Automotive News Canada - January 2021 - 12

* J A N U A R Y 2 021

Auto company executives
on the move, to dealerships
From head office to the sales
front line, business leaders
apply their unique skill sets
By PERRY LEFKO

TORONTO CORRESPONDENT

Trade under Biden:
Expect restrictions
without the drama
WHEN JOE BIDEN TAKES OFFICE AS THE 46TH PRESIDENT OF
the United States on Jan. 20, don't expect all of that country's
protectionist leanings to suddenly evaporate.
To be sure, Biden is highly unlikely to approach foreign
affairs, including trade with
Canada, as impulsively and
often recklessly as his preIN CANADA'S VIEW
decessor Donald Trump did.
Canadian auto-industry
executives have spent the
IRWIN
past four years worried
about the fate of North
American trade and the
COMMENT
possibility of tariffs being
imposed with little notice.
They will have far less to worry about on that front. Top Biden
trade advisers are unlikely to go on a Sunday morning talk
show and say there is a " special place in hell " for Canadian
Prime Minister Justin Trudeau. Remember Peter Navarro on
" Fox News Sunday " in 2018 when he also called Trudeau
" weak " and " dishonest " ?
That needless bluster created a cloud over U.S.-Canada
trade relations and will be left behind when Biden is inaugurated, but our southern neighbour's newfound love of protectionism is not going to go away.
Consider the Biden campaign's platform, which calls for the
U.S. government to spend $400 billion (CDN $510 billion) on
" American products, materials and
services " during his term in office.
There will be less
As Flavio Volpe, the head of the
Parts Manufacturers'
shoot-from-the-hip with Automotive
Association, told me, it's a clear
the new president, but sign of a " nationalist attitude
toward procurement " that could
he's likely to be 100
shut domestic automakers out of
per cent U.S. first.
fleet sales to the U.S. government.
When it comes to trade deals,
Biden and Trump might be aligned on some issues. Biden has
signaled his support for the new United States-Mexico-Canada
Agreement, which replaced the North American Free Trade
Agreement. Biden supported NAFTA as a U.S. senator in the
1990s.
As vice-president in the Obama administration, Biden
backed the Trans-Pacific Partnership. But he has stopped short
of saying he would re-enter the United States into the agreement, which Trump abandoned in 2017. If the United States is
to one day re-enter the TPP, expect renegotiations focused on
tightening the pact's labour rules.
The U.S. relationship with China is also unlikely to cool
down much, at least in the early days of the Biden administration. In December, Biden told The New York Times that he
would not immediately eliminate the U.S. tariffs on China
imposed under Trump and would first launch a review of the
trade deal his predecessor struck with China.
Biden is expected to take a multilateral approach to relations with China, as he has promised to " develop a coherent
strategy " with U.S. allies in Europe and Asia before making any
changes to tariffs.
For the Canadian auto industry, this means things will not
return to the pre-Trump status quo on trade. You won't hear
Biden insulting Canada or other U.S. allies, nor will you see the
country impulsively slap tariffs on Canadian goods.
But it would be foolish to expect the new president to be a
free-trade absolutist. Instead, the Canadian auto industry
should brace for a new set of challenges. - ANC

JOHN

FOR BRIAN FULTON, MOVING FROM THE
corporate suite at Mercedes-Benz Canada to managing a single dealership was the right step at the
right time.
His career switch is part of a growing trend
as technology and shifting consumer behaviour
transform auto manufacturing and retailing, say
industry executives.
Fulton, CEO at the automaker for five years,
joined Zanchin Automotive Group in October
as a managing partner of a recently purchased
Mercedes-Benz store in Newmarket, Ont., about
50 kilometres north of Toronto.
" I've gone from 59-dealerships responsibility and here you are front-face to the customer,
which I wasn't directly in front of in my previous
role, " Fulton said.
" When I look at a lot of the strategic decisions
and policy decisions we made, it's one thing to
understand it at a corporate level, but when the
puck drops and you are on the ice here [at the
dealership], I'm playing the game. "
Paul Cummings, who spent 13-plus years in
top leadership roles at the Canadian operations
at Volvo and Mitsubishi, made a similar transition.

WORKING TOGETHER
Cummings, CEO of Grand Touring
Automobiles in Toronto, said the collaboration
between automakers and retailers is intensifying.
" We're working closer ... together all the time,
so I do think the migration of [heads of automakers] going to retail is going to happen more
and more, " said Cummings, whose dealership
group sells luxury brands, including Jaguar and
Lamborghini.
" One reason is because we
do need to work together, but
it's also the high cost of entry as
far as a business is concerned.
Capital investments by dealers
are getting higher ... all the time,
so they are looking for a business
model and a businessperson to
help them lead that charge. "
Cummings:
Joe Zanchin, owner of the
Moved to
Zanchin group, said Fulton's
retail after
experience as a CEO made him
holding
executive
an ideal choice for the job that
positions
also gives him a stake in the
with
Mercedes-Benz dealership.
" I did not discover [his talent]. Volvo and
Mercedes-Benz did. He went from Mitsubishi.
being the [head of] finance to the F I L E P H O T O
CEO. That tells me that the man
has a lot of [talent]. He's got the people skills, and
he's got the knowledge to represent what he's
selling. "
It marks the first time in Fulton's 35-year
automotive career, most of it spent with
Mercedes-Benz, that he is operating from the
sales floor.

TO THE FRONT LINE FROM THE HEAD OFFICE
" Running a company like Mercedes-Benz, you
had all the private dealers; they were the franchisees running the business front-face with a customer, " said Fulton. " Now I get that opportunity ... it's executing a lot of different programs we
conceived and put in place in the dealer network.
Now it's my responsibility to execute on those,
being on the front line, which is great. "
The 58-year-old Toronto native became the
first Canadian president of Mercedes-Benz since
the automaker arrived in 1955. His five-year term
ended in January 2020, but Fulton said he stayed
on through July because of COVID-19.

" He's got the knowledge to represent what he's
selling, " Zanchin Automotive Group principal
Joe Zanchin, left, said of Brian Fulton, former
CEO of Mercedes-Benz Canada.
PHOTO: ZANCHIN AUTOMOTIVE GROUP

While he was offered a post with MercedesBenz overseas, Fulton didn't want to relocate
again after having done it 11 times in his 26 years
with the company. He wasn't ready to retire,
either, and Zanchin's offer " checked off all the
boxes, " notably the chance to remain in Toronto.
" I happen to be in my hometown, wanted
to stay with the brand, and retail excited me, "
Fulton said. " The chance to be an owner with Joe
[Zanchin] in a Mercedes franchise, I would say
that's an opportunity that doesn't get afforded to
many manufacturer CEOs. "
Fulton said the Zanchin group plans to purchase land in Newmarket to build a " new stateof-the-art dealership " that would open in the
next five years. The dealership will replace the
Newmarket store being managed by Fulton.

BENEFITS BOTH WAYS
Cummings said Fulton will add " huge value "
because of his knowledge of Mercedes-Benz.
As well, he said, Fulton's new role provides
valuable customer feedback for the brand.
" Getting it from a dealer who has had manufacturer experience and also understands the
investments made by manufacturers, and manufacturers understanding the investments made
by dealers, is actually developing into a great
relationship by the two entities.
" I think you're going to see more of it, but I
must admit it was the greatest combination I've
ever pursued personally, no question. "
Don Romano, CEO of Hyundai Canada, said
it is not surprising to see automaker executives
move over to the dealer side.
" Once you've done these jobs at this level,
you're so involved with the entire process from
end to end and you become familiar with the
markets, which ones are doing what and which
dealers need what improvements, " he said. " It
kind of makes sense. It worked well for Paul
Cummings. "
But Romano doesn't see himself making a similar career move.
" It requires a different skill set than I have.
My whole life has been working in a factory
capacity. My whole career has just been developing larger strategies than you would in a dealership. That's not to belittle it at all. I'm more book
smart. I think they're more street smart. " - ANC

REUSS ALSO MOVED TO RETAIL
Brian Fulton's predecessor, Tim Reuss,
worked for the Dilawri Group of
Cos. as president for one year
after his four-and-a-half-year
term at Mercedes-Benz Canada
ended in December 2015.
Reuss subsequently went
into consulting in the automotive industry
before being hired as CEO of the Canadian
Automobile Dealers Association in 2019.

Automotive News Canada - January 2021

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