A new study shows that Black car buyers and those from other racial groups notice a lack of diversity among staff at Canada’s auto dealerships.
Black car buyers note lack of diversity at Canada’s auto dealerships, study finds
According to the study commissioned by Accelerate Auto, 63 per cent of Black respondents perceived the dearth of employee diversity
Raj Kuchibhatla, left, of RK Insights, and Jerry Chinner, vice-president of dealer sales and business development at taq Automotive Intelligence, were part of the Automotive News Canada Embracing Diversity panel on March 28, 2023.
FINDINGS AT A GLANCE
A study commissioned by Accelerate Auto was designed to understand the car buying experiences of Black Canadian and how they feel about pursuing careers in automotive. It was conducted in September and included responses from 1,116 consumers across Canada.
- Nine per cent of respondents described dealerships as diverse.
- 92 per cent of respondents, regardless of race, saw well-paying opportunities in the automotive industry.
- 32 per cent of Black consumers said the auto industry is lacking diversity compared to 24 per cent of white consumers and 16 per cent of other minorities.
- More than 75 per cent of Black respondents reported having experienced negative experiences at dealerships versus 64 per cent for whites.
- Affordability, reliability, and safety were the top three considerations when buying a vehicle. However, technology mattered more to Blacks and other minority groups than to white Canadians (46 per cent versus 30 per cent for white).
- When preparing to shop for a vehicle, two-thirds (64 per cent) of consumers employ at least one strategy to ensure they are treated respectfully by the sales staff. Higher for Blacks — 73 to 74 per cent and other non-black minorities — versus white, 55 per cent.
- Black consumers (30 per cent) were more likely than white (16 per cent) or other consumers (21 per cent) to say, “I ensured that my clothing/dress was immaculate.”
According to the study commissioned by Accelerate Auto, 63 per cent of Black respondents perceived the dearth of employee diversity.
The study, which included responses from 1,116 participants from different racial backgrounds who had purchased a vehicle over that last decade, found that perception was also common among white consumers, said Raj Kuchibhatla, founder and managing partner at RK Insights.
“The interesting thing when we looked at the numbers is that that 63 per cent is very uniform across all segments [of respondents],” he said. “The findings are really telling us that if you have a dealership without any diversity in sales staff or leadership, the customers do notice, Black customers notice, other minority customers notice [as do] white customers. So, that was a bit of a surprise.”
The study was the focus of the March 28 Embracing Diversity online panel organized by Automotive News Canada and Accelerate Auto, a group dedicated to advancing career opportunities for Black talent in car dealerships, within in auto manufacturing, the aftermarket and suppliers.
Other panelists included Jerry Chinner, vice-president of sales and business development at taq Automotive Intelligence, Anne Marie Desando, vice-president, manufacturer partnerships and dealer programs at Scotia Auto Finance, and Shereena Robinson, senior manager, HR, Porsche Canada Ltd.
PROFILING IS REAL
The study also found Black and other minorities are more likely than white consumers to be financially profiled at a dealership and geared toward lower priced vehicles.
Negative experiences, such as staff assuming a customer had poor credit, were cited by 76 per cent of Black consumers compared with 64 per cent of white consumers and 82 per cent of other minorities, according to the study.
A diverse employee base within a dealership “makes great business sense,” said Chinner, who is also a founding member of Accelerate Auto. “People like to talk to people in the sales process with [staff] they can relate to.”
Chinner urged dealers to get involved with underrepresented groups on a local level.
“Go to the local schools, start talking to people,” he said, citing an event organized by Accelerate Auto last summer at a Toronto high school that was visited by representatives of Nissan Canada and suppliers.
“The students loved it; just the fact that we brought part of the industry down to them so they can see it.”
During the Canadian International AutoShow in February, Accelerate Auto partnered with the Toronto District School Board for an event that included students from five predominantly Black high schools, said Chinner.
“At the beginning of the event, we asked how many of the students were considering a career in the automotive industry and two of the students put their hand up. At the end, we asked the same thing, and 40 out of the 45 put up their hand.”
In an effort to create a bias-free workplace, Porsche Canada launched a diversity equity and inclusive training program aimed at “delivering customer experiences that are as great and as legendary as the cars,” said Robinson.
A survey leading up to the program found that some of Porsche’s employees “did not feel like they always felt like they belonged in the dealership,” she said.
“So, we needed to change the narrative,” said Robinson, adding that the two-year-old program has been “embraced” by Porsche’s dealer body.
CREDIT FOR NEW CANADIANS
Vehicle affordability also emerged as a key concern of survey respondents, and that issue is a priority at Scotia Auto Finance, said Desando.
She cited the financial institution’s StartRight Auto Finance program.
“Oftentimes, underrepresented groups are new to Canada [and] don’t have a credit history in Canada,” she said. The program helps newcomers “establish credit for the first time [and] buy that first vehicle when they come to the country.”
With the federal government planning to boost immigration, the auto industry needs to focus on vehicle affordability, said Chinner of taq Automotive Intelligence.
“We’re on the verge of pricing a segment of the population out of vehicle ownership and moving people down a different path,” he said.
