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Billionaire Jimmy Pattison is not an imposing figure. Small, balding and certainly not prone to loud public outbursts, he does stand out, however. And even at 78 years of age, he fills a room as much with his obvious insight and intellect as his gracious manner.

Here is the chicken-and-egg question: Did he fill a room before he became one of Canada's biggest car dealers and sole proprietor of a sprawling conglomerate with 30,000 employees and $6.4-billion in sales?

In the 47 years since he leased his first dealership — a General Motors store with a two-car showroom and three filling pumps — in 1961, Pattison has built an empire comprising sign companies, magazine distribution outfits, grocery stores and car dealerships, among other things.

But none of that is a topic for discussion on this sunny day in a suburb of Vancouver. Pattison the host is all grace and dignity — the perfect host, really — for the grand opening of car store No. 19, Jim Pattison Chrysler Jeep Dodge in Surrey.

He also owns two auto malls, one in Surrey and the other a half-hour drive away in North Vancouver. He owns many of the dealerships in each mall, too — Chrysler, Hyundai, Lexus, Toyota, Volvo and a couple of used-car superstores in all, not to mention Jim Pattison Lease with its national presence.

Toyota is the biggest piece, though. His five Toyota stores account for more than one-fifth of all the new Toyotas sold in British Columbia. Conspicuously absent from the list is General Motors. Aside from this new Chrysler outlet, the former Freeway Chrysler, Pattison has no interest in the Detroit Three.

So for Chrysler Canada, the Pattison commitment here is a coup. Chrysler officials on hand, speaking off the record, are hoping Pattison says some nice things about the future of Detroit's smallest auto maker, but Pattison cannot be lured into commenting about Chrysler's future models, even though he has seen many of them.

All questions about future Chrysler products, products which might have inspired Pattison to sink some $12-million into this new store, are referred to Chrysler Canada president Reid Bigland, who sits in on our little media session and who will be taken for a nice sunset cruise on Pattison's yacht, the Nova Spirit.

Bigland is not here only for the boat ride and canapés, but because coups like this don't come easily for Detroit-based auto makers these days.

General Motors and Ford continue to bleed market share in Canada and the United States, and down south there are serious efforts under way to slash the dealer bodies of all three Detroit car companies.

In Canada, Chrysler's share is up slightly to 14.7 per cent (versus 12.6 for Ford and 21.7 for GM). But in the United States, Chrysler is suffering. It cannot have been easy for Chrysler to land a new 34,000-square-foot shop like this one with the Pattison Group.

Pattison concedes that the Detroit companies are struggling, but while avoiding details, suggests that he likes what he's seen from Chrysler.

Having size and scale is a huge advantage for Pattison the car dealer. While there may still be some place for the so-called mom-and-pop operation, it is growing harder and harder to be a successful car dealer without economies of scale.

Being able to spread costs over several or 19 stores offsets all the negatives of being a car dealer: Profit per vehicle is sliding, costs are up, worker turnover remains high and manufacturers continually apply pressure to spend money upgrading stores and training employees.

On top of that, buyers are harder and harder to reach using traditional media — which leads to added marketing costs — and the buyers who do walk into showrooms are smarter, better educated, savvier and more prepared to bargain on the car of their choice than ever before.

The changing landscape — driven largely by the power of the Internet — is having an impact on car dealers like Pattison and all the 3,450 or so others operating in Canada. This is a huge business under relentless pressure to cut costs and deliver more to customers. And it is not well.

"It is disheartening to learn that this staple [of employment] has fallen on hard times," Dennis DesRosiers of DesRosiers Automotive Consultants notes in a recent research note.

According to DesRosiers, the vehicle dealer industry employs about 150,000 people. The automotive sector accounted for $156.1-billion in total revenue in 2007. New-vehicle sales accounted for a large chunk of that revenue at $52.5-billion, but not the most. That honour goes to automotive finance at $57.8-billion.

Used vehicles ($28.5-billion) and aftermarket sales such as parts and accessories make up the rest ($17.3-billion).

New-car dealers command the lion's share of all that revenue, though their share has been shrinking for a decade. DesRosiers estimates new-car dealers channelled $69.8-billion of that revenue in 2007, or roughly 44.7 per cent. In 2000, new-vehicle dealers accounted for 48.2 per cent of total automotive-related revenue.

Declining revenue is a problem, but so is profitability.

DesRosiers says average profit per dealer was about $331,000 last year, down from a peak in 2004 of $442,000. Dealers in Canada have an average of $5-million in assets, therefore the net return on those assets is averaging about 6.6 per cent. Not great by any measure.

"With such thin profit margins," DesRosiers says, "it's easy to understand why Canada loses 30-to-50 stores to bankruptcy every year. The margin for error in operating a dealership is razor-thin."

In fact, DesRosiers notes, while dealers enjoy a fairly healthy gross profit margin of 13 per cent, the cost of doing business is eating into profitability. For consumers, that means there is less on the table for wheeling and dealing than many might think.

Average per vehicle profit in 2007 was $448 in Canada, down from a high of $635 in 2004.

The cost of doing business as a car dealer, says DesRosiers, is blowing profits "out the door." And that profit includes all money made from also selling used vehicles, part and services.

"If net profit per new vehicle could be isolated, one would find many new vehicles are actually sold as loss leaders in order to generate profits in other business units at a dealership," DesRosiers says.

Some of the biggest costs include continuing dealership upgrades to meet manufacturer requirements for both the look of a store and the equipment and technology in it. Training is also a big expense.

"A service professional can easily earn more than $100,000 a year and that same technician requires frequent and significant retraining to stay current with new technologies," DesRosiers says.

To cope, dealers across Canada more and more are taking the Pattison economies-of-scale approach. Dealer groups with two or more stores now control 54 per cent of vehicle sales in Canada. Meanwhile, in the past decade, the number of owner/operator dealerships has shrunk by about 1,400, to about 2,100, DesRosiers says.

"It is becoming harder and harder for smaller stores in larger communities to survive. The writing is on the wall for single-store car dealers in metro markets."

Pattison, one of 83 dealer groups in Canada with four or more stores, saw this trend coming decades ago. And that is surely why he is having such a grand time today at the opening of store No. 19.