McLEAN, Va. (April 24, 2012) - When looking at the return-on-investment of factory-mandated dealership renovations programs, a “first-of-its-kind” study commissioned by the National Automobile Dealers Association indicates there's no solid data that new-car dealers would sell one more vehicle by investing $1 million in the dealership. 

“That was the bottom line of the study,” said NADA Chairman Bill Underriner, in a recent interview. “We commissioned that [study] last year with Glenn Mercer, a former partner with McKinsey and Company. He's a consultant who really knows his way around the auto industry. This was an objective, fact-based study.”

Automakers have had mixed reactions to the findings of the study, said Underriner, a new-car dealer in Billings, Mont., who says the No. 1 issue for NADA today is facility mandates. So far, the NADA leadership has met with 12 manufacturers to discuss the study.

“It was all over the board. We had some manufacturers that said maybe we ought to slow down the process a little bit and take a look at this,” he said. “We've had other manufacturers that were farther down the road ... but were 85 percent complete with [their] facility planning. We had some that said that's a great idea. We haven't started our facilities planning yet, but we'll take it into consideration.”

Underriner added that the next step for NADA is to include a discussion of the facilities study at the upcoming round of Dealer Attitude Survey meetings with 30 auto manufacturers.

To read Phase I of the report, click here. To read Phase II, click here.