Business Q and A: AutoFair's Andy Crews has expanded the company's reach while advocating for dealerships
AutoFair President and CEO Andy Crews sits in his office at company headquarters on South Willow Street. (DAVE SOLOMON/UNION LEADER)
He became chairman of the state's auto dealers association on May 20, and the next day was named to the advisory board of the Independent Business Council of New Hampshire, a newly created business advocacy group led by former U.S. Rep. Frank Guinta.
It's a very different relationship than in a lot of other businesses. They control 100 percent of our inventory, so they are holding all the cards in a negotiation. All 50 states have laws on the books governing the relationship between the two. The dealer bill of rights simply amends the existing law in New Hampshire. There was a lot of misinformation put into the market, especially from the auto manufacturer's alliance. And that was the disheartening part - to see your manufacturers actually advertising against you as dealers.
Q. Why were things so different this time?
There are multiple states right now going through the same process because of the same concerns. Manufacturers changed their habits. They started coming into dealerships after the bankruptcies. Chrysler and GM, under the bankruptcy laws, were able to blow out all franchise agreements.
Q. It's been quite a roller coaster ride for the automotive business the past five years.
It still hasn't levelled off. Things feel better. One month they feel better, but then you turn around and have a soft month, so it makes you hesitate a little bit. But it is continuing to improve. The nation was at 17 million units sold in 2007, coming into 2008, and to drop down to almost 10 million in 2008 and 2009 is a huge drop. It was a very scary time.
Q. Are you returning to pre-recession sales levels?
We're not back to 2007, but every year we continue to improve. We've been running steady increases year over year since 2009. End of 2008 was when everything started to come apart. We went down, but I will tell you that New Hampshire and New England as a whole did not drop as low as other areas of the country.
Q. How did you implement your growth strategy?
First we expanded into Massachusetts with Honda, which had designated an area that did not have a dealership, and through a bidding process we won that open point in Plymouth, Mass., in 2010. Then we started looking at other opportunities here in New Hampshire, and had an opportunity in Stratham and opened a Nissan dealership at the end of last year. Then we acquired another Nissan dealership in Tewksbury, Mass., also at the end of last year, and acquired a VW dealership in Nashua in December.
Q. Do you anticipate continued consolidation in the auto business in New Hampshire, with a smaller number of players owning more and more of the market?
I supported the dealer bill of rights because if we did not put in some more protections, there would be major consolidation. Two of my acquisitions were because the owners were apprehensive about having to build facilities for these manufacturers. That would have continued if we didn't put this bill in place.
Q. What lies ahead for the automotive market in terms of hybrids and electric cars?
With hybrid vehicles, the payback is constantly changing. People do the math, and as long as gasoline prices are below a certain dollar amount, it takes too long to recoup the $4,000 price differential, especially with the manufacturers now getting 40 miles per gallon out of some traditional gas engines.
Q. What types of vehicles are you finding most popular now?
Ever since 2009, both the SUV and truck market have been in a steep, steep decline, and we've seen a huge increase in people buying compact and subcompact cars. The main driving force has been fuel economy. And those smaller vehicles are more affordable.
The same families that bought the small cars are finding they don't have the room they want and they are moving into the crossover vehicles, which are a sort of a hybrid between an SUV and a car.
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