study on various upgrade programs.
“In contrast, facility programs focused on expansion or modernization of stores that need renovation can pay off,” says Underriner, a Buick,, and Volvo dealer in Billings, MT.
He has been at odds withbecause his plans for a new Buick store call for service lanes in front. That goes against the auto maker’s uniform Buick store blueprints.
Auto maker’ facilities programs must provide dealers with flexibility, Underriner says. “The one-size-fits-all approach is just plain wrong. There is incredible diversity among dealers. Rigid standards often raise costs and produce little return.”
He also calls 2-tier incentives programs unfair to dealers.
“NADA has had a longstanding position in support of a level playing field for all dealers,” he says. “Unfortunately, history shows that at times manufacturers create incentive programs that favor some dealers over others.
“These unfair programs are bad for dealers, bad for auto makers and bad for customers. Two-tier pricing harms brand credibility, hurts dealers…and destroys customer confidence in dealers and auto makers.”