Alan Haig, President of Haig Partners, joined host Jamie Butters and co-host Martin French on Autotown. In the episode's coffee shop segment, Alan explained why Stellantis and Nissan dealers are seeing a turn, what Carvana's new-vehicle results reveal about consumers, where AI stands on dealership profitability and how Haig Partners' Franchise Horsepower Index helps buyers decide where to invest.

Key takeaways

• Stellantis is correcting course. New leadership cut sticker prices and is bringing back the Hemi and V8s after pricing and product missteps cost the brand years of sales.
• Nissan is rebounding more slowly. A strong lineup under $25,000, more hybrids and a management team that now tracks dealer profit as a key metric are helping some stores recover.
• Convenience commands a premium. Carvana is selling new Stellantis vehicles for several thousand dollars more than franchised dealers, showing some buyers will pay more for an easier process.
• AI has yet to move the margin. The average dealership's pre-tax margin sits around 2.5 percent, and Alan is not yet seeing AI push it to 3 percent.
• The Franchise Horsepower Index points buyers to profit potential. It multiplies average new-vehicle sales per franchise by average transaction price, complementing blue sky multiples.
• Different buyers belong on different ends of the scale. Larger groups need high-index brands like Lexus and Toyota. Younger or less capitalized dealers can buy into recovering brands like Nissan and Stellantis.

Why are Stellantis dealers seeing a turnaround?

Stellantis dealers are seeing a turnaround because new management reversed the pricing and product decisions that drove customers away. Alan traced the decline to Stellantis raising wholesale prices more than any other automaker during the COVID era. Customers compared the new payment on a Grand Cherokee with their old one and walked away, often to another brand.

The brand also struggled to fit electrified powertrains into products built on a muscle-car image. Alan pointed to the electric Dodge Charger, which uses speakers to simulate engine sound, as an awkward fit for buyers who wanted the real thing. The dealer body pushed back, led by dealer council head Dave Kelleher, and the board replaced CEO Carlos Tavares.

"They are course correcting back to the state where they were before Mr. Tavares raised prices and the EV mandates were impairing that company's ability to compete," Alan said. Sticker prices are down significantly and the Hemi and V8 engines are returning, with hybrids likely to be mixed in.

Is Nissan recovering?

Nissan is recovering, though not yet as sharply as Stellantis. Alan noted the brand offers many vehicles under $25,000, which draws consumers priced out of other brands. Lower prices mean thinner gross per unit, but they are helping Nissan regain share.

More important, current Nissan leadership tracks dealer profitability and net to sales as monthly key performance indicators. "I think previous generations might have said that, but I don't think they meant it," Alan said. With fresher product and more hybrids arriving, Nissan dealers are better equipped to compete with Hyundai, Kia, Honda and Toyota. "It looks like the worst is behind us with Nissan."

What does Carvana's new-vehicle success mean for franchised dealers?

Carvana's results show that a segment of buyers will pay more for a simple, digital purchase. Carvana has acquired seven or eight Stellantis dealerships, and two small stores have become national sales leaders. Data suggests Carvana is selling the same new vehicles for several thousand dollars more than franchised dealers, while running leaner stores without traditional sales managers or commissioned salespeople.

Alan believes many of those buyers arrived shopping used vehicles and were converted to new, growing the pie for Stellantis. The OEM has since limited buyers to one new franchise acquisition per year. "I will pay you more for that vehicle if you can make it simple for me," Alan said. "And I don't think I'm alone in trading price for convenience."

What is the ROI of AI in auto retail?

The ROI of AI in auto retail is still unproven at the profit line. "I'm not yet seeing that two and a half percent pre-tax profit margin go to three," Alan said. Dealers are investing heavily because margins are thin, targeting sales productivity, used-vehicle acquisition, pricing and advertising.

Early wins are specific. Alan cited dealer Jeff Swickard, who replaced a used-vehicle pricing software provider with an in-house AI specialist to cut costs and price inventory more precisely. Alan remains optimistic that AI can deliver a needed tailwind as higher interest rates pressure dealer profits.

AI ROI will be a featured panel at the 2027 Maximizing Value Conference, hosted by Haig Partners on February 17, 2027, at the Hyatt Regency Orlando.

What is Haig Partners' Franchise Horsepower Index?

The Franchise Horsepower Index measures the profit potential of each franchise brand. It is calculated by multiplying the average number of new vehicles sold per franchise by the average transaction price per new vehicle retailed at that brand. Lexus ranks at the top and Infiniti at the bottom.

The index complements the blue sky multiples Haig Partners has long published, which reflect what a buyer must pay to acquire a franchise. Those multiples range from roughly zero for the lowest-value franchises, such as Infiniti today, to 10 times earnings or more for Lexus.

How should buyers use the Franchise Horsepower Index?

Buyers should use the Franchise Horsepower Index to match acquisitions to their capital and goals. For larger dealer groups, a store must generate enough cash flow to justify the time spent on it. "You just can't get enough juice out of that lemon," Alan said of lower-index brands, noting a best-case Infiniti store might earn a few hundred thousand dollars to $1 million. Toyota stores average an estimated $4 million to $5 million nationwide, and the largest earn $20 million or more.

For younger dealers who are less well capitalized, the low end of the index can be an opportunity. They may not be able to afford a Toyota store, but they can afford a Nissan or Stellantis store while those brands are in recovery. "If you want to buy low and you're betting on the future, the horsepower index gives you a guide of where you can shop," Alan said.

Talk with Haig Partners

Haig Partners is the leading sell-side advisor to owners of franchised automotive dealerships, with guidance grounded in transaction data and decades of operating experience. Owners considering a sale or acquisition can contact our team or read the latest Haig Report for current blue sky multiples and Franchise Horsepower Index rankings.