Stephen Gilchrist spent a lot of his childhood at the family auto dealership as a child, learning the business from the ground up.
“I started out sweeping cigarette butts and crickets off the front porch,” he recalled.
It took performing many different tasks to understand the many moving parts involved in the retail auto business. Stephen’s father, Charlie Gilchrist, bought his first dealership two months before his son was born.
Now at age 32, Gilchrist, runs the day-to-day operations of Parker County-based Gilchrist Automotive and helping position the family business for continued success at a time when the industry is undergoing significant change.
Formerly known as Southwest Ford Auto Group, the business was renamed Gilchrist Automotive and serves as the holding group for 10 North Texas dealerships, including five that were acquired in the past five years.
Growth is critical for businesses like Gilchrist Automotive as publicaly traded companies such as AutoNation or multinational conglomerates like Berkshire Hathaway are snapping up family-owned enterprises and consolidating them into large holding groups.
Irving-based Berkshire Hathaway Automotive is now the fifth-largest dealership group as a result of its acquisition of its 2015 acquisition of Van Tuyl Group, then the largest privately owned dealership group in the country. The group owned 81 dealerships in 10 states.
Berkshire Hathaway Automotive has added several more dealerships to its holdings, which includes 13 in the Dallas-Fort Worth area. The automotive group’s sales are about $9 billion per year.
For Stephen Gilchrist, the prospect of the buyout became a reality a few years after graduating from the M.J. Neeley School of Business at Texas Christian University with a degree in accounting and joining the family business as an assistant controller at Southwest Ford.
Around 2012, the dynamics of the industry started to change, he recalled. As the economy was recovered from the recession, auto sales began to take off from pent up demand.
“We were seeing hedge funds and private equity investors buying up dealerships because auto sales were hot and they making a lot of money,” he said.
During this time, Charlie Gilchrist got a phone call that could have changed their lives.
The family gathered to consider the offer, but decided against selling, Gilchrist said.
The decision was rooted in the family’s desire to remain in the retail auto business and to use the business as a springboard for positive impact on the community.
“Getting an offer makes you think about whether it’s time to get out,” said Gilchrist. “But dad and I would have needed jobs and we don’t have a lot of hobbies.”
Gilchrist said he could not imagine a different career as fulfilling as the one he already had.
“I love the auto business,” he said. “All I ever wanted to do was follow in my dad’s footsteps and work in this business. When we thought about it, we decided to stay strong.”
The Gilchrists’ recognized that public companies often support charitable and philanthropic causes but typically do so on a national scale rather than in the local areas where their stores are located, Gilchrist said.
Gilchrist Automotive takes pride in having contributed more than $1 million over the last few years to more than 20 organizations in communities where its stores are located. The company’s main focus is education initiatives through organizations such as Communities in Schools, TCU, Weatherford College and local education foundations. It also supports nonprofits such as United Way, Community Foundation of North Texas, Susan G. Komen, Cook Children’s Hospital, the Boy Scouts of America and local chambers of commerce.
With the decision not to sell, the company embarked on a period of growth in both building new facilities and acquiring more dealerships.
Growth is important to the company because of the economy of scale in purchasing for multiple stores rather than one, Gilchrist said.
“To be profitable you have to do this,” he said.
Charlie Gilchrist has a long track record of success in operating auto dealerships. After earning his degree in accounting from the University of Texas, he earned his CPA license and went to work as an accountant at Coopers and Lybrand.
Before long, he made his way into dealer operations as controller for Ford Heavy Truck dealerships, which led to his move to controller and then general manager of Ken Nichols’ Ford dealerships in Fort Worth and Weatherford.
Gilchrist purchased the Weatherford store in 1986 and began building his Southwest brand in Parker County, with additions of Toyota, Jeep-Eagle and Suzuki franchises. Gilchrist sold the Toyota franchise to Jerry Durant and Jeep-Eagle to Roger Williams, both in Parker County. Suzuki discontinued U.S. auto sales.
Through business partnerships and acquisitions, the Gilchrist brand now boasts 10 retail stores, including the Southwest Ford, Southwest Nissan, Southwest Mitsubishi and Southwest Volkswagen in Hudson Oaks.
Other recently acquired dealerships in North Texas are: Platinum Ford and Platinum Chrysler Dodge Ram and Jeep in Terrell; Parkway Buick GMC in Sherman; Southwest Ford and Southwest Buick GMC in Greenville and Southwest Chevrolet in Kaufman.
“They’ve been looking out for opportunities,” said Lee Chapman, president of the Dallas-Fort worth Metropolitan New Car Dealers Association. “When those opportunities happened to present themselves, they took advantage of them.”
Gilchrist Automotive has blossomed into a formidable brand with 336 employees and more than $443 million in sales in 2017, according to figures reported to the Fort Worth Business Press.
Gilchrist continues to be a leader in Ford heavy truck sales.
While Charlie Gilchrist remains head of the family-owned operation, his role this year as vice chairman of the National Automobile Dealers Association has him tied up for most of this year. And that will continue through 2019 when he serves as chairman of the industry group. Both and son have been active in industry affairs.
In his absence, Stephen Gilchrist will continue in his operations role in a business he was born into and takes pride in as a next-gen-er.
“I can’t imagine doing anything else,” he said.
Tarrant County leading area auto sales
Tarrant County is leading the Dallas-Fort Worth area as this year is shaping up to be another robust year for auto sales.
New data provides more of evidence of Tarrant County’s booming economic strength compared to Dallas County. Tarrant County led the four counties – Tarrant, Dallas, Collin and Denton – with 11,699 vehicles sold in April, the latest monthly data available from Freeman Metroplex Recap.
The Freeman report tracks new vehicle sales in the immediate Dallas-Fort Worth area based on new car registrations.
Year-to-date data is slightly sluggish this year for the combined counties of Collin, Dallas, Denton and Tarrant compared to the same period a year ago, according to the report. From January through April, 125,298 vehicles were sold in the four immediate Dallas-Fort Worth counties compared to 127,432 during that period last year, according to the Freeman report.
Tarrant stands out with the highest number in year-to-year sales. Through April, 47,173 vehicles were sold compared to 45,970 vehicles sold last year. Tarrant’s 47,173 sales bested Dallas County’s year-to-date sales of 46,640, down from 49,203 last year.
Dallas County’s April sales of 10,975 were lower than April 2017 sales of 11,786 while Tarrant County’s April sales of 11,699, up from 10,212.
“Dallas-Fort Worth and all of North Texas has a very strong economy and that’s why auto sales numbers are strong,” said Lee Chapman, president of the Dallas-Fort Worth Metropolitan New Car Dealers Association. “People are moving here all the time and buying new vehicles.”
At the national level, auto sales fell 2 percent to 17.2 million. It was the first year-to-year decline, the Associated Press reported, based on data from Autodata Corp. Sales declined from 17.55 million in 2016.
“Everyone is thinking that this year is going to be similar to last year,” said Jerry Reynolds, nationally syndicated talk show host of Car Pro Show, based in the Dallas-Fort Worth area. “If the numbers are about the same this year as last year, everyone would be very, very happy.”
Chapman said a handful of new dealerships opened in the DFW area within the last year, including Park Place Jaguar Land Rover and Sewell BMW in Grapevine and Autobahn Porsche in Fort Worth.
The North Texas region accounts for about 35 percent of vehicles sold in Texas, according to Dallas-Fort Worth association, which represents about 200 dealers in Collin, Dallas, Denton, Ellis, Kaufman, Hood, Johnson, Parker, Rockwall, Tarrant and Wise counties.
Trends this year continue to follow of the last few years with sedans losing ground and SUVs becoming more popular among younger as well as older buyers, Reynolds said.
Baby Boomers prefer the higher ride of an SUV compared to a sedan as well as the ease of unloading items without bending, Reynolds said. Younger buyers with children are choosing the larger-size SUVs rather the minivans, which continue a slide toward history. – Marice Richter