A Long, Cold Winter in Detroit

to placing dealerships in the hands of four to six ethnic minorities every year, split among all the groups, says Watson. “But what we can’t forecast is who might sell. The prices of these dealerships are so high, you can’t get mad at entrepreneurs who cash in. Toyota is bringing in seven times earnings,” he says, pointing out that Anthony L. Merritt sold his Superstition Springs Toyota store in Mesa, Arizona, but kept his Lexus franchise.

The high-water mark for minority dealers was back in 1998 or 1999, says Watson, and he doesn’t think we’ll “ever see it again.” He proposes that the new paradigm for minority dealers is to partner with each other — or with majority dealers, and adds that Winston R. Pittman Sr. and H. Steve Harrell, both on the BE AUTO DEALER 100 list, have now joined forces. March Hodge is another dealer partnership on the list. Because the most desirable brands cost so much, says Watson, “The single-point dealer will be extinct if he or she doesn’t partner to diversify.”

Will Congress Help? Dealer associations ask for assistance
Help from Congress is being sought by the National Association of Minority Automobile Dealers and the minority dealer associations affiliated with the auto manufacturers. These organizations are seeking working capital, job training, and job recruitment assistance for dealerships owned by ethnic minorities. “We’re looking at ways we can have something put into the next budget, perhaps added to the economic stimulus package,” says A. V. Fleming, executive director of the Ford Motor Minority Dealers Association. The associations are also exploring how to work directly with various departments within the Bush administration.

Working with a Democratic-controlled Congress, President Jimmy Carter acted to rescue American auto manufacturers in 1979 and set a precedent providing federal government assistance to dealers in 1980. After 700 dealerships went out of business during the first half of the year, the Carter administration funneled $400 million in Small Business Administration loan guarantees to automobile dealers. — C.H.

Auto Dealer Eligibility
An auto dealership must be at least 51% black-owned and have been fully operational for the previous calendar year.
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