2025-2026 ISSUE 2 AUTO SHOW TIME IS HERE 2026 Chicago Auto Show
Memberships in: • AUTOCPA Group • The American Institute of Certified Public Accountants • The Illinois CPA Society CERTIFIED PUBLIC ACCOUNTANTS Located in Central Illinois, we serve the entire state. Contact us today to learn how we can help your dealership thrive. Drive Your Dealership Toward Financial Success We specialize in automobile dealers in the following areas: • Dealership valuations • Automobile dealer legal support • Buy-Sells for dealerships • LIFO inventory computations • Financial statement analysis • Corporation Income Tax returns • Personal Income Tax returns • CPA prepared financial statements • Dealer estate planning • Employee theft consulting • Internal control studies and audits • Profit consulting • Training office managers/CFO’s • 401K Audits Serving more than 250 Automobile Dealers throughout the United States (309) 662-8797 Email: woodwardassoc@cpaauto.com Website: www.cpaauto.com 1707 Clearwater Avenue P.O. Box 1584 ·Bloomington, IL 61702
17 6 ©2026 The Chicago Automobile Trade Association (CATA) | The newsLINK Group LLC. All rights reserved. CATA Up to Speed is published four times per year by The newsLINK Group LLC for CATA and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and education. The contents do not constitute legal advice and should not be relied on as such. If you need legal advice or assistance, it is strongly recommended that you contact an attorney as to your circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of CATA, its board of directors or the publisher. Likewise, the appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. CATA Up to Speed is a collective work, and as such, some articles are submitted by authors who are independent of CATA. While a first-print policy is encouraged, in cases where this is not possible, every effort has been made to comply with any known reprint guidelines or restrictions. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at (855) 747-4003. CONTENTS 5 Letter From the Auto Show Chairman Why the 2026 Chicago Auto Show Matters to Dealers By Jason Roberts, 2026 Chicago Auto Show Chairman 6 2026 Chicago Auto Show Event Highlights 2026 Public Show Dates: Feb. 7-16 at McCormick Place 10 What Drives Her Awards Return to 2026 Chicago Auto Show 12 Chicago Auto Show Drives Local Car Culture To Center Stage With New “Chi-Town Alley” Exhibit 16 Auto Show Time Is Here 2026 Chicago Auto Show 17 5 Tips To Stop Profit Leakage in Your Service Department and Maximize Profitability By Dynatron 20 The Power of Partnership How One Minority Dealer Is Growing His Vision By Jennifer Rafael, Executive Vice President & Partner, Midwest, DSMA 23 Economists Expect Another Strong Year for Auto Retail Favorable Conditions Across Both the New- and Used-Car Markets Sustain Dealer Profitability By Truist Dealer Services CATA UP TO SPEED 4
Why the 2026 Chicago Auto Show Matters to Dealers Letter From the Auto Show Chairman By Jason Roberts, 2026 Chicago Auto Show Chairman Dear Members, As we begin a new year, we also look ahead to one of the automotive industry’s most important annual gatherings, the Chicago Auto Show. Taking place Feb. 7-16, 2026, at McCormick Place, the 118th edition of one of North America’s largest auto shows once again provides an unmatched platform to showcase our industry, engage consumers and drive momentum heading into the selling season. For more than a century, the Chicago Auto Show has played a critical role in connecting dealers, manufacturers, media and buyers. Ahead of the public opening, the Media Preview on Feb. 6 brings together local, national and international press, setting the tone for coverage that directly influences consumer interest and showroom traffic. That evening, First Look for Charity returns as the show’s premier industry event, combining a high-end customer experience with meaningful philanthropy. Since its inception, the event has generated more than $66 million for Chicagoland charities, while also offering guests premium hospitality, live entertainment and the chance to drive home a 2026 Chevrolet Equinox or 2026 Toyota Land Cruiser Hybrid. What continues to distinguish the Chicago Auto Show is its strong focus on real-world vehicle experiences. In 2026, attendees will once again have access to multiple indoor test tracks and outdoor ride-and-drive opportunities, giving consumers a hands-on way to compare vehicles and build confidence, often before stepping into a dealership. These experiences consistently translate into informed, motivated buyers. New this year, Chi-Town Alley debuts as a dynamic celebration of Chicago’s diverse and passionate car culture, adding fresh energy and local relevance to the show floor. Returning fan favorites such as Overlanding Chicago and the Family Zone continue to broaden the show’s appeal, attracting adventure enthusiasts and families alike, key segments for today’s dealerships. The Chicago Auto Show remains a proven driver of consumer excitement and purchase intent. Many attendees leave McCormick Place with specific vehicles, brands and dealers already in mind. By bringing the industry together under one roof, the show continues to support dealers by turning enthusiasm into action. We look forward to welcoming you and your teams to McCormick Place and working together to make the 2026 Chicago Auto Show another strong success for our industry. Sincerely, Jason Roberts 2026 Chicago Auto Show Chairman CATA UP TO SPEED 5
2026 Chicago Auto Show Event Highlights 2026 Public Show Dates: Feb. 7-16 at McCormick Place CATA UP TO SPEED 6
he Chicago Automobile Trade Association (CATA), producer of the Chicago Auto Show, released the dates and plans for the 2026 event, held Feb. 7-16 at McCormick Place. Marking its 118th edition, the show will offer attendees an engaging experience with the latest new vehicles, outdoor ride-and-drives and indoor test tracks. “Every year, the Chicago Auto Show evolves, but 2026 will set a new standard for what an auto show experience can be,” said Chicago Auto Show Chairman Jason Roberts. “From cutting-edge vehicle technology to immersive test tracks and ride-alongs, we are giving attendees a multitude of interactive ways to explore the future of mobility, in a hands-on and fun manner.” Attendees at this year’s show will have the chance to explore multiple indoor test tracks, providing more opportunities to ride along in some of the latest models. The Chicago Drives Electric “electrified” track returns, giving consumers the chance to experience the newest all-electric, hybrid and plug-in hybrid vehicles. Ford’s “Built Wild” track will showcase the capability of the Bronco family of vehicles, and Camp Jeep returns with its signature off-road course, offering an immersive, adventure-filled ride that highlights Jeep’s legendary 4x4 capability. The 2026 Chicago Auto Show will also offer attendees the opportunity to get behind the wheel for outdoor test drives. Demonstrating the power and influence of an auto show, a post-show survey of 2025 Chicago Auto Show attendees found that more than one-third (35%) reported purchasing or leasing a vehicle in the months following the show. Among those who made a purchase, 84% indicated that the Chicago Auto Show was influential on their purchase decision. “This strong post-show activity underscores the Chicago Auto Show’s ongoing role as a catalyst for consumer engagement,” said Chicago Auto Show General Manager Jennifer Morand. “It’s a testament to the power of hands-on experiences. When consumers can compare vehicles side-by-side, ask questions and truly immerse themselves, it drives confidence and ultimately decisions.” To further enhance the attendee experience, the 2026 show will debut a brand-new, high-energy addition to the show floor: Chi-Town Alley. This immersive exhibit celebrates the city’s vibrant car culture and invites attendees to experience and engage with Chicago’s diverse automotive communities. Designed to spotlight the pride and creativity of local enthusiasts, Chi-Town Alley will reimagine the show’s former marketplace as a dynamic area showcasing everything from performance cars and custom builds to street-inspired rides and exotics. CATA UP TO SPEED 7
The 2026 show is bringing back special themed days and events, including: » Exclusive VIP Tours on Friday, Feb. 6: Experience the Chicago Auto Show like never before with an exclusive 60-minute VIP Tour led in person by some of the best and brightest experts in the automotive industry. » Miles Per Hour Run on Sunday, Feb. 8: Runners can experience the auto show via a 2.4-mile loop inside McCormick Place before the event doors open to the public. » Automotive Career Day on Tuesday, Feb. 10: Students of all ages are encouraged to learn more about various careers within the automotive industry through a series of presentations and activations; special ticket prices are offered for advanced sales at $10 per ticket. » First Responders & Military Appreciation Day on Wednesday, Feb. 11: Present your badge or military ID for free entry. Guests who accompany first responders or military personnel on this day receive a voucher for $5 off adult admission. » Chicago Auto Show Food Drive held Wednesday-Friday, Feb. 11-13: Bring three cans of food for A Safe Haven’s Food Bank and get a $5 voucher off regular admission. » Chicago Friday Night Flights on Friday, Feb. 13: A one-of-a-kind indoor craft beer sampling event, along with full access to the show. Returning specialty exhibits include: » Overlanding Chicago is a space dedicated to showcasing the overlanding and outdoor lifestyle. In its first year on the show floor in 2025, Overlanding Chicago drew a unique crowd of showgoers looking to explore life outside the urban jungle with their vehicles. With a focus on the overlanding lifestyle, the space features manufacturer displays of specialty vehicles, upfitting vendors, off-road accessories and much more. Attendees can look for an expanded space focusing on demonstrations, education and specific product features. » Family Zone returns to the show as a dedicated area designed specifically for families and aimed at entertaining children aged 2-16. This safe and fun environment allows kids to enjoy themselves while being immersed in the auto show experience. Families will find a great variety of activities within the exhibit and around the show floor, including a kids’ Power Wheels track and more. “The momentum behind the Chicago Auto Show has never been stronger,” said Morand. “With the introduction of Chi-Town Alley and the return of popular attractions like the Family Zone and Overlanding Chicago, we are transforming the show into an even more dynamic, consumer-focused experience.” The show’s 2026 Media Preview will be held Feb. 6, and its black-tie charity gala, First Look for Charity, will be held the evening of Friday, Feb. 6 at McCormick Place. Since its inception, First Look for Charity has raised more than $65 million for local charities, positively impacting individuals in the Chicagoland community. Attendees can once again expect an evening of gourmet food, beverages, musical entertainment and even the chance to win a brand-new 2026 Chevrolet Equinox and a 2026 Toyota Land Cruiser Hybrid, all while supporting those in need. Tickets and more information for First Look for Charity can be found at FirstLookforCharity.org. Tickets to the 2026 Chicago Auto Show are currently on sale at ChicagoAutoShow.com. The 2026 show runs Feb. 7-16 at McCormick Place and opens to the public daily at 10 a.m. Adult ticket prices are $20; seniors ages 62 and older are $15; children ages 4-12 are $15; kids 3 and younger are free. Show hours vary by day, so please check the site for details. To purchase tickets or for more information, visit ChicagoAutoShow.com. CATA UP TO SPEED 8
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AWARDS Return to 2026 Chicago Auto Show CATA UP TO SPEED 10
Chicago Auto Show organizers, in partnership with A Girls Guide to Cars, have announced that the What Drives Her networking event and awards program will return to the show’s industry day for the ninth year. What Drives Her was started in 2017 as a way to bring together influential women in the automotive industry and amplify the female leadership and innovation contributions across manufacturing, retailers, media and beyond. “Each year, What Drives Her grows in impact and inspiration, and we’re thrilled to welcome it back for 2026,” said Chicago Auto Show General Manager Jennifer Morand. “The Chicago Auto Show continues to be an ideal setting to highlight the leadership, creativity and groundbreaking contributions of women who are shaping the future of the automotive world.” The annual What Drives Her awards recognize and applaud outstanding females and advocates in the industry. Nominations are submitted by individuals within the industry, ranging from auto manufacturers, suppliers, media and dealers. The panel of distinguished jurors is made up of female automotive journalists. The four award categories include: 1. Trailblazer Award: Employed by an automaker, auto retailer or core automotive supplier; job title no higher than vice president; works primarily in North America; she may be notable for her empowerment of others, her breaking down of barriers that allows others to follow, her pursuit of non-traditional roles or jobs, her leadership, and taking on additional roles such as leading an employee resource group or mentoring program. 2. Best in Craft Automotive Media Award: A full-time or part-time North American journalist, content creator, video creator, social or digital media creator with a focus on the automotive industry, she demonstrates general excellence of craft, supports women and her colleagues in the automotive industry or, through voice and narrative, creates more accessible automotive information and more inclusive automotive storytelling. 3. Automotive Ally: This person offers continual support, coaching, advocacy, education and understanding, helping to create opportunities for others as they build their careers in automotive. This award is open to any executive, leader, manager or other person inside or outside the automotive industry and reflects the impact that this person has on the industry, for both individuals and organizations. 4. Best Retailer Award: At a local level, the award calls on Chicago Automobile Trade Association dealers to nominate an extraordinary female at Chicagoland and Northwest Indiana dealerships. This person demonstrates a high level of commitment and drive to any task at hand, whether that’s in sales, service, finance or technical support. Nominees must be employed by a Chicago-area dealership. The top three finalists for the Best Retailer Award include Alyssa Farkas, assistant general manager, Arnie Bauer Buick GMC Cadillac; Kelly Kane, marketing and social media manager, Brilliance Subaru; and Jennifer Pascoe, service advisor, Jerry Haggerty Chevrolet. Other nominees include Jessica Banta, Samantha Nieves, Krystal Roberts, Kathleen Walters, Carly Weck and Danielle West. All of the awards will be presented during the 2026 Chicago Auto Show’s Media Preview on Friday, Feb. 6 at McCormick Place. For more information on the What Drives Her program, visit www.chicagoautoshow.com/events/ what-drives-her. CATA UP TO SPEED 11
Chicago Auto Show Drives Local Car Culture To Center Stage With New “Chi-Town Alley” Exhibit CATA UP TO SPEED 12
The Chicago Auto Show is shifting gears for 2026 with a brand-new, high-energy addition to the show floor: Chi-Town Alley. This immersive exhibit celebrates the city’s vibrant car culture and invites attendees to experience and engage with Chicago’s diverse automotive communities. Designed to spotlight the pride and creativity of local enthusiasts, Chi-Town Alley will reimagine the show’s former marketplace as a dynamic area showcasing everything from performance cars and custom builds to street-inspired rides and exotics. “Chi-Town Alley is all about celebrating the heartbeat of Chicago’s car culture,” said Jim OBrill, Chicago Auto Show senior director of marketing and strategy. “From classic restorations to cutting-edge customizations, this space gives local car enthusiasts a place to share their passion and creativity with the entire city. It is truly a reflection of the community that keeps our automotive scene thriving year-round.” Chi-Town Alley will transform a section of the show floor into an energetic hub of automotive expression, featuring CATA UP TO SPEED 13
community-built vehicles, interactive displays and cultural touchpoints inspired by Chicago’s streets and neighborhoods. Debuting at the 2026 Chicago Auto Show, Chi-Town Alley is a fresh platform for the city’s homegrown car community. Partners who have already confirmed participation in Chi-Town Alley include Chi-Town Exotic Car Group, FullyDrivn (JDM style/import vehicles), Orale Chicago Car Club (LowRiders) and Northern Mustang Corral, among other custom shops and vendors. Drifter: A Film by Sung Kang will also be featured, showcasing two vehicles from the film and welcoming Sung Kang himself for a meet-and-greet. From sleek show cars to creative customizations, the space is designed to capture the individuality and energy that define Chicago’s car scene, bringing enthusiasts, creators and fans together in one exhilarating destination. To kick off this exciting new feature, show organizers launched the Chi-Town Alley Showcase, a contest that invited car enthusiasts from across the Chicagoland area to share their stories for a chance to have their vehicles featured at the 2026 Chicago Auto Show. Car lovers eager to be part of the action were invited to submit a 60-second video highlighting their vehicle and explaining why it deserves to be featured in the Chi-Town Alley exhibit. The contest generated strong interest, receiving over 50 submissions. From those entries, six winners were selected, and their vehicles will be on display throughout the 2026 Chicago Auto Show. “The Chi-Town Alley Showcase contest gives local enthusiasts a real opportunity to shine,” said OBrill. “We know Chicagoans take pride in their rides, and this contest lets the public decide who represents the best of our city’s car culture. It’s a fun, authentic way to bring that community spirit onto the show floor.” The final winner will be chosen by attendee voting during the show, making it a true celebration of the community that defines Chicagoland’s car scene. The 2026 Chicago Auto Show public event will take place Feb. 7-16 at McCormick Place. The Media Preview date is Feb. 6, and the First Look for Charity black-tie gala will be held the evening of Feb. 6. For more information, visit ChicagoAutoShow.com. CATA UP TO SPEED 14
Anticipate every turn In an industry that’s always evolving, your dealership can rely on our Dealer Financial Services team’s 90 years of experience to see what’s around the corner, forward-thinking insights to prepare you, and technology to keep you ahead of the curve. What would you like the power to do?® Diana Zamudio, diana.zamudio@bofa.com business.bofa.com/dealer ©2024 Bank of America Corporation. All rights reserved. DFS-699-AD 6942528 Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value “Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, derivatives, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc., which is a registered broker-dealer and Member of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. is a registered futures commission merchant with the CFTC and a member of the NFA.
MEDIA PREVIEW: Feb. 6 FIRST LOOK FOR CHARITY: Feb. 6 PUBLIC SHOW: Feb. 7-16 Miles Per Hour Run: Sunday, Feb. 8 Automotive Career Day: Tuesday, Feb. 10 First Responders & Military Appreciation Day: Wednesday, Feb. 11 Chicago Auto Show Food Drive: Wednesday-Friday, Feb. 11-13 Friday Night Flights: Friday, Feb. 13 McCormick Place 2301 S. King Dr. Chicago, Illinois For more information and to purchase tickets, please scan the QR code. ChicagoAutoShow.com CATA UP TO SPEED 16
5 Tips Maximizing Fixed Ops profitability starts with uncovering the money you’re already earning but not keeping. Many service departments focus solely on driving more traffic and sales, while pricing strategies remain based on gut instinct or outdated models. The real opportunity lies in optimizing processes, compliance and pricing to stop hidden leaks and boost the bottom line. To Stop Profit Leakage in Your Service Department and Maximize Profitability By Dynatron CATA UP TO SPEED 17
Here are five proven strategies to capture that missed revenue and maximize your Fixed Ops performance: 1. ASSESS THE CURRENT SITUATION OF PROFIT LEAKAGE Evaluate Customer Pay (CP) Start by analyzing CP and warranty repair orders to uncover revenue opportunities in warranty labor rates, parts markups and your CP Effective Labor Rate (ELR). Review repair orders from the last 30-90 days to ensure your warranty labor rate aligns with authorized state requirements. Improving documentation and consistent implementation can raise your authorized rate and boost revenue. Address Op-Code Utilization and Compliance Review your op code utilization, CP pricing compliance and CP repair ELR. A lack of pricing compliance is one of the biggest causes of profit loss. Set correct prices, enforce compliance and regularly review op-code usage to prevent price erosion. Well-managed op codes also improve efficiency, allowing advisors to quickly access service history and identify needed maintenance, creating more revenue opportunities. 2. UNDERSTAND THE DOWNFALLS OF YOUR DMS Your Dealer Management System (DMS) should unify operations — but many don’t. Poor DMS integration can lead to miscommunication between departments and gaps in pricing accuracy, pay types or labor-hour tracking. CATA UP TO SPEED 18
Improper DMS use often hides behind catch-all “MISC” codes, making it impossible to see what was actually sold or what parts to reorder. This lack of visibility causes pricing errors and missed revenue opportunities. By monitoring your DMS setup and ensuring consistent op-code use, you’ll gain clearer data, prevent price deviations and stop unnecessary profit leakage. 3. USE ANALYTICS AND BUSINESS INTELLIGENCE TOOLS Analytics software bridges the gaps left by your DMS. The right solution provides real-time visibility into key performance indicators (KPIs), advisor performance and pricing compliance. A unified dashboard allows you to: » Identify missed pricing opportunities. » Track deviations or noncompliance. » Improve communication between Fixed Ops and upper management. With the right analytics tools, you can make data-driven decisions that eliminate inefficiencies and uncover hidden revenue streams. 4. IDENTIFY OPPORTUNITIES TO INCREASE PROFITABILITY Optimizing prices doesn’t mean ignoring traffic and sales — it means aligning all strategies for maximum impact. Improve Service Advisor Selling Set clear sales goals, track KPIs and provide coaching to close performance gaps and increase hours and dollars per repair order. Increase Service Drive Traffic Focus on retention, reactivation and lifetime spend. Target campaigns using customer data and market insights to maximize ROI and response rates. Optimize Pricing Dynatron’s PriceSmart solution identifies the “Perfect Price” for labor, parts and repairs, maximizing margins without hurting retention. It uses market research and historical data to adjust pricing, boost Customer Pay ELR and ensure compliance. By combining advisor performance, traffic strategies and optimized pricing, your dealership can capture every profit opportunity and prepare to implement a comprehensive pricing strategy. 5. DEVELOP AND IMPLEMENT THE PERFECT PRICING STRATEGY Finding the “Perfect Price” prevents losing margin or driving away customers. PriceSmart uses insights to help structure a consistent pricing matrix for labor, parts and repairs. This approach directly protects and grows Fixed Ops profitability. Maximize Warranty Reimbursement Warranty labor and parts reimbursement can be complex, but Dynatron’s FileSmart solution helps reclaim lost revenue efficiently. By enforcing compliance and optimizing warranty submissions, dealerships can recover hidden profits and improve overall Fixed Ops performance. Regularly review pricing and reimbursement to stay ahead of inflation, maintain compliance and maximize profitability. TAKE ACTION TO MAXIMIZE YOUR SERVICE DEPARTMENT REVENUE Applying these five strategies will help you uncover and retain more of your department’s hidden revenue. Typical dealerships see a strong, sustained return: 22x ROI in Year 1, 17x in Year 2, 15x in Year 3 and 13x in Year 5 and onward. Many dealerships generate $250,000+ in additional annualized revenue within the first year. Maximizing profitability isn’t a one-time fix. Reassess your strategy regularly to stay ahead of inflation, maintain compliance and adapt to market changes. Supercharge your Fixed Ops with Dynatron’s cutting-edge tools, powerful data and expert coaching. Ready to stop profit leakage? Scan the QR code to contact us today and discover your service department’s full profitability potential. https://go.dynatronsoftware.com/cata CATA UP TO SPEED 19
Success in the automotive industry is rarely achieved in isolation. For Michael Manning, a minority dealer with over 27 years of experience, his journey from a small East Texas town to owning and managing multiple dealerships has been shaped by hard work, strategic partnerships and a commitment to excellence. His story is a powerful testament to how collaboration, mentorship and strong networks can open doors in a competitive field. Manning grew up in Marshall, Texas, and entered the car business at just 19 years old. His inspiration came after seeing a friend drive a Chevrolet Camaro demo car. “He told me how lucrative the job was, and that was it. I started selling Hondas and never looked back.” Early mentorship played a pivotal role in his success. Manning credits his first general manager, Bob Shows, for promoting him to new car sales manager at the age of 21. “I could never repay him for that trust,” Manning says. While navigating the automotive industry as a minority dealer hasn’t been without its challenges, Manning views these obstacles as opportunities. “There are definitely hurdles, but if you maintain strong CSI and RSI scores, there are many minority programs designed to support you. You just have to be ready to put in the work,” he explains. Manning’s guiding principle is simple: “Ladies and gentlemen doing business with ladies and gentlemen.” He believes in treating customers and employees with the same respect he would offer his own family. Manning credits his experience during the COVID-19 pandemic for teaching him valuable habits. “Tough times create good habits,” he notes. His goal has always been to build a business where customers return not just to buy, but for ongoing service and support. A key turning point came when Manning attended his first National Association of Minority Automobile Dealers (NAMAD) event. “It showed me that dealership ownership was truly attainable,” he shares. The relationships he formed through NAMAD helped open doors to future growth. As his vision for growth expanded, Manning turned to Jennifer Rafael, executive vice president and partner, Midwest, at DSMA, for support. “[DSMA] has been instrumental in providing fresh perspectives on dealerships within their portfolio and offering invaluable due diligence,” Manning says. “Their hands-on approach ensured I never had unanswered questions. More than just a broker, [Jennifer] has been a true partner.” He credits their guidance with helping him stay focused and confident as his business expanded. For Manning, trusted partnerships are key. “People want to do business with those who have integrity and come prepared. Get close to the people who are doing the work,” he advises. He also stresses the importance of representation in leadership: “We must reflect the communities we serve. Customers want someone who understands their experience.” The Power of Partnership How One Minority Dealer Is Growing His Vision By Jennifer Rafael, Executive Vice President & Partner, Midwest, DSMA CATA UP TO SPEED 20
For aspiring minority dealers, Manning’s advice is clear: “Don’t doubt yourself. Hard work pays off. No one ever drowned in their own sweat.” He also reflects on his own path, wishing he had focused on a single franchise earlier to build credibility. “My eight years with Chevrolet were crucial in building a name I could stand behind.” Manning’s work ethic is at the core of his identity. “I’m an early riser, always at the dealership before the doors open. I also volunteer on the board of the Boys and Girls Club, which keeps me grounded,” he says. His mother instilled a strong sense of responsibility in him from an early age. “At 11, my mother, my sister and I cleaned office buildings after school. That taught me the value of hard work and saving.” Manning’s story highlights the power of mentorship, community and strong networks. His involvement with NAMAD and DSMA shows how these partnerships can elevate minority dealers. “Owning a dealership is more than just a career — it’s a legacy,” he concludes. “With the right support system, that legacy is within reach for anyone willing to put in the work.” “If you don’t come from generational wealth, it’s your responsibility to create it,” Manning says. “Success is possible with determination and the right support.” DSMA has played a critical role in Michael Manning’s growth, providing expert support in dealership acquisitions and expansion. Specializing in mergers, acquisitions and transitions, DSMA offers services like business valuation, deal structuring and post-acquisition integration. With a deep understanding of the automotive industry and a tailored approach, DSMA has helped Manning navigate complex growth opportunities with confidence. Choosing the right M&A partner goes beyond simply completing a transaction; it’s about finding a trusted advisor who understands your vision and provides the strategic insight needed for long-term success. Whether expanding, acquiring or selling, DSMA ensures every step aligns with the broader business goals. This hands-on guidance has been essential in Manning’s journey, transforming challenges into opportunities and helping him build a lasting legacy. To learn more about how DSMA can help you succeed, call (833) 650-4188 or visit dsma.com. CATA UP TO SPEED 21
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2025 turned out to be a solid year for auto retailers, with profitability steady even as Q1’s strong sales softened over the balance of the year. 2026 looks to be more of the same, supported by an uptick in overall economic growth predicted for the year. Vehicle affordability is a risk dealers will be watching throughout the year. According to Mike Skordeles, head of U.S. economics at Truist Advisory Services Inc., “The overall economy has been muddling through 2025, but we see indications for an uptick in growth fueled by four big factors: changes to tax policy, marginally lower borrowing costs, and more stability on the trade policy and tariff front, along with continued investment in AI and technology spending.” Economists Expect Another Strong Year for Auto Retail Favorable Conditions Across Both the New- and Used-Car Markets Sustain Dealer Profitability By Truist Dealer Services CATA UP TO SPEED 23
Mark Strand, deputy chief economist at Cox Automotive Inc., elaborated, “2026 may look a lot like 2025, but with lower credit delinquencies and improving credit scores. I’m predicting moderate growth fueled by stimulative provisions from the One Big Beautiful Bill (OBBB) and AI buildout. Targeted tax relief and larger tax refunds should take some pressure off lower and middle-income households and reduce credit strain. Some re-shoring of investment would boost employment. But if inflation remains elevated and an obstacle for lower and middle-income consumers looking to make a vehicle purchase, then the top-earning households may not have enough spending to overcome the drag and lift the economy.” “Along with the federal fiscal situation, I’m watching the bond market.” Strand continued. “There’s a voracious global demand for capital — for AI, robotics, European rearmament and fiscal deficits — that’s keeping long-term rates elevated. Despite the Federal Reserve (Fed) rate cuts, longer-term mortgage and auto loan rates haven’t fallen as much as the Fed would like, and we still haven’t seen all the tariff pass-through. If inflation accelerates, that could force the Fed to pause or reverse rate cuts and create headwinds for vehicle affordability.” IT’S A BIFURCATED, TWO-SPEED ECONOMY “We have near record-low consumer sentiment at a time when GDP is growing, and equities are at an all-time high. That tells us the benefits are not being distributed evenly. It’s a bifurcated consumer market, and there is real stress on lower and middle-income households,” says Strand. Skordeles added, “It’s often labeled as a K-shaped economy, but that doesn’t accurately describe the dynamic we’re seeing. K-shape suggests that spending is going down for a segment of consumers — that’s not what we are seeing.” Skordeles continued, “I’ve been describing the economy as ‘two-speed.’ At the top end, spending is robust; these consumers are buying, especially autos. For median earners and below, spending is still happening, but shoppers are being more selective. Value is paramount, and they’re more deliberate about their purchases.” Strand added, “Consumers aren’t happy about what they’re getting for their money, whether that’s at the grocery store or the auto dealer. Want-to-be home buyers feel prices are out of reach. Current homeowners are pressured by rising insurance, utilities and upkeep costs. All those factors are driving consumer sentiment south.” EXPECT A SMALLER, MORE PROFITABLE AUTOMOTIVE MARKET “Wages are once again growing faster than inflation,” Skordeles said, “which supports real incomes and should help consumers as we move through 2026.” Still, the total cost of vehicle ownership — vehicle prices and loan payments, along with insurance and maintenance costs — has outrun wages over the cycle. The result is a smaller new market than we saw before the pandemic. Strand expanded, “The auto market is driven by $100K+ households. Everything has changed for consumers earning below that, including subprime buyers. Compared to 2019, we’ve lost roughly 10% of the buying pool due to credit issues, access and affordability. We see elevated delinquencies and repossessions concentrated in subprime, though not at 2008-2009 crisis levels. Many are reprioritizing and may choose to stay in an older vehicle versus buying a newer one, which contributes to the gap.” For the dealer, the smaller new car market hasn’t diminished returns. “Overall profitability is almost two times what it was pre-pandemic,” Strand explained. “Dealers are finding revenue from parts, from the service lane and from selling F&I. As consumers have adjusted to the idea that they get less for their money and are staying in older vehicles with higher mileage, they’re buying the tire plan, extended warranties and some insurance add-ons. The dealer wins on all of those.” DISCIPLINED, TECH-SAVVY DEALERS CAN EXPECT ANOTHER STRONG YEAR Jason W. Smith, head of Truist Dealer Commercial Services, states, “In the capital-intensive auto retail sector, lower short-term interest rates should reduce floor plan interest expenses, enhance cash flow and earnings, and ultimately benefit organizations financing commercial real estate projects and franchise acquisitions through debt.” “Broadly speaking, dealers who learned from the pandemic are better off,” says Smith. “Dealers that have systematically applied operational improvement lessons and embedded efficiency into their organizational DNA are outperforming peers.” During the pandemic, buyers demanded enhancements to the digital buying experience, and auto retailers offered them. Skordeles said, “Digital buying forced familiarity with technology, tools, apps and CRM systems that allowed dealers to hold less inventory and generate more cash flow. Dealer operations have become far more sophisticated and are being operated with greater discipline.” Strand added, “The latest inventory optimization and management software lets dealers take a more scientific approach. Retailers can easily track what they’re holding onto and better manage acquisitions, pricing and margins.” OEMS’ APPROACH TO THE MARKET Strand believes that new car production levels will remain flat in the short term. “Without greater vehicle affordability, it’s hard to see production returning to levels we saw CATA UP TO SPEED 24
pre-pandemic.” Skordeles added that tariff pressures and the risk of supply chain disruption will be part- and OEM-specific. “The supply chain is massively complex. OEMs aren’t going to figure out how to build cheaper cars or de-contented trim levels by mid next year,” noted Strand. “Incentives have been running 7.5-8% of average transaction prices,” continued Strand. “The ‘air gap’ in sales in the fall has created some slack — very brand specific — with needed incentives to move product. Some OEMs have been eating tariffs and would like to pull back discounts to protect margins. Raising prices will attract the wrong kind of attention. Throttling incentives may be the least bad answer.” COMPETING FOR SUPPLY IN A TIGHT USED CAR MARKET “New cars are the used car ‘factory.’ It takes three to four years for a lease to work its way into the used vehicle supply,” said Strand. “Today, one in four new vehicles is leased, whereas pre-pandemic, it was one in three. Fewer leases contribute to the tight supply market for used and Certified Pre-Owned (CPO) cars.” Strand added, “We are fundamentally limited on the supply of used vehicles, about 8 to 9 million units short in the 5-year-old and less segment. We are nowhere near generating enough used car supply to move the market. That means used car values and prices should hold stable for the foreseeable future, and that should make room for more leasing, maybe on shorter terms.” Competition is fierce for the cream of the used car crop. Per Strand, “Players like CarMax and Carvana are aggressively sourcing vehicles directly from consumers. And traditional dealers have also gotten into the game of direct purchase. Smaller and mid-sized dealers may find themselves short on inventory and in a tough spot competitively.” Strand continued, “The customer experience is more important than ever. Develop loyalty by maintaining strong customer relationships with a lifetime-value mindset. Do it in the service lane. With vehicles in short supply, you might want to resell that car in the future, so you want them to come back. Emphasize delivering a great customer experience at every touchpoint, with transparency and responsiveness. You don’t want them leaving your dealership feeling unappreciated or neglected and wanting to sell their car to someone else.” FINDING THEIR FOOTING IN THE EV MARKET Expect 2026 to be a reset year with many, but not all, automotive manufacturers pulling back from EV investments. Producers are still trying to figure out how to absorb tariffs and rebuild more resilient supply chains while profitably building vehicles. With so many buyers priced out of the EV market, CATA UP TO SPEED 25
manufacturers must determine what kind of product they can build to bring back entry-level buyers. Strand predicts, “The big story for 2026 will be around used EVs. Under the tax credit scheme, only leases really made sense. As those leases are returned, we expect a few million EVs to hit the market over the next three years. We’re not sure what values will look like, but these cars may be affordable enough to entice some reticent buyers off the sidelines. These returns would create a new opportunity for millions of EV-wary buyers to set aside their apprehensions and experience driving an EV at a very attractive price.” Without tax subsidies, EV adoption will be an uphill climb for the foreseeable future. EV and even plug-in hybrid production are being de-emphasized. Full-size EV pickups have largely failed in real-world use cases due to range, charging access and the challenges of rural operation. The center of gravity is shifting back towards traditional hybrids as a bridge technology. For now, internal combustion engines will remain the king of the road, in part because they are generally cheaper to build, and affordability is key. Truist Bank, Member FDIC. ©2026 Truist Financial Corporation. Truist, the Truist logo, Truist Purple, Truist One, Truist Marquee, LightStream and the LightStream logo are service marks of Truist Financial Corporation. Equal Housing Lender. Comments regarding tax implications are informational only. Truist and its representatives do not provide tax or legal advice. You should consult your individual tax or legal professional before taking any action that may have tax or legal consequences. TAKE US ANYWHERE! Scan to read the most recent publication. Stay up to date from your couch, office or even the moon! Place a 1” x 1” QR Code White on Black Here to the main website CATA UP TO SPEED 26
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This magazine is designed and published by The newsLINK Group LLC | (855) 747-4003 18W200 Butterfield Rd., #096 Oakbrook Terrace, IL 60181 Truist.com/DealerServices The auto retail industry is more complex than ever. We’re here to help you make the right moves. From adopting AI to navigating economic uncertainty, auto dealers today face unique challenges. Truist Dealer Services knows this industry inside and out—and more importantly, we’re invested in knowing you. Truist Bank, Member FDIC and Equal Housing Lender. © 2025 Truist Financial Corporation. TRUIST, the Truist logo and Truist Purple are service marks of Truist Financial Corporation. All rights reserved.
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