How Damon Lester is Leveling the Auto Dealer Playing Field - EBONY

How Damon Lester is Leveling the Auto Dealer Playing Field

How Damon Lester is Leveling the Auto Dealer Playing Field

As president of the National Association of Minority Auto Dealers, the 43-year-old is seeking ways to get the same percentage of people of color into the car selling game as there are in the car buying game

by Avis Thomas-Lester / Urban News Service, August 12, 2016

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How Damon Lester is Leveling the Auto Dealer Playing Field

Damon Lester’s phone typically starts ringing at 7:30 a.m. And it keeps ringing until after 10:00 p.m.

Since taking the steering wheel of the National Association of Minority Automobile Dealers in 2006, Lester has become the face of the group that advocates for people of color who own dealerships.



It’s a busy gig. By nine o’clock on a recent morning, he had spoken to a National Highway Transportation Safety Administration executive, a congressional staffer, a dealer and a prospective dealership buyer. Later, he attended two Capitol Hill meetings, one of them with his group’s lobbyist. He also took  a long call about his association’s annual conference scheduled for mid July in Miami Beach.

“Mine is definitely a 24 hours a day job,” says Lester. “Of the 18,000 new automobile dealerships in the United States, only 1,128 are owned by an ethnic minority. People of color buy 30 percent of the cars in this country, but own only about 6 percent of the car dealerships. So, there’s a lot to be done.”

Based in Largo, Maryland, the association was founded in 1980 to promote “diversity and inclusion in all aspects of the automotive industry,” according to its website. The organization lobbied then-President Jimmy Carter to assist minority dealers in the wake of the 1979 government bailout of Chrysler.

As head of this nonprofit, Lester’s mandate is to increase the number of dealers of color and ensure that those who enter this ultra-competitive business have an equal opportunity to thrive and prosper. He has met with the president and testified before Congress on behalf of his constituency.

“Damon is very passionate and dedicated about representing NAMAD and all of its dealer members, vendor and manufacturer partners,” says Jenell R. Ross, president of the Bob Ross Auto Group in Dayton, Ohio. “He is a true advocate [for] our industry.”

Lester, 43, wasn’t particularly interested in the auto industry before joining the association’s staff in 2002. He was more interested in accounting, which was the West Philadelphia native’s major at Temple University. His first accounting job was with Black-owned Milligan & Company, LLC, in Philadelphia, where founder John Milligan took him under his wing. Three years later, Lester moved to the accounting firm of Gelman, Rosenberg & Freedman in Bethesda, Maryland. The firm audited the minority auto dealers’ association.

Lester joined the association in 2002 as vice president of operations. He became president in 2006, succeeding the late Sheila Vaden-Williams.

Lester was promoted just as auto dealers were stung by the economic slowdown of 2007.

His “whole focus was trying to save as many members as possible” from losing their dealerships, says Jose Pozos, an owner of car outlets in Texas and Louisiana and past chairman of the association’s 25-member board of directors.

Because many of the members were first-generation business owners, they didn’t have access to capital to tide them over when demand slowed and sales flatlined, Lester says. Thirty percent of minority dealerships folded.

“[Manufacturers] would give you a financial buyout and thought you should be happy,” Pozos says. “But the dealers weren’t into it for that. They were into it for the entrepreneurship, the family legacy and the American Dream.”

Pozos credits Lester for organizing a coalition of leaders to support association members, including other dealer groups and representatives of the minority congressional caucuses.

Because of his connections, Lester “was able to get the industry talking to Washington,” Pozos says.

In June 2009, Lester asked for his board to visit Valerie Jarrett, Obama’s chief of staff, to discuss the financial fate of minority dealerships. Obama attended the meeting.

The group asked Obama to order the Small Business Administration to lend directly to minority dealers, as happened under President Jimmy Carter in 1980. Prior to the meeting, in a letter to the White House, Lester wrote that 75 percent of minority dealerships faced closure if they didn’t receive financial assistance. The dealers were just as desperate for government help as GM, Chrysler and the big banks that received government aid.

“The president listened to us, but in the end he didn’t give us what we were asking for,” Lester says. “But we were able to enter into a memorandum of understanding with General Motors” to address dealers’ financial concerns.

Their memorandum became the template for legislation that Congress ultimately passed, says H. Todd Bullard, the association’s attorney. It included binding arbitration and wind-down payments of up to $1 million for dealers who lost their stores.

“Congressional staffers were looking at it, going, ‘You know what? This is good. I think we’re going to turn this into a bill,’” Bullard says. “And that’s what happened.”

The White House meeting also pushed the SBA to guarantee loans for some minority-owned, new car dealers.

As America’s financial fortunes improved, so did those of dealers of color. About 17.5 million new cars were sold last year and dealerships are on track to match or exceed that level this year, says Lester, who is trying to add members to his group. .

The number of minority-owned dealerships peaked at 1,805 in 2005, dropped to 1,156 in 2007 and bottomed out at 873 in 2011. As of Dec. 31 2015, America had 1,128 minority-owned dealerships, according to statistics from Lester’s organization. That number includes 552 Latino-owned stores; 264 owned by Blacks; and 215 Asian-owned dealerships. In years past, Blacks held the top spot.

Nissan had the highest percentage of Black-owned stores at more than 2 percent, followed by Ford at just under 2 percent. In order by number of stores, Ford had 63 black dealerships out of 3,238; GM had 49 out of 4,245; Fiat Chrysler had 27 of 2,385; Nissan had 21 of 1,077; and Toyota had 14 of 1,245. The vehicle brands most popular with Black purchasers in 2015 were Toyota, Nissan, Chevrolet (GM), Ford and Honda, respectively.

“We’re working with some Black entrepreneurs who are interested in purchasing dealerships to help bring those numbers up,” says Lester.

Acquiring capital is easier now, but the cash stash needed to even apply to purchase a new car dealership these days is $1 million. That figure is up from $100,000 in 1980.

As he celebrates 10 years as association president, Lester is satisfied. When he’s not traveling or negotiating for his members, he hangs out with his two young sons and Kappa Alpha Psi fraternity brothers. His favorite wheels are those on his Harley-Davidson Street Glide Special.

Lester is most proud of his association’s success in pushing diversity to the forefront of the auto industry’s agenda. His message in countless meetings and phone calls is that demographics are changing. Minorities are becoming the majority.

“It’s in their best interests to adopt diversity as a business imperative because they want to increase their market share,” says Lester. “It makes good business sense.”

Editor’s note: The writer is not related to the subject of this story.





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