Dealer Damon Lester: More diversity needed among owners

More work needs to be done to make the number of minority-owned dealerships representative of the U.S. car-buying market, dealer Damon Lester told the audience at the Automotive News Retail Forum: NADA on Thursday. 

At the end of 2022, the minority dealer body totaled just more than 1,300. Hispanics made up the largest share of that group, owning just more than 500 dealerships, then Blacks with about 290, Asians with about 280 and the remainder owned by Native Americans. 

“There’s been some year-over-year growth,” Lester said. “The D&I push over the past couple years has definitely helped. We want to help in this environment now with this big consolidation we’re seeing and scaling [that] a lot of larger groups are doing. We continue to see year-over-year expansion.”

Before the recession, in 2006, there were more than 2,200 minority dealers. After the recession, the number plummeted to fewer than 1,000, mainly due to the bankruptcies of General Motors and Chrysler. 

Lester joined the National Association of Minority Automobile Dealers in 2002 and was president from 2006 to 2022. At NAMAD, he focused on creating opportunities and fighting for minority dealers, particularly during the 2008-09 recession. In 2021, he became a dealer himself as owner of Nissan of Bowie in Maryland, just three miles from his home.  

Making the transition from advocate to dealer didn’t happen overnight for Lester, who said he tried to buy 15 dealerships before he purchased his Nissan store. 

“I could advocate for other people, but there was no one to advocate for me,” he said. 

Lester continues to push for minority representation in the industry. 

“When you look at the data, our business case is 30 percent of all new cars and trucks are purchased by a minority, but yet we have 6 percent representation,” he said. “So the scales of parity aren’t equal, and so that’s what we’re striving for.” 

When asked what it’s going to take, Lester points to three things: access, opportunity and cash. 

“Our average dealer body on the minority side is maybe three to 3.5 stores,” he said. “We need to scale up so we can, from a longevity standpoint, compete. The benefit we have is that we are more profitable and outperform, from a volume standpoint, non-minority dealers.” 

There’s a business case that shows financing should be made available, Lester said. “But we have to be creative,” he added. “We have to figure out ways of partnerships.”

As for his plans 10 years from now, Lester said, “I’ll probably have over 10 stores.”