Charlie Gilchrist, the National Automobile Dealers Assn.’s immediate past chairman, tossed some mostly gentle questions to General Motors Chairman and CEO Mary Barra at the closing general session of the NADA conference and expo here.
The following are a few questions that are more pointed, from the dealer point of view. Gilchrist is president of Gilchrist Automotive in greater Dallas-Fort Worth, plus SouthWest Ford in Weatherford, TX.
Gilchrist: Dealer profitability. How do you see dealer profitability, and how do you measure success for the dealer? (Note: According to NADA, the average U.S. dealership had a pretax net profit of 2.4% for 2019, year to date through November. Operating profit as a percent of gross was 1.8%.)
Barra: We have to win together. That means we both have to be profitable. You need GM to be profitable so we can reinvest in the product, just as you need to be profitable and reinvest in the business. We’re working on 1.6%, to 1.7%, on our way to 2% and beyond.
Gilchrist: How do you see the future for small dealers?
Barra: At GM, they play a large role. We are strong in suburban and rural markets, and that’s because of you.
Gilchrist: What’s my future? When you hear electrification, supposedly there’s not going to be the service business.
Barra: I think we will transform GM. We believe in climate change. … We think EVs are going to be a huge opportunity. … Just look at the complexities. Every EV has hundreds of millions of lines of code. … We have to lead, and to get the best technology to our customers, and that’s how we’re going to win.