Welcome to another edition of the Car Dealership Guy Podcast Recap—a rundown of key lessons from top operators, founders, and execs shaping the future of auto retail.
Today’s guest is Matt Haiken, President of Prestige Auto Group.
Haiken is the President of Prestige Auto Group, a second-generation dealer who has run stores under the Lincoln, Volvo, and Polestar brands for more than 20 years.
Broker deals were losing $2,000 net per car, but the volume, awards, and allocation made them feel worth it.
When brokers first called, the math worked, and the relationships were real. Over time, more dealers chased the same channel, margins compressed, and what was once a profitable niche became a $2,000-per-car loss that nobody wanted to admit.
"Why? Because I'm a dumbass. I'm an idiot. Listen. Talk about prisoner’s dilemma. Broker [deals] were my personal prisoner’s dilemma. The volume, the awards, the allocation."
Floor plan interest, cars coming back with a thousand miles on them, and the whole dealership's energy pointed at a money-losing channel.
Quitting brokers cold turkey dropped sales 40-50% and raised net profit.
New Jersey declared brokering illegal, and the decision to cut it off completely, not gradually, was the forcing function that changed the business.
"Let me tell you, my people, my team, they're putting their energy into profitable ventures and to taking care of our customers and used cars."
Every broker deal removed from the books was net-negative, so losing that volume made the P&L better, not worse.
Brokers thrived because dealers failed to deliver what customers actually wanted.
The broker filled a gap that the dealership left open, and the evidence is that customers weren't going to brokers because it was cheaper.
"It's not the brokers fault. It's our fault because they gave our customers something that we didn't provide."
The same argument applies to Carvana and Tesla—he said none of them are winning on price, but they're winning on experience, and dealers who ignore that are funding the competition.
New car departments can't stand on their own, and he said Carvana might be proving there's another way.
The new-car department has always been the exception everyone tolerates.
"I was brought up two golden rules, right? Number one absorption. I want parts and service to cover the expense of the entire dealership. Golden rule number two, every department stands on its own. Parts stands on its own. Service stands on its own. Used car stands on its own. How does new car stand on its own? Tell me how. It's impossible."
Watching Carvana scale a single point from 50 to 900 cars a month with no sales management, no F&I, and no salespeople is forcing a real question about whether the model that's been treated as a given actually has to exist.
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Car brands are incredibly valuable, and dealers are managing them in the opposite direction from every other luxury brand.
The contrast between how Rolex manages its brand and how automotive retailers manage theirs is not a subtle one. Rolex customers go on a scavenger hunt to pay full price and feel good about it.
"Look at Rolex, okay? I mean, what they have done to that brand is insane.It's insane that you can't buy a watch, and the watches that you can buy are watches that, years ago, they needed to get rid of at a huge discount...And now it's a scavenger hunt. Consumers go from store to store to store, and yes, they know they have to build a relationship, but they're on a scavenger hunt looking to pay full price.”
He added, “They feel they got the best deal in the world paying full price for a product. And in automotive, like we're going in the opposite direction."
Nobody has matched Tesla's payment calculator, and it has nothing to do with price.
The FTC sends enforcement letters to dealers for advertising payments with gas savings built in. Tesla does exactly that on their app, and customers thumb through it wanting to leave a deposit.
"Nobody has been able to come up with a payment calculator as seamless as buying a Tesla from your phone."
The simplicity of the Tesla buying experience removes every step that doesn't need to exist and makes the decision feel obvious, and that's what customers are responding to.
The service MPI report fails a basic comprehension test, and the industry has accepted that as normal.
The test is simple: hand the red-yellow-green MPI printout to someone who doesn't work in automotive and ask if it means anything to them.
"I do this test. I give it to my wife or you give it to your mom or your mother-in-law… I just want to say, ‘Does this mean anything? Do do these red, yellow, greens mean anything to you?’ Like, no, it's toilet paper. You know, it's sitting on the front seat or even if it's digital, does it mean anything? No. So, trying to reimagine that."
The goal is a service inspection that reads like a Manheim or ADESA condition report, aka clear enough that a customer can actually act on it.
Service is the lifeblood of the dealership, and moving it 15 minutes away killed the energy.
The market looked great on paper—strong registrations, 10- to 15-million-dollar houses, the right demographics. In practice, it was one of the toughest markets to operate in, and the physical setup was a big reason why.
"The energy of a car dealership is walking in that dealership at 7:45 to 8:30 in the morning and the place being packed with service waiters. Because the real estate was spread apart, my service department was 15 minutes away, you walk in the morning and there's no energy. There's no service customers. There's no waiters. It's just a showroom."
A showroom without a service drive attached is a display floor, and no amount of good demographics fixes the dead-store feeling that follows.
Dealers should be proud of what they do, and the outside world already knows it.
There's a perception gap between how dealers see themselves and how the broader business world sees the industry.
"I always tell people that, you know, Bill Gates is still, I think, one of the biggest shareholders of AutoNation… You name the NFL team or the NBA team, they have automotive holdings. So yeah, we should be proud. Everybody should have a sliver of automotive in their portfolio or their family office or whatnot, because it's a great industry."
In other words, the stigma around saying "I sell cars" is a dealer problem, not a market problem.
The OEM perks that drove broker behavior are a psychological trap, and the freedom comes after quitting.
The awards, the trips, the allocation, the CEO relationships… for a second-generation dealer trying to surpass his father, these were the whole point.
"Once the poison's out of your system and you're like, all right, I care about net, I care about employee retention, I care about customer satisfaction, it's a freedom."
He also argued that the psychology of dealer incentive programs runs deeper than the economics, and recognizing that is the first step to making decisions based on what actually builds the business.
