Independent Dealers, National Economy: Why America Must Protect Small Businesses in the Used Auto Industry
Independent Dealers, National Economy: Why America Must Protect Small Businesses in the Used Auto Industry
Independent Dealers, National Economy: Why America Must Protect Small Businesses in the Used Auto Industry
Originally published on Medium.
By Vitalii Tkachenko
Licensed Automotive Engineer | Founder of The Guaranteed Best Choice | NIADA & FIADA Member
The Backbone Nobody Talks About
When Americans think about the economy, they picture Wall Street, Silicon Valley, or giant manufacturers. But there’s another backbone that rarely makes headlines: independent used car dealers.
These small businesses keep families moving. They provide affordable cars, create local jobs, and recycle millions of vehicles through repair and restoration. According to the National Independent Automobile Dealers Association (NIADA), more than 40,000 independent dealers operate across the U.S., supporting over 300,000 jobs and contributing billions in tax revenue.
Yet despite this impact, independent dealers lack real protection. Auctions, lenders, and digital platforms hold most of the power, leaving small businesses vulnerable to unfair contracts, delays, and sudden account suspensions.
Small Dealers, Big Impact
Independent dealers are economic multipliers. Each one supports:
- Local repair shops
- Parts suppliers and transporters
- Insurance and finance partners
The U.S. Bureau of Economic Analysis estimates that every $1 spent on vehicle sales generates $2.50 in economic activity. That ripple spreads through communities nationwide.
But these businesses are under pressure:
- Auction contracts that shift all liability to buyers, even when the auction causes damage.
- Delayed titles that freeze tens of thousands in inventory capital.
- Marketplace bans that can erase a dealer’s reputation overnight with no appeal.
The Legal Blind Spot
Franchise dealerships have legal protections under state franchise laws. Independent dealers don’t.
That means they face:
- One-sided arbitration that always favors auctions.
- Cash flow crises when titles are delayed beyond legal timelines.
- Exclusion from platforms like Facebook Marketplace or CarGurus with no explanation.
For thousands of small businesses, these aren’t rare issues — they’re everyday survival battles.
Why It Matters for America
Transportation is not optional. Without independent dealers:
- Car prices climb. Independents often sell vehicles 35–40% below franchise lots, making them the only affordable option for many families.
- Jobs disappear. Losing just 10% of independent dealers would erase tens of thousands of local jobs.
- Consumer choice shrinks. Fewer sellers means higher prices and less competition.
In rural and suburban areas especially, independents are often the only bridge to affordable mobility.
The Case for a Dealer Rights Bill
It’s time for Congress to act. Just as lawmakers once protected farmers, small banks, and franchise businesses, we now need a Dealer Rights Bill for independent auto dealers.
Key protections should include:
1. Fair contracts — ban one-sided arbitration clauses.
2. Title enforcement — strict deadlines and penalties for delays.
3. Marketplace accountability — platforms must give reasons and appeals before suspensions.
4. Neutral arbitration — disputes should be handled by independent panels.
5. Auction transparency — require accurate reports, real-time disclosures, and VIN checks.
The Data Is Clear
- 70% of U.S. car sales are used vehicles.
- Average new car price in 2024: $47,500. Independent dealers’ average: $27,500.
- Title delays cost small dealerships $10,000–$25,000 per month in frozen inventory.
- Marketplace suspensions grew 45% between 2020 and 2024, often without stated cause.
Without reform, the market will tilt further toward giant corporate sellers — and away from local businesses.
A Call to Action
Independent dealers are not asking for handouts. They’re asking for fairness.
The question for lawmakers and industry leaders is simple:
👉 Will we allow corporate platforms and auctions to bend the backbone of America’s used car economy?
Or will we give independent dealers the protections they need to keep families moving and communities thriving?
About the Author
Vitalii Tkachenko is a licensed automotive engineer and founder of The Guaranteed Best Choice, a Florida-based dealership specializing in sustainable, certified vehicle restoration. With over 20 years of industry experience, he advocates for transparency, dealer rights, and affordable mobility for American families.
📚 Further Reading & References
• NIADA – Independent Dealer Insights
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