News Column

Hispanic Auto Dealers Form New Advocacy Group

March 2001

By Peter Brennan

Last July's annual meeting of the National Association of Minority Automobile Dealers (NAMAD) in Portland was anything but typical, thanks to Silvestre Gonzales, chairman and chief executive of Gonzales Automotive Group Inc.

Mr. Gonzales' family-owned firm, which reported revenue of $130 million last year, controls five Southern California dealerships that sell Chryslers, Jeeps, Nissans, Isuzus, and Kias. He is a NAMAD member, and the organization has helped his company.

Nevertheless, Mr. Gonzales feels NAMAD hasn't done enough to reach out to Hispanics and despite potential business risks, he said as much in a presentation to the organization's 20-member, African-American-dominated board of directors. In light of what he claimed was the group's failure to diversify its board has just three Hispanics Mr. Gonzales called for the resignation of NAMAD chairman Donald P. Tinsley, owner of Centralia Ford Lincoln Mercury in Centralia, Illinois. He also announced the imminent formation of a new Hispanic dealers group.

"You could hear a pin drop," recalls Mr. Gonzales. "They didn't expect it to come from my lips. The leadership was very upset. The board was divided."

Formed in 1980, NAMAD was originally an African-American organization, but it began reaching out to other minorities five years ago. President Sheila Vaden-Williams says the group has made significant progress in its Hispanic outreach, but adds, "We're not satisfied with the number of Latinos within our ranks."

Both sides agree that the stakes are high. The top 100 African-American-owned dealerships had sales of $6.3 billion in 1998, according to NAMAD. Hispanics bought 28 percent of the 15.5 million new cars sold that same year, according to Auto News. And of some 20,000 car dealerships nationwide, only about 1,000 are minority-owned, according to the group.

What's more, NAMAD, based in Lanham, Maryland, and with 550 members nationwide, is more than a typical advocacy organization. It often influences car-manufacturer decisions on awarding dealerships. But Hispanic dealers say NAMAD steers too many dealerships toward African Americans.

"If only eight dealerships go to minorities, how about letting us have two or three?" says Mr. Gonzales. "We'd like to have equal numbers. When you don't get any, you've got problems."

Mike Padilla, owner of a Gateway Chevrolet dealership in La Mirada, California, agrees that NAMAD focuses too much on African Americans.

"It's important to have a voice with the manufacturers and to create awareness for other Hispanics," says Mr. Padilla, whose dealership generates $35 million in annual revenues. "There is very little awareness within the Hispanic business community that it's possible to become a dealer."

In a letter to Mr. Gonzales and other Hispanic car dealers, Ms. Vaden-Williams and Mr. Tinsley stated that NAMAD has gone out of its way to help Hispanics in the past four years pointing out, for instance, that NAMAD has established banking relationships with Hispanic-owned banks. They also noted that NAMAD held a two-day meeting last year to discuss how to increase participation by other minorities.

While acknowledging that NAMAD regularly facilitates contact with automobile manufacturers, Ms. Vaden-Williams denies that the group lobbies to have dealerships go to African Americans.

"NAMAD partners with automotive manufacturers to design and implement diversity programs, but it doesn't steer dealerships toward certain people," she says. "It would be inappropriate for us to say, 'X should get this.' "

If African Americans have more dealerships than Hispanics it's because that was the organization's focus during its first 15 years, Ms. Vaden-Williams says. "But in the past four or five years, there was a fairly equal distribution of dealerships."

Mr. Gonzales remains unconvinced.

"The name's been changed, but the representation hasn't," he says. "There are people on NAMAD who feel that it is a black organization and should remain a black organization."

He and three other dealers have put up a total of $30,000 to charter the Southern California-based National Association of Hispanic Dealers. More than 100 dealers are expected to attend the group's inaugural meeting in San Antonio May 4-6. Mr. Gonzales says the group has the support of such organizations as the U.S. Hispanic Chamber of Commerce and the Southwest Council of La Raza.

Despite all that's happened, Mr. Gonzales says he hopes the new group will work with NAMAD.

"All we're looking for is a voice in the automotive industry," he says. "A lot of dealers feel we should have our own organization; we'll be affiliated with NAMAD, but we will represent ourselves."

Source: HISPANIC BUSINESS magazine

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