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Did you miss the CRA Annual Conference?  We’ll be sharing articles over the coming weeks on each of the panels from the conference, written by ChatGPT.

Managing a Car Dealership Through Receivership

CRA Annual Conference 2025 | St. Louis
Panelists: Eric Camm (Turning Point Strategic Advisors), Gary Hunter (Capital Financial), Eric Peterson (Spencer Fane)
Moderator: Baker Smith (BDO Consulting)

Car Dealership 2025

Introduction

Car dealerships are uniquely complex businesses to manage under receivership. At the CRA Annual Conference 2025, the panel “Managing a Car Dealership Through Receivership” examined the cash flow dynamics, regulatory requirements, and pitfalls that professionals must navigate when stepping into these high-value, high-liability businesses.

Understanding the Business Model

Dealerships generate revenue from multiple streams—auto sales, service, financing, parts, and body shop operations. Each area has its own leadership structure, from general managers to controllers, finance managers, and department heads.

Receivers must quickly get a handle on cash flows while balancing obligations to floor plan lenders, original equipment manufacturers (OEMs), and consumers

Car Dealership 2025

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Key Relationships and Dependencies

One of the most important dynamics in managing a dealership is maintaining good standing with the OEM and its incentive programs. Loss of OEM licenses or failure to meet manufacturer requirements can devastate the business’s value.

Equally critical are relationships with:

  • Floor plan lenders, who finance dealership inventory.

  • Finance and insurance (F&I) departments, which provide high-margin revenue streams.

  • Service and parts departments, which sustain cash flow even when sales slow

    Car Dealership 2025

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Common Issues to Protect Against

Receivers stepping into dealership operations face recurring risks:

  • Trade-in mistakes that erode equity.

  • Loss of OEM licenses due to noncompliance.

  • Contracts in transit, which can create liquidity gaps.

  • Selling cars out of trust—a critical violation that endangers lender relationships.

  • Contracts lacking proper security interests, leading to disputes with creditors.

  • Overpaying at auction for inventory that fails to hold value

    Car Dealership 2025

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These pitfalls can quickly turn a distressed dealership into an unrecoverable one.

Realizing Value in a Receivership

Maximizing recovery requires careful consideration of:

  • Location, which plays a major role in dealership profitability.

  • OEM approval of buyers, a condition for any ownership transfer.

  • Buyer net worth and upfront cash requirements, which determine deal viability.

Panelists also highlighted the nuances of atypical dealerships—including recreational vehicle, exotic/luxury, motorcycle, used car, and EV dealerships—each of which carries its own valuation challenges

Car Dealership 2025

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Conclusion

Car dealerships are unlike most other receivership assets. They combine operational complexity with strict regulatory oversight and intense lender/manufacturer scrutiny.

As the panel emphasized, success depends on mastering cash flows, protecting against common pitfalls, and aligning with key players—from OEMs to floor plan lenders—while positioning the dealership for a viable transfer or sale.

The session reinforced that while car dealership receiverships present unique challenges, they also offer meaningful recovery opportunities when managed with precision and foresight.