EFG Companies: Dealers Must Embrace Industry Paradigm Shift
DALLAS, Texas — Staffing and customer engagement models are the top issues impacting the future health of the retail automotive industry, EFG Companies President and CEO John Pappanastos said today. The F&I product provider’s chief executive delivered his comments as part of a state of the industry address the company posted on its website. Pappanastos encourage ... Read More »
DALLAS, Texas — Staffing and customer engagement models are the top issues impacting the future health of the retail automotive industry, EFG Companies President and CEO John Pappanastos said today.
The F&I product provider’s chief executive delivered his comments as part of a state of the industry address the company posted on its website. Pappanastos encourage dealership principals and senior managers to quickly address those issues or risk becoming a dinosaur in today’s rapidly changing consumer car-buying mode, noting that digital buying habits, millennial and Gen Z consumers, and women are forcing industry change.
According to the National Automobile Dealers Association’s 2017 Workforce Study, retail automotive suffered from a 43% turnover rate — up two points from 2016. Additionally, the automotive industry experienced an 88% attrition rate among female new hires, and a below average rate of millennial new hires when compared to other industries.
Pappanastos said many retail automotive businesses lack a comprehensive plan to become an employer of choice, and instead rely heavily on traditional “bell-to-bell” hours, commission-only payment plans, and limited training. He urged them to immediately develop a strategy for hiring, training, and promoting the best and brightest employees to operate in a world where consumers are demanding a more digital process with a better customer experience.
The executive noted that a single poor hiring decision in F&I can easily result in up to $75,000 in lost profit due to onboarding costs and lost production, adding that the retail automotive industry’s focus on daily operations also hampers leadership development and obscures the growth path for millennial hires who, as a group, require opportunities for promotion.
The F&I product executive also touched on recent research from Cox Automotive, which showed that 80% of consumers want to complete at least half of the car-buying process digitally. He also cited a 2018 Deloitte study showing that “dealers create a fragmented and inconsistent approach to the customer,” which leads to inefficient customer contact, inconsistent messaging, and ultimately failure to sell and build loyalty.
“While I realize change is difficult, dealership principals must incorporate greater consumer-facing digital platforms into their dealerships,” said Pappanastos, adding that hiring employees who are experts in online customer engagement and digital sales approaches represents one solution. “Failure to do so will result in lost revenue. We must remember the old adage of ‘meet the customer where they are.’ And today’s customer is clearly online.”
Pappanastos also encouraged dealerships not to lose sight of compliance. “Job skills are easy to assess. What’s difficult is finding candidates who have solid character,” the executive said. “During these tumultuous times, dealerships must maintain a high degree of integrated compliance. The resulting fines, and damage to reputation, can result in significant business loss due to very clear and public online postings and reviews.”
Pappanastos remarks during his state of the industry address focused on the future health of the retail automotive industry and sounded a wakeup call to dealership principals to quickly embrace changing consumer buying preferences. He also encouraged future millennial and Gen Z employees to seek out careers in retail automotive, noting that exciting changes and their opportunity to make industrywide impact.
More Industry

Pennsylvania Dealership Under New Retailers
The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.
Read More →
Battery Storage Takes Priority Over EVs
U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.
Read More →
Auto Dealers Feel Better But Not Great
A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.
Read More →
New-Vehicle Sales Picture Relative
A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.
Read More →
Auto Group Acquires Third Nissan Rooftop
Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.
Read More →
April Less Affordable
Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.
Read More →
Building an Extraordinary F&I Agency
Work to determine your specialized talent, because that fact will determine everything about your agency’s future.
Read More →
Recipe for Compliance
The secret to both amazing barbecue and compliance is the same: understanding the basics and committing to a process.
Read More →
EVs Getting More Attractive
A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.
Read More →
EV Sales Drop in April Following Surge
North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.
Read More →