In starting his tenure as NIADA President, Gordon Tormohlen delivered a securing message to dealers as they head into what could be a turbulent end of 2023.
Tormohlen told dealers during the Welcome General Session at the NIADA Accelerate 2023 Convention and Expo, they are not alone, with the Board of Directors, NIADA staff and vendors ready to work for them and “have their back.”
“I look forward to this next year,” Tormohlen said. “We’ll spend more time together, have conversations, and I’ll get to meet all of you. That’s the biggest reward of all. As your president, it’s a high honor for me and I’m grateful for you for it.”
He also reminded dealers they are ready for what is to come because of their courage and grit, which has allowed them to chase their dreams in the first place.
“Look at you now, you’re an entrepreneur,” Tormohlen said. “I hope you don’t mind me saying, ‘I’m proud of you.’”
The dealers are also helping many others from their families, their employees and the customers, who are receiving safe and reliable vehicles.
“Everyone benefits by you chasing your dream,” he said.
Before Tormohlen addressed the general assembly, the 2022-23 Chairman of the Board Joe McCloskey reflected on his nine years on the board.
“This is the culmination of an extraordinary chapter of my life,” McCloskey said.
During that time, NIADA worked to influence policy and protect the industry in Washington D.C. It also brought dealers together for education.
“We’ve worked to keep the heart of the independent industry beating,” McCloskey said. “We’re not only taking care of the customers, but each other.
“Let us continue to be a beacon of integrity, innovation and excellence in the automotive industry. May we always remember that our greatest strength relies in our unity, shared commitment to excellence and our unwavering dedication to the industry we serve.”
NIADA Vice President of Dealer Development Jeremy Beck gave dealers an extensive market report.
The average sales price for used vehicles is up to $25,497 in 2023 from $24,965 in 2022. The front-end gross is down from $4,110 to $4,068. But dealers are making up the difference with F&I products, seeing an increase of nearly $200 to $1,603.
Reconditioning costs continue to rise, hitting $1,741.
For the buy here, pay here sector, the average reconditioning cost is at $1,267. In BHPH deals, the average financed is up nearly $1,000 to $13,117.
“As the costs have gone up, the down payments have not gone up,” Beck said.
Beck also pointed out the delinquency rates are rising.
“All the indicators are pointing to it’s a good time to be a BHPH dealer,” Beck said.
He added dealers need to stay engaged with the market and tighten inventory management.
“Where there’s challenges, there’s opportunities,” Beck said.
