Dealer Joe Serra on inventory shortages, electric vehicles, and more

Serra Automotive ranks among the top 10 privately-held retail automotive groups in the nation; with 51 dealerships and representing 63 franchises. On today’s show, we’re pleased to welcome the President of Serra Automotive, Joe Serra, to walk us through what business looks like for his group, and what his perspective is on the current state of automotive retail.

Like many car dealers, Serra Automotive is experiencing strong profitability despite a low inventory supply. Over the past 23 months, having a lower day supply on average has benefited the business however, Serra is not as optimistic when thinking about the long-term effects. Three or four years from now, Serra believes manufacturers won’t have the discipline to keep day supply low. For Serra, a 30-day supply seems to be the sweet spot. Only time will tell it that type of management plan sustains itself beyond the next 12 months.

In terms of pre-owned inventory, Serra Automotive is working diligently with consumers to negotiate trades. They are using all avenues available to them to acquire used vehicles. In fact, used vehicle inventory levels across the group were higher compared to a year ago. This is particularly important considering the average price of new vehicles is a staggering $46,000.

In regards to preparing for an EV future, Serra says it doesn’t matter what consumers want right now. From his perspective, the government and societal pressures are driving the transition. It’s a concern for Serra. He explains, automotive retailers have to provide value to the manufacturers. If they don’t bring value to manufacturers, there’s a big issue.

“We sometimes are our own worst enemy,” says Serra. “But, you know what, we’re going to figure it out. I love automotive retail. I love all my car dealer friends. We’re going to figure it out, and be there long term.”

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