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Wanted: Dealers of imported cars

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Published:   |   Updated: August 16, 2013 at 11:56 AM

Hernando County has plenty of domestic car dealerships but when it comes to import franchises, there are none.

People who want to visit a showroom to view a new Toyota Camry, Honda Accord, Hyundai Sonata or Kia Sportage must make lengthy commutes to Pasco, Pinellas and Hillsborough counties to the south or even less-populated Citrus County to the north.

That makes no sense to Rick Matthews, owner of the Buick GMC dealership on State Road 50, just east of the Suncoast Parkway interchange.

Matthews said he's called all of the major import franchises and manufacturers and hears the same thing: "Don't open in Hernando County because it will drain customers from us."

Matthews said that argument holds no water, especially since most of these import franchises are more than 25 miles away from Hernando County, well out of competitive range.

He said he's made an offer on the vacant Suzuki dealership across from his current facility on SR 50 in hopes of converting it someday to an import franchise but has not heard back from the bank.

Matthews said an import dealership in Hernando County would boost economic development, add to the tax base and create jobs.

But don't look for one soon.

It's the law

John Gilliss, owner of Friendly KIA off U.S. 19 in New Port Richey in Pasco County, said he would love to be the first import new car dealer in Hernando County but is stymied from doing so because of strict regulations set forth in Florida statutes, especially two that pertain to franchise location.

State statutes prohibit someone from obtaining an application for a motor vehicle dealer license in a community if there is a similar franchise (selling the same brand of vehicle) within a 12.5-mile radius of the other.

Statutes also say a dealer cannot locate in an area if 25 percent of the new-car registrations at the competitor's site originate from there.

For example, Gilliss said a large percentage of Hernando County residents buy from his Pasco facility and so fall within that law.

Gilliss said if he were to open a franchise in Hernando County he would be sure to receive protests from the other KIA dealerships in Crystal River and Wesley Chapel.

"We have a right to protest and it is simply to protect the individual business," Gilliss said.

Hernando County has had two Ford dealers in proximity for years, but Gilliss said they were here long before the 12.5-mile law and registration laws were enacted.

There used to be two import dealers in Hernando County: Suzuki and Mitsubishi. Both went out of business, with the former pulling out of the country completely.

When that Mitsubishi dealer was open on U.S. 19, it did affect his business at KIA, Gilliss said.

But at the time, Gilliss said he couldn't stop them from opening because they were a different import dealer and didn't violate the 12.5-mile rule.

To illustrate the problem, Gilliss said he will pick up one of his customers' vehicles in Hernando County, take it to his dealership in Pasco County and then return it to the customer - all free of charge.

Rethinking economic priorities

Scott Fink, CEO of Hyundai of New Port Richey, said the automobile business is fiercely competitive, and manufacturers are wary of opening dealerships in an area that may either hurt surrounding franchises or could stand a good chance of folding.

That ultimately hurts not only the dealer but the vehicle brand, Fink said.

Each month, dealers get a count of how many new-car registrations are logged at individual dealerships. In July, Fink's Pasco County franchise recorded 80 such registrations from Hernando County, more than any other import or domestic car dealership.

If he was to open a Hyundai franchise in Hernando County, it might boost that county's sales somewhat, but he would lose the valuable Pasco and North Pinellas base, he said.

Hernando County commissioners offer tax abatements and incentives to industries interested in relocating to Hernando County, especially at the Brooksville-Tampa Bay Regional Airport.

But Fink said that while commissioners in most counties are "quick to open their wallets to companies outside of Florida," perhaps it's time to look closer to home and that includes car dealerships.

The economic impact of having a dealership in a county can be substantial, said Fink, who employs 310 people in all five of his facilities.

Fink said it is surprising that Citrus County, with less population than Hernando, has several import dealers.

That decision was made by the manufacturers who, for whatever reason, decided that market was underserved, Fink said.

Fink said he is not na´ve enough to think that people who buy from his Pasco County dealership are returning there for oil changes and nonwarranty work.

That business likely goes to the independent mechanics in Hernando County, even with free-pick-up for service which he also offers.

But then again, he said, there are many in Hernando County who turn a trip to a faraway dealership into an excursion.

"There are lots of customers there who are retired," he said. "They have lots of time and will make the trip (to Pasco) and combine it with shopping, maybe to the mall."

'Buy American'

County Commission Chairman Dave Russell said he was surprised to hear of the stringent laws governing car dealerships, but it is indicative of the strong lobbying efforts by the Automobile Dealers Association and car manufacturers.

Russell said he encountered that during his years as a state legislator.

The ultimate loser in all this is the consumer who is forced to travel long distances to get their car serviced or to satisfy manufacturer warranty demands, he said.

In a county of 170,000 people, "it's shameful that there would be such (laws) to prevent competition and inconvenience customers.

"People need to know if they buy a foreign car that can't be supported locally they may want to buy American," he said.

mbates@hernandotoday.com

(352) 544-5290

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