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MAGAZINE LEADERS IN THE SALE OF QUALITY

PARTS

JUNE 2007

Lasorda Picks Ally for Top Post

Gary Scelzi to Step Away from Drag Racing

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Pages 10-11

Industry News New York Pages 6-7 Massachusetts Pages 8-9 Also In This Issue! President’s Message Member Profile Brian Joynt Managing Employee Turnover Hanel News Reynolds and Reynolds News Storage Consultants of America MMG 2007 Committees

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Performance Group News Vendor Profile Rex Watkins ADP News OEConnection News TidBits Wisdom of Larry the Cable Guy

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Mopar Masters Magazine

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Mopar Masters Guild President Gerry Oakes Baxter Chrysler Summertime and the feelin’ is easy! Well it’s not yet summer according to the calendar but it is fast approaching. The changes that our earth goes through from autumn to winter to spring to summer is quite a wonderful thing to see in my neck of the woods where there are four distinct seasons. In an area of recent drought a record rainfall this spring has been welcomed. However, with the rainfall came flooding in many areas that changed the lives of the people that lived there. Many were unprepared and not insured. Others were insured and well prepared. The prepared were given a chance to build a new life. Their summertime will be feelin’ a little easier than those who lost everything. Have we prepared well for the changes that face us in the new environment of ‘Dealer Rewards’? Are we insured to get our maximum coverage from what ‘Dealer Rewards’ has to offer? Many have prepared and insured their departments for success by changing processes and attitudes within the dealership. But, there is always room for improvement. The best way I have found to be prepared is by networking with fellow guild members and sharing our thoughts and ideas on what is making their departments successful. The guild is a great resource for those who become active within the guild, use the guild website and connect with other managers through email and phone conversations. Attending a performance group with fellow MMG members is another great way to glean information that will be of great benefit to you and your store. There is an opportunity for you to do so on September 20th & 21st in Park City, UT. See the sign up information in the issue, log on the Dealer Connect, and get enrolled. These are excellent ways to be prepared and insured for success in our new life under ‘Dealer Rewards’. Have a ‘feelin’ easy’ summer! And be safe and enjoy the months ahead! Take care,

Gerry PERFORMANCE GROUP NEWS It’s barely June, but we’re already planning our September Performance Group meeting. The meeting will be held September 20-21, 2007 in Park City, Utah. As of this printing, Chrysler has not picked a hotel, but sign up is available on the DCA website. My last contact with Jim Jackson had us returning to the old Group format with a “Useful Ideas” presentation. We will finalize that before September, but get those “thought gears” turning. Most of your dealer/SID codes should allow everyone to sign up without problem. If anyone has trouble, feel free to contact me @ 800.441.2301 x3362 or oolson@elkriverforddodgejeep.com.


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LaSorda picks ally for top post New purchasing boss Boag has old ties with Chrysler chief Robert Sherefkin and David Barkholz Automotive News

DETROIT -- The key thing about Simon Boag, Chrysler's new purchasing chief: He's Tom LaSorda's guy. Boag (rhymes with "vogue") is a manufacturing expert who can match Chrysler CEO LaSorda's deep knowledge of production. Years ago, the two Canadians worked together at General Motors' CAMI assembly plant in Ontario. More recently, Boag was chief of production planning for the Mercedes Car Group in Germany. Now they've reunited. LaSorda wants new blood and a new bedside manner for his company's all-important supplier relations post. Last week, Chrysler announced that Boag would replace Peter Rosenfeld, executive vice president of procurement, who is leaving the company. Rosenfeld, 49, was viewed as a finance guy with bureaucratic tendencies. The 41-year-old Boag knows what Chrysler needs to get lean. "Simon will bring more energy to the position," said a source familiar with the change. "He gets the message. Peter operated at a different wavelength than Tom." It's unclear whether Rosenfeld quit or was forced out after 25 years at Chrysler. A source close to the situation says Rosenfeld and LaSorda had a "mutual understanding that it would be best for him to leave." Just hours after Chrysler announced its new purchasing chief, Rosenfeld held a teleconference to reassure the CEOs of his 16 largest suppliers. Rosenfeld was "upbeat and positive about what the changes at Chrysler mean for suppliers," said a vendor. "The gesture of contacting suppliers underscores the value that (Chrysler) places on its relationship with suppliers." Chrysler spokesman Kevin Frazier declined to comment. There is one other bit of unfinished business: When DaimlerChrysler AG announced the sale of the Chrysler group to Cerberus Capital Management LP, it indicated that the new Daimler AG no longer would have a global purchasing position on its board. That leaves global purchasing chief Tom Sidlik in limbo. Until the deal is complete, Sidlik retains his title as the board member in charge of global purchasing. Chrysler has not said what the future holds for Sidlik. One of Boag's top priorities will be to nurture Project Magellan, Chrysler's effort to buy more parts made in low-cost countries. In recent months, Rosenfeld had set aside day-to-day purchasing responsibilities to run Magellan. Chrysler hopes to buy $5 billion worth of parts annually from low-cost countries, but it could make the automaker vulnerable to global supply disruptions. So Boag has a lot to worry about. But he won't have to blow up Chrysler's purchasing operation and start from scratch. Two independent supplier surveys conclude that Chrysler enjoys smoother relations with suppliers than General Motors or Ford Motor Co. Over the past three years, Chrysler has sharply improved its ability to encourage and carry out supplier innovation, reports a just-released Automotive News supplier survey conducted by J.D. Power and Associates. But in recent months, the automaker's efforts to improve relations with suppliers appear to have stalled, concludes a second report by suburban Detroit consultant John Henke Jr. "The early indications are that Chrysler is now treating its suppliers in a more adversarial fashion than in the past," reports Henke, president of Planning Perspectives Inc. Henke's survey will be released June 4. The bottom line: While Chrysler treats suppliers better than Ford or General Motors, it still lags behind the Japanese automakers. Is the glass half full or half empty? Boag soon will find out.


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Member Profile Brian Joynt Power Chrysler Jeep Hyundai Isuzu Subaru For this issue we travel to Scottsdale Arizona for our Member Profile. Brian Joynt is the Parts Director of Power Chrysler Jeep Hyundai Isuzu Subaru. Originally from Cadillac Michigan moving to Arizona in 1982 he says he was born in the automotive business. His grandfather had a chain of stores in Michigan named A.H. Joynt Automotive. He started working at his fathers store at age seven dusting oil cans every Saturday. Working after school from the seventh to twelfth grade gave him his true start in the business. He says that since he was on his high school golf team that didn’t quite work every day. He started working at Pitre Chrysler Jeep, Phoenix in 1989 as a counterman and shipper receiver and was promoted to Assistant Manager in 1992. At that time his manager was Mark Skinner. In 1994 he was transferred to their Scottsdale store where he worked with Rob Roth and was promoted to the managers’ position in 1996. Both stores changed names to Power in 2005 after being bought by Autonation in 1996. Brian is currently single but living happily with his significant other Jennie Crabtree, she has accompanied him to many of our meetings. They have been together for six years. He is the proud father of two children, Elizabeth and Brian. Elizabeth, 21, lives in Avondale Arizona with her husband Kyle and their two year-old son. Brian, 17, lives in Boise Idaho with his mother. His favorite book is Where the Red Fern Grows tells the exciting story of 10-year old Billy living in the Ozark Mountains during the Great Depression. He likes old rock and roll by artists like Bob Seger, Boston, the Beatles, Eagles, and Journey just to name a few. Independence Day is his all time favorite movie and absolutely any movie with Julia Roberts. He enjoys watching all sports, camping, golf, cooking and to keep fit lifting 12 ounce cans. If he could own any car he would have a 1970 HEMI Cuda, which he says is an awesome muscle car and worth just a little bit of money. Brian has been involved in the Phoenix Parts Guild for fifteen years and was their Secretary-Treasurer from 2000-2005. He feels that he is very fortunate to be part of a team assembled that was one of the top 12 dealers in purchases from 2000-2005. Brian has been a Mopar Master member for the past six years and was on the Reynolds & Reynolds committee in 2004 and 2005. He states “The friendships that I have made through the Guild have impacted my life to be a better person as well as successful in our business.” You can contact Brian by phone at 800-253-2021 and by email at joyntb@autonation.com . Submitted By: Dan Murphy


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Vendor – Member Profile Rex Watkins Interstate Batteries I want to introduce you to Rex Watkins who is from one of our new supporting vendors for 2007, Interstate Battery Systems of America (ISBA). Rex is the Senior National Account Manager and is based in Dallas, Texas. He has been with Interstate for eight years as National Accounts Manager and now as a Senior Account Manager. Prior to Interstate, he worked for Quaker State as a Sales Representative, a Distribution Manager in the Rockies, and a Division Manager for Texas, Oklahoma, Arkansas, and Louisiana. Rex has been married to his wife Cathy for 20 years this June. They have three great kids, Bailey 16, Chandler 13, and Delaney 9. His favorite authors are Clive Cussler, who is the grand master of action adventure novels, Tom Clancy, author of bestselling political thrillers, and best known for his technically detailed espionage and military science storylines set during the Cold War, and J.K. Rowling, best known for the Harry Potter fantasy series. Favorite movie is The Abyss which is set in the deep sea and is a great flick except for the part about breathing fluids to survive underwater. He enjoys classic rock and his much loved artist is his daughter Delaney. As far as staying fit Rex says “At this point in my life, golf is about the only thing my body will allow me to do.” He was an avid softball player for twenty plus years, but the knees are gone. Any spare time they have as a family is dominated by the kid’s sports activities which include fast pitch softball, football, basketball, and soccer. He says it seems that they are always at some field or gym. ALWAYS!! He enjoys movies and reading to relax. He says “if I have a special talent (at least my son thinks so) it is being able to remember names of bands, band members, etc. after just hearing a little bit of the classic songs.” (Hmmmm – it sounds like we need to work on a challenge to test this talent.) When it comes to naming his car of choice he would chose an original Cobra or Shelby Mustang as his toy. In his opinion the classic muscle cars. His rule of thumb in reality is a vehicle that will hold the most people and equipment. Rex states that “Respect and integrity are of high importance to me. As a result, I am very protective of my word. If I give it, mean it!” He is proud of building a reputation as someone that is trustworthy enough to be responsible for key accounts such as the Mopar program. Rex is extremely pleased to be involved with the Mopar Masters Guild and looks forward to working together to build a better battery program. You can contact Rex by phone at 972-715-6612 or by email at rex.watkins@isba.com . Submitted By: Dan Murphy


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NY Shop Files $40 Mil Suit against Progressive for Illegal Steering New suit details multi-year scheme motivated by 'money and greed' to knowingly mislead its insureds. North State Custom of Bedford Hills New York has filed a lawsuit against Progressive Insurance and several of its appraisers and adjusters for illegally steering collision repair customers to the insurer's DRP shops. The suit is claiming $40 million dollars in damages. Based in Bedford Hills, NY, North State has been in business for over 30 years. Today it operates a state of the art facility large enough to house eight frame racks and two downdraft spray booths. Under the leadership of its founder and President, Greg Coccaro, North State has also earned the distinction of being a certified aluminum structural repair facility for the Mercedes Benz CL Class, and the Jaguar XJ8. The suit, filed in the Westchester County Supreme Court of the State of New York, alleges that since 2001, Progressive engaged in a massive scheme whereby it steers its insureds to its DRP shops by making claims that the non-DRP independent shops might not be guaranteed, or fully covered, or overpriced, or that the work will be unduly delayed. Specifically, the suit claims that Progressive knowingly made, and continues to make, misleading and false or exaggerated statements concerning North State in an effort to coerce the claimant to have their car repaired at Progressive's DRP shops. The North State complaint also states that Progressive habitually coerced vehicle owners to have their vehicle removed from North State and brought to a DRP shop after telling them that North State is not a reputable body shop. North State describes Progressive's scheme to steer customers as being motivated by money and greed without regard for their insured. There are eight separate causes of action contained in the lawsuit ranging from Negligent Misrepresentation to Common Law Fraud. The suit also alleges that Progressive has committed unfair claims practices in New York State, specifically violating the state's steering regulations. The New York state Auto Collision Technicians Association (NYSACTA) issued a statement in support of the North State suit Saying NYSACTA strongly believes in the enforcement of steering laws calling illegal steering by insurers "the major defect in the current system of (Continued on page 7)


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claims handling." Ed Kizenberger, NYSACTA Executive Director said, "These are very serious allegations. Should these prove true it would substantiate many complaints that have been filed regarding illegal steering in New York State." The law suit alleges a laundry list of claims against Progressive but illegal steering is the main focus of those claims. Inside the 42 page document, North State details some specific practices of Progressive and its employees, alleging that Progressive and its employees have repeatedly told claimants that North State inflates its estimates and they will not pay North State's estimates. The court document details the practice: "Typically, the defendant will claim that it will only pay 50 percent of North State's estimate, and thereby effectively steer the insured/claimant to remove his or her vehicle from North State in favor of a Progressive DRP repair shop. Once the vehicle is removed, the DRP's final invoice for repairs is substantially similar in price (although not workmanship) as that offered by North State." Mike Orso, President of NYSACTA said, "We all know the tricks and games that are being played by a majority of the insurance companies, their appraisers and adjusters. The inside information obtained in this lawsuit only confirms our suspicions; understand this is only one company. The collision industry needs to rise-up and support not only North State Customs but realize this type of illegal steering is the root of every single industry problem. Today is the first day of the rest of this suit." Other claims detailed in the suit include: • Progressive sent person(s) who were not qualified to issue damage repair estimates to appraise the damage to its insured's vehicles. • Progressive failed to inform its insureds that its employees were not qualified to appraise high end vehicles and issue damage reports/appraisals concerning those vehicles. • Progressive, with intent to deceive, does not properly and professionally evaluate the damage to its insured's vehicle • Progressive intimidates and bullies claimants into the mistaken belief that they shall be required to make substantial out of pocket payments for the repair of their vehicle (unless they select a DRP facility). • Progressive rewarded those employees who were successful at steering and penalized those who were not • Progressive told insureds that North State would keep their vehicle for an unreasonably long period of time • Progressive told insureds that it was prohibited to come on North State's property when such was never the case. • According to the summons, dated February 13, 2007, Progressive and the defendants must answer the complaints within 30 days. Reprinted with permission from CollisionWeek (www.collisionweek.com)


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MABA Files Legislation to Enforce 1963 Consent Decree in Massachusetts State level legislation to codify Consent Decree is unique approach to enforce compliance with insurance industry agreement. The Massachusetts Auto Body Association has filed legislation that, if passed, would have the effect of enforcing major provisions of the landmark federal 1963 Consent Decree within the state of Massachusetts. A state level approach to codify relevant sections of the Consent Decree is unique. MABA believes that, in light of the unwillingness or inability of current federal officials to act, a state by state approach offers an alternative solution to enforce the 44 year old agreement. The 1963 Consent Decree was the result of an agreement between the US Department of Justice and 265 insurers affiliated with three national trade associations to settle a lawsuit brought by the DOJ, who accused the insurers of violating two sections of the Sherman (antitrust) Act. As a result of negotiation between the parties a binding "Consent Decree" was entered into to avoid a trial. In the agreement, the defendant insurers agreed to refrain from entering into any agreements or establishing any plan that would have the effect of appraiser or repairer steering, controlling how appraisers conduct damage reports, or controlling how repairs were made or the prices charged for repairs or appraisals. Massachusetts House Bill 1049, filed by state representative Robert Nyman, if passed, would incorporate into Massachusetts law Section Four (IV) of the Consent Decree. In short, Section IV of the Final Judgment, as ordered by the court, stated that insurers would not participate in any activity that recommended appraisers, steered to or away from any appraiser or repairer, control activities of appraisers, allocate markets of appraisers, or control prices paid for appraisals or charged by repair shops for damage repair or parts replacement, whether by coercion, boycott or intimidation or by the use of flat rate or parts manuals or otherwise. MABA spokesman Steve Regan explained that, over the years, many individuals and organizations have alleged that the defendant insurers, and many others, continue to be in violation of the agreement, and fought tirelessly to get the DOJ to go back to court to force compliance with their 1963 agreement. However, after years of collecting and forwarding thousands of documents and years of pleading with DOJ and Congressional officials to act on these alleged violations, little progress has been made. Unfortunately, only the DOJ, as the other party to the agreement, has the "standing" to ask the court to review whether the defendants are in violation of the agreement. (Continued on page 9)


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"Clearly, there are many obstacles to getting Consent Decree violations addressed by the federal government," said MABA spokesman Stephen Regan. "However, that does not preclude individual states from passing laws based upon the language in the Consent Decree. Language, mind you, that was agreed to by the insurers. They agreed the activity was illegal and agreed to no longer engage in those activities. A lot of individuals and organizations have been fighting for years to get these violations addressed. This is just another angle, limited to Massachusetts, to get insurers who are bound by this agreement to comply, as well as address the ongoing problem of inappropriate insurer control of the collision repair industry," Regan added. In the original lawsuit leading to the Consent Decree, lawyers for the DOJ alleged in a civil complaint that insurers engaged in a conspiracy in unreasonable restraint of trade and commerce in the adjustment and settlement of automobile property insurance claims. The complaint said that their offenses caused the elimination of competition in the adjustment and settlement of automobile claims, in the automobile damage appraisal business and in the automobile damage repair business. Some of the effects on the market noted by the complaint included repair shops 'which refuse to accept the sponsored appraisers' estimate have been foreclosed from a substantial segment of the automobile damage repair business; and prices charged by shops have been subjected to collective control and supervision by defendants and co-conspirators.' Some of the specific offenses committed by insurance companies and noted in the complaint included: inducing member companies to channel automobile material damage repair business to those repair shops which will, and boycott those repair shops which will not: (1) Accept the sponsored appraiser's estimate as to the cost of repairs; (2) Give a price discount on replacement parts; (3) Maintain hourly labor rates at a figure which is considered the lowest possible rate in the area; and (4) Accede to the sponsored appraiser's determination of time allowances. While the agreement was clearly binding on the defendants, Regan points out that it also stated, "The provisions of this Final Judgment shall be binding upon each defendant and upon its officers, directors, agents, servants, employees, committees, successors and assigns, and upon all other persons in active concert or participation with any defendant who shall have received actual notice of this Final Judgment by personal service or otherwise." Massachusetts House Bill 1049 is expected to be assigned to the Joint Committee on Financial Services. No action has yet been taken on the measure. Reprinted with permission from CollisionWeek (www.collisionweek.com)


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Scelzi to step away from drag racing at conclusion of the 2007 season By Rob Geiger Sr., NHRA.com Senior Editor 4/17/2007

Four-time NHRA POWERade Drag Racing Series champion Gary Scelzi, one of the most popular drag racers in history, will stop racing at the conclusion of the 2007 season. The 46-year-old father of two young boys, Dominic and Giovanni, is leaving the door slightly open for a possible return, although he says his main priority in the coming years will be to his family and rapidly expanding truck body manufacturing business. "My family has sacrificed a lot to allow me to chase my dream," said Scelzi, driver of the Mopar/Oakley Dodge Charger R/T. "Because of their support, I've accomplished everything I've set out to do in drag racing and so much more. Now it's time for me to watch my kids grow up and to be there for them every day. It's time to help my brothers full-time with the business. It's time to hold my wife Julie's hand and tell her I love her every night. "Maybe I'll come back out one day and maybe I won't. I don't want to say one way or the other because who knows what the future will hold? I still love the sport and the competition very much but this is a decision I've put a lot of time and thought into and I'm completely at peace with it. I'm actually looking forward to this next stage of my life." A 40-time national event winner and one of only two racers in history to have captured championships in Top Fuel and Funny Car (along with Kenny Bernstein), Scelzi burst onto the professional scene in 1997 by winning his first two starts in Pomona, Calif., and Phoenix. A contender from the onset, Scelzi won five events in 10 final-round showing his first year out, becoming the first professional driver ever to win the championship in his rookie year. He was the overwhelming pick for Rookie of the Year. Recognized as the only driver with national event wins in the sport's four quickest categories -- Top Fuel, Funny Car, Top Alcohol Dragster, and Top Alcohol Funny Car -- Scelzi's resume includes three wins in the Budweiser Shootout, a stunning 350-177 race-day record, 55 final-round appearances, and 43 No. 1 qualifying efforts. But as impressive as his on-track accomplishments are, Scelzi is perhaps more beloved for his easy-going style and selfdeprecating humor, which has endeared him to fans across the country. His "Scelzi Sez" segments on ESPN2 are overwhelming favorites among the network viewers and his willingness to do anything from wearing silly costumes to playing practical jokes on his racing peers is legendary. (Continued on page 11)


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"I always try to have fun because I'm having fun," Scelzi said. "I never looked past the fact we're doing something very special that very few people ever get to do. We're in the entertainment business to a large extent and I have always loved making people laugh so all the goofy stuff comes naturally to me. "When the helmet's on, I'm a step-on-their-throat kind of guy, but the rest of the time I'm out to have fun. Life is too short. "It's important for people to know I made this decision well before Eric Medlen's accident. This is about my desire to spend more time with my family, period. Any other speculation would only be hurtful to the Medlen family and that would be wholly and completely unfair to them. "I'm very grateful for what Don Schumacher has done for me, hiring me when I didn't have a ride and letting me have the opportunity to be a world champion. I'm continuing my relationship with Mopar and Oakley through my USAC Midget program, so it's not like I'm leaving them. I'm not getting out of racing entirely. "Of all the accolades and accomplishments I've had, none would have been possible if Alan Johnson hadn't made that phone call to me at the end of 1996 and T. Wayne Robertson with Winston taking a chance on a no-name guy to go drive their Top Fuel car, the highest profile car probably ever. That was 'the' car, especially after Blaine Johnson's accident. I can't even express my gratitude to those people for making my dream come true. "And I'm extremely grateful to Jim Jannard of Oakley, Kevin Miller of Mopar, and Chris Cortez (Senior Vice President - Global Service & Parts, ChryslerGroup), and all the great sponsors who have supported me throughout my career." Scelzi is insistent on not letting his handlers conduct a "Farewell" or "Retirement Tour" because, as he says, "I'm not retiring." Even so, fans of the Fresno, Calif., native should make sure to say thanks to the mustachioed mischief-maker this year just in case. "Dominic is kicking butt in Junior Sprint cars and Giovanni starts go karts this summer so maybe I'll have so much fun chasing them around that I'm done for good," he said. "All I know is I don't want to get older and look back with regrets that I didn't spend enough time with my family. All the trophies don't mean that much when you stack them up next to your kids and your wife. "I'll tell you what I want the rest of this year to be like: I want to have a kick-ass racecar, I want to have as much fun with my teammates as humanly possible, I want us to run for the championship, and I want to say 'thank you' to as many fans as I can because I've had a helluva ride and it's all because of them."


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Managing Employee Turnover in Dealerships By: Bob Murray

If there is a common theme I hear from dealers today, regarding their struggles with employee turnover in their organization, is that they tend to attribute turnover issues with their inability to find good people. My general response is “well did you think they were a good fit when you hired them?” The answer to this question is almost always yes; which then begs the question; what changed? This is not an attempt of sarcasm, but rather an attempt to provoke thoughts around other reasons for why people are seeking employment elsewhere. If you think about the reasons behind chronic employee turnover, you can boil it down to core issues; those being external issues and internal issues. External issues include the quality of the labor pool, alternative job opportunities, high residency migration, etc. External issues generally contribute to the “I can’t find good people” issue. Rarely, however, do I find a dealer who considers looking internally to determine if the issue is from within. In which case, he may be finding good people; but it is the organization that is the root cause for your employee turnover. Just like performing vehicle diagnostics before performing service, understanding the root cause behind employee turnover is crucial in repairing it.

Who is leaving? Understanding who is leaving is a critical first step in understanding the root cause of turnover. What if you were to look at your organization and discover that 60% of your turnover is coming from employees who have been with your organization less than 1 year? This would indicate that you may have a recruitment issue or perhaps an orientation/on-boarding problem. Regardless of what the root causes may be (more information is required to determine the core issue) the solution is going to be fundamentally different than if your tenured employees are leaving. Consider the dealer who has over 90% retention but over 70% turnover. Simple orientation or mentoring programs could be all that is required to remedy the issue.

Why are they leaving? The reasons can vary from compensation issues to questionable ethical activity. Bottom line is rarely will you understand the reasons for why employees are leaving unless you take measures to find out. Employee satisfaction surveys, leadership assessments (i.e. 360 analysis), and exit interviews are extremely valuable in uncovering why your employees are seeking employment elsewhere. For example, employee satisfaction surveys give your employees an opportunity to confidentially inform you of issues that you may not get by walking the floor. Sexual harassment, favoritism, unethical business practices, or threatening leadership styles are not only contributors to employee turnover; but can represent a significant business risk. Employee satisfaction surveys also send a message to your employees that you care and you want to know we can be a better employer. This act alone has shown to lower employee apathy in the organization. (Continued on page 13)


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The Impacts of Employee Turnover Turnover can be just the symptom of a much larger issue. The average turnover in dealerships, as reported by DeltaTrends Inc., is over 55% across the organization with sales and service averaging over 60% turnover. Unlike other industries, auto dealerships rely heavily on CSI scores as operational metric. There is no single greater impact to CSI scores than the employees who work at your organization. Apathetic employees will consistently keep your organization from reaching its desired CSI targets. High turnover can load your organization with “green” employees who may struggle with systems and processes which can further contribute to a stifled CSI.

Gross profitability is also impacted by employee turnover. Consider the lifecycle of a sales new hire. For the first 3 – 4 weeks, your new employee is in training, drawing a salary, and represents a drag against gross. The employee is contributing $0 to the gross profit line; therefore this person represents an investment which you hope to get a return on. If this person leaves after 6 months, you will most likely not recover your investment and you get to do this all over again. Now consider the dealership whose turnover is 10% lower than his competitors. By virtue of his turnover rates, he can expect a bump in gross profit per employee and perhaps CSI. The dealer who has 50% turnover in a 60 person dealership you is turning 2 ½ employees per month. He is also doing better than most of his peers.

Where to start Similar to getting an X-ray, you need to understand the root cause or potential risks in your organization before you put together an action plan to remedy them. Furthermore, don’t be fooled by the notion that your turnover is 40% so you must be doing well. The key is to understand how you benchmark against other dealers in your area selling your brands to understand how you rate. If your competitors are turning employees at 30%, you are at a competitive disadvantage. Having your assessment conducted by an organization who works with dealerships is critical. Conducting employee satisfaction surveys should be an annual best practice just like a check-up. Just like ignoring the checkup, problems have time to incubate and fester and become much more difficult, painful and expensive to correct. Giving your employees a voice in the organization will lower employee apathy, increase employee engagement, and provide you with the insight into your organization not otherwise available. I had a dealer come to me and state he had low turnover and low CSI and questioned if an employee satisfaction survey would do any good. After having his employees complete a satisfaction survey it was determined that he was understaffed. His employees were making good money with plenty of overtime; but they were exhausted, irritable, and could not meet and could not keep up with client requests. This is an example of a simple change that yielded several benefits. Bob Murray is the General Manager of the Tax and Employment solutions organization for ADP Dealer Services. Robert_murray@adp.com


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ADP’s CustomerTouchsm Communication Services

With ADP’s CustomerTouch four methods of communication: Live Voice, Automated Voice, Email, and Direct Mail, ADP can help streamline dealership processes and improve customer satisfaction with consistent, properly timed and coordinated communications strategy. Not to mention, ADP CustomerTouch does all set-up, configuration and fulfillment. SERVICE NOTIFICATIONS - REAL TIME Reduce parts obsolescence, appointment “no shows” and improve CSI. ADP’s Service Notifications are sent in REAL TIME triggered by events in the DMS as employees do their everyday routine processes. For example, the “Service Notifications” package includes REAL TIME notification by automated voice and/or e-mail when: a special order request is receipted saving time and assuring that the customer is notified immediately to improve turnover, reduce obsolescence, and improve customer satisfaction. a scheduled service appointment is booked reducing no shows, improving work flow, and increasing repair order counts – more customer pay labor! a vehicle is ready for pick up - improving work flow, reducing vehicle rental and administrative costs, and improving customer satisfaction (Continued on page 17)


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REAL TIME automated voice and/or e-mail notifications…it’s a winner!

ADP can help out in other areas of the dealership! Here are a few other services provided through ADP CustomerTouch: Service Reminders - Recommended Service Reminders Brake, Tire and Battery Graph Support Sales to Service Purchase Thank You Extended Service Offer 1st Service Appointment Request 1st Service Visit Overdue notice CSI/SSI Survey (Live Voice) Quick 2 question survey 6 Question Survey Service Reminder Follow Up (Live Voice) Unsold Prospect Follow-up (Live Voice) Welcome/Introduction to Service Letter

For further information about these highlighted services or our other packages contact: Ray Alther ADP’s CustomerTouch Phone: 847-485-4886 Email: Ray_Alther@adp.com


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Our Supporting Vendors Support those who support you


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Our Supporting Vendors Support those who support you


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Parts Barcoding Inventory Management from Reynolds Save Time. Reduce Errors. Enhance Your Bottom Line. Parts Barcoding Inventory Management is a handheld wireless scanning device and software program for use with the ERA® dealership management system from Reynolds and Reynolds. It can help turn your parts department into a more profitable and efficient part of your business. By using this tool in your parts area, you can: • Eliminate manual data-entry errors • Improve productivity by reducing parts receiving and parts physical inventory time by up to and over 50 percent • Increase your customer satisfaction with special order parts receiving notification and labeling • Enhance your bottom line by cutting costs for manual labor, especially during physical inventories

In Spring 2007, Reynolds conducted a case study looking at a diverse sample of dealerships across the U.S. The results? Real, measurable ROI for dealerships using the Parts Barcoding Inventory Management solution: • The average parts department saved more than 62 percent of amount of time it takes to receive parts versus manual receipting • That time savings equates to 1.8 minutes per parts line • So, if your parts department receipts in at least 800 part lines per week, you will achieve your Return On Investment in less than 12 months!

Furthermore, Parts Barcoding Inventory Management’s wireless scanner integrates seamlessly with the DMS, so your ERA parts inventory file reflects the updated quantities right after a part is scanned. This allows you to fill customer requests more quickly and increase turn around time between the parts department and service. In addition to Parts Barcoding Inventory Management, Reynolds offers Parts Barcoding Point of Sale to help parts departments further eliminate data entry errors and reduce the amount of time spent filling parts over-the-counter retail and wholesale sales and technician requests. For more information on Reynolds’ Parts Barcoding Inventory Management Technologies, contact Steve Graham at (937) 485-8236 or stephen_graham@reyrey.com or visit www.reyrey.com.


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Tidbits Welcome back to North America It wasn't a marriage made in heaven. In fact, German investors learned how to lose tens of billions of dollars in less than 10 years. And it cost them only $700 million more at the end to be able to get rid of all those liabilities. Now Chrysler is coming back to North America FIXING CHRYSLER First, make the dealers happy. Then call upon a proud design heritage, make some smart alliances and take some cues from the Japanese. Soon Chrysler group CEO Tom LaSorda will be free from the shackles of quarterly sales reports, meddlesome Germans and nosy journalists. A couple of months from now, Cerberus Capital Management is expected to complete the Chrysler acquisition - a deal that will unravel the DaimlerChrysler merger and create a privately held car company. Chrysler sale may accelerate dealership closings The news that the private equity firm Cerberus Capital Management is slated to acquire Chrysler has prompted some industry watchers to predict that many more dealers will be put on the chopping block, according to a report on National Public Radio. Chrysler wants its dealers to have larger geographic territories, a broader customer base, and less competition with others selling the same brand. The aim: More sales and higher profits. Some industry watchers suggest that Chrysler needs to eliminate 1,000 more dealers as part of its long-term strategy. Detroit 3 consolidate more stores GM, Ford Motor Co. and the Chrysler group are pursuing consolidation programs aimed at creating fewer, more profitable dealerships. This year's Automotive News dealership census suggests those plans are substantially reducing the number of Detroit 3 retail outlets. Will 3 tops keep Sebring on top? With the 2008 Sebring convertible, Chrysler is breaking with an industry tradition in an effort to keep its leadership in the drop-top segment. Chrysler is offering three convertible tops designed to cover the budgets and motoring needs of a wide range of customers. The vehicle went into production on March 14 and will go on sale in early May. New ads aim to elevate Chrysler brand Out goes the old slogan; in comes the new. The question is: Will a change in advertising lift the struggling Chrysler brand? This month the new tag line, "Engineered Beautifully," replaces "Inspiration Comes Standard," which has run since April 2004. The new hellhound of Motown Detroit was full of happy recently after Cerberus Capital Management agreed to pay DaimlerChrysler $7.4 billion for the Chrysler group. But the name is more than a little bit intimidating. In Greek mythology, Cerberus was the flesh-eating hellhound who patrolled the gates of Hades – YIKES!!! Survey: 60- and 72-month loans continue to increase The use of long vehicle loans is rising sharply, a new survey of 24 leading auto lenders suggests. Loans of more than 72 months account for 17 percent of the lenders' new-vehicle loan business, up from 9 percent last year and 7 percent in 2005, according to the survey released last month by the Consumer Bankers Association. (Continued on page 27)


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(Continued from page 26)

Smart USA takes ForTwo orders online Smart USA has let some "insiders" dole out $99 each to reserve ForTwo minicars, but the company won't say how many orders it received. Smart gave the 46,000-plus people who registered on its Web site, www.smartusa.com, first dibs on reserving one of three ForTwo models. Toyota races to match model mix of Tundra to the market Three months into the launch of its redesigned Tundra, Toyota is scrambling to revamp its model mix and make a series of other fixes on the run. Toyota executives admit they have made missteps in their first venture into the full-sized pickup fray. VW’s Piëch poised to get 5 more years as supervisory board boss Ferdinand Piëch is expected to be voted in for another five-year term as Volkswagen group’s supervisory board chairman at the company’s annual shareholders meeting in Hamburg, Thursday, April 19. The move will cement the Piëch-Porsche family’s control of VW. Here come India's pickups -- but maybe not from India When the first Indian-brand pickup arrives in the United States in 2009, it might have been built somewhere else -- maybe even in the United States. Indian automaker Mahindra & Mahindra Ltd. says the 25 percent U.S. tariff on imported pickups could force it to move pickup production out of India to a location that is not subject to the tariff. Halberstam foresaw Japanese ascendancy Writer David Halberstam died in a motor vehicle crash last week, and the timing was ironic: He died during the same week that media reports said Toyota had overtaken General Motors as the world's top-selling automaker in the first quarter. Halberstam was among the first to dig deeply into the historic shift of fortunes in the automobile industry with his 1986 book, The Reckoning. Ex-Fiat exec: Should have sold to DCX Fiat should have accepted an offer from DaimlerChrysler to buy its auto division seven years ago. That's the view of former Fiat Chairman Paolo Fresco, who is quoted in Agnelli, a new book by French journalist Pierre de Gasquet. The book looks at the Agnelli family, which controls the Italian automaker. Hindsight is always 20/20! Chrysler group plans Hemi hybrids Put the words Hemi and hybrid together, and that's what the Chrysler group will bring to market next year. The 2009 versions of the Dodge Durango and Chrysler Aspen SUVs, arriving in dealerships in 2008, will be powered by a 5.4-liter Hemi engine mated to the dual-mode hybrid system. Will Koreans ship cheap pickups here? The proposed free trade agreement with South Korea could open the United States to inexpensive pickups. For years, U.S.-made pickups have been sheltered from foreign competition by a 25 percent tariff on imports. But if a free trade pact with Korea is approved, the tariff for pickups made there would disappear gradually.


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The wisdom of Larry the Cable Guy..... 1. A day without sunshine is like night. 2. On the other hand, you have different fingers. 3. 42.7 percent of all statistics are made up on the spot. 4. 99 percent of lawyers give the rest a bad name. 5. Remember, half the people you know are below average. 6. He who laughs last thinks slowest. 7. Depression is merely anger without enthusiasm. 8. The early bird may get the worm, but the second mouse gets the cheese in the trap. 9. Support bacteria. They're the only culture some people have. 10. A clear conscience is usually the sign of a bad memory. 11. Change is inevitable, except from vending machines. 12. If you think nobody cares, try missing a couple of payments. 13. How many of you believe in psycho-kinesis? Raise my hand. 14. OK, so what's the speed of dark? 15. When everything is coming your way, you're in the wrong lane. 16. Hard work pays off in the future. Laziness pays off now. 17. How much deeper would the ocean be without sponges? 18. Eagles may soar, but weasels don't get sucked into jet engines 19. What happens if you get scared half to death, twice? 20. Why do psychics have to ask you for your name? 21. Inside every older person is a younger person wondering, "What the heck happened?" 22. Just remember -- if the world didn't suck, we would all fall off. 23. Light travels faster than sound. That's why some people appear bright until you hear them speak. 24. Life isn't like a box of chocolates. It's more like a jar of jalapenos. What you do today, might burn your butt tomorrow.


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THE GUILD MOTTO

“THE EXCHANGE OF INFORMATION BY LIKE SIZE DEALERS IN A NON COMPETITIVE ENVIRONMENT” This is the reason the Guild exists. The strength of our existence relies not on the voices of a select few, but on the combined knowledge of all. With this in mind, everyone should remember to become as pro-active as possible. The Guild is YOURS, be proud of it and be part of it!

2007 Mopar Masters Guild Executive Committee Gerry Oakes Roy Benner Brent Hoge Mike Gerber Marvin Windham Alan Yancey Rick Monteiro Dan Hutton Robbie Jackson Steve Hofer

President Vice President Treasurer Secretary

Baxter Chrysler Allen Samuels Dodge Larry H. Miller CJD Eastside CJ Don Drennen Chrysler Hayes Chrysler Jack Powell Chrysler Dodge Tom O’Brien Chrysler Salsbury’s Dodge City Park Jeep

Guild Committees Membership Committee

Vendor Chairman Newsletter Chairmen Performance Group Chairman Finance Committee Chairmen Reynolds and Reynolds

ADP

Snap-On Business Solutions OEConnection Dealer Tire Hanel Storage Interstate Batteries

Full Circle Solutions

Mike Gerber Dan Murphy Steve Hofer Larry Morris Robbie Jackson Paul Allred Dan Murphy Don Cushing Ole Olson Roy Benner Brent Hoge Paul Allred Tom Watson John Gilbert Rick Cutaia Larry Morris Jim Stoneman Roy Benner Steve Hofer Mike Mulkins Tommy Thrift

Eastside CJ Earnhardt CJ Park Jeep Franklin Sussex Auto Mall Salsbury’s Dodge City Metrolina Dodge Earnhardt CJ Bald Hill Dodge Chrysler Elk River Ford-Dodge Allen Samuels Dodge Larry H. Miller CJD Metrolina Dodge Performance Dodge Preston Dodge Rick Hendrick Dodge Franklin Sussex Auto Mall Westoaks CD Allen Samuels Dodge Park Jeep Go Chrysler Jeep Haynes Motor Co.

Dan Hutton Tom O’Brien Chrysler Brent Hoge Larry H. Miller CJD (Dan & Brent are the chairs for Snap-on. OEConnection and Dealer Tire) Terry Doll Earnhardt Dodge Dan Murphy Earnhardt Chrysler Jeep Mark Skinner Power CJD Dan Murphy Earnhardt CJ Tom Watson Performance Dodge Tom Welz Lou Fusz Dodge Rick Stewart Commonwealth Dodge

NADA 2008 Planning Committee

Steve Hofer Rick Monteiro

Park Jeep Jack Powell Chrysler Dodge

Website Chairman & Webmaster

Mike Gerber

Eastside CJ

2007-06 June  

Gary Scelzi to Step Away from Drag Racing Also In This Issue! Pages 10-11 Page 3 JUNE 2007LEADERSINTHESALEOFQUALITY PARTS

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