Inside Automotive with Jim Fitzpatrick, powered by CBT News

How A Dealer’s $6M Gift And Smarter Operations Shape Automotive’s Future

• Jim Fitzpatrick • Season 1 • Episode 43

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In this episode of Inside Automotive, Serra Automotive Chairman Joe Serra discusses leadership transition, operational priorities, and the broader industry outlook while reflecting on a significant philanthropic commitment in Michigan. Serra explains how a recent $6 million pledge to McLaren Flint Hospital aligns with his later-career focus on community impact, as well as the organization’s long-term planning for stability and growth.

The conversation covers:

  • The motivation and goals behind Serra Automotive’s cardiac care donation
  • How leadership responsibilities are divided as part of a multi-year succession plan
  • Managing a 62-store, multi-brand operation through changing market conditions
  • Affordability pressures facing consumers and their impact on demand
  • Used-vehicle acquisition strategies and compensation alignment
  • The growing importance of fixed operations and leadership development

Serra offers perspective on balancing business performance with long-term stewardship, emphasizing consistency, preparation, and accountability as the group supports both its employees and the communities it serves.



Inside Automotive with Jim Fitzpatrick is powered by CBT News, your go-to source for the latest news, trends, and insights in retail automotive. Subscribe for more interviews with top industry leaders, dealership innovators, and experts shaping the future of automotive.

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Speaker:

Welcome to Inside Automotive with Jim Fitzpatrick.

Jim Fitzpatrick:

Today we're joined by Joe Serra, chairman of Serra Automotive, home to 62 dealerships representing 27 brands. We'll talk about his business, his outlook for 2026, and an incredible $6 million gift that he and his wife made to advance cardiac care in his hometown. Thank you, Joe, so much for taking the time out of what I would imagine is a very busy schedule with 62 dealerships. I know Matt, your son, runs uh helps you run those, and uh uh, but thanks so much for taking some time with us at CBT News.

Joe Serra:

No, it's my pleasure. Always great to uh spend time with you, Jim.

Jim Fitzpatrick:

Sure. So let's talk about this big, uh very, very generous donation that you made. Uh you and your wife gave six million dollars, as I said, uh, to uh McLaren uh uh Flint to support cardiac care. Uh tell us about that. I know it's very near and dear to your heart, so it's not no pun, but uh but talk to us about that.

Joe Serra:

Yeah, you know, you say very generous, and um and I appreciate that. But in all honesty, the one thing about our business, retail automotive, I think retailers, automotive retailers might be the most generous people that I've ever come across. I think anytime I meant go into a community, whenever there's like a community needs of funds for whatever, a fundraiser, it seems like you always reach out to local dealers. So I think I work amongst and compete against some of the without a doubt the most caring-giving people in the world. So our gift, I mean, there's a lot bigger gifts that auto dealers have given, but in our case, um I had I've had some health issues um unfortunately, but it is what it is. And um I've had a heart attack about 12 years ago, then nine years later, three years ago, um, I had issues again. And long story short, I needed a five bypass. Wow. And I'll never forget um when you're when you say that, you think of where do you go and you think of the big names, you know, you think of the mayo, the Cleveland, sure. You think outside of Flint, Michigan, which is where we're from.

Jim Fitzpatrick:

Sure.

Joe Serra:

And Flint Flint has their their own history, right? We've had our own stories of hardship. But when I reached out to some local people, they said, Joe, we have we can do this. And if we couldn't do it, we'd tell you.

Jim Fitzpatrick:

Yeah.

Joe Serra:

And there's some real huge advantages of staying local for your family and for other reasons.

Speaker:

That's true.

Joe Serra:

So some said it was a leap of faith, it really wasn't. I met with our my surgeon, Dr. Sanjay Batra of McLaren Hospital, McLaren Health Network, and literally it's in Flint, it's five minutes from my home. He explained what he could do, how he was gonna do it. And the experience was so great and so wonderful that when they spoke about some of their needs to make it even a better world-class um experience cardiovascular, it was pretty easy, yes. Um normally we don't, my wife and I, we wouldn't publicize it. But this is one where they were hoping we would to help bring awareness to the fact that we have this jewel, this gem in our backyard. Yeah, sure. So that was sort of the reason we put our our name out there. Normally we would not.

Jim Fitzpatrick:

Yeah, sure. And I think what you know, when somebody hears like this kind of a donation and contribution, it inspires them to give what they can. You know what I mean? Maybe everybody can't afford six million dollars, maybe some gonna afford more, who knows? But at least you it gets you thinking to say, wow, you know, to be able to give back to a hospital that's doing so much for your community, it makes sense, right?

Joe Serra:

Right, 100%.

Jim Fitzpatrick:

Yeah.

Joe Serra:

And um, I always tell people it wasn't six million laying around. I told them I'm gonna give it to them over time. So I got to work hard and and keep earning it so we can give back. But you know, it's funny, but um I look back on my career and I tell people there's certain phases of life. You know, when I was younger, it was a learning phase, and then I got into the earning phase, and I tell people this is the returning phase. Yeah, and it's the most enjoyable phase of all. Sure. Because you can't you can thank those that have been that have helped you become who you are, and you can sort of have an impact where it's needed in whatever communities you do business in. That's right, that's right.

Jim Fitzpatrick:

Including your business. I know that you uh you've been uh Matt's your son Matt's uh mentor over the years, and you've been there to you know to uh as a as a uh calm advising voice, right, to uh steer him in the right direction in operating so many stores, right?

Joe Serra:

Yeah, that I got lucky there. I give uh my wife a lot of credit. She raised a really brilliant young man that um when you say calm advice, usually it's calm. Every once in a while I get a little wound up, you know how it goes. Um but um yeah, we're fortunate as an organization. Um, the fact that we have a longer runway now. Matt, my son, is in the business and um likes the business. Um I think he's very good at the business, the people side of it is which is so vital. So yeah, we're blessed in that we do have a runway which is important for the our current operation, my our current business partners, because we have business partners in all our stores, yeah. And also for the manufacturers, they can see, they look at me and they say, Hey, you're you're in the pre-owned department, I need a new car. So they like Matt. So it gives them a longer distance.

Jim Fitzpatrick:

Right. So having said that and gone through what you've gone through with your uh with your health uh issues there, when when does Joe Serra say, okay, I got my son in place, doing a great job, your partners are doing a great job. When do you, I mean, you're right there at the desk. I've been in your office, it's incredible. When do you just go, hey, I'm I'm pushing away and and let me go on a few cruises or something?

Joe Serra:

Yeah, that's a great question. And um, and I'll give um you sort of give Matt credit on this one because what happened was a while back, even before it was after my initial heart issues, but before the the big surgery, we had talked about uh Matt was one of my partners at one time. He was running a 12 operation campus. Okay, but we knew he all eventually had to come into Serra Automotive and be more active. Yeah, and um so just prior to my surgery, ironically, people thought we had knew about it, we didn't. Um we talked about getting him more involved, and one of the things we did, which I thought was critical, is we identified responsibilities. Okay, and um, and he took over all the operational, which means he deals with the day-to-day, he deals with the partners. Um, and he allowed me to um, and obviously he's involved with myself on future acquisitions, so the cap of future capex, um, because he's got to live with it. I'm involved, he's his say is right there. If he doesn't agree with it, we're not gonna do it.

Jim Fitzpatrick:

Yeah.

Joe Serra:

And I get to do the fun stuff, which is construction, um, which is which is a major job nowadays. I know. Manufacturers. So I jokingly tell people his jobs to spend the money, and my job is to, I'm sorry, his job is to make the money, my job is to spend the money, which is wonderful. Um, so I think as long as we have a need for, you know, making sure our facilities are meet the manufacturer's guidelines and sure what they're looking for, I think there's a role for me. I'm slowly trying to, you know, give Matt more room, and it'll be a transition. I'm I'm I'm hoping I have a desk for, you know, a place to come to forever, but um, so I'm not looking to end it. I would like to slow down at some point. There's no doubt.

Jim Fitzpatrick:

Yes, yeah, yes. It's hard for dealers that have built their companies to slow down, isn't it? I mean, I speak to so many of your colleagues in the industry that that they uh and as you know, many will sell their dealerships, maybe to larger groups, only to find that two years after the non-compete, they buy dealerships again.

Joe Serra:

Yeah, but I'm gonna tell you one thing, and I want to say this in the right way. Because one thing I'm trying not to be is that one dealer that never lets go.

Jim Fitzpatrick:

Yeah.

Joe Serra:

Because one thing I see in our business that if I was gonna be not critical of all the retailers because they're wonderful people, but I see a lot of cases where they have talented individuals below them, whether it be their siblings or even just some talented person, sure, but they can't let go of the day-to-day operational decisions and they're aging and they're just there's they're stifling this person. Exactly. And so the company doesn't grow like it should.

Jim Fitzpatrick:

Right.

Joe Serra:

We think because we all think we're the best, right? We've been there. Nobody better than me or or you, right?

Jim Fitzpatrick:

Of course, of course.

Joe Serra:

So what I've tried to be is not that. Right. So I'm trying, like I said, Matt Handle's operational. Does he do everything the way I like it? Absolutely not.

Jim Fitzpatrick:

Right.

Joe Serra:

Does he do a lot of it better than I could? Sadly, probably so, right? And so I think I'm doing a decent job of letting that go. And what I would say to some retailers is I think that we gotta improve on that. I think some of them, that's where, if I was being critical, that's where some of them just I think are doing their themselves and their company maybe a disservice.

Jim Fitzpatrick:

Yes, yeah. I I would agree with you, and I and I've seen it firsthand. Um, and obviously you're you're I don't think in that category. You've really let Matt run the deal, and you and you're right, he's been doing an incredible job at it. But uh, but I have I know exactly what you're talking about, where they bring people in and only as kind of figureheads, but they every final big decision's got to comply with them. And yeah, we we are challenging that in the industry.

Joe Serra:

Yeah, so it's tough, it's not easy to do, right? It's tough.

Jim Fitzpatrick:

Right, right. So let's talk a little bit about uh talk shop for a moment and um and uh let me just kind of go through some things that the industry is is faced with. And uh I don't I don't want to do a speed round with you or anything, but just kind of give me your your comments and your thoughts on this. Obviously, in this year we've we've looked at the tariff situation or been confronted with that from uh from Trump's tariffs and what have you. Kind of an impact has that had in your industry? What is what is your take on tariffs moving forward? Is it is it a threat for 2026, for car companies, for dealers? Where does that lie?

Joe Serra:

You know, surprisingly, this year, with all that's happened, all the tariffs you talked about, the year has performed better than we had expected. Yeah, and I think if you talk to other auto retailers, they're gonna tell you the same thing. So does that mean it's not had an impact? It hasn't yet. Does that mean it maybe in the future? I'm hoping not, and I'm not smart enough to maybe answer that. Yeah, but so far it seemed like everybody's been able to manage it so far. Yeah. Now, am I concerned about the rising prices of our our used vehicle inventory, of our the monthly payments to consumers? Absolutely. Um, but those are just things we deal with every day, and we've been dealing with since I got in the business in '82 since then. So yeah. But um, so far it's not had an impact.

Jim Fitzpatrick:

Yeah, yeah, that's good. And that was my next question, was was really the just the overall affordability issue. Um I I'm still amazed that we're looking at 16 million plus vehicles as a SAR for 2025, in light of the fact that the average transaction price now has exceeded $50,000. Don't really know where this is going or where it's headed, but I'm still amazed that those new car buyers are still committing to cars for the next 60, 72, or even 84 month financing uh at these numbers. What what's your take on the overall affordability issue?

Joe Serra:

I echo echo everything you just said. Yeah. What you just said is I think about every day. I'm amazed. Yeah. Um there's you think there has to be a point where this is enough.

Jim Fitzpatrick:

Yep.

Joe Serra:

And um and it will happen. I and so our job is to make sure, like I said, whether it be finding those vehicles, whether it be pre-owned or um some of the manufacturers that can produce a little bit lower MSRPs, they're not gonna lose in that, although the Highline brands, as you know, are doing great. Yeah.

Jim Fitzpatrick:

So yeah.

Joe Serra:

Um it's um it's interesting. Interesting, amazing are two words.

Jim Fitzpatrick:

It really is.

Joe Serra:

I tell people all the time, you know, this year it's uh the business is better than we deserve, quite frankly.

Jim Fitzpatrick:

Yeah, yeah, for sure. Um, since you brought up pre-owned vehicles, how is that looking at at your group? Obviously, hard to get your hands on uh good used vehicles, um, but uh and then of course the prices are staying, you know, just as strong uh as ever. But uh what what's the problem?

Joe Serra:

No, our team and and again, Matt, Matt, Matt's the one that guides the team, but they've been talking about since all year long, even last year. It started our most we have to be aggressive on trade-ins. That's the answer to everything. We gotta we have to make sure all of our our processes, pay plans are aligned to where we're going aggressively going after trade-ins from the consumers. And um, and it's surprising. A lot of when we go look at dealerships, a lot of their processes or pay plans aren't aligned for that. They think they are, but they're just they're not. Right. Where we we want to easily upfront tell a consumer here's what your trade's worth, and tell them what it's actually worth, not holding back.

Jim Fitzpatrick:

Yeah.

Joe Serra:

Let them know that we want their trade, we need their trade, because that's the best source of any used vehicle inventory.

Jim Fitzpatrick:

Fixed ops, uh, strong as ever?

Joe Serra:

Yeah, yeah, that's just fabulous. And um, we've been fortunate. Our team um we've got a great, great group of uh dealer partners, but our fixed operation managers, they're so receptive and open to ideas, and they share one thing, one good thing about our organization with the 20 some plus different partners and all the managers, they share best practices. And um a lot of the a lot of our monthly calls on best practices that Matt facilitates have been on fixed operations. And so we're sharing some of the best practices amongst our network.

Jim Fitzpatrick:

Yeah, yeah, that's fantastic. We we never seem to get enough fixed ops directors into that GM spot or dealer principle. When we do, the it seems as though you know the store uh can make a ton of money because as you know, so many of us came from the variable side, including myself. So you're kind of like, yeah, no, I I know fixed ops, but I don't I don't know it as well as my fixed ops directors. But I know over the time over the years I've left a ton of money on the table in fixed ops because I didn't know it that well, you know.

Joe Serra:

Yeah, and it was funny you said because um the one of our like the original store where I started with was called the Al Serra Auto Plaza, which is um located in Grand Blanc, Michigan. It's now grown to 12 different um franchises, and that's where Matt just came from as well, as you'll recall. Yeah. And um, and when he decided to make the move over to Serra Automotive, he the person who took his seat was the service fix ops director. So that's a that's a big operation to put somebody with that that talent in. And um, and he's smart enough. His name's Dave Garr, he's smart enough to surround himself with people that have variable you know talent.

Jim Fitzpatrick:

Yeah, sure.

Joe Serra:

And you that necessarily the key. You got to know where your your strengths are, you gotta know where your weaknesses are, and and then also just like anything, when you went from variable into the dealer role, you got to make sure you don't push too much a year onto the variable people. And Dave's got to make sure he lets his fixed people grow too.

Jim Fitzpatrick:

You know, that's right.

Joe Serra:

We always want to we always want to be good at what we know, but sometimes you've got to back away.

Jim Fitzpatrick:

Yeah, you're micromanaging that fixed ops director that you know just filled your shoes there. 100%. You know, yeah, exactly. That that it can be difficult at times. Um in terms of business overall, uh, will you do and you don't have to share this with me if you don't want to, but will 2025 be a better year financially for Serra than 2024?

Joe Serra:

It has, it will be.

Jim Fitzpatrick:

Yeah.

Joe Serra:

Yeah, yeah. Yeah, no, that's as I said earlier, it's uh been sure surprising. I remember I sat sat in a meeting with a bunch of brilliant dealers that owned a bunch of stores, and we were talking early in the year. And um, I think I I said I would be happy with 90 percent of um 24 or 25. And that was about the sentiment in the room. There maybe was one or two that said, no, we'll be equal to. Nobody said we're gonna be better, and right, I think we're all wrong. So that's good.

Jim Fitzpatrick:

That's great. So yeah. I mean, it it it is it really is such a resilient business out there. You know, we we think in terms of headwinds and whether it be the Great Recession, which was a tough one, but COVID and of course the chip shortage and the tariff situation, and man, you dealers just keep coming, right? Yeah, there's no slowing you down, right?

Joe Serra:

Yeah, it's a great industry with great people, and like I said earlier, people that truly do care about their the communities they do business in. Yeah. And they they show it not just with their financial ability, but with their time and um their commitment and their talents. I it's this is what I love about this industry. Yeah, I'm so blessed and fortunate to be in it.

Jim Fitzpatrick:

Joe Serra, chairman uh of Serra Automotive Group, all around great guy. We really appreciate you and certainly appreciate you even more now that you're giving six million dollars away for a great cause. So thank you so much to you and your wife and your family uh for that matter, and uh giving back to the community, stepping up. Really appreciate it, and uh, thanks so much for all the time you've given us.

Joe Serra:

Thank you, sir. Thanks for all you do.

Speaker:

Thanks for watching Inside Automotive with Jim Fitzpatrick.