In a Congressional hearing today on options to aid the struggling domestic automakers, National Automobile Dealers Association (NADA) Chairman Annette Sykora urged the members to consider the important role that dealers play in the success or failure of an automaker and the direct impact that the nation’s almost 20,000 franchised automobile dealers have on local communities across America.

“Dealers are the public and local face of the automobile industry in towns and cities across the country,” Sykora said in testimony before the House Financial Services Committee. “Our fate is directly connected to our manufacturers and the success of the automakers is directly connected to the success of our dealerships.”

Read Sykora's full remarks

Sykora noted that the economic downturn, the meltdown on Wall Street and the real estate crisis have caused auto sales to plunge to a 15-year low. As a result, dealers have cut business expenditures, including employees and close to 700 dealerships have simply gone out of business.

“Car and truck sales account for 20 percent of all retail sales in the country. The fact is local dealerships will be a major factor in our economic recovery. By getting automotive retailing back on track, Congress can effectively leverage the economic engine of the automobile industry to get this economy running on all cylinders again,” Sykora added.

She also praised legislative proposals that would provide tax incentives to boost automobile sales. Sens. Barbara Mikulski, D-Md., Kit Bond, R-Mo., and Reps. Bill Pascrell, D-N.J., and Steve LaTourette, R-Ohio, have introduced legislation (S. 3684/H.R. 7273) that would permit new car buyers to deduct auto loan interest and sales tax from their personal income taxes. Additionally, she testified that supporting programs such as emergency small business loans for dealers and “cash for clunkers” initiatives, which encourage consumers to upgrade their older cars to cleaner, more fuel-efficient models, will help restore consumer confidence and get the economy moving again.

“At a time when the future of the auto industry hangs in the balance, we urge Congress to move quickly to provide the assistance needed to help the automobile industry to once again lead our country back to economic health,” Sykora reiterated.

NADA, founded in 1917 and based in McLean, Va., represents about 20,000 new-car and -truck dealers holding nearly 43,000 separate franchises, both domestic and international.

Source NADA.org

Update January 24, 2009

National Automobile Dealers Association annual convention, New Orleans LA

SYKORA: WE WILL SURVIVE

If the economic debacle of the past six months has had a sliver of a silver lining for dealers, said NADA chairman Annette Sykora at Saturday’s general session, it’s that NADA had the chance to educate the public—and Washington—about the vital role dealerships play in their communities and in the national economy. And that’s been no small feat, because it was clear from politicians’ questions during hearings last fall that they don’t understand the auto retail business, she said.

Sykora recalled her frustration while waiting to testify before the House Financial Services Committee in November. As lawmakers asked the Detroit Three CEOs and the UAW, “ ‘Exactly how much money do you need?’ and ‘ Why did you fly here on your corporate jet?’” Sykora got a text message from her husband back home in Texas that a dealer down the street from her store was going to have to close.

“When it came my turn to testify, I was honored and proud to tell dealers’ side of the story,” said Sykora. “I knew how important it was for the House members to understand the entire economic impact of our industry.”

Driving past that abandoned dealership every day now is indescribably depressing, she told Saturday’s audience. “I think about the effects of that lost business—about the people who used to work there, about the lost tax revenue to our community, and even the morale of my own employees.”

Dealers need to keep hammering home to the media and lawmakers that “it’s our investments and our risks that allow manufacturers to distribute their products efficiently, and our facilities that service America’s cars and trucks.”

Acknowledging the difficulty of living with uncertainty—especially the March 31 deadline for Detroit’s viability plans—Sykora said she nevertheless maintains her faith in the industry. “We are optimistic, and we are resilient. We will survive.”

(click the play button) NADA's Annette Sykora

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