Pohanka brought insights to NADA’s leadership and recommended key issues they helped shape.
“That led to our guiding principles: what we’re for and what we’re against,” Pohanka said. “It is very important that NADA stays ahead of the curve.” The group’s manifesto captures the collective voice of dealers in acknowledging new developments and protecting the franchise model.
Pohanka is well versed in trends in the retail industry. At the top of his agenda is ensuring that manufacturers and distributors are fair when it comes to sharing data. Implement over-the-air updates fairly. Prepare dealers for the move to expensive EVs. Stay competitive and keep direct sellers away from “our business”.
Pohanka spoke with staff reporter Carly Schaffner. Below is an edited excerpt.
Q: How did you prepare for your role as president of NADA?
A: I see my role in three-year terms as Vice President, President, and Immediate Past President. I didn’t wait to become chairman and launch many initiatives. Of course, it takes some time for things to get off the ground, but I had a productive year as vice president and launched many initiatives.
Tell us about one of your most important initiatives?
started rolling the ball [on the NADA guiding principles] and one of the authors, it was a collective effort. I could see what important issues would surface. Afterwards, I met with his NADA executives and offered to help shape its development ahead of the big issues. This led to the creation of a focus group of dealer and trade association executives to identify the most important ones. That led to the principles we now share with dealers, automakers and industry associations, and which are now widely accepted.
One of the issues highlighted is data sharing. why is that a concern?
Data sharing presents significant challenges. Manufacturers demand more data from dealers. And some of these agreements are unilateral. For example, one data-sharing agreement gave manufacturers unrestricted use of their data and stated that dealers were required to compensate manufacturers if the data were mishandled. It imposes a burden and does not say how the information will be used and protected.
I personally negotiated with the manufacturer and to their credit they rewrote the contract. Your data is protected and we mutually indemnify — if dealers damage our factories, we indemnify them.
What’s the problem with over-the-air updates?
There are two parts to this. Many cars have drivability issues and get alerted to come to the dealer and download to get the car fixed. This kind of update isn’t beneficial for dealers, but it’s convenient for consumers. And manufacturers can tinker with these cars to make them run better.
Meanwhile, as vehicles run computers, manufacturers will have the opportunity to sell subscriptions and accessories to consumers. If a consumer wants to pay to add his 100 horsepower of an electric car, that’s what it can sell.
Dealers should be encouraged to sell those products and if consumers buy them dealers should get credit for it. does not restrict over-the-air updates for drivability and warranty.Also, for subscription and accessory sales, this is downstream revenue that dealers should participate in.
And what about the agency model?
Manufacturers are pursuing a pure agency model all over the world. In other words, the consumer buys the car from the manufacturer and the dealer gets paid to deliver the car. Dealers have an advantage in the sense that they don’t own the car. They don’t have floor plans and don’t need to advertise. But here in the US, many states have franchise laws, so a pure agency model can’t be enforced.But despite that being true, dealers are concerned that some elements of the agency model are showing up. [in ways such as] Omnichannel and direct ordering. That further fan dealer fears that the agency model will come near you.
Many of these issues are related to the advent of EVs. How do dealers feel about the impending transition?
There are many concerns about that transition. If your dealer hasn’t done so, we recommend driving thousands of miles with your EV. Don’t just demo overnight. Drive thousands of miles, experience public charging networks, have a charger in your home, and experience the customer experience. Know it inside and out. EVs are coming, and for several reasons. One is competition. A direct seller has taken over our business and we need to compete. And second, there is a federal duty to demand that it happen. Dealers are worried, but I would recommend going out, getting it, driving it thoroughly, and understanding it from the inside out.
Are there dealers who don’t want to sell EVs or invest in EVs? If so, what is your reaction?
I think it’s a mistake to not want to sell when there is real demand. Demand may be higher in California or New York than in Nebraska, but the demand is there. They will come here in a big way based on government regulations. Therefore, it must be driven by a dealer. we have to do a lot of research. What’s the best way to set up a charging infrastructure that spends the right amount of money, has the right amount of utility, and easily charges your car?
Fill up with gas when the car is unloaded from the truck. Now we charge those EVs and restock them when we sell them. They will stay here and be part of our business.In some states they are a big part of our business.
I don’t think it will be 100% of our business for many reasons: cost, charging, infrastructure, availability of minerals to produce them. I think it will be a hybrid system of electric vehicles and gasoline. Let the chips fall everywhere.
So some manufacturers say they can’t do everything –Electrical apart from what they say?
Due to the cost and lack of charging infrastructure, there will still be many internal combustion vehicles in the future. If you say you’re going to keep a petrol car, you’re taking a lot of heat. This is often said, but in reality it may not be so.