NY Auto Dealers Are All In On Electric Vehicles, Hold the Key To Meeting Clean Energy Goals

By Mark Schienberg | May 4, 2022

Electric vehicles took center stage at the recent New York International Auto Show, with more than 1 million square feet of exhibition space at Manhattan’s Javits Center showcasing 21 different models from 11 auto makers – plus multiple indoor test tracks dedicated to EVs.

All told, every company that exhibited in the County’s oldest and largest publicly attended Auto Show had an EV or plug-in hybrid on display, underscoring the steady rise of consumer interest in zero-emissions vehicles.

New York’s local franchise new car and truck dealers are all in on filling the growing demand for EVs, with a variety of models currently available at all price points on lots statewide. By the end of next year, consumers will have some 100 different EV options to choose from.

New York is still far from realizing its goal of putting 850,000 zero-emission vehicles on the road by the end of 2025. Meeting this ambitious target requires a concerted effort on the part of government, utility companies, manufacturers, and the auto dealers.

The state certainly won’t realize this objective if dealers are undermined by a few EV manufacturers who are seeking special treatment in Albany to maximize their profits at the expense of New York vehicle buyers and owners. The expansion of the direct sales model that would benefit only a handful of out-of-state corporations will undermine consumer protections, put good-paying jobs at risk, and jeopardize New York’s ability to reach its clean energy goals.

As of April 1, only 98,090 of the approximately 4.2 million registered vehicles (2%) in New York were  EVs, according to the New York State Energy Research and Development Authority. While that’s a significant increase from about 3,000 on the road just a decade ago, it’s not nearly enough to help reach the state’s sustainability and climate change mandates.

New York auto dealers, who are located in nearly every community across the state and have been meeting customers’ transportation needs for more than a century, are the key to balancing the drive for more EV sales while maintaining important consumer protections.

New York’s franchise law clearly states that it was established to protect consumers. Part of a dealership’s franchise agreement with the manufacturer is the requirement to provide onsite vehicle maintenance, an inventory of parts, and loaner vehicles. These consumer expectations when buying a vehicle from a New York dealer are not included in the direct sales business model.

The same handful of manufacturers who want the long-established franchise model dismantled to meet their own profit needs have been consistently unable to meet delivery and production targets. The model they employ is not consumer friendly, leaving vehicle owners with no place to go for recalls, and no one to go to bat on their behalf.

Local auto dealers in New York provide over 100,000 community jobs. They are the fourth-largest retail employer in the Metro Area, paying $4.3 billion in wages last year alone. Overall, dealers generated $60 billion in total sales in 2021 and paid close to $2.4 billion in sales tax.

As Governor Kathy Hochul noted during her Auto Show visit, the auto industry is a critical post-pandemic economic driver that should be embraced. “Support these dealers, support these hard-working individuals and tell them how much you appreciate what they do, day in and day out,” the governor urged the crowd during her speech, in which she touted the state’s $1 billion investment to support EV adoption and infrastructure.

Governor Hochul is clearly all in on EVs, signing a bill into law last September that requires all passenger vehicles sold in New York be emissions-free by 2035 – making the state second only to California in its efforts to reduce greenhouse gas emissions from cars and trucks.

It’s time for Albany to heed the governor’s call and recognize the important role auto dealers will play in achieving the state’s clean energy goals by rejecting the expansion of direct sales. Changing the law just to benefit a small group of companies that serve a small group of consumers isn’t good for the economy. It’s not good for consumers. And it won’t get New York to the zero-emissions future to which it aspires.

Mark Schienberg is president of the Greater New York Automobile Dealers Association (GNYADA).


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