

ZEV MANDATES UPDATES
The official publication of the Massachusetts State Automobile Dealers Association, Inc

St A ff Directory
Robert O’Koniewski, Esq. executive Vice President rokoniewski@msada.org
Jean Fabrizio wwwDirector of Administration jfabrizio@msada.org
Auto De A ler MAg A zine
Robert O’Koniewski, Esq. executive editor MSADA o ne McKinley Square Sixth f loor Boston, MA 02109
Subscriptions provided annually to Massachusetts member dealers. All address changes should be submitted to MSADA by e-mail: jfabrizio@msada.org

cBiz, 20 complyAuto, 33 ethos group, 2 gW Marketing Services, 18 Merchant Advocate, 17 nancy Phillips, 18 ocD tech, 29 PlugStar/Plug in America, 19 reynolds & reynolds, 24 Sprague energy, 23 Withum, 43
ADVertiSing rAteS inquire for multiple-insertion discounts or full Media Kit. e-mail jfabrizio@msada.org


Looming Federal Actions On the Road Ahead
By Jeb Balise, MSADA President
There are two federal matters currently hanging over our industry that present considerable uncertainty for our dealerships depending on the direction in which they go, especially as they relate to vehicle availability and affordability.
First off is potential Congressional action to overturn the EPA’s previously approved waivers of zero-emission vehicle mandates for Model Year 2026 and beyond imposed by the California Air Resources Board that eleven other states, including Massachusetts, adopted. Second is the Trump Administration’s desire to re-write trade policies with all our international partners, including the imposition of considerable tariffs on imported parts and finished products.
As we have covered in our previous communications, our franchisor manufacturers, under California’s Advanced Clean Cars II (ACC II) rule, need to hit 100% in ZEV sales by MY 2035, beginning with the first hurdle of 35% in MY 2026 and increasing by 8% in every subsequent year. The math shows the only way our manufacturers will hit those numbers is by selling us more ZEVs while reducing the amount of ICE vehicles in our inventory. This will hurt our Massachusetts customers’ ability to find the cars they want and can afford. The Advanced Clean Truck (ACT) rule, covering ZEV requirements for medium- and heavy-duty trucks, already has kicked in for MY 2025, with disastrous results for dealers and fleet owners alike.
Your MSADA has been lobbying the Healey-Driscoll administration and legislators for relief from ACC II and ACT, especially since Massachusetts does not have anywhere near a mature enough charging infrastructure in place to meet current and prospective EV owners’ needs. Recently, Gov. Healey announced a delay in ACT enforcement for MY2025 and MY2026, a helpful pause as the manufacturers craft a compliance plan.
This leaves uncertainty for passenger vehicles. Although we have bills pending in this year’s Legislature to address these mandates, there is also a proposed amendment up for consideration when the Massachusetts House debates its FY26 budget in late April. However, one tool being pushed by the Trump Administration and the Republican Congress that could ultimately help Massachusetts and the other CARB states would be a challenge, through the Congressional Review Act (CRA), to strike down the waivers on ACC II and ACT that the Biden EPA approved for California and then followed by the CARB states.
The U.S. House could debate and vote on the waiver revocations as soon as the end of April. If successful, the resolutions then would go to the Senate for a vote. If Congress successfully overturns the waivers, and Trump signs them, the CARB states, as well as California, will not be on the hook for the upcoming ZEV mandates. There are never any guarantees in politics, but at least Congress seems to be moving in the right direction.
Tariffs are a whole other matter. On March 26, President Trump signed a proclamation invoking Section 232 of the Trade Expansion Act of 1962 to impose a 25% tariff on imports of automobiles and certain automobile parts. As of now, they are scheduled to kick in on May 3. The tariffs would impact existing automotive supply chains, costs for consumers, and dealerships’ ability to service and repair cars. It is vital that any change in current trade policies fully consider the potential impact on consumers and main street businesses. As auto-related trade groups lobby the Trump Administration to pullback on any tariffs that will hurt our customers and businesses, the clock is ticking toward May 3.
MsAdA BoARd
Barnstable County
Brad tracy, tracy Volkswagen
Berkshire County
Brian Bedard, Bedard Brothers Auto Sales
Bristol County
richard Mastria, Mastria Auto group
Essex County
William Deluca iii, Bill Deluca family of Dealerships
Paul Bertoli, Priority chryslerJeep Dodge ram
Franklin County [open]
Hampden County
Jeb Balise, Balise Auto group
Hampshire County
Bryan Burke, Burke chevrolet
Middlesex County frank Hanenberger, MetroWest Subaru
Norfolk County
Jack Madden, Jr., Jack Madden ford charles tufankjian, toyota Scion of Braintree
Plymouth County
christine Alicandro, Marty’s Buick gMc isuzu
Suffolk County [open]
Worcester County
Steven Sewell, Westboro chrysler Dodge ram Jeep
Steve Salvadore, Salvadore Auto
Medium/Heavy-Duty Truck Dealer
Director-at-Large [open]
Immediate Past President chris connolly, Jr., Herb connolly chevrolet
NADA Director
Scott Dube, Mcgovern Hyundai rt.93
OFFICERs
President, Jeb Balise
Vice President, Steve Sewell
Treasurer, Jack Madden, Jr. Clerk, c harles tufankjian

ACV Auctions
MSADA A SS oci Ate M e M ber S D irectory
Steve Sirko (856) 381-3914
ADESA
Elizabeth Morich (508) 270-5400
Albin, Randall & Bennett
Barton D. Haag (207) 772-1981
Allied Recycling Center
Joseph Castaneda (781) 316-7180
Ally
Maryanne Recupero (617) 997-9574
American Fidelity Assurance Co.
Kathleen Weisenbach (402) 523-5945
America’s Auto Auction Boston
Chris Colocousis (774) 218-8930
ArentFox LLP
Paul Marshall Harris (617) 973-6179
Sarah Decatur Judge (617) 973-6184
Armatus Dealer Uplift
Joe Jankowski (410) 391-5701
Auto Auction of New England
Steven DeLuca (603) 437-5700
Bank of America Merrill Lynch
Stephen Delaney (781) 981-9370
Nancy Price (781) 534-8543
BCI Financial Corp.
Timothy Rourke (860) 302-7127
Bellavia Blatt
Leonard Bellavia (516) 873-3000
Broadway Equipment Company
Fred Bauer (860) 798-5869
Brown & Brown Dealer Services
Jason Bayko (508) 624-4344
Cambridge Trust
David Sawyer (617) 620-3484
CBIZ
Nichole Rene (203) 781-9690
CDK Global
Rob Steele (508) 564-1346
Citrin Cooperman
Ron Masiello (508) 757-3311
Clifton Larson Allen
Nick Chappell (508) 930-2199
Cooperative Systems
Scott Spatz (860) 250-4965
Cox Automotive
Polly Penna (303) 981-1298
CVR
John Alviggi (267) 419-3261
Dave Cantin Group
Woody Woodward (401) 465-7000
Dealer Pay
Shannon Wischmeyer (636) 293-8038
Downey & Company
Paul McGovern (781) 849-3100
DP Sales Distributors
Andrew Prussack {631) 842-7549
Driving Dealer Performance
Kimberly Guerin (978) 760-0322
EasyCare New England
Greg Gomer (617) 967-0303
eDealer Services, LLC
Tom McKinnon (617) 631-3293
Electric Supply Center
Jennifer Williams (781) 265-4272
Ethos Group, Inc.
Drew Spring (617) 694-9761
EVready Energy
Chris Nihan (978) 406-1578
Federated Insurance
Kevin Sundberg (559) 547-9694
Fisher Phillips LLP
Jeff Fritz (617) 532-9325
Josh Nadreau (617) 532-9323
Freedom Solar Power
Ryan Ferrero (970) 214-4433
GW Marketing Services
Gordon Wisbach (857) 404-0226
Harris Beach Murtha Cullina
Thomas Vangel (617) 457-4072
Hilb Group
James Pietro (508) 791-5566
Huntington National Bank
Mark Flibotte (781) 724-3749
iHeart Media
Jane Cogliano (781) 844-8951
JM&A Group
Chris “KC” Hwang (954) 415-6961
JM Electrical Co.
Christopher Cedrone (781) 581-3328
Key Bank
Tom Flynn (716) 998-6247
M & T Bank
John Federici (401) 642-5622
Maverick Document Signings
Lisa Spring (310) 739-6967
McWalter Volunteer Benefits Group
Shawn Allen (617) 483-0359
Merchant Advocate, LLC
Dan Giordano (973) 897-2778
Mintz Levin
Kurt Steinkrauss (617) 542-6000
Nancy Phillips Associates, Inc.
Nancy Phillips (603) 658-0004
National Business Brokers
Peter DiPersia (603) 881-3895
National Grid
Nicole Caruso-Carlin (347) 426-6331
NEAD Insurance Trust
Charles Muise (781) 706-6944
Northeast Dealer Services
Johna Cutlip (401) 243-7331
OCD Tech
Michael Hammond (844) 623-8324
Performance Brokerage Services
Jacob Stoehr (847) 323-0014
Performance Management Group, Inc.
Dale Ducasse (508) 393-1400
Piper Consulting
Jim Piper (207) 754-0789
Plug In America
Joel Levin (237) 925-1364
Priority Payments Local
Andrew Pollina (732) 372-4352
Pullman & Comley LLC
James F. Martin, Esq. (413) 314-6160
Reynolds & Reynolds
Austin Ziske (802) 505-0016
Rockland Trust Co.
Joseph Herzog (508)-830-3241
Santander Bank
Richard Anderson (401) 432-0749
Chris Peck (508) 314-1283
Schlossberg, LLC
Michael O’Neil, Esq. (781) 848-5028
Southern Auto Auction
Joe Derohanian (860) 292-7500
Sprague Energy
Steve Borelli (508) 768-5252
The Towne Law Firm P.C.
James T. Towne, Jr. (518) 452-1800
TrueCar
Lauren Bailey (703) 909-1625
Truist
Andrew Carmer (401) 409-9467
Twelve Points Wealth Management
Taylor Duffy (978) 318-9500
US Bank
Vincent Gaglia (716) 649-0581
Wells Fargo Dealer Services
Rich DeFreitas (857) 205-2780
Withum
Kevin Carnes (617) 471-1120
Zurich American Insurance Company
Steven Megee (774) 210-0092

House Digs into FY26 Budget
By Robert O’Koniewski, Esq.
MSADA Executive Vice President
rokoniewski@msada.org
Follow us on X (formerly Twitter) • @MassAutoDealers
Under our Massachusetts Constitution, one of the primary responsibilities of the governor and the legislature is crafting a budget to operate and fund the Commonwealth’s governmental operations. Governor Maura Healey, the first-term Democrat looking at possible re-election next year who is into her third budget process, filed her $62 billion Fiscal Year 2026 plan in late January. The Governor’s budget, known as House 1, represented an almost 7% increase over FY25 spending.
After a joint effort of the combined House and Senate Ways and Means Committees for a series of public hearings across the state in March, House Ways and Means Chairman Aaron Michlewitz, on April 16, issued the committee’s version of the FY26 budget, coming in at $61 billion.
By the time the deadline for filing amendments passed two days later, representatives had handed in 1,650 proposed riders, mostly to create spending earmarks for their various district projects.
As concerns auto dealers, although the Governor’s House 1 had included language to amend current law to require the Registry of Motor Vehicles to establish a program for electronic vehicle titles and to allow electronic signatures on all vehicle transactional documents, the HMW budget did not include those provisions. Your MSADA has long advocated for such language, which was included in the House’s FY25 budget last year when it was sent to the Senate. Although the language did not end up in the final FY25 budget after the conference committee negotiations, we continued to work with legislators, the Governor’s office, and
the RMV to get such language approved. Thus, we were encouraged with the Governor’s inclusion of the provisions in her proposed budget.
For this year’s House budget debate, Rep. Ann-Margaret Ferrante (D-Gloucester), who is the vice chair of the House Ways and Means Committee, filed the Governor’s e-title and e-signatures language as a proposed amendment. We, along with the independent auto dealers association and other interested parties such as Carvana, will be advocating for the language during the budget debate that will begin on April 28. The amendment carries 25 co-sponsors.
Another issue that is heating up is the zero-emission vehicle mandates for cars and trucks that Massachusetts follows due to its marriage to any and all emissions-related regulations promulgated by the California Air Resources Board. We have documented in considerable detail in these pages and in other communications to our members over the years the issues dealers will be struggling with under the Advanced Clean Cars II rule’s ZEV mandates at 35% for Model Year 2026, increasing up to 100% by MY 2035, and ZEV mandates for medium- and heavy duty trucks beginning in MY 2025 and going out to 100% by MY 2026.
To increase the attention on ACC II for legislators, the Healey-Driscoll Administration, and regulators, Rep. David Muradian (R-Grafton) and Rep. Brad Jones (R-North Reading), who is the House minority leader, filed an amendment at our request to delay the implementation and enforcement of ACC II until July 1, 2027. This amend-
ment carries 24 co-sponsors, mostly Democrats.
There was no amendment filed to address the Advanced Clean Trucks rule because, as a result of our joint lobbying with the Trucking Association of Massachusetts, the Administration’s Department of Environmental Protection announced, on April 14, enforcement discretion for manufacturers that are unable to meet minimum electric truck sales required under the ACT program. Manufacturers that cannot meet those sales requirements will receive relief for Model Years 2025 and 2026, provided they make internal combustion engine (ICE) trucks available to distributors seeking them. This approach gives manufacturers more flexibility and eases the challenges dealers are facing, while keeping the state on track to achieve critically important emissions reductions. Use this link to obtain the full regulatory announcement: https://www. mass.gov/doc/act-enforcement-discretion-apr-14-2025/download.
The third CARB rule adopted by Massachusetts that has impact on trucks, the Heavy-Duty Omnibus NOx Emissions (HDO) rule, was delayed by the DEP last year until January 1, 2026.
As we continue to meet with the Administration and legislators on ACC II, there is a chance the Republican-led Congress and President Donald Trump will take care of the ACC II, ACT, and HDO rules so the twelve CARB states, all heavily-Democrat, do not have to come to a resolution on their own. In late March, EPA Administrator Lee Zeldin filed three resolutions with Congress under the Congressional Review Act to nullify the Biden Administration’s granting waivers to CARB for ACC II, ACT, and HDO. In early April, House members and Senators filed a series of resolutions in each chamber to revoke the three rules. Indications are the House and Senate will vote on the resolutions in the coming weeks. Check out this month’s cover story for more details on the ZEV mandates and potential actions here and in D.C.
Returning to the state budget for a moment, once the House completes its action by the end of April, the Senate will take up its own FY26 budget in mid-May, leading to the creation of a conference committee to resolve differences between the House and Senate spending plans. Although the fiscal year starts on July 1, the Legislature has not sent a budget to our governor to review and sign to start the fiscal year on time in over a decade. Another X-factor to keep an eye on: Continued efforts by the Trump Administration and Congress to rein in spending, which could impact all sorts of state programs, especially if the state’s revenue collections come up short of expectations.
Tariffs
Another headwind created for dealers, other retailers, and consumers alike is President Trump’s plan to disrupt existing trade activities with our international partners, friend and foe alike, by imposing various new tariffs to cover all activities – subject to change, of course, as negotiations may proceed.
On March 26, President Trump announced the imposition of a 25% tariff on imports of automobiles and certain automobile parts:
• The 25% tariff will be applied to imported fully-assembled passenger vehicles including sedans, SUVs, crossovers, minivans, and cargo vans as well as light trucks. The U.S. planned to start collecting the new tariff on automobiles on April 3.
• The 25% tariff will also be applied to certain imported automobile parts, specifically engines, engine parts, transmissions, powertrain parts, and electrical components. The tariff on these automobile parts will take effect no later than May 3, 2025. Additional auto parts may be added to the list of those subject to the tariff after 90 days.
• Entities that import completed automobiles duty-free under the United States-Mexico-Canada Agreement (USMCA) will have the opportunity to
certify their U.S. content so that the 25% tariff will only apply to the value of their non-U.S. content.
• Similarly, automobile parts that are compliant with the USMCA will not be subject to the tariff until the Secretary of Commerce creates a process to apply the tariff to parts’ non-U.S. content.
In addition to the auto-specific tariffs announced on March 26, a number of other existing tariffs apply to autos or auto parts, including the 25% tariff on imported steel and aluminum and, for non-USMCA compliant vehicles, the 25% tariff on imported light-duty trucks and the 2.5% tariff on passenger cars.
On Wednesday, April 2, the administration also announced 10% “reciprocal” tariffs on all imported goods as well as higher tariffs tailored for each of about 60 countries that have the largest barriers to U.S. exports. The newly announced reciprocal tariffs, however, do not apply to “all automobiles and automotive parts subject to the additional duties imposed” on March 26, nor do they apply to steel and aluminum imports that are subject to existing tariffs.
U.S. customs authorities assess tariffs and collect them from the importing party at the point of entry -- that is, when the goods physically cross the border.
Moving forward, sustained tariffs will almost certainly increase the cost of vehicles, with estimates ranging from an additional $2,000 to $12,000 per vehicle, although tariffs will affect each OEM and vehicle model differently.
NADA, AIADA, and the Alliance for Automotive Innovation are lobbying Members of Congress and the Trump Administration regarding the harmful impacts these proposed tariffs will have on the automotive industry and dealership customers. NADA has expressed its concerns about tariffs directly with the White House, Office of the U.S. Trade Representative, Department of Treasury, Congress, and other government agencies. NADA continues to communicate with government agencies regarding the impact of on-
the roundu P
going tariffs. Upon the announcement of the auto tariffs, NADA issued the following statement: “Matching customers with vehicles they can afford has been a continuing challenge for America’s new car and truck dealers. The tariffs announced on March 26 could put the purchase of a new car out of reach for an increasing number of American consumers. It is essential that the potential impact of tariffs on consumers and main street businesses be fully considered.”
Since the March 26 announcement, the tariff sands seem to shift hourly, so it is difficult to write about them with any timely accuracy, until they are finalized of course. Nevertheless, in keeping with the start of the baseball season, I look at the current tariff situation as being in the bottom of the first inning, with plenty of frames left on the scoreboard to get us to a final score.
Buckle up for the ride. It should be a doozy.
MSADA Annual Meeting –Oct. 10, Encore Casino
Save the date – We have begun preparations for our 2025 MSADA Annual Meeting on October 10 at the Boston Encore Casino and Hotel in Everett. Be on the lookout for our registration and sponsorship materials.
FinCEN Removes CTA Beneficial Ownership Requirements
In the roller-coaster ride we have witnessed since last year regarding the onagain, off-again enforcement of the Beneficial Ownership filling requirements under the Corporate Transparency Act (CTA), the Financial Crimes Enforcement Network (FinCEN), on March 21, announced it is issuing an interim final rule that establishes additional certainty removing filing requirements for U.S. businesses and persons.
Consistent with the U.S. Department of the Treasury’s March 2, 2025 announcement, FinCEN issued an interim final rule that removes the requirement for U.S.
companies and U.S. persons to report beneficial ownership information (BOI) to FinCEN under the Corporate Transparency Act CTA).
In that interim final rule, FinCEN revises the definition of “reporting company” in its implementing regulations to mean only those entities that are formed under the law of a foreign country and that have registered to do business in any U.S. State or Tribal jurisdiction by the filing of a document with a secretary of state or similar office (formerly known as “foreign reporting companies”).
FinCEN also exempts entities previously known as “domestic reporting companies” from BOI reporting requirements. Thus, through this interim final rule, all entities created in the United States, including those previously known as “domestic reporting companies”, and their beneficial owners will be exempt from the requirement to report BOI to FinCEN. Foreign entities that meet the new definition of a “reporting company” and do not qualify for an exemption from the reporting requirements must report their BOI to FinCEN under new deadlines, detailed below. These foreign entities, however, will not be required to report any U.S. persons as beneficial owners, and U.S. persons will not be required to report BOI with respect to any such entity for which they are a beneficial owner.
Upon the publication of the interim final rule, the following deadlines apply for foreign entities that are reporting companies:
• Reporting companies registered to do business in the United States before the date of publication of the IFR must file BOI reports no later than 30 days from that date.
• Reporting companies registered to do business in the United States on or after the date of publication of the IFR have 30 calendar days to file an initial BOI report after receiving notice that their registration is effective.
FinCEN is accepting comments on this interim final rule and intends to finalize the rule this year.
Truck Fleets Now Qualify for MassEVIP Charging Station Funds
On April 16, the Massachusetts Department of Environmental Protection announced that its Massachusetts Electric Vehicle Incentive Program (MassEVIP) Workplace and Fleet Program will now fund level 1 and 2 (up to 36kW) charging station projects for medium- and heavy-duty vehicle fleets, in addition to light-duty fleets. A fleet owner must have at least one light-, medium-, or heavy-duty electric vehicle in its fleet, or on order (proof required before payment is issued), to participate in the program.
Information about the program, including the application process, is available at: https://www.mass.gov/ how-to/apply-for-massevip-workplace-fleet-charging-incentives.
2025 Dues Invoices
In January your Association sent out 2025 dues invoices to all our dealership and associate members. Our members’ dues help fund the Association’s activities on their behalf, including our lobbying on Beacon Hill and in Washington, our member counsel services, and our education and training activities.
Over the last several years we have witnessed quite a bit of economic disruption in our industry, including governmental over-regulation. More than ever, our dealers need a strong MSADA. MSADA will continue to lead on the various issues that threaten the viability of our dealerships. We will strive continuously to keep you informed of developments in our industry and how they will play out in Massachusetts. These efforts also include working closely with NADA to better serve our members.
Our strength lies in our members. With your continued support and membership renewal, we can build on our current foundation and begin to enhance your Association’s core purposes of communication, advocacy, and education.


EGISLATIVE S CORECARD
APRIL 2025
BILL# SPONSOR SUBJECT
S201
H406
H398
S271
H342
H365
S202 H424
Sen Crighton Rep Hunt
Amendments to Ch. 93B, the auto dealer franchise law.


In Joint Committee on Consumer Protection; no hearing scheduled yet.

Sen O’Connor
Rep Chan
Rep Finn Rep Howitt
Sen Crighton Rep Lewis
RTR Law amendment to fix consumer notice requirement.
Creates process to appeal improperly issued Class 1 license.
Modernize on-line vehicle purchase process.
S266 Sen Moore Amends definition of heavy-duty trucks in RTR law.
S291 H474 Sen Velis
Rep Walsh Open safety recalls notifications.
S228 Sen Feeney Protects consumer choice in vehicle service contracts.
S797
H1260
H1285
H1293
H3406 S2185
H2386
H3535
H3572
S2360
Sen Moore
Rep McMurtry Rep Philips
Rep Puppolo
Creates process to increase the insurance reimbursed labor rate paid to auto body repairers.
Protects consumer choice in vehicle service contracts.
Rep Puppolo Sen Moore Creates process to delay ACT.
Rep Muradian
Rep Muradian
Rep Soter
Sen Cronin
Creates process to delay ACC II and ACT.
H3603 Eliminates initial state inspection for new vehicle.
Rep Arciero
In Joint Committee on Consumer Protection; no hearing scheduled yet.
In Joint Committee on Consumer Protection; no hearing scheduled yet.
In Joint Committee on Consumer Protection; no hearing scheduled yet.
SUPPORT In Joint Committee on Consumer Protection; no hearing scheduled yet.
SUPPORT In Joint Committee on Consumer Protection; no hearing scheduled yet.
SUPPORT In Joint Committee on Consumer Protection; no hearing scheduled yet.
In Joint Committee on Financial Services; no hearing scheduled yet.
In Joint Committee on Financial Services; no hearing scheduled yet.
SUPPORT In Joint Committee on State Administration; no hearing scheduled yet.
SUPPORT In Joint Committee on Telecommunications, Utilities and Energy; no hearing scheduled yet.

SUPPORT In Joint Committee on Transportation; no hearing scheduled yet.
H3690 Rep Howitt Limit doc prep fee to $400. OPPOSE In Joint Committee on Transportation; no hearing scheduled yet.
H3676
H3677
S2371
S2374
Rep Gregoire
Rep Gregoire
Sen DiDomenico
Sen DiDomenico
Establishes requirements for e-titles and e-signatures on RMV and sales docs.
SUPPORT In Joint Committee on Transportation; no hearing scheduled yet.







ZEV MANDATES UPDATES
As we begin to welcome April’s warmer weather, legislative and administrative attention on the lingering zero-emission vehicle mandates for cars and trucks also is heating up in Washington, D.C., as well as here and in the other eleven states committed to the California Air Resources Board (CARB) emissions rules.

Congress over the coming weeks will have the opportunity to debate and vote on three resolutions to overturn previously approved EPA waivers for CARB to pursue its own path on EV adoption requirements. If approved, these would be much stronger solutions to the onerous ZEV mandates than the ad hoc approach state dealer associations have been forced to pursue in the eleven states, including Massachusetts, to postpone or otherwise weaken the rules’ demands.
To summarize why we are in this situation, Massachusetts, in the early 1990s, for better or worse, was one of the first state’s to fully commit itself to all things CARB – namely, the vehicle emissions policies and regulations promulgated by a group of unelected bureaucrats known as the California Air Resources Board. Under the Massachusetts Clean Air Act (MGL Chapter 111, Section 142K), the Commonwealth must adopt CARB’s motor vehicle emissions standards unless the state determines the
California standards do not provide better pollution reductions than those imposed by federal laws and rules.
Under the U.S. Clean Air Act, states can either follow the emissions standards set by the Environmental Protection Agency or seek a waiver to establish emissions rules that are stricter than that which are set by the EPA. Many decades ago, California undertook the process and received a federal waiver. Over time, the EPA has granted CARB over 100 waiver requests for their various emissions rules. Thus far, 17 states have adopted all or part of CARB’s low-emission and zero-emission vehicle regulations, as allowed under Section 177 of the U.S. Clean Air Act, meaning over one-third of national new light-duty vehicle sales presently meet CARB’s auto emissions standards.
In November 2022, CARB approved its Advanced Clean Cars II (ACC II) rule that required vehicle manufacturers individually to meet delivery of 100% new zero-emission vehicles to dealers by Model Year 2035. Beginning with a minimum requirement of 35% ZEVs and plug-in hybrid vehicles by MY 2026, the goalline is increasingly adjusted each year by an additional eight percentage points (e.g., 51% by 2028; 68% by 2030; 82% by 2032, etc.) until a touchdown is scored of 100% in a decade from now.
In December 2022, Massachusetts regulators adopted the CARB ZEV ACC II rule, after the Legislature re-affirmed the state’s commitment to them in the 2022 Clean Energy Act that Gov. Charlie Baker signed into law in August that year. That law also had a substantial carrot: The vehicle and consumer eligibility standards for the state’s EV rebate program – MOR-EV (Massachusetts Offers Rebates for Electric Vehicles) – was enshrined
in law to be administered by the Massachusetts Department of Energy Resources, with a minimum rebate of $3,500.
Along with Massachusetts, ten other states also follow ACC II: Colorado, Delaware, Maryland, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, and Washington. None of the twelve states is on track to see the legacy vehicle manufacturers meet the ZEV mandates due to low consumer demand based on issues tied to vehicle price affordability or lack of available charging infrastructure.
As detailed in communications with the Massachusetts Legislature and the Healey-Driscoll Administration, the Massachusetts State Automobile Dealers Association has pointed out that, in order to meet the mandated thresholds, automakers must sell to dealers either more ZEVs or fewer gas cars, meaning internal combustion engine vehicles will be limited in the states following California’s rule.
In addition to the ZEV mandates for cars under ACC II, the vehicle manufacturers are facing in the so-called CARB states similar mandates for heavy-duty trucks under the Advanced Clean Trucks (ACT) rule and the Omnibus Low NOx (HDO) emissions rule, with disastrous results thus far. (Massachusetts and nine states – Colorado, Maryland, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, and Washington –have adopted California’s ACT regulation.)
ACT requires truck manufacturers to sell an increasing percentage of zero-emission trucks each year up to a 100% mandate by 2036 while HDO’s emission standards have increased the cost of a new diesel truck by upwards of $10,000. Due to no manufacturer meeting the new emission standard, diesel trucks are capped at below market purchase rates, further tightening diesel truck availability. In combination with a lack of truck charging infrastructure and the two- to three-times higher costs of EV trucks versus diesel, the two rules have killed heavy-duty diesel truck sales in California and the other CARB states.
Massachusetts Actions
Since the truck rules began a model-year earlier than the car-related ACC II, Massachusetts regulators and legislators were put on notice in 2025 of the impending issues resulting from ACT and HDO implementation. As a result of lobbying from a coalition consisting of the Trucking Association of Massachusetts, MSADA, and scores of fleet owners and other affected end-users, the Massachusetts Department of Environmental Protection (DEP) in the Fall of 2024 issued an emergency regulation to push off the im-
plementation of the HDO rule for one-year until January 1, 2026.
Then, on April 14, the DEP announced enforcement discretion for manufacturers that are unable to meet minimum electric truck sales required under the ACT program. Manufacturers that cannot meet those sales requirements will receive relief for Model Years 2025 and 2026, provided they make internal combustion engine (ICE) trucks available to distributors seeking them. This approach gives manufacturers more flexibility and eases the challenges dealers are facing, while keeping the state on track to achieve critically important emissions reductions. Through these two actions, Massachusetts is the only state amongst the ACT states with a MY25 start date to delay the rule.
MSADA continues to lobby the Healey-Driscoll Administration for regulatory relief from the ACC II requirements for MY 2026 and beyond. In addition, when the Massachusetts House debates its FY26 budget in late April, among the 1,650 amendments that were filed is one that would delay the implementation of ACC II until July 1, 2027. Finally, as the saga plays out, numerous bills with bipartisan support have been filed for the 2025-2026 session to address the ACC II, ACT, and HDO rules.
Potential Congressional Relief
Despite the lobbying efforts of dealer associations and other affected parties in the CARB states (all heavily-Democrat dominated) to achieve some level of relief from the onerous ZEV mandates, politicians and regulators in those states may have an eye on what may transpire in Congress, especially as the Trump Administration and the Republican-led Congress have expressed their desire to eliminate the EPA waivers for the CARB rules under the Congressional Review Act (CRA).
Over the last several weeks, Congressional efforts to revoke the EPA’s waivers of three CARB ZEV-related and truck emis-

16
ZEV MANDATES UPDATES
sions rules have been heating up.
In late March, EPA administrator Lee Zeldin sent the appropriate communications to Congress to commence the CRA process. On April 2, the following CRA joint resolutions were introduced in the House:
• H.J. Res. 88 to revoke CARB’s ZEV Mandate (ACC II rule), filed by Rep. John Joyce (R-Pennsylvania);
• H.J. Res. 87 to revoke CARB’s Heavy-Duty ZEV Mandate and Diesel Requirements (ACT rule), introduced by Rep. John James (R-Michigan); and
• H.J. Res. 89 to revoke CARB’s Heavy-Duty Omnibus Low NOx rule, introduced by Rep. Jay Obernolte (R-California).
Each resolution has the same original co-leads: Reps. Kevin Kiley (R-California), Doug LaMalfa (R-California), Jay Obernolte (R-California), Russ Fulcher (R-Idaho), John James (R-Michigan), Lisa McClain (R-Michigan), and John Joyce (R-Pennsylvania).
The process has seen some bumps in the U.S. Senate. On April 4, the Senate Parliamentarian, Elizabeth MacDonough, told Senators, in a non-binding opinion, that she did not believe Congress can revoke the EPA/CARB waivers through CRAs. The parliamentarian’s opinion was said to be influenced by a recent opinion by the Government Accountability Office (GAO), which questioned whether the EPA waivers meet the qualifications for a CRA. There was considerable disagreement with the GAO’s assessment, and the GAO’s opinion is also not legally binding. Two Republican committee chairs wrote a letter to the GAO questioning their opinion that Congress cannot use the CRA to block California’s waivers. While this presents a significant hurdle, there are still potential opportunities to overcome the opinion.
Despite the parliamentarian’s opinion, Sen. Shelley Moore

Capito (R-West Virginia), chair of the Senate Environment and Public Works Committee, along with Sens. Deb Fischer (R-Nebraska) and Markwayne Mullin (R-Oklahoma), introduced a trio of legislation, matching the three House bills, to revoke CARB’s ZEV mandates and Low NOx rules: S.J. Res. 45 to revoke the ACC II waiver, S.J. Res. 46 to revoke the ACT waiver, and S.J. Res. 47 to revoke the HDO/NOx waiver.
Time will tell if the Congressional efforts to revoke the CARB waivers succeed. Given what we have seen with Trump Administration opponents running to the courts to challenge every action the administration takes, a favorable outcome for dealers, their customers, and the vehicle manufacturers may not be quickly realized even with positive action coming from our elected Members of Congress in the weeks ahead.


NEWS from Around the h orn





Dealership Recognitions
VOLKSWAGEN – 2024 Wolfsburg Crest Club winners for superior sales and market performance achievements:
Platinum Level Winners
Kelly Volkswagen, Danvers
Nucar Volkswagen of Norwood
Gold Level Winners
Colonial Volkswagen, Medford
ACURA – 2024 Precision Team 2024 winners for delivering a premium experience throughout their operations:
Acura of Peabody – 16-Year Recipient
MERCEDES-BENZ – 2024 Best of the Best Dealer Recognition Award:
Mercedes-Benz of Sudbury, Herb Chambers
GROUP 1 AUTOMOTIVE 2024 President’s Award for its highest-performing operators who have demonstrated exceptional achievement in sales, aftersales, and both customer and employee satisfaction:
Market Director – Jon Zillioux

CHEVROLET – 2024 Dealer of the Year:
Dan Quirk, Quirk Chevrolet, Braintree
HONDA – 2025 Environmental Leadership Program Award: Hyannis Honda
HONDA – 2024 President’s Award for outstanding sales and dedication to their customers:
Honda North, Danvers
Silko Honda, Raynham
Tufankjian Honda of Plymouth
AUDI – 2024 Magna Society Award for exceeding expectations in customer experience and business results:
Magna Society Elite
Audi Natick
Audi Westwood
Magna Society
Audi Norwell
Audi Shrewsbury
Audi West Springfield
VOLVO – 2024 Excellence Award winners: Herb Chambers Volvo Cars Norwood


I N C R E A S E E V S A L E S W I T H

V C E R T I F I C A T I O N
PlugStar.com connects consumers and certified dealers to drive EV sales. Designed to enhance the EV shopping experience, the PlugStar program provides dealers with tools, knowledge, and ongoing support through education, certification and resources. Plug In America, the organization behind PlugStar, represents America's deepest pool of EV drivers and is the national leader in EV consumer education

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Strong F&I Practices Can Drive Dealership Success

By Matthew Marcoullier
CPA, Albin Randall & Bennett
After a strong finish to 2024, and an initial positive outlook for 2025, uncertainty has emerged in the auto industry. The tariff landscape, customer issues with claiming EV credits, and a generally slow start have dampened the optimistic forecast.
Fixed ops and expense control were the mantras of 2024 and will continue to be important as front-end grosses shrink and interest costs rise. There is a bright spot on the variable side; strong F&I departments contribute to a dealership’s profitability. Risk mitigation is also an area that continues to draw scrutiny from regulators.
Unlocking Profit Potential
Available data from the public auto groups and local dealers tell us that F&I income remains a stable source of gross profit for dealerships. While front-end margins have slid back towards pre-pandemic levels, F&I remains consistent with 2022 peaks. This will be increasingly important as affordability and pricing have become major headwinds. With inventories still bloated, price competition is sure to pick up.
This does not mean you should give away a vehicle to get money on the back end, but it does highlight the importance of having sound processes and a welltrained team in place. Those that can sell value-added products (finance reserves do not count) will have a clear edge in gross profit.
Leveraging F&I for Cash Flow and Growth
In addition to gross, F&I also provides a unique opportunity through dealer reinsurance programs. Several options are available, and each store’s needs vary.
The greatest advantages are generally realized when a dealer shares in the underwriting profit on the products he or she is selling. These reinsurance companies provide an off-balance sheet asset and potential source of liquidity as they earn out, allowing dealers to take distributions, use them as collateral, or borrow directly. Capital requirements tightened in 2024, making it more challenging to obtain financing for a deal or new facility, but tapping into your reinsurance company can help you operate with greater flexibility than with a traditional lender.
As good as the programs can be, reinsurance is not a set-it-and-forget-it affair. In managing and monitoring performance, dealers need to stay in touch with their F&I providers to make sure products are ceded correctly. To quickly build premium, you want high volume on products that earn out quickly, which spreads out the risk and shortens the lag between cash going into the company and becoming available to the dealer. Rising repair costs make it more expensive to fix a vehicle.
To the extent your reinsurance company is footing the bill, that fact will drive up your loss ratio unless the products and premium going into the reinsurance company are managed.
Protecting Your Dealership from Costly Pitfalls
Managing and monitoring F&I helps maximize sales and protect your dealership. Poor F&I practices led to large claims brought against dealers in 2024, including a $20 million settlement in Illinois and smaller, but significant, cases in New York and Rhode Island. Many of
these cases involve alleged deal packing or other practices that were deemed deceptive to consumers. Establishing policies and processes, along with deal jacket reviews and other monitoring initiatives, helps minimize your exposure to unnecessary risk.
Also note, although the FTC’s Vehicle Shopping Rule was vacated by the Fifth Circuit Court of Appeals in January, many of the same provisions still apply and continue to be subject to FTC enforcement. Further, while the current administration is generally seen as pro-business and anti-regulation, this does not stop states from moving forward with their own actions against players they deem as running afoul of the rules. During President Trump’s first term, there was concerted action by various state Attorneys General to fill any perceived void left by Federal deregulation, and many appear ready to do so again. This is not to say dealers are generally doing anything deceptive, but documenting compliance is an effective way to avoid frivolous complaints that become financial and reputational headaches.
Conclusion
Procedural compliance is not the most exciting part of dealership operations. In the case of the F&I department, however, it is an imperative component for optimizing profits and mitigating risks. The additional benefit of growing a dealer’s reinsurance reserves provides the flexibility and capacity needed to adapt in the face of uncertainty. Those that can put sound processes and well-trained teams in place will be poised to leverage opportunity for the greatest success. Dealers should consult with their F&I providers and other advisors to make sure their F&I programs are properly aligned with their goals.
Driving Profit Through A Strategic Parts Matrix

By Frank O’Brien
As vehicle gross profit per unit faces downward pressure, successful dealers are shifting their attention to fixed operations—specifically, the parts and service departments.
Why? Because the service drive offers a significant opportunity, one that is essential for sustaining profitability as the age of vehicles continues to grow, extending the period for which vehicle owners seek highly-trained technical service rather than opting for new vehicles.
A Strong Parts Strategy Matters More Than Ever
The parts department is typically static with few changes. However, a couple of industry shifts are reshaping the landscape for parts sales:
• Original Equipment Manufacturers (“OEMs”) are Adjusting List Pricing: Warranty reimbursement laws have prompted the OEMs to adjust their list pricing downward, often making it less reliable as a standard for setting your dealership’s prices. If your dealership has a matrix based on list pricing, the OEM ultimately controls your parts matrix.
• Inflation is Moving the Sweet Spot: The most impactful range of parts is referred to as the “sweet spot.” The sweet spot is based on the volume and dollar value of the parts. Covid-19 and the subsequent inflation have moved this “sweet spot” from $50 to $200 to $200 to $500 on average but will vary by OEM. Many dealers still employ parts matrices that phase out at $200 in cost. Both factors could be limiting your dealership’s overall profitability. It is critical for management to review its parts matrix to identify whether either of these pitfalls

exist. This can be overwhelming for dealers and general managers, especially those who grow up in the industry from the new and used vehicle sales side.
We have created a tool called the Parts Matrix Analyzer that performs this task for the dealership. It also provides a recommended parts matrix that will maximize profitability. It is important to note that parts managers will want to source maintenance and competitively priced parts in a source that does not apply the matrix in order to stay competitive for those services. This also should not be applied to counter or wholesale parts sales.
A Captive Audience
The customers in your service drive are a captive audience trusting your service department will fix their vehicles to OEM standards while providing excellent service. Oftentimes, customers are more concerned about fixing the vehicles in a timely manner than the cost. We hear little to no pushback from those dealers that have utilized our Parts Matrix Analyzer, demonstrating that the market will bear the price increase.
Action Items for a Strategic Parts Matrix
To maintain profitability, your parts pricing strategy needs regular attention. Here’s
what you can do:
• Base Matrix Pricing on Cost, Not List. List prices from OEMs are ever-changing and at the discretion of the OEMs. Instead, use the actual cost of parts as the foundation for your matrix. This ensures that the dealership controls its matrix and maintains profitability while staying competitive.
• “Set It and Forget It” Pricing No Longer Exists. Your parts matrix should never be static. Conduct an annual review to adjust for market dynamics, pricing trends, and competitive factors. This keeps your dealership responsive to changing conditions.
• Do Not Let the Vocal Minority Dictate Strategy. It is easy to let the rare vocal customer complaining about price sway your decisions. But remember, these exceptions do not represent the majority. Stay focused on the data and trends that reflect broader customer behavior, not the outliers
The Bottom Line
A well-maintained, data-driven parts matrix is essential for keeping your dealership profitable amid declining vehicle gross profit and evolving market forces. By reviewing your strategy annually, pricing intelligently, and tuning out the noise of outliers, you can capture more revenue and solidify profitability in fixed operations.
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There are over 1,500 attorneys in the United State who focus on legal actions against car dealers.
Who reviews your F&I documents for legal or regulatory changes?
What if your dealership had access to a complete suite of documents needed in F&I?
Tom Vangel and Jamie Radke are partners and Lindsey McComber is an associate with the law firm of Harris Beach Murtha Cullina in Boston who specialize in automotive law. They can be reached at 617-457-4072.
Only the LAW F&I Library™ provides:
A complete set of state-specific F&I documents in both pre-printed and electronic formats.
An industry leading team of in-house and outside legal resources reviewing forms for legally required and best practice updates.
A trained team of compliance consultants who can work with you to manage your compliance risks.
Newly Released “Junk Fee” Regs May Impact Dealers
By Attorneys Tom Vangel, Jamie Radke, and Lindsey McComber, Harris Beach Murtha Cullina PLLC
Earlier this month, Massachusetts Attorney General Andrea Campbell released her final regulations of so-called “junk fees”, which are aimed at increasing protection for Massachusetts consumers across all industries.
Like other states regulating against “junk fees”, the Massachusetts regulations promulgated under 940 CMR 38.00 require that the total price of a product be displayed every time a price representation is made and that the total price is provided prior to requiring a customer to provide any personal information. They also place new obligations on businesses offering free trials and require that businesses provide clear terms for recurring charges and subscriptions.
Thanks to the strong advocacy of the Massachusetts State Automobile Dealers Association, the new regulations provide a carve-out for motor vehicle dealers that are already in compliance with the motor vehicle advertising and sales regulations found at 940 CMR 5.02, 5.03, and 5.04. However, for motor vehicle dealers and manufacturers, this carve-out does not apply to subscriptions, trial offers, and recurring fees.
These regulations are set to go into effect on September 2, 2025, and will require dealers to carefully review their practices around trial offers and negative option features, including whether they are processing paperwork on behalf of the vehicle manufacturers and other third parties.
In recent years, as the subscription business model has become more popular across all industries, dealership customers are choosing to opt in to certain features offered by the manufacturers as part of the sale or lease transaction that require paid subscriptions. These features, such as enhanced navigation and hands-free driving, will now be regulated under 940 CMR 38.05.
In the case of subscriptions offered by third parties in which the dealer does not
supply or facilitate the product as part of the sale or lease transaction, such as satellite radio, the responsibility to comply with the regulation will fall to the third-party offeror, and not the dealer.
The regulation defines “Negative Option Feature” as “a provision of a contract under which the consumer’s silence or failure to take affirmative action to reject a good or service or to cancel or non-renew an agreement is interpreted by the seller as acceptance of the offer[.]” Negative Option Features include automatic renewals and pre-notification negative option plans.
Section 38.05(2) makes it a violation of MGL Chapter 93A, the Massachusetts Consumer Protection Act, for any product with a Negative Option Feature to fail to disclose clearly and conspicuously prior to the purchase of the product:
• that the consumer will be charged for the product or that charges will increase after any applicable trial period ends;
• that the charges will occur on a recurring basis, unless the consumer timely takes steps to prevent or stop such charges; and
• instructions as to the mechanism by which the consumer may cancel the Negative Option Feature to avoid being charged for the product.
Under this section, dealers will also have to ensure that they provide a simple mechanism by which a consumer can cancel the Negative Option Feature to avoid being charged for the product and to immediately stop any recurring charges. This requires that a dealer provide the same method for cancellation as the method the purchaser used to initiate the Negative Option Feature.
For a Negative Option Feature exceeding thirty-one days, dealers will also be required to provide written notice between five and thirty days before the date upon which the consumer must cancel in order to
avoid incurring additional expenses. This notice must include the date and mechanism by which the consumer may cancel the Negative Option Feature. Further, for all Negative Option Features, dealers must provide written notice in a medium that is substantially similar to that used by the consumer to initiate the Negative Option Feature.
Like Negative Option Features, trial offers given by dealers will also be regulated by 940 CMR 38.00. Section 38.05(a) makes it a Chapter 93A violation to fail to disclose clearly and conspicuously prior to the consumer’s acceptance of the trial offer:
• any financial obligations that may be incurred as a result of accepting the trial offer;
• identification of all products for which the consumer may incur a financial obligation as a result of accepting the trial offer;
• instructions as to the means by which the consumer may reject or cancel the trial offer before the consumer incurs a financial obligation;
• the calendar date by which the consumer must reject or cancel the trial offer in order to avoid incurring a financial obligation; and
• the calendar date on which the consumer will incur any financial obligation if the consumer fails to reject or cancel the trial offer.
The regulation defines clearly and conspicuously as “readily noticeable and readily understandable by ordinary consumers” and requires that it be unavoidable.
Massachusetts motor vehicle dealers should carefully review these regulations and consult with competent counsel to ensure that their dealership practices are in compliance with these regulations prior to them taking effect.
Compliance Corner: How Are Your Doc Fee Disclosures?
By Attorneys Sara Judge, Paul Marshall Harris, and Gregory Paonessa, ArentFox Schiff, LLP
Recent legal developments in the past year should push every Massachusetts dealer to review how they are disclosing their document preparation fees on their websites. Advertising compliance is always ripe for class action litigation and investigation by the Commonwealth’s Attorney General’s Office. Therefore, dealers should be routinely checking their websites and consulting with legal counsel to ensure compliance with the law.
It is an unfair or deceptive act for a dealer to advertise the price of a vehicle and not include all charges of any type which are necessary and usual prior to delivery of the vehicle to the retail purchaser.
or “doc fees extra” in an advertisement with the sales price of the vehicle. It appeared that the disclosure by reference complied with the regulation… until recently.
Let’s start with the applicable advertising regulation, which has not changed: It is an unfair or deceptive act for a dealer to advertise the price of a vehicle and not include all charges of any type which are necessary and usual prior to delivery of the vehicle to the retail purchaser, including any charges for freight, handling, vehicle preparation, or documentary preparation. The regulation excludes any requirement to disclose taxes or optional charges for the dealer’s preparation of title (capped at $5.00) or assistance for registering the vehicle. The applicable regulations for motor vehicle advertising are found at 940 CMR 5.02.
For years, many Massachusetts dealers have complied with this regulation by disclosing the existence of their Doc Fee by reference (such as by using the language “doc fees extra” or “doc fees additional”), or by including a hyperlink on their websites to additional disclosures, which may bury the Doc Fee in the fine print. This type of “disclosure by reference” is a common practice and, until recently, the only reported case law on the regulation allowed the practice. The first reported decision on the regulation is a 2018 Norfolk County Superior Court case, which held that the dealer had satisfied the disclosure requirements by including the words “doc. [fee] additional”
In September 2024, a Federal District Court in Massachusetts took the exact opposite view and disagreed with the Norfolk County Superior Court’s interpretation of the regulations. In the 2024 District Court case, a plaintiff brought a putative class action against a Class 2 motor vehicle dealership, claiming that the dealership failed to disclose a Doc Fee in its online advertisement or otherwise include the fee in the vehicle’s advertised sale price. The District Court held:
“The plain text of Section 5.02(3) makes it an unfair or deceptive practice for dealerships not to include documentary preparation fees in their advertised prices. Under the regulation, it is not enough for a dealership to publish a sales price with a disclaimer or footnote that apprises consumers of the existence of a separate preparation fee. The fee must be included in the advertised price and defendant’s argument that the documentary preparation fee is an “optional charge[ ] for the dealer’s preparation of title” within the meaning of Section 5.02(3) is unpersuasive. That reading would require the Court to ignore the plain text of the regulation, which instructs dealerships to include any charge for ‘documentary preparation’ in the advertised price.”
In December 2024, a Middlesex Superior Court reviewed the conflicting case
law on whether a Doc Fee disclosure by reference complied with the law. The Middlesex Superior Court recognized the existence of differing case law but ultimately determined that, because the regulation stated that “doc fees must be included in the advertised price,” the advertised price must include the dollar amount of the Doc Fee. The Middlesex Superior Court found that disclosures using language like “doc fee extra” or “doc fee additional” did not shield the dealership from a potential violation of the regulation.
The safest approach, thus, is for all dealerships to include the amount of their Doc Fee in the advertised price of the vehicle, instead of disclosing the Doc Fee by reference separate and apart from the sale price. We understand that dealerships are hesitant to change long-held practices, but consumer class action counsel in the Commonwealth is aware that this area of law is ripe for legal challenge.
If the conflicting case law on this issue does not convince you to review your disclosures, the Commonwealth’s recent (February 2025) issuance of new “junk fee” regulations demonstrates that the Attorney General’s Office is still focused on compliance regarding fees charged by businesses of all sorts. Failure to do so could invite future litigation not only from the plaintiff’s bar but also the Massachusetts Attorney General. It is also imperative that dealers review their advertisements with legal counsel when making changes to online disclosures, as Doc Fees are only one piece of the regulatory puzzle.
Paul Harris, Sara Judge, and Gregory Paonessa are partners in the Automotive Group at ArentFox Schiff LLP’s Boston office.
Five Compliance Reminders for Website Tracking Software


By Jeff Fritz, Esq. and Joshua Nadeau, Esq. Partners, Fisher & Phillips LLP
The Massachusetts Supreme Judicial Court recently delivered a significant victory for businesses, including auto dealerships, regarding website tracking software used for marketing purposes.
In Vita v. New England Baptist Hospital, the court clarified that using common web-tracking tools, such as Google Analytics or social media pixels, does not violate the Massachusetts Wiretap Act, which was originally intended to protect private, person-to-person communications from unauthorized interception.
of any rational doubt.” According to the court, “communication” includes messages and conversations between people in person, on the phone, and through e-mail, text message, chat, instant message, or the equivalent.
In this case, the patient’s complaint involved interactions with the hospitals’ website, not their staff. “When a user browses a public website and accesses databases and other information readily available to anyone on the Internet, the user is not speaking or messaging with another person but rather interacting with the website; the user is also not engaged in personal conversation or messaging but rather browsing and interacting with the published information on
Ascertain what third parties are doing with your data once they receive it.
2. Display Appropriate Disclosures. Before the consumer provides any information on your website — for example, through a search bar, a contact form, or chat feature — review your website disclosures to ensure they adequately describe the parties to the communication, who will receive the data, the further use (if any) of the data, and where consumers can access information about your privacy and data use practices.
3. Ensure Third-Party Compliance. Be proactive by periodically reviewing your third-party providers’ data privacy practices to ensure they comply with legal obligations as well as your company’s policies.
Depending on your organization’s data practices, you may be required to implement, or may consider implementing, automated ways to acknowledge consumer opt-out preference signals.
the website,” the court noted.
The decision confirmed that website interactions, including customers browsing vehicle inventory or service pages, are not considered protected “communications.”
What Happened?
A patient brought a proposed class action under the Massachusetts Wiretap Act, claiming that two hospitals collected and shared her information with third parties for marketing purposes without her consent.
The patient alleged that she accessed and reviewed public information on the hospitals’ websites, such as doctors’ profiles, medical symptoms and conditions, and procedures. She claimed these interactions with the websites were “wire communications” protected by the act.
The Court noted that the term “communication” in the statute is ambiguous, so the hospitals were entitled to “the benefit
“Ultimately, we cannot conclude that the wiretap act unambiguously prohibits and, indeed, criminalizes the interception of web browsing activity,” the court found. Critically, it found a big difference between interactions on a public website and private conversations in a house or on the telephone, the latter being the intention of the act.
Although the Court held that the use of tracking software does not violate the state’s Wiretap Act, the court acknowledged that there may be other claims outside of the Wiretap Act, and businesses still should consider the host of privacy laws regarding tracking website user interactions.
Data Privacy Compliance Steps to Consider Taking Now
1. Review Your Website. Closely review your website to evaluate the pixels, web beacons, cookies, and other tracking tools being used. Identify the data each tracking tool discloses and any parties receiving it.
4. Consider Privacy Preserving Technologies. Many comprehensive consumer privacy laws either recommend or require (in certain circumstances) the adoption of privacy preserving technologies on websites, like Global Privacy Controls (GPCs), HTTP header field, or JavaScript objects. Such technology could allow a user to set his or her browser to send an automatic signal to each website he or she visits telling the website that this user does not wish to have any data that can identify him or her collected or disclosed through cookies. If your website enables or accepts GPCs, the website would automatically accept the user’s preset signal and comply with the user’s choice without requiring the user to further select cookie choices upon navigating to the website. Depending on your organization’s data practices, you may be required to implement, or may consider implementing, automated ways to acknowledge consumer opt-out preference signals.
5. Seek Competent Legal Counsel. Your Fisher Phillips attorney can help you effectively and comprehensively develop a compliance plan.
Building Value in Your Auto Business

By Dave Clayman CEO, Twelve Points Wealth Management
In the fast-paced, competitive world of the automotive industry, success is not just about driving revenue or increasing units in operation. It is about building a business that runs smoothly without you, stands out in the market, and holds its value whether you plan to keep growing, transition leadership, or sell.
That is where the Build Stage of the Value Acceleration Methodology’s Five Stages of Value comes into play. After understanding what your business is worth today (the
At Twelve Points, we work closely with automotive business owners who are looking to take that next step. We understand the unique challenges you face, from razor-thin margins to the constant need to keep up with technology and customer expectations. That is why we guide our clients through the Build Stage by helping them design a roadmap that not only increases value today but protects it for the future.
What Happens During the Build Stage?
It starts with answering some key questions:
• What are your long-term business, personal, and financial goals?
• How involved do you want to be in the business moving forward?
• What do you want the business to look like if you step away?
Once you have set that vision, it is time

Identify Stage) and uncovering the gaps between where you are and where you want to be (the Protect Stage), the Build Stage is all about taking strategic action to grow and enhance your company’s value.
Why Does This Matter for Automotive Business Owners?
Whether you are running a dealership, a repair shop, or a parts distribution company, the Build Stage helps you create a business that is not just profitable but sustainable, scalable, and eventually transferable. In other words, it is about making your business work for you, not the other way around.
to define, develop, and document the systems and processes that will get you there.
In the automotive space, that might mean:
• Streamlining service operations to increase dollars per repair order;
• Developing a strong leadership team that can take the wheel when you are not in the shop;
• Documenting sales and customer service protocols to ensure retention and consistency;
• Building strong supplier and financing relationships to protect your margins;
• Leveraging technology to improve workflow, reporting, and the customer experi-
ence; and
• Developing acquisition criteria and a pipeline of potential targets
Do Not Forget the People
At Twelve Points, we always remind our clients that a strong business starts with a strong team. From the service tech to the sales floor to your back-office staff, creating a culture where people feel empowered, trained, and invested in the company’s future makes a massive difference in long-term value.
We worked with a dealership that wanted to create a stronger, more consistent customer experience by building culture into its business. Together, we helped the dealership define core values like transparency, trust, and accountability. From there, the dealership put those values into action, integrating them into their hiring process to ensure new team members were a cultural fit, holding regular team huddles to reinforce the values in day-to-day operations, and creating recognition programs to celebrate employees who went above and beyond. By making culture part of their daily workflow, the dealership not only improved employee morale but also saw a noticeable boost in customer satisfaction and long-term loyalty.
Why Should You Care About the Build Stage Now?
Because value does not appear overnight. It is not something you can slap together when you are ready to sell or retire. Value is created through intentional, consistent actions taken over time.
By focusing on the Build Stage today, you are not just preparing for a future exit; you are creating a stronger, smoother, and more profitable business now. With the right guidance, whether that is from your internal team or experienced advisors like us at Twelve Points, you can build a business of real significance that serves you, your family, and your community for years to come.

The Benefits of Using Company Email Accounts

By Dianne McGaunn Senior IT Project Manager, OCD Tech
While businesses continue to experience an increase in the number of cyberattacks in all industries, it is worth re-evaluating company email policies and procedures on a regular basis to reduce attack surfaces. Although having company emails for all employees can incur some costs and resources, the security benefits of having company email accounts for all employees are well worth the cost.
Consistent with good security hygiene, all employees should have company-based email accounts that are used for business only. It is good practice for employees not to use a personal email account for company business. Corporate emails help keep employee personal data from mixing with corporate data. Using personal emails for business or on a company machine poses several security risks.
Corporate email systems offer many protections that personal email systems do not. For instance, with corporate email accounts, conditional access policies block locations that might signal an intrusion attempt if the email originates in an area from which employees typically are not working. Corporate email can also enforce encryption to ensure confidentiality and protection of important information.
Corporate email systems offer advanced spam filtering and antimalware in real-time, providing more protection from large-scale cyberattacks, especially if attackers attempt to leverage the initial compromise of a cor-
porate computer as a launching point to infect the rest of the network. Furthermore, company email systems enforce multi-factor authentication (MFA) for further essential protection, which personal emails do not offer.
Corporate emails enforce best practices for passwords. It is very common for users to re-use passwords, and this can further expose personal email accounts. Many passwords on personal email accounts are weak, because of re-used passwords or use words or phrases that are easy for hackers to guess using password cracking techniques.
For instance, corporate systems that enforce password guidelines from the Center
ulate the types of emails attackers send, to test employees’ susceptibility and provide subsequent training to help them identify real threats in the future. This is typically only implemented through known company email addresses. So, if employees are using personal email addresses in favor of their corporate email, their susceptibility is not measured as intended, and they are not receiving the important training that keeps them resilient against attacks.

for Internet Security (CIS) require a minimum of 8 characters (8 characters with MFA, 14 characters without MFA), use of uppercase, lowercase, special characters, regular password rotation and resets, restrict password hints, lockout after failed login attempts, and prohibit the use of personal information. These passwords will take far longer to crack, as opposed to weak passwords on personal email accounts that can take seconds or minutes to crack.
Another consideration worth mentioning is that many organizations provide employee awareness training via corporate email systems. This is often provided via simulated phishing campaigns, which em-
Additional benefits of corporate email accounts can include data loss prevention (DLP) which helps organizations monitor and protect sensitive information and the unauthorized transfer of it. Finally, the use of corporate email accounts allows automated password resetting for cases in which an employee forgets their password. If an employee is using a personal email account and forgets their password, access to any information on that email account is lost completely. This could result in the loss of critical corporate information that could potentially affect customer service and other business functions.
The use of personal email accounts for business obfuscates the ability for tracking of work activity, which can cause problems if legal issues arise or if confidential company information is either purposely or inadvertently leaked. Businesses gain greater control when they directly manage employee email accounts, ensuring proper oversight.
Consider a common scenario: A longtime employee leaves the company, but corporate information remains in their personal email account. Without centralized email management, there is no way to restrict

The use of personal email accounts for business obfuscates the ability for tracking of work activity
access to this sensitive data, increasing the risk of unauthorized disclosure or misuse.
From a legal perspective, using personal email for work-related matters may create future complications. Should litigation arise, an employee’s entire personal email account history could be subject to review, which could potentially expose private information. Personal email accounts are often shared with other family members, and this could further complicate any issues related to the protection of company assets or confidential information, for the employee and/or their other family members.
Therefore, businesses that allow employees to use personal email accounts should assume that the emails within are not confidential. In contrast, corporate emails are a safer way to transmit potentially confidential information. Furthermore, corporate email retention policies
are often needed for compliance purposes with federal and industry regulations, further emphasizing the need for the use of corporate emails for all employees.
It is important, moreover, to consider that using personal email accounts can create confusion and diminish credibility with clients. Without a professional email address linked to an official business domain, clients may question the legitimacy of the sender and whether they truly represent your company. Personal email addresses, especially those with informal usernames or generic domains, can appear unprofessional, potentially undermining trust and brand perception.
Finally, if employees are allowed to use personal email accounts for business, clients can still communicate with employees via personal email without knowing whether the person is still employed at the organization. Typically, on corporate man-
aged email, a forwarding rule will be set up so any incoming mail to that address will go to an individual’s replacement or superior so that there is no interruption in quality customer service. Without this setup, the business might have no idea of these incoming business-related emails the employee continues to receive.
In summary, the use of personal email accounts for business use is far less secure than using corporate email accounts. The use of personal email for business is far more likely to lead to unauthorized access and use of corporate data. Therefore, there are several solid reasons to invest resources in corporate email accounts for all employees. Stronger password policy management, MFA, DLP, confidentiality, compliance with regulations, and professional image are just a few assurances that corporate emails can provide.
Your Cybersecurity Leadership: Full-Time vs. Fractional CISO

By Scott Spatz President, Cooperative Systems
Cybersecurity has become a big concern for automotive dealerships, which handle large amounts of sensitive customer data daily. As threats grow more sophisticated, the role of a Chief Information Security Officer (CISO) has never been more important. However, not every dealership has the resources or the need for a full-time cybersecurity executive. This brings up a pivotal decision: Does your dealership require a full-time CISO, or would a fractional CISO suffice?
The Crucial Role of a CISO
A CISO is responsible for overseeing the development and implementation of your dealership’s cybersecurity strategies. This role includes managing all aspects of information security, ensuring compliance with data protection laws, and preparing and leading the response to any cybersecurity incidents. The role also includes educating and training staff to recognize and mitigate security threats proactively.
Dealerships face unique cybersecurity challenges, such as protecting customer databases from breaches and ensuring business operations are shielded from attacks like ransomware and phishing. The ramifications of these security threats are not just operational but can severely impact a dealership’s reputation and financial standing.
The Full-Time CISO
Hiring a full-time CISO provides continuous, dedicated oversight of your cybersecurity measures. This individual becomes








Privacy #1



Guardian

Workforce
Create

Safety Stay

ComplyCrypt

Schedule
Leadership and the Three Tenets

By Tim Marbut
Ethos Group
people feel seen, heard, and appreciated. For a leader, validation is not a mere formality; it is an essential tool for fostering motivation, trust, and engagement.
Why validation matters
• Boosts Morale: When team members know their contributions are valued, they feel a greater sense of purpose and pride in their work.
morning, thanks for working so hard” can go a long way.
In a recent Gallup study, employees stated that one of the most important things is feeling seen. By practicing validation, you create an environment where people feel empowered and appreciated, setting the stage for greater collaboration and productivity.
Leadership is not just about achieving results; it is about inspiring, guiding, and elevating others toward a shared vision. At the core of effective leadership are three foundational tenets: validation, valuation, and common purpose. These principles foster trust, build strong relationships, and create environments where individuals and teams thrive. As a leader, understanding and applying these principles can significantly enhance your ability to motivate and unify people toward collective success.
• Builds Trust: Validation shows that you respect and appreciate others, which strengthens relationships and fosters loyalty.
• Encourages Positive Change: People are more likely to share ideas and take risks when they feel their input is valued.
Validation ideas:
• Acknowledge Efforts: Publicly or privately recognize specific achievements,

When team members know their contributions are valued, they feel a greater sense of purpose and pride in their work.
highlighting the effort behind them.
Validation Importance
Validation is the practice of acknowledging and affirming the efforts, ideas, and feelings of others. It is about making
• Listen Actively: Give your full attention to team members when they express concerns or ideas, demonstrating that their voice matters.
• Show Empathy: Validate emotions as well as actions. A simple “I understand how challenging this must be” or “Good
Valuation Importance
While validation focuses on recognizing contributions, valuation goes deeper. It is about recognizing and affirming the intrinsic worth of everyone. Valuation means seeing team members not just as employees or contributors but as valuable individuals with unique talents, perspectives, and potential.
The Impact of Valuation
• Increases Retention: Attrition is common in this business; however, people are more likely to stay in environments where they feel valued and respected.
• Fosters Growth: When individuals know their worth is recognized, they are more motivated to develop and contribute to their fullest potential.
• Strengthens Team Dynamics: Valuing diversity of thought and background fosters a sense of belonging and collaboration.
Ways to Show Valuation
• Invest in Development: Provide opportunities for professional growth, such as training, mentorship, or challenging assignments.
• Celebrate Uniqueness: Acknowledge and leverage the unique strengths and perspectives that everyone brings to the table.
• Provide Fair Compensation: Ensure that rewards and recognition align with the value individuals bring to the organization.
Valuation is about more than words; it requires actions that affirm the inherent worth of every team member. Leaders who practice valuation inspire loyalty and com-

When individuals know their worth is recognized, they are more motivated to develop and contribute to their fullest potential
mitment, creating teams that are not just functional but exceptional.
Common Purpose: Uniting Through Shared Vision and Goals
The third cornerstone of effective leadership is fostering a common purpose – a shared understanding of why the team exists and what it seeks to achieve. A common purpose aligns individual motivations with organizational goals, creating a sense of unity and direction. It is important to state that this is separate from the individual’s personal sense of purpose.
The Power of a Common Purpose
• Drives Engagement: When people feel connected to a larger mission, they are more engaged and committed to their work.
• Improves Collaboration: A shared purpose reduces conflicts and silos by aligning everyone’s efforts toward a common goal.
• Provides Clarity: Teams with a clear purpose are better equipped to make de-
cisions and prioritize tasks.
How to Cultivate a Common Purpose
• Articulate the Vision: Clearly communicate the team’s mission, values, and goals. Ensure that everyone understands how their work contributes to the bigger picture.
• Involve the Team: Engage team members in shaping the purpose and goals, giving them a sense of ownership and investment.
• Reinforce the Purpose: Regularly remind the team of the shared mission, especially during challenging times, to keep everyone aligned and motivated.
A common purpose transforms a group of individuals into a cohesive team, working together with shared passion and focus.
Conclusion
Leadership is not just about directing tasks; it is about inspiring people. Valida-
tion, valuation, and common purpose are the foundation of this inspiration. By recognizing contributions, affirming worth, and uniting people around shared goals, leaders create environments where individuals and teams can thrive.
As you lead, remember that people do not just follow because of authority or title; they follow because they feel valued, understood, and connected to something greater than themselves. By embracing these principles, you not only enhance your leadership effectiveness but also empower your team to achieve extraordinary success.
For more information on how Ethos Group can help your dealership develop more leaders in your F&I office, sales management tower, and your sales floor in 2025, please contact Drew Spring at dspring@ethosgroup.com or (617) 6949761.

Patrick Manzi NADA Chief Economist
New Light-Vehicle Sales Record Highest SAAR in Nearly Four Years
New light-vehicle sales in March 2025 recorded the highest monthly SAAR in nearly four years. March 2025’s SAAR reached 17.8 million units, as customers rushed to dealer lots to purchase vehicles before the 25% tariffs on imported vehicles took effect. The SAAR in March 2025 represented an increase of 13.3% year over year and an increase of 11.0% compared to February 2025. A SAAR of 17.8 million units is the highest since April 2021, when the SAAR reached 18.2 million units just before the semiconductor microchip shortage significantly impacted new light-vehicle sales and production. If tariffs proceed as announced, this may be the highest monthly SAAR for some time as price increases from new trade duties likely push new-vehicle prices significantly higher.
Both retail and fleet deliveries increased in March 2025. According to Ward’s Intelligence, the total raw sales volume reached 1.585 million. Retail sales accounted for an estimated 1.3 million units, an increase of 17.3% year over year, and fleet volume also increased 5% to 281,000 units. The total SAAR for Q1 2025 hit
16.5 million units, a SAAR increase of 1.0 million units compared to March 2024. March 2025’s sales performance was the primary driver for sales growth in Q1.
Given the strong demand from consumers in March 2025, average incentive spending per unit fell slightly month over month. J.D. Power estimates that average incentive spending per unit reached $3,059 in March 2025, a decline of $102 per unit compared to February 2025 but up by $235 per unit compared to March 2024. OEM incentive spending had been forecast to rise throughout the year as new-vehicle inventory improved, but its trajectory was disrupted by the new tariff announcements. The future of the U.S. auto industry is murky as we await final tariff announcements. If tariffs go into effect as planned, expect vehicle prices to increase, sales to decrease, and production to fall. However, the exact magnitudes of these effects are difficult to quantify currently. There also likely will be effects on U.S. vehicle exports, as other countries retaliate with tariffs of their own.



Tariff Uncertainty Threatens Dealerships

By Cody Lusk President & CEO, American International
Auto Dealers Association
Ask any successful dealer and they will tell you, “Change is good”. Keeping up with fresh developments is key to longevity in the competitive auto retail market. If you are stuck in your ways, you are just that – stuck. And that makes you easy to pass.
Change is good, but uncertainty is not. It is one thing to be open to new ideas and methods. It is another to have no idea what is around the next corner. In the business world, the former drives innovation. The latter contributes to stagnation. And unfortunately, when it comes to America’s trade relationships, uncertainty is ruling the day.
It makes sense for a new White House administration to re-evaluate and renegotiate standing trade agreements. But implementing on-again off-again tariffs against our allies fuels uncertainty and slows economic growth. In our industry, where manufacturers need years to develop and open new production facilities and in which consumers are already stretching to afford vehicles, uncertainty has a powerful chilling effect.
As I write this, the Trump administration has placed 25 percent tariffs on Canada and Mexico (suspended on USMCA-compliant autos for 30 days), 25 percent tariffs on steel and aluminum, additional 20 percent tariffs on all Chinese imports (on top of existing duties), threatened 200 percent tariffs on European alcohol, and has committed to enacting global reciprocal tariffs on April 2 – matching

“Change is good, but uncertainty is not.”
any tariffs enacted by foreign countries.
In response, the EU says it will impose $4.9 billion worth of tariffs on April 1 and enact an additional $19 billion in tariffs on April 13, some specifically targeting Republican-voting states. Canada, meanwhile, has enacted 25 percent tariffs on $8.8 billion worth of U.S. products and threatened to cut off electricity to Minnesota, Michigan, and New York. That move prompted President Trump to threaten, and subsequentially backtrack on, 50 percent steel and aluminum tariffs.
This is just a taste of some of the trade quarrels the US has embroiled itself in in the past month, but it gives you a sense of the chaos that is brewing. America’s trade relationships may have needed modification, but this level of turmoil has both small and large businesses struggling to plan for the next month, let alone years in advance. Whether you are brewing bourbon in Kentucky, designing clothes in New York City, or selling cars in any community in the United States, you have to be questioning how tariffs will impact your business plan.
At AIADA, we recognize that trade agreeement are living, breathing documents. Trade relationships must evolve
over time to reflect changing industries, national security concerns, and shifting global alliances. When it comes to trade, change is not just good; it is necessary. That said, America’s business leaders have a right to expect some level of consistency from our government’s trade strategies. Dealers, in particular, need certainty in order to floor plan, estate plan, and, hopefully, plan for growth.
President Trump has shown, time and again, how highly he values a healthy and globally competitive auto industry. Both on the campaign trail and in the Oval Office, he has committed to supporting American-based manufacturers and workers. AIADA’s members are similarly committed to working with the president and his administration to find trade solutions that work for all Americans invested in this economy.
Looking ahead, open lines of communication between dealers, manufacturers, and lawmakers will be essential in ensuring that when the dust settles from these many trade clashes, America’s thriving automotive industry will still be a world leader

By Scott Pearson Chairman, American Truck Dealers
ATD ChAirmAn SCoTT
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PreSiDenT of PeTerbilT of ATlAnTA
Preparing for Our 2025 Legislative Fly-In
As we have seen over the last couple of months, the Trump Administration and the Republican Congress are committed to addressing the large number of items on their plate – making permanent the tax rates initiated by the first Trump Administration and set to expire at the end of this year; reining in excessive spending by federal agencies; overturning regulations that seem extreme, such as the EPA’s waivers granted to the California Air Resources Board for the Advanced Clean Trucks rule and the Advanced Clean Cars II rule, just to name a few.
Each year, your ATD organizes a fly-in to Washington, D.C., for heavy-duty truck dealers, their key personnel, and state dealer association executives to lobby their Members of Congress on our issues. Our preparations are well underway for our 2025 ATD Legislative Fly-In, June 3-4. The 2025 ATD Fly-In is an invitation-only event that provides truck dealers and Automotive Trade Association Executives an opportunity to lobby Congress on issues of importance to medium- and heavy-duty truck dealers. Registration is now open at https://www.nada. org/atd-fly-in.
This year’s event will be held at The Hotel Washington near the White House. ATD will make hotel reservations for each guest. Upon check-in, guests will be required to provide credit card information for room charges and any incidentals.
Dealer visits with legislators on Capitol Hill are the key component of the Fly-In. ATD Legislative Affairs will set up your legislative meetings unless you prefer to schedule your own. This year’s legislative priorities include:
• The EPA’s waiver on the Advanced Clean Trucks (ACT) rule and the EPA’s de facto ZEV truck mandate through the aggressive “Phase 3” greenhouse gas rule for heavy-duty vehicles;
• Repeal of the federal excise tax on heavy-duty trucks;
• Opposition to the vehicle “right to repair” legislation; and
• Support for catalytic converter anti-theft legislation.
If you have attended previously, we would love to have you back for our 2025 event. If you have never
attended, we would welcome your participation as we reach out to our representatives in Congress and regulators to educate them on our issues. We have grown our Fly-In ranks every year, and we look forward to welcoming you on board in June.
ATD Applauds Bipartisan Effort to Repeal Federal Excise Tax on New Heavy-Duty Trucks
On March 31, the American Truck Dealers released the following statement applauding Reps. Doug LaMalfa (R-California), Chris Pappas (D-New Hampshire), Darin LaHood (R-Illinois), Salud Carbajal (D-California), and Max Miller (R-Ohio) for reintroducing H.R. 2424, the Modern, Clean and Safe Trucks Act of 2025. This important bipartisan legislation would repeal the 12 percent Federal Excise Tax (FET) on heavy-duty trucks and trailers.
The FET, enacted more than a century ago, is the highest excise tax on a percentage basis that Congress levies on a product, hindering the ability of dealers to sell the safest and cleanest trucks on the road.
“The burdensome 12 percent Federal Excise Tax on the sale of new heavy-duty trucks and trailers is an outdated levy which drives up costs and slows the adoption of safer, more fuel-efficient vehicles,” said Scott Pearson, ATD Chairman and President of Peterbilt of Atlanta. “This onerous tax adds approximately $20,000 to the price of a new diesel truck, and $50,000 to the cost of a new electric truck. America’s truck dealers commend Reps. LaMalfa and Pappas for their leadership on this important issue, which will help motor carriers modernize their fleets and improve road safety.”
“For over a century, the federal excise tax on heavy-duty trucks has gone from a temporary wartime measure to fund World War I, to an outdated tax that punishes truck buyers,” said Rep. LaMalfa. “This is the highest percentage-based tax Congress imposes on any product, yet it fails to be a reliable source of funding for the Highway Trust Fund. This tax forces buyers to stick with older, less efficient models and makes it harder for truckers to modernize their rigs, holding back the trucking industry
from updating. Let’s repeal this outdated tax and support the men and women who keep America moving.”
“Every potential saving we can deliver to businesses makes a difference to help them operate and lower costs for families,” said Rep. Pappas. “Cutting the federal excise tax on heavy-duty trucks and trailers will help America’s Main Street economy grow and strengthen our supply chains, while also supporting the adoption of newer, safer, and cleaner trucks. This legislation is bipartisan and commonsense, and I’ll keep fighting for Congress to take it up to provide immediate relief to small businesses and consumers alike.”
“The Illinois trucking industry is a vital economic driver that impacts agriculture, manufacturing, and small businesses,” said Rep. LaHood. “I am proud to join my colleagues in introducing this critical piece of legislation that abolishes the federal excise tax on semi-trucks and trailers. This outdated tax hinders trucking companies from hiring more drivers and upgrading their fleets to cleaner, safer, and more efficient models.”
“Repealing the outdated federal excise tax on heavy-duty trucks—which was first enacted over a century ago—is essential to modernize our transportation sector and help reduce emissions,” said Rep. Carbajal. “This outdated tax drives up the costs of cleaner, more efficient trucks. By eliminating this financial barrier, we can accelerate fleet turnover, enhance road safety, and promote economic growth while supporting American manufacturing and jobs. I am glad to join this effort to pave the way for a cleaner, safer, and more competitive industry.”
“America’s truckers work hard to keep our economy moving, but outdated policies like this federal excise tax on heavy trucks and trailers make it harder for them to upgrade to safer, more reliable equipment,” said Rep. Miller. “By eliminating this excessive tax, we can empower small trucking businesses to invest in modern trucks, reduce costs, and improve safety on our highways. Supporting our truckers means ensuring they have access to the tools they need to keep goods moving efficiently in our communities.”
Tariff on Imported Trucks May Drive Prices up 9%
By Pamella De Leon, Senior Editor Commercial Carrier Journal
A 25% tariff on imported vehicles and specific vehicle components set to take effect on April 3 could impact one-third of U.S. commercial vehicle sales, according to a report by S&P Global Mobility.
Since taking office in January, President Donald Trump has increased tariffs on China by 20%, enacted narrow 25% tariffs on Canada and Mexico, and boosted tariffs on steel and aluminum to 25% – duties on more than $1 trillion of imports.
Along with swift retaliatory measures from Canada and Mexico, S&P anticipates that more tariffs targeting vehicle imports could potentially reduce short-term trucking demand and, over time, reshape the landscape of commercial vehicle manufacturing.
Some manufacturers are more exposed to potential disruptions than others. According to S&P, nearly a third of new Class 4-8 trucks sold in the U.S. are imported from Canada and Mexico, with more than 40% of Class 8 trucks coming from those countries.
While manufacturers consider typical cost-cutting measures, Andrej Divis, executive director of global truck research at S&P Global Mobility, said they could also be reoptimizing or rebalancing production between manufacturing in Canada and Mexico.
U.S. commercial vehicle suppliers have “little or no” capacity to absorb a 25% increase, according to S&P. Meanwhile, most bigbore engines are manufactured in the U.S. before being shipped to Canada or Mexico for vehicle installation. The report, which also includes motorcoaches and RVs, warned that while the full impact across the supply chain is difficult to quantify, price increases for U.S. commercial vehicle buyers are likely if the tariffs take effect.
American Trucking Associations President and CEO Chris Spear estimated the price of a new tariffed tractor could increase by as much as $35,000. S&P estimates that the net impact of tariffs on new U.S. truck prices could be around 9% and reduce demand for new commercial vehicles as much as 17%.
The anticipated decline would effectively wipe out all previously expected market growth for this year, resulting in a weaker commercial vehicle market in 2025 compared to 2024.
The report also pointed out that while demand is projected to drop, commercial vehicle production could decline even more sharply. This is due to the high number of newly built trucks currently in transit or sitting in inventory, which could force manufacturers to further slow production.
Currently, S&P’s data indicated that new-truck supply represents about 4.5 months’ worth of demand, compared to the typical level of three months, indicating a potential oversupply issue.
Tariffs could also slow the adoption of zero-emission vehicles, the report said. Additional trade restrictions on imports from China and other trading partners are already driving up the cost of ZEVs, and further price increases may make them even less attractive to fleets, adding another setback.
“We do think that basically there’s a question about once the tariffs are in place, if they come, [and] how long are they going to be in place for… The question is, how long are they going to last?” Divis said.
In addition to raising costs of production, Divis noted that it could also have an impact on overall economic activity.
“I think, initially, we would probably see some reduction in short-term production rates across the region, which might last for some time, while the manufacturers sort of wait and see and digest the news,” he said. “And then we would probably expect that to shake out and then see more of a normalization after that.”
The S&P report anticipates that tariffs introduced in April will remain in place for four to five months, coinciding with a renegotiation of the USMCA trade agreement.
n A d A u pdate MSADA
NADA Focuses on ZEV Mandates and Tariffs

Scott Dube, Partner at McGovern
HyunDai rt. 93, rePreSentS
naDa’S MaSSacHuSettS MeMberS on tHe naDa boarD of DirectorS. He can be reacHeD at SDube@ McGovernauto coM
Over the last two months, your NADA has been working with the Trump Administration and Congress on two main issues dominating our industry’s headlines: the California zero-emission vehicle (ZEV) mandates and U.S.-imposed tariffs on all nations with whom our nation conducts trades.
ZEV Mandates – Revoke CARB’ s EPA Waivers
As of April 4, Congressional efforts to revoke the EPA’s waivers of three CARB ZEV-related and truck emissions rules have been heating up.
NADA/ATD has been a leader in the effort to urge Congress to prioritize Congressional Review Act (CRA) resolutions to disapprove the Biden Administration’s EPA waivers granted to the California Air Resources Board (CARB) for car ZEV mandates under the Advanced Clean Cars II (ACC II) rule, the heavy-duty truck ZEV mandates under the Advanced Clean Trucks (ACT) rule, and the heavy-duty Omnibus Low NOx rule.
House Action. On April 2, the following CRA joint resolutions were introduced in the House:
Light Duty CRA
• Revoke CARB’s ZEV Mandate (ACC II rule): H.J.Res.88 was introduced by Rep. John Joyce (R-Pennsylvania). California’s ZEV mandate will soon start distorting the vehicle market in all states. To comply with the mandate, OEMs will need to either sell more ZEVs or sell fewer gas-powered vehicles in these states. The rationing of gas-powered vehicles will leave millions of consumers far fewer vehicle choices and force consumers everywhere to pay more for new and used vehicles.
Heavy Duty CRAs
• Revoke CARB’s Heavy-Duty ZEV Mandate and Diesel Requirements (ACT rule): H.J.Res.87 was introduced by Rep. John James (R-Michigan). This rule, which took effect last year, restricts the sale and then bans the sale of new heavy-duty diesel trucks in 2036.
• Revoke CARB’s Heavy-Duty Omnibus Low NOx rule: H.J.Res.89 was introduced by Rep. Jay Obernolte (R-Cali-
fornia). This rule, which took effect last year, limits the sales of new diesel engines and establishes more stringent NOx emissions requirements for 2024 and 2027.
Each resolution has the same original co-leads: Reps. Kevin Kiley (R-California), Doug LaMalfa (R-California), Jay Obernolte (R-California), Russ Fulcher (R-Idaho), John James (R-Michigan), Lisa McClain (R-Michigan), and John Joyce (R-Pennsylvania).
According to Speaker Mike Johnson’s (R-Louisiana) office, the CARB CRAs are a key priority for the majority. The House is expected to consider the CRAs on the House floor some time in April, perhaps after the Easter recess.
Senate Action. On April 4, Senate Parliamentarian Elizabeth MacDonough told Senators, in a non-binding opinion, that she does not believe Congress can revoke the EPA/CARB waivers through CRAs. The parliamentarian’s opinion was said to be influenced by a recent opinion by the Government Accountability Office (GAO), which questioned whether the EPA waivers meet the qualifications for a CRA. There is considerable disagreement with the GAO’s assessment, and the GAO’s opinion is also not legally binding. Two Republican committee chairs recently wrote a letter to the GAO questioning their opinion that Congress cannot use the CRA to block California’s waivers. While this presents a significant hurdle, there are still potential opportunities to overcome the opinion.
Despite the parliamentarian’s opinion, Sen. Shelley Moore Capito (R-West Virginia), chair of the Senate Environment and Public Works Committee, along with Sens. Deb Fischer (R-Nebraska) and Markwayne Mullin (R-Oklahoma), introduced a trio of legislation, matching the three House bills, to revoke CARB’s ZEV mandates under the ACC II (S.J.Res. 45) and the ACT (S.J.Res. 46) rules, and the truck Low NOx rules (S.J.Res. 47).
NADA/ATD strongly supports swift passage of the CARB CRAs and will be activating the dealer grassroots networks to communicate dealer support as we get additional vote scheduling information. NADA/ATD is in constant communication with Republican congressional leadership and the CARB CRAs are a top priority for the White House as well. Dealers should urge their Representatives to cosponsor and pass the CARB CRAs. NADA will provide updates to dealers on how they can engage their Members of Congress to support this pro-dealer and pro-consumer legislation.
Trump Administration Tariffs
The situation is quite fluid. During the on-and-off-and-on announcements during the first two weeks of April, NADA has had ongoing meetings with White House staff, the Office of the U.S. Trade Representative (USTR), the U.S. Treasury, the Small Business Administration (SBA), Congressional
Leadership and members of Congress, senior legislative staff, and President Trump’s transition teams.
The administration and federal agencies have been respectful and willing to understand our positions on many issues that affect our dealers and industry. Our efforts will continue to focus on educating the Administration and Capitol Hill about the anticipated impact of trade policy decisions to help ensure those decisions are well-informed.
In addition, we continue to engage with the OEMs, the Alliance, and other industry trade associations. NADA has been and will continue to be the dealers’ voice, and we are working with all parties to better understand the president’s tariff announcement and its overall impact on our dealership operations.
Tariffs on U.S. trading partners, who are vital to our automotive supply chains, would increase costs on auto manufacturing and parts production, driving up prices and making it harder for many Americans to afford the new vehicles of their choice. Affordability and availability are already persistent challenges that dealers must overcome every day to get customers into the right vehicles.
While tariffs have been useful to combat unfair trading practices and protect vital U.S. security interests, America’s franchised auto dealers urge the Administration to continue to work with our trading partners to ensure consumers and Main Street businesses are not negatively impacted by the imposition of these new tariffs.
NADA is working with our counterparts across the auto industry and is engaging the Administration and Congress to protect dealer interests. We will continue to urge the Administration to ensure that consumers and Main Street businesses are not negatively impacted by the imposition of new tariffs.
The following is our public statement, issued by NADA Chair Tom Castriota and NADA President Mike Stanton: “Matching customers with vehicles they can afford has been a continuing challenge for America’s new car and truck dealers. The tariffs announced Wednesday could put the purchase of a new car out of reach for an increasing number of American consumers. It is essential that the potential impact of tariffs on consumers and main street businesses be fully considered.”
We will continue to provide updates on these developments.
J.D. Power: Prepare Now for Price Volatility
Brands relying more heavily on imported models will be hit hardest as Q3 pricing shifts loom
By Nancy Dunham, Principal Analyst/Retail WardsAuto
U.S. auto dealers are preparing for what will likely be a turbulent few months, as the first effects of newly imposed tariffs on imported vehicles and auto parts begin to ripple through the industry. According to a fresh analysis from J.D.
Power, the full picture of the tariff fallout is still coming into focus – but one thing is clear: The impact won’t be uniform.
“Asymmetry makes it almost impossible for highly tariffed brands and models to increase prices without large volume declines,” says Thomas King, president of data and analytics and chief product officer at J.D. Power. “In order to maintain reasonable volumes, a large portion of tariffs must be absorbed.”
$62 Billion in Tariff Exposure – But It’s Complicated
Today’s tariff landscape includes a 25% tax on imported vehicles and major parts, with even Canadian and Mexicanmade vehicles facing charges if they contain less U.S. parts content than is required under the U.S.-Mexico-Canada Agreement trade pact. The average vehicle tariff exposure is approximately $4,782, but this number varies significantly across manufacturers.
For dealers, this means some brands will be hit much harder than others. King says that highly imported lineups may see thinner margins or even product cuts, while brands with stronger U.S. production footprints could be in a better position to compete on price.
Inventory Strategy: Short-Term Wins,
Long-Term Shifts
As reported earlier by WardsAuto, new-vehicle sales in Q1 2025 were especially strong because consumers took advantage of pre-tariff pricing. That urgency continues into Q2, but J.D. Power warns this is temporary. Starting as soon as May or June, King expects price increases to begin as tariff-affected vehicles arrive on dealer lots.
Manufacturers face tough decisions: Should they maintain low-margin, high-tariff models in their U.S. lineups or reallocate them to other markets? Many may also fasttrack efforts to localize production or revise parts sourcing strategies to reduce exposure.
Pricing, Profitability and Customer Demand
J.D. Power projects an average new-vehicle price increase of 5% – or about $2,300 – by year-end, with retail sales dropping 8%, or roughly 1.1 million vehicles. Depending on how brands respond, the pricing effect could range between 3% and 5% in Q3. J.D. Power notes forecasts rely heavily on broader economic health, such as interest rates.
“Due to the competitive nature of the market, coupled with tariff asymmetry, it will be challenging for highly tariffed brands to simply pass on those price increases to buyers while still maintaining profitability,” a report authored by King and other analysts notes.
By Q4, J.D. Power expects the market to stabilize into a “new normal,” with pricing, supply, and production adjustments starting to take hold. In the meantime, dealers should focus on staying informed, managing inventory proactively and helping customers navigate a market that’s anything but business as usual.


