Prime CEO David Rosenberg Grew Up in the Business

Rosenberg established Prime Auto Group eight years ago and has grown it into a four-wheel juggernaut consisting of 23 dealerships that sell 20 different brands with total sales last year of 30,000 cars.

FORTY-FOUR YEARS IN THE BUSINESS: David Rosenberg, 52 and CEO of Prime Motor Group, which includes Mercedes-Benz of Westwood, started helping out at his father’s used car lot when he was just eight years old. Last year, his company sold 30,000 cars.

By Paul Kenny

March 16, 2015

4 minutes to read

It wouldn’t be surprising if the genome of David Rosenberg, the CEO of Prime Motor Group, is the outline of an automobile.

He is the son of the legendary Ira Motors dealer, Ira Rosenberg, and a man who has been in the car business since age eight, when he helped broom snow from windshields at the Salem used car dealership owned by his now 78-year-old father. In the years since, Rosenberg has run two powerful auto groups, sold thousands of cars—his first, at age 17, was an Oldsmobile 98 Regency Brougham—and he now writes his own car blog offering advice to readers in search of their perfect vehicle.

Rosenberg established Prime Auto Group eight years ago and has grown it into a four-wheel juggernaut consisting of 23 dealerships that sell 20 different brands with total sales last year of 30,000 cars.

But it wasn’t always such a smooth ride. “I had just graduated from Columbia University with my MBA, and I was learning how to be a general manager under the tutelage of the GM at my dad’s Pontiac/Hyundai dealership in Danvers,’’ Rosenberg recalls while seated in his office at Mercedes-Benz of Westwood. “It was the deep recession of 1990, and the car business was in horrible shape.’’

Rosenberg soon discovered that the general manager to whom his father had entrusted the business, which then consisted of Ira Toyota, Lexus, and Pontiac/Hyundai, wasn’t performing adequately; the dealerships were failing miserably. Once informed, his dad immediately let the manager go and installed his 27-year-old-son to head up the Ira Motor Group.

“I’m here to guide you, and I’m here to advise you,’’ Ira told David, “but you’ve got to learn on your own. You’ve got to make your own mistakes.’’

It was a decision that would ultimately save the business, and allow the Ira brand to expand, grow, thrive, and in a circuitous route, lead to the creation of David Rosenberg’s current automobile empire.

“Once I took a look at the books,’’ recalls David Rosenberg, “I realized we should have been bankrupt. We had a negative $3 million cash balance.’’

In addition to bleeding money, the Consumer Satisfaction Index, then a new measuring barometer instituted by automotive manufacturers, listed the Ira dealerships in the bottom 5 percent nationwide. When Rosenberg went to his first dealers meeting in New York, the vice president of Lexus told him he regretted giving his family a Lexus franchise.

But instead of wallowing in self pity, the newly minted general manager says the crisis gave him a great sense of motivation to try to save the family brand.

“Believe me, I learned more about running a car dealership between the years of 1990 and 1992 than I ever could have from a Ph.D. in economics,’’ he says. “We brought in some very talented people, began to share all the information at managers’ meetings, cut expenses, and eliminated people who didn’t want to get on board.

“We were honest,’’ he continues. “We told our employees that the dealerships were not doing well. A lot of employees were very loyal to my father; in fact, my dad had instituted a profit sharing plan for them. It still tears me up when I think of the number of employees who wanted to give back some of that money to help me save the company.’’

Rosenberg’s vision, combined with a lot of hard work, paid off, and Ira Motors experienced a renaissance. The company not only showed a profit, but added Mazda, Porsche-Audi, and Subaru to its brands. It also became known for high customer satisfaction.

Always looking to the future, Rosenberg bought the company from his father in 1998, paying, as he explains, “a bunch of cash,’’ with the rest to be paid over time. But shortly thereafter, Rosenberg’s mother became ill and the son didn’t want his parents’ liquidity to depend on his automotive sales.

In 1999, Rosenberg sold the business to Group 1 Automotive for a “substantial sum,’’ and continued on for the next seven years as its general manager, retiring in 2006 at the age of 44.

But Rosenberg quickly found that retirement wasn’t for him. “I missed it,’’ he explains simply. In 2007, Rosenberg partnered with his former CFO, Matt McGovern, and purchased the Clair Auto Group, taking all the good things he had learned along the way to create Prime, a name that, for him, embodies everything he’s learned about the automobile business.

“Running a car dealership is like owning a three-legged stool,’’ says Rosenberg. “By the three legs I mean; employee engagement, customer satisfaction, and profitability. Pull out one of those legs and down you go. You can’t have one without the other two.’’

The auto sales process has changed significantly over the years, Rosenberg explains. Customers now do a great deal of research online and have an excellent idea of what a car should cost. Prime embraces that preparation, making sure customers get the car they want at a fair price. That’s a key to success that hasn’t changed since the days an eight-year-old boy first started sweeping the snow off vehicles in his dad’s used car lot.