ALABAMA AUGUST/SEPTEMBER 2013
I N D E P E N D E N T A U T O M O B I L E D E A L E R S A S S O C I AT I O N
MAGAZINE
Hand Motor Company D O T H A N ,
FEATURED DEALER
A L A B A M A
A M O D E R N - D AY C A R D E A L E R W I T H O L D - F A S H I O N E D VA L U E S
DALLAS, TEXAS Permit No. 2079
PAID
PRSRT Standard U.S. Postage
V I S I T
AL_0813.indd 1
U S
A T
W W W . A L A B A M A I A D A . C O M
7/19/13 11:51 AM
AL_0813.indd 2
7/19/13 11:48 AM
INSIDE 08 Finance Matters 10 Washington Update 16 Maximize Your Floorplan Potential 26 Compliance Overdrive
WHAT’S NEW
What do the industry’s top dealers have in common? A commitment to constantly learning new ways to improve their business. Don’t let the industry pass you by. Learn how to better understand your finances, improve your back-end processes and take your marketing efforts to the next level with NIADA’s Certified Master Dealer™ program!
September 25-27, 2013: Carmel, IN October 3-5, 2013: Lincoln City, OR Check out the Education section at www.niada.com for details.
ADVERTISERS INDEX
ADESA........................... Inside Front Cover Ally..........................................................9 Chase....................................................17 Manheim.com..........................................7 Manheim Nashville......... Inside Back Cover Manheim Pennsylvania...........................11. NextGear Capital....................................13. Protective................................................5. STARS GPS............................................14. United Acceptance.................................15. VAuto........................................Back Cover
OFFICE 120 VULCAN ROAD • BIRMINGHAM, AL 35209 PHONE: (205) 942-1000 FAX: (205) 942-3565 WEBSITE: WWW.ALABAMAIADA.COM TO BECOME A MEMBER OF AIADA, PLEASE CALL (800) 239-2423
NIADA HEADQUARTERS:
2521 BROWN BLVD. ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 FOR ADVERTISING INFORMATION CONTACT: TROY GRAFF (800) 682-3837 OR TROY@NIADA.COM. The Alabama Independent Automobile Dealers Association is published bi-monthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 760065203; phone (817) 640-3838. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of AIADA or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright © 2013 by NIADA Services, Inc. All rights reserved. Visit the NIADA Web site at www.niada. com.
STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com
EDITORS
J ennifer Carman • jenniferc@niada.com Andy Friedlander • andy@niada.com
ART DIRECTOR
Christy Haynes • christy@niada.com
PRINTING Nieman Printing
ASSOCIATION
NEWS
From the Desk of Ken McFarland, 2013-2014 President MAKING A REAL DIFFERENCE IN THE INDUSTRY
As an organization, I believe we are poised and ready to make a difference in the independent automobile dealers industry now more than ever before. The AIADA staff is working diligently on our image. We’ve recently updated the main office, and it’s never been more warm and inviting. We’re also more than blessed to have the staff we do. Judy Benton and Jureda Sullivan always represent AIADA in a positive and professional manner. Their top priority is meeting the needs of our board and our members, and assisting any way they can. Randy Jones had a vision and appreciation for this organization long before he ever accepted the position of executive director. The fruits of his labor were already bountiful before his first day on the job.
Charles Moring has also done an outstanding job as president this year. AIADA appreciates his leadership and he deserves a very large thank you. Local chapters are continuing to be established, and will have a profound impact on our growth and leadership in the coming years. Speakers, vendors and government officials can now be brought to the chapter meetings to inspire, educate and lead. Randy is also developing training courses for all members, to help ensure we have a solid foundation and processes to enhance all aspects of our business. Every step we take is brings us that much closer to the future. Every moment counts. So take chances and make mistakes, but don’t look over your shoulder at the past unless it’s to help mold your future.
EXECUTIVE COMMITTEE PRESIDENT Charles Moring Midland City charlesmoring@sw.rr.com PRESIDENT ELECT Ken McFarland Birmingham kmcfarland@compuhelp.net VICE PRESIDENT O’Neal Cleveland Springville onealcleveland@gmail.com SECRETARY/TREASURER Rex Canterbury Fayette rexcanterbury@yahoo.com CHAIRMAN OF BOARD Randy Burns Gadsden rburns222@bellsouth.net DIRECTORS Barry Searcy Muscle Shoals barrysearcy@bellsouth.net John Dunn Sylacauga johndunnauto@ charterinternet.com
Lance Turner Anniston lance@peeweeturnermotors.com
Randy Crump Jasper fas_jasper@yahoo.com
Willie Colvin Tuscaloosa colvinautosales@aol.com
Larry Morris Birmingham larry@morrisautos.com
Tommy Greene Birmingham swautos@bellsouth.net
Darrin Henderson Montgomery darrinsperfection@hotmail.com
John Pigg Prattville piggenterprises@knology.net
Cary Sears Montgomery cjsears@networktel.net
Paul Claborn Albertville paul@wholesalecars.com
Heath Hendricks Greenville heath@camelliacom.com
Robert Case Hartselle robertsautosales1@live.com
Kelly Steely Hoover wksteely@gmail.com
Tim Duke Birmingham timdukeauto@gmail.com
Pokey Brimer Oxford pbrimer6@gmail.com
Chad Tillery Jemison jemisonauto@gmail.com
Darrel Pettie Pleasant Grove Pettie7@msn.com
Jay Saul Jasper jay@e-zautocredit.com
Association Attorneys John Martin Galese and Jeff Ingram Galese & Ingram PC 3
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 3
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
ASSOCIATION UPDATE
COME JOIN US - WE ARE GROWING! Membership in AIADA is an investment in the growth and protection of the independent automobile industry in Alabama. Between Jan. 1 and June 20, 2013, the 77 dealers and companies listed below have decided to invest in their future. We welcome you aboard and THANK YOU for becoming involved in the association.
ACCEPTANCE AUTO FINANCIAL HASSAN FARHAT MOBILE, ALABAMA
DEANS AUTO SALES & TITLE PAWN JOEL EARLY FT. PAYNE, ALABAMA
BRUCE SMITH ACCU PRINT EAST BIRMINGHAM, ALABAMA
DECATUR HWY AUTO & TRUCK SALES JOHN MITCHELL GARDENDALE, ALABAMA
DANIEL ALVARE ACTION AUTO WHOLESALE LLC LILLIAN, ALABAMA
EA AUTO SALES (DBA J.D. BYRIDER) PAUL H. SANDERS OPELIKA, ALABAMA
ADAM RUE AUTO SALES, INC. ADAM RUE MUSCLE SHOALS, ALABAMA
ELITE AUTO SALES ERIC ROBERTS FT. PAYNE, ALABAMA
ANDERSON AUTO SALES, INC. JIM ANDERSON GADSDEN, ALABAMA
ETHAN HUNT AUTOMOTIVE, LLC MAJID NASSER MOBILE, ALABAMA
ANDERSON MOTORS AUBREY & JAY ANDERSON HARTSELLE, ALABAMA
FAST LANE AUTO SALES DARRIN HENDERSON MONTGOMERY, ALABAMA
ATTALLA AUTO SALES JERRY JORDAN ATTALLA, ALABAMA
FUSAK’S TIRE CENTER, INC. DENNIS LOWERY MOBILE, ALABAMA
AUTO CREDIT, LLC BOBBY & SUSAN SIMMONS MUSCLE SHOALS, ALABAMA
GARRETT AUTO SALES SOLOMON GARRETT BIRMINGHAM, ALABAMA
AUTO LIAISON INC. JAMES CAMERON ATHENS, ALABAMA
GATEWAY ONE LENDING HANK BRILEY ANAHEIM, CALIFORNIA
BAYO MOTORS DAVID BAYODE TUSCALOOSA, ALABAMA
HALL’S MOTORSPORTS TRENT & ALLISON HALL MOBILE, ALABAMA
BENTLEY AUTOMOBILE CITY DONALD BENTLEY MERIDIANVILLE, ALABAMA
HAMILTON STATE BANK WAYNE DANIEL CARTERSVILLE, GEORGIA
BEST BUY AUTO SALES KHALED KHILIDI BIRMINGHAM, ALABAMA
HEMPHILL WHOLESALE WAYNE DANIEL ARAB, ALABAMA
BLUE HOUSE AUTO SALES KEN CROWDER & CATHY WILKERSON PINSON, ALABAMA
HOLLAND FAMILY AUTO JACK HOLLAND ADAMSVILLE, ALABAMA
C & J AUTO SALES LINDA HILYER FT. PAYNE, ALABAMA
JIMMY’S USED CARS JIMMY BROWN ATTALLA, ALABAMA
CAPITOL CITY PRE-OWNED, LLC STEVE SHALAYDA MONTGOMERY, ALABAMA
KENNY’S WHOLESALE, INC. KENNY HOLLOWAY NORTHPORT, ALABAMA
CARCO CARS, LLC RICHARD PRESTWOOD MOBILE, ALABAMA
L & M MOTORS, LLC DON MARR ALBERTVILLE, ALABAMA
CENTRAL ALABAMA AUTO SALES, LLC LES HEAD, TONEECE & STANLEY PRICE, BOBBIE PIKE MILLBROOK, ALABAMA
LA AUTOS & MORE, INC. BRUCE & BETTY DIENES KINSTON, ALABAMA
CLAYTON CAR COMPANY HERSHEL CLAYTON TONEY, ALABAMA CREDIT AUTO SALES DANIEL WAYNE WEAVER PHENIX CITY, ALABAMA
LA MOTORS TERRY LEE MCLEAN LINCOLN, ALABAMA LEE-RODGERS TIRE COMPANY BILL RODGERS BIRMINGHAM, ALABAMA
LES AUTO SALES, INC LES SCHMITT LEEDS, ALABAMA LEVI LANG LEVI’S AUTO SALES GURLEY, ALABAMA
ROBERT DENNIS AUTO SALES ROBERT DENNIS HAYDEN, ALABAMA
LONGBEACH CUSTOMS, LLC BILLY LONGSHORE HUNTSVILLE, ALABAMA MANHEIM AUCTIONS NAN POLLOCK ATLANTA, GEORGIA SCOTT MCARDLE/MISHA WHITMAN MCARDLE & WHITMAN, P.C. MONTGOMERY, ALABAMA MEMS AUTO SALES GLENN & SHELIA AVERETTE NORTHPORT, ALABAMA METRO MOTORSPORT LLC JEREMY ALLEN BIRMINGHAM, ALABAMA MID-SOUTH AUCTION ROBERT SULLIVAN PEARL, MISSISSIPPI MITCH MORGAN MOTORS, INC. MITCH MORGAN ALBERTVILLE, ALABAMA MITCHELL MOTORS TOMMY MITCHELL BIRMINGHAM, ALABAMA MO RYDERS AUTO SALES MOHAMED ELLEISSY GADSDEN, ALABAMA NATIONAL ADVANCE CORPORATION GARRY BARNES & WAYNE WILKINSON MUSCLE SHOALS, ALABAMA NATIONAL AUTO LENDERS O.F. & DANIA RAMOS MIAMI LAKES, FLORIDA NATIONWIDE SOUTHEAST LLC MARTIN E. LESS CHICAGO, ILLINOIS NITRO MOTORS, LLC W L WELCH, JR. ALABASTER, ALABAMA ORTEGA AUTO SALES LIZETH & JUAN VILLARREAL RUSSELLVILLE, ALABAMA PARKER PLATINUM MOTORS, LLC GARRICK PARKER & GABRIEL DUNCAN MADISON, ALABAMA PRICE CAR & TRUCKS SALES LLC CARL C. PRICE WETUMPKA, ALABAMA QUALITY CARS, LLC KEITH CROWLEY & KERI GILBREATH GERALDINE, ALABAMA
ROBERT L. BURT, CPA ROBERT L. BURT TUSCALOOSA, ALABAMA RUNAWAY RV SALES SAM FOLMAR DOTHAN, ALABAMA SAM’S AUTO SALES SAM FOLMAR DOTHAN, ALABAMA SOUTHERN HOME & HEARTH, INC KEN DAVIS HUNTSVILLE, ALABAMA STRICKLER IMPORTS LLC ED STRICKLER DAPHNE, ALABAMA SUPERIOR AUTOS JERRY GILES & RICHARD JOHNSON TUSCALOOSA, ALABAMA TEAM MOTOR COMPANY JONAH ALEXANDER BOAZ, ALABAMA TLS AUTO SALES LLC JEREMY BASS LEEDS, ALABAMA TOWN CREEK AUTO SALES, LLC BOBBY ELLIS TOWN CREEK, ALABAMA TRINITY AUTO SALES SHANNON MANN ARAB, ALABAMA TRIPLE E AUTO SALES EARL GRIGSBY ROGERSVILLE, ALABAMA TY’S USED AUTO SALES BISMARCK TYE BYNUM, ALABAMA UNITED ACCEPTANCE TIM VOLLENWEIDER SPANISH FORT, ALABAMA US AGENCIES TAMMU STODDART PRATTVILLE, ALABAMA USA CARS 4 SALE CINDY HOLLAND BESSEMER, ALABAMA WEST ALABAMA FORD LLC TERESA OGDEN WHEELER SULLIGENT, ALABAMA WE FINANCE AUTO SALES TONY RICHARDS & KENNETH THOMAS MONTGOMERY, ALABAMA WHOLESALE SOLUTIONS, INC CHAD POSTLE LOXLEY, ALABAMA
4
AIADA
AL_0813.indd 4
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
!
S
AL_0813.indd 5
7/19/13 11:48 AM
INDUSTRY NEWS LEGAL
NEWS
Have You Heard There Was An Oil Spill? F R O M T H E D E S K O F J E F F I N G R A M O F G A L E S E & I N G R A M , P. C .
If you’re like me, you have likely seen many advertisements by lawyers who want to help you file claims against BP as a result of the Gulf oil spill. There have been ads on TV, in newspapers, on the Internet and even in the mail. By now, most dealers should be aware of the possibility they may be entitled to receive money from the BP settlement. Surprisingly, you can recover funds even if you’re not located along the coast and/or can’t show specific losses as a result of the spill. To determine whether a business is entitled to receive settlement funds and if so, how much, Alabama has been divided into zones based on proximity to the coast. Those zones range all the way to north Alabama. Accordingly, dealers throughout the state – not just along the coast – should consider evaluating whether or not they have a claim. Ultimately, your right to recover is determined by patterns in your gross revenue between January 2007 and December 2011. If your gross revenue in the years before and after the oil spill fits one of the patterns or formulas set out in the settlement documents, you can qualify for recovery. The formulas are too detailed for this article, but basically involve showing a decrease in income followed by an increase in income. If your revenue fits into one of the proscribed formulas, you are entitled to a recovery. The amount of recovery is determined by categorizing the costs and expenses of your business; profits lost during 2010 are computed to determine the claim. In addition to lost profits, the settlement provides for recovery of an additional percentage of the loss as compensation for the economic damage suffered throughout the affected area as a result of the spill. So, where do you start? Making a claim basically involves three basic steps: gathering, analyzing and verifying data. First, an accountant or attorney should analyze your monthly gross revenue from Jan. 1, 2007, through Dec. 31, 2011, using a sophisticated software program. This analysis is typically
performed at no charge, since most legal and accounting firms ask the client to pay a percentage of the recovery and don’t require any payment at all if no recovery is made. The settlement also provides some reimbursement to businesses for fees paid to an accountant in preparing the claim. The person performing the test will need your physical address and the NAICS code which identifies the nature of your business. (The address determines the formula which must be met and the NAICS code determines whether your business is one of the few that are excluded from participation in the settlement.) If your business has more than one location, each location may make individual claims, or you can submit a consolidated claim covering all locations. Some of the qualification formulas also require a detailed analysis of your customer mix; those formulas will require more effort by you during claim preparation. Learning this at the time of the qualification testing will help you make a decision as to whether the potential claim size justifies the work required to meet the higher proof level. If your business meets the qualification threshold and you decide to proceed with a claim, you will need to provide monthly profit and loss reports, tax returns and documents showing your corporate structure. You must also appoint a representative, execute the claim documents and provide a W-9. Because the settlement categorizes certain expenses differently than customary accounting, be prepared to provide additional documentation if questions arise during the preparation process. Issues may also arise when it comes time to reconcile tax returns and monthly financial data. The deadline for filing claims is April 22, 2014. Once filed, claims are examined in order of submission. The volume of claims already filed to date has significantly extended the length of time between filing and payment, so don’t expect immediate results. Claims filed in October 2012, for example, weren’t being resolved until July 2013.
Car Buyers Use Social Media More Than Ever
Online dealership reviews on social media networks are now the most important factor in the dealership selection process according to a study of more than 2,000 recent car buyers and 650 dealerships released by automotive social media, online reputation and digital response company Digital Air Strike. The majority of car buyers included in the Spring 2013 Automotive Social Media and Reputation Trend Study said they consider review sites “helpful” in their decision as to where to purchase a vehicle. The study found that 24 percent of consumers consider online review sites to be the “most helpful” factor, a higher percentage than any other factor. Fifteen percent said dealership websites were the “most helpful.” The study also showed 81 percent of car buyers who use review sites said they look at review scores in search results, and that car buyers use the top five sites – Cars. com, Edmunds.com, Google+ Local, Yelp and Yahoo – 13 percent more than they did six months previously. In addition, 67 percent of car buyers search for local businesses using mobile devices. u FOR MORE INFORMATION, VISIT WWW.DIGITALAIRSTRIKE.COM.
SEMA Contest Seeks Top Young Talent
The SEMA Young Executives Network put out a call for the industry’s most promising young entrepreneurs to compete in the inaugural SEMA Launch Pad competition. The competition offers executive-level innovators younger than 40 a platform to showcase their business plans for marketing new automotive products or services. “Our industry is made up of innovative visionaries,” SEMA Launch Pad project manager Bryan Harrison said. “Through the SEMA Launch Pad, we’re hoping to discover new leaders who will pave the way to the future. We’re looking for folks to follow in the steps of the pioneers who started our industry nearly 50 years ago.” The five finalists will compete in a live event at the 2013 SEMA Show in Las Vegas, where they will make a business pitch to a judging panel of industry leaders. The winner will receive a booth at the 2014 SEMA Show, an ad in Hot Rod or 4-Wheel & Off-Road magazine, web design, graphic design, PR consultation packages and more. u FOR MORE INFORMATION, VISIT WWW.SEMA.ORG/LAUNCH-PAD
6
AIADA
AL_0813.indd 6
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
AL_0813.indd 7
7/19/13 11:48 AM
FINANCE M AT TERS
Dealer Finance Departments Install Glass Cubicles U N D E R S TA N D I N G T H E F U L L R E AC H O F YO U R F & I P R AC T I C E S
Documenting your actions and exceptions in each loan file will no doubt provide a future resource to defend your actions, but it could also illustrate your track record of success. Remember that lenders’ loan review proxy services are, by necessity, based on assumptions.
Today, more than ever, it’s evident that what happens in your dealership’s finance office has far reaching implications for your overall business and lender relationships. In recent months certain practices have once again come under scrutiny, challenging dealers to take a closer look at decisions being made within their finance departments and how those decisions might impact their lender relationships. The rate markup issue, for example, seems to resurface every few years; most recently, it has drawn the attention of many state legislators and the Consumer Financial Protection Bureau (CFPB). Although the CFPB doesn’t regulate dealerships, it does regulate lenders, including those who indirectly fund the very auto loans that keep the industry afloat. The CFPB is challenging lenders to be more proactive in regulating dealer actions when contracting with customers. Lenders have always tracked individual dealer portfolios from a performance perspective on charge-off and delinquency rates and the ultimate yield. They are now being asked to go a step further and look for trends that may indicate discrimination, disparate impact or disparate treatment to protected individuals, which might indicate fair lending violations. Dealers need to be aware of the ways lenders might be reviewing and monitoring their loan portfolio and what information they may be asked to provide as a result. Lenders will be looking for trends associated with how rate markups are applied and how back-end products are sold. Lenders do this by using different loan review services that offer a proxy, wherein the personal information gleaned from credit applications and loan documents is fed into a reporting system that makes associations and assumptions based on various attributes such as first name, last name and address. The resulting report can show how rate markups are applied to a given individual protected class within each dealer’s loan portfolio. For example, it may show that at a certain dealership, non-protected classes received only half-point rate markups, women received one point rate markups, and Hispanics received one and a half point rate markups. Even if the dealership had no intention of discriminating or creating disparate practices or impact, the bottom line is that if individual groups appear to have been treated differently, it can be enough to warrant further action. Once a lender is made aware of a possible disparate impact, the lender must take action. Many lenders may choose to simply terminate the relationship with the dealer. Others may
be willing to work with dealers to resolve the issues, in which case they must work together to explain, and develop a corrective action plan to reverse, the trend. So what does all of this mean to you as the dealer? For starters, you need to ask yourself: • Why are we doing what we’re doing in the finance office? • How do we determine which lender will receive a credit application? • Does everyone get offered the same amount of rate markup when it is available from the lender? • Do we have a written rate markup policy and are our employees aware of the policy? • When we do make rate markup exceptions, do we document why we made an exception? Being able to answer these questions could help you avoid the loss of a lender relationship. The fact of the matter is that dealers are already required to comply with the Equal Credit Opportunity Act, so they should already be addressing these issues. It is also just a good business practice. Having a written policy that dictates how your finance office operates, applies rate markups, prices back-end products and distributes credit applications to lenders will help you track performance and better manage your business. Documenting your actions and exceptions in each loan file will no doubt provide a future resource to defend your actions, but it could also illustrate your track record of success. Remember that lenders’ loan review proxy services are, by necessity, based on assumptions. As a result, the reports are subject to errors, and some error rates may be substantial. Dealers may need to defend their ECOA compliance against proxy service reports of unknown accuracy. Having solid compliance policies, practices and oversight may provide the best and most accurate defense to a lender’s unfavorable proxy service report. You may be feeling pressure to look through the cubicle walls of your finance department, but the first step toward managing your risk is understanding the fair lending regulations and the ECOA. Once you have a basic understanding, you can begin to create a manageable policy where exceptions will be transparent to you and your lenders. The last step is sharing the expectations of your lender, fair lending regulations, ECOA and your policy to your employees. Ultimately, accountability for communicating expectations to your staff and measuring their performance is critical to success.
BY CHET HEUGHAN
CHET HEUGHAN IS A DIRECTOR OF INDIRECT LENDING FOR WOLTERS KLUWER FINANCIAL SERVICES. FOR MORE INFORMATION , VISIT WWW. WOLTERSKLUWER.COM/INDIRECT.
8
AIADA
AL_0813.indd 8
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
AL_0813.indd 9
7/19/13 11:48 AM
WASHINGTON UPDATE
NIADA Government Report
KEEPING YOU INFORMED WITH THE LATES T GOVERNMENTAL ISSUES AND ACTIVIT Y IN THE USED CAR INDUS TRY
Here’s a rundown of some of the latest governmental issues and activity affecting the used car industry from NIADA regulatory counsel Shaun Petersen and NIADA lobbyist Sante Esposito. REGULATORY REPORT Consumer Financial Protection Bureau Responsible business conduct: The CFPB released a bulletin called “Responsible Business Conduct: SelfPolicing, Self-Reporting, Remediation and Cooperation,” which said the bureau will give businesses under investigation “credit” for self-policing, self-reporting, remediation and cooperation when determining how to resolve a case. The bulletin focused on businesses taking proactive steps to prevent violations, reporting violations once they have been discovered and implementing procedures to insure violations do not occur again. It outlined specific questions the CFPB will ask about the business’ actions – or inaction – before, during and after the investigation. The bulletin is available at www. consumerfinance.gov/guidance. Lenders cited: The CFPB ordered US Bank and Dealer Financial Services to end what it deemed unfair and deceptive practices in a program aimed at junior members of the U.S. military who had not yet established credit. The lenders were cited for failing to disclose a finance charge, misrepresenting the cost and coverage of service contracts and GAP policies, and charging interest during the lag time between a payment being deducted from a service member’s paycheck to when it was credited. As part of the settlement, US Bank will refund all processing fees and interest that accrued during the lag time. DFS agreed to improve its disclosures, especially related to the cost of additional products. The ultimate restitution will cost US Bank and DFS approximately $6.5 million. Supervisory authority rules: On June 27, the CFPB issued its final rule outlining how CFPB determines whether a nonbank poses a risk to the market. The rule has the potential to impact our members that are not otherwise defined as a larger market participant if they pose a risk to the market.
After accepting comments, including some from NIADA, the CFPB made few changes from its initial proposed rule. If the CFPB staff has “reasonable cause” to believe the entity is a risk, the deputy director will send a written notice and explanation to the entity, along with a summary of supporting evidence. The entity will have a chance to respond in writing and to participate in an informal hearing, by telephone or in person, with CFPB staff. After the hearing, the associate director could submit a written proposed order to the CFPB director to bring the entity under the supervisory oversight of the CFPB. If the determination is made to supervise the entity, the CFPB would do so for a minimum of two years and can make a petition to be relieved of that obligation after that. It is unclear how the CFPB will begin to assert jurisdiction based on a risk determination. However, it is anticipated that risk-determination based supervision will commence immediately. Disparate impact: In recent weeks, two groups of congressmen – one from each party – sent letters to CFPB director Richard Cordray regarding the bureau’s March bulletin claiming indirect auto lending could lead to discrimination as evidenced by disparate impact. Cordray responded to the Democrats’ request for information about the CFPB’s methodology, saying the CFPB has found instances in which lenders had strong fair lending programs for mortgagerelated lending but no compliance programs or weaker ones for other consumer lending products. The letter from 35 House Republicans raised concerns about the lack of public comment on the CFPB’s analysis and encouraged the bureau to be cautious in asserting its theory given the reliance on statistics and lack of any intentional misconduct. The Republicans asked the CFPB to provide detailed information concerning its methodology in finding its statistical disparate impact. FEDERAL TRADE COMMISSION Debt collection data workshop: The FTC, in conjunction with the CFPB, held a roundtable with industry and consumer advocates to discuss issues concerning debt collection and debt sales. The discussion focused on the lack of communication between the original creditor and the second or third debt buyer. Specifically, once a creditor sells a
debt to a collector, the consumer might be unaware or confused about whether the collector is legitimate. Consumer advocates noted the amount in collections often is a lump sum that includes principal, interest, fees and other costs associated with the debt and is unrecognizable to the consumer, and said the company the consumer does business with is often different from the name listed on the collection notice. Both sides agreed the required information in debt collection notices should be tweaked to better inform the consumer of the debt owed. The FTC and CFPB will use the information in crafting future changes to debt collection laws and regulations. Red Flags Rule business guide: The FTC revised its guidance document to help businesses comply with the Red Flags Rule. The guidance explains which businesses are required to comply and what is expected from them to protect consumers from identity theft. To read it, visit http://business.ftc.gov, then click on the “Privacy and Security” tab. State Law Pending legislation: Two states – California and New York – have legislation in the works involving the sale of vehicles with open recalls. California’s would prohibit dealers from offering for sale a new or used vehicle subject to a manufacturer’s recall unless the recall work is performed. New York’s would require dealers to search for recalls before selling a used car to either make the required repair or disclose the recall in writing to consumers. New York is also considering a bill to require manufacturers to make the same diagnostic and repair information and tools available to owners and repair shops that is available to its franchised dealers. LEGISLATIVE REPORT S.1029, the Regulatory Accountability Act of 2013 The bill, introduced May 23 by Sen. Rob Portman (R-Ohio) with eight bipartisan cosponsors, amends the Federal regulatory process by specifying issues agencies must consider in a rulemaking, notice requirements, public comments, hearing procedures, judicial review and final rulemaking. It has been referred to the Committee on Homeland Security and Governmental Affairs. Sen. Portman introduced a similar bill during the last Congress.
10
AIADA
AL_0813.indd 10
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
AL_0813.indd 11
7/19/13 11:48 AM
COVER STORY AUCTION
SPOTLIGHT
DEANCO AUTO AUCTION
Deanco Auto Auction is an independently-owned auction operated by Donnie W. Dean. A second generation auctioneer, Donnie grew up in the auction business and received his auctioneer license in 1982. He worked sales as an auctioneer before opening his first equipment sale in 1989. In 2001, Manheim closed their facility in Dothan, which up to that point had had an auto auction for over 60 years. Seeing a void in the market, Donnie opened a small auction in January 2002. Later that year, he was able to purchase the closed Manheim facility, and Dec.11, 2002 conducted the first sale in Deanco’s new location. Primarily a consignment auction, Deanco currently runs 300 to 350 units per week. The average conversion (sold) rate is 66 percent overall, although currently 11 of the top 35 sellers have an average conversion rate of 90 percent or above. The sale starts at 10 a.m. every Wednesday, with Mitchell Group (Mazda, Hyundai, and Nissan) and Bill Cramer Chevrolet Cadillac featured on alternating weeks. In-op and specialty sales are held bi-weekly at the end of the regular sale. All of Deanco’s lanes are offered to online buyers via LiveBlock. Deanco offers fleet lease units weekly, including Tyndall Federal Credit Union, Army Aviation Federal Credit Union, Five Star Federal Credit Union, Navy Federal Credit Union, FLEXCO, ARI, ARMS Across America, Credit Acceptance (VRS) and many more. Deanco offers full service to fleet accounts, including reconditioning, condition reports with photos, AutoIMS, mechanic and frame inspection. Deanco’s employees are key to the auction’s success, and their longevity is just one indicator of their professionalism and dedication to the dealers and the auction itself. Bernard “Bo” Bowskill (front office), Valarie Grooms (registration), and several drivers have been with Deanco since its inception in December 2001. Phillip “Freddy” Mayne (lot/driver supervisor) started in December 2002, Holly Roettgen (office manager) in July 2004, Tonja Bastien (title clerk) in October 2004 and Renee Shields (fleet lease manager) in August 2007. These employees are the driving force behind the auction. Deanco also has four outside sales representatives: Diane Christian (2003) works the Panama City, Fla., area; Carolina Johnson (2003) visits dealers from Marianna, Fla., to Troy, Ala. Billy Gray (2004) travels from Dothan to Albany, Ga. The newest member is Andy Lee (2013), who works east of Panama City to Tallahassee. In 2007, Donnie hired Kelly Terrell to manage Deanco Auto Auction of Montgomery. Kelly started at Greater Pensacola Auto Auction March 1996. A month later, the auction was purchased by Manheim, where Kelly worked for 11 years as a clerk, MAFS manager, business manager, fleet lease manager, office manager, and TRA (salvage) manager. When CoPart Auctions purchased the Montgomery auction, Kelly stayed on with Deanco in Dothan. In August 2010, she became the general manager at Deanco. Kelly is a strong advocate for the independent dealers. The people at Deanco know franchise/fleet lease brings buyers to a sale, but independent dealers are the foundation that keeps the auction stable. Deanco Auto Auction and Donnie W. Dean are proud supporters of the Alabama Independent Automobile Dealer Association and its members, offering and giving support whenever it is needed. It is with great pleasure that we are able to feature some insight to their very successful auction. We encourage you to stop by and check out their sale every Wednesday at 10 a.m.
FEATURED
DEALER
HAND MOTOR COMPANY
– DOTHAN, ALABAMA
If you’ve ever traveled 431 south through Dothan, Ala., (the gateway to the Gulf Coast beaches) then you probably saw the classic cars, late model trucks and SUVs that fill the lot at Hand Motor Company. Danny “Flat Top” Hand, owner of HMC, started out in the car business at a time when your word was your bond and a handshake meant something. That’s still Danny’s motto today – he’s a modern-day car dealer with old-fashioned values. Danny has one of the largest customer bases in the Wiregrass because once you meet him, you’re not just a customer – you’re a friend. Danny takes pride in getting a vehicle frontline ready to sale, and believes a big factor in HMC’s success is the process by which vehicles are reconditioned. It starts with a vehicle being serviced and having any mechanical issues addressed. The detail process includes being pressure-washed on a four-post rack and undercoated. The final step is the most important to Danny. He believes if a vehicle looks good enough, it will sell itself; it’s no secret that HMC has the nicest, cleanest inventory in the Wiregrass. As a second-generation family-owned business, Danny has passed down a legacy of hard work, honesty and integrity to his sons, Kyle and Chad. Kyle manages the retail and wholesale operations along with inventory. He was not only born and raised in the car business, but has more than 17 years of experience in the auto industry. He’s constantly looking for new methods for obtaining inventory, including advertising to the public: “Need Cash? We Will Buy Your Vehicle.” Kyle has bought vehicles from people as far away as Arizona, Kansas and Michigan – no distance is too far if the quality and price are right. Chad manages accounting and finance, and is involved in most deals at HMC. He has also been raised in the car business, with more than 14 years of experience in the industry. One of the most important aspects of any business is having someone you can trust in the business office. Many customers have commented that the buying experience at HMC was one of the quickest and easiest transactions they ever experienced. This can all be attributed to Chad and his quick and well-organized process. HMC also runs very lean, with only two additional salesmen and a total of 10 employees – all of whom contribute greatly to the success of the company. HMC recently launched HMC Motorsports, which offers vehicle restoration, reconditioning and a full-line speed shop. This addition has been successful, and has also added more classic car sales and foot traffic. HMC’s inventory is available to all dealers and can be viewed on the company website at www. handmotorcompany.com. HAND MOTOR COMPANY IS A QUALITY INDEPENDENT DEALER THAT EXEMPLIFIES THE VALUES OF QUALITY AND INTEGRITY OF AIADA. WE ARE PROUD TO HAVE HMC AS FEATURED DEALER OF AIADA.
12
AIADA
AL_0813.indd 12
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
AL_0813.indd 13
7/19/13 11:48 AM
ASSOCIATION
NEWS
NIADA Succession Plan Takes Effect Longtime NIADA chief executive officer Michael Linn has assumed the title of CEO emeritus as the National Independent Automobile Dealers Association’s leadership succession plan goes into effect. A transition team, headed by NIADA past president Charles Teel, worked behind the scenes for more than two years to craft a plan to ensure a seamless transition in the association’s senior leadership. As part of the plan, Steve Jordan, hired by NIADA in 2011 as chief operating officer after serving as executive director of the Florida IADA, has been promoted to executive vice president. Linn, who served 14 years as NIADA’s CEO, moves into the role of CEO emeritus. The transition became official July 1. Jordan is responsible for the day-to-day operations of NIADA and will serve as president of the NIADA Services board and the NIADA Foundation’s board of trustees. He will report directly to the executive committee. Linn has relocated back to North Carolina – he served for 12 years as executive director of the Carolinas IADA before coming to NIADA – and will use his extensive background
in broadcasting and media to head the growth opportunities associated with NIADA.TV, NIADA’s Conference Broadcasting TV and other new media. “There is a lot of room for future growth in that area for the association that we are excited about.” Linn said. “To meet that demand, my primary focus will be to take the NIADA Internet TV networks to the next level.” Linn will continue to work with the NIADA executive committee and attend industry events in his new role. As NIADA’s executive vice president, Jordan’s experience as a former Buy Here-Pay Here dealer and his expertise in lobbying, governmental affairs and public relations comes into play. He continues to be responsible for growing and maintaining NIADA’s regulatory and legislative affairs programs, member services and association publications, as well as coordinating activities with the association’s state affiliate organizations around the country. “It’s such a great honor to be given this opportunity to serve the NIADA, our dealers and the automotive industry in this capacity,” Jordan said. “I am humbled by the faith and trust Mike Linn and the NIADA executive committee have placed in me to
carry the torch into the future. “I’m excited. This position suits my background, personality and professional experiences perfectly.” Chris Martin, former NIADA president and current chairman of the executive committee, said the association’s leadership is on board with the moves. “The NIADA executive committee is eager to lean on Mike’s broadcasting background to ramp up the NIADA TV networks and is thrilled to have someone of Steve’s enthusiasm, integrity and automotive industry experience steering the NIADA ship,” Martin said. “Mike Linn is leaving some very big shoes to fill, but we are all confident Steve is the right man at the right time to build on the solid foundation Mike has established during his storied career at NIADA.” Jordan has direct automotive dealership experience, specializing in Buy Here-Pay Here operations as the managing partner of J.D. Byrider’s Florida operation in Tallahassee. Previously he held positions as a political campaign manager and consultant, founder of an Internet company, account executive in Enterprise Rent-ACar’s Fleet Services division and the deputy national field director of a nationwide political advocacy organization.
14
AIADA
AL_0813.indd 14
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
LICENSING
NEWS
RENEW YOUR DEALER LICENSE ONLINE
NEWS
Starting Aug. 1, 2013, the Department’s Motor Vehicle Dealer’s Regulatory License Portal will enable dealers to begin renewing their regulatory licenses for the 2014 license year. Please note: dealers must continue to renew their license online using the Portal. At the request of several users, the Portal has been changed to allow users to enter their seven-character dealer regulatory license number in order to renew a license. The password has also been changed; renewal notices containing renewal instructions and a temporary password were mailed to licensees in the end of July 2013. To renew a license on the Portal, follow the instructions below: 1. Go to the Dealer License website: https://dealerlicense.mvtrip.alabama.gov. 2. Select Log In. 3. Enter your User ID (first seven numbers of the dealer license). 4. Enter the temporary password (provided in the renewal notice). 5. Click the Log In button. 6. Select Renew License. 7. Update and click the Save button for each section. 8. Enter your payment information and electronic signature. 9. Click the Submit button. 10. Print the coversheet and documents. 11. Mail the requested documentation and coversheet to the address on the coversheet. Motor vehicle dealers may also electronically update their dealer regulatory license information and apply for an off-site sales license using the Portal. Additional instructions are available in the dealer license system manual located at: https://dealerlicense.mvtrip.alabama.gov. If you need further assistance, please email the Motor Vehicle Division at dealerlicense@revenue.alabama.gov
Used Car Registration Share Still Strong
MARKET
From the Desk of Brenda Coone
A recent Edmunds.com/Added Value survey found that more than two-fifths (43 percent) of car shoppers indicated they are only looking at new vehicles, about a quarter (24 percent) are only shopping for used, 30 percent would consider both and three percent were unsure. However, actual registration data tells a different story. According to the 2013 Edmunds.com Car Shopping Trends Report, which examined registration data in the new and used car markets, the “actual data skews more toward used,” with used cars representing roughly three-fourths (74.2 percent) of all vehicle registrations in the U.S. Here’s the caveat, though: that 74.2 percent share was the lowest in the past five years, Edmunds said. The report also cites Polk data showing the average age gap between used and new car buyers has shrunk in the last four years: today, the average new car buyer is just four years older than the average used car buyer, compared to a 6.5 year difference in 2009.
BY JOE OVERBY SUBPRIME NEWS
15
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 15
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
INDUSTRY NEWS
How to Present Your Portfolio to Receive the Most Floor Planning Dollars The automotive industry is unique in that it is one of the few where commercial loans are abundant and relatively easy to qualify for. Whether you are just starting out, or looking to shift your business into the next gear, it is extremely likely that you will be able to find the capital you need to stock your dealership. Although there is a good chance that you will be able to acquire a floor plan line of credit, the size of that line of credit will vary depending on your business needs and your overall portfolio snapshot. Floor Plan 101: The Basics First and foremost, to qualify for a floor plan, you need to have established credit. Specifically, you should have a history of utilizing and repaying debt. Bad credit and ‘hiccups’ on your credit report aren’t always deal-breakers, but they will likely reduce the amount you qualify for. Additionally, there is a good chance that credit issues will have a negative impact on your pricing structure. The good news is that over time, with good performance coupled with adherence to the terms and conditions of any loan agreement, you can eventually overcome these setbacks. It is also important that you are not over-extended. If your credit cards are all maxed out, that is a potential red flag even if you have not paid late. Handling your available credit responsibly is essential, so be sure to maintain a substantial amount of available credit. Getting Started Thinking about opening a dealership? You will want to setup a free consultation with the floor plan company of your choosing right away. Even if you are well capitalized out of the gate, having a floor plan line of credit is an amazing asset that can help you seize opportunities as they arise. If you aren’t well capitalized, you will probably be looking at starting with a smaller initial line of credit to get your business off the ground. As you turn inventory and build your reserves, submit a formal request for a credit line increase. Growing Your Business If you are looking to grow your business through the addition of a floor plan line of credit, there are several other items that will play into the
lending decision above and beyond your personal credit history. Trade references, business credit, equity, cash, and the overall health of your business all come into the picture and become increasingly more important in your effort to acquire more floor planning dollars. The same principals apply if you are looking to increase your existing floor plan credit limit. However, there is another component that could either be in your favor or held against you: performance. You can rest assured that commercial lenders have learned a lot about managing and mitigating risk, especially over the last several years. It is crucial that you closely adhere to your lender’s terms and conditions. NSF’s, late curtailments, slow payoffs, and bad audits will inevitably prevent you from gaining the additional buying power you need to grow your business. Stay on top of managing your accounts and you will improve your chances of increasing credit limits. Also, those of you with substantial business equity should flaunt it! To a floor plan company, inventory that is owned outright is viewed similarly to cash, and is a good indicator of the viability of your operation. Business equity exhibits an enhanced capacity to repay debt. When applying for a floor plan, take the time to validate your equity position. Your floor plan company might ask to see the titles and bills of sale for everything that you currently own. Go with it! They might even ask to physically inspect your owned inventory. This will all play into your favor as finance companies prefer lending to people that already have money. The more equity you have, the lower the perceived risk. Heavy Hitters When seeking a floor plan line of credit in excess of a quarter of a million dollars, both business and personal financials will typically need to be presented as well as your standard business documents. Those financials typically include the following: 1) Personal Financial Statement (required for each owner/signer) 2) Personal Tax Return (2 years required for each owner/signer) 3) Business Tax Return (2 years) 4) Business Bank Statements (3 months) 5) Income Statement (current and prior year end)
6) Balance Sheet (current and prior year end) As you can imagine, the larger the credit line request, the greater degree of scrutiny you and your business will be given. Although you are welcome to provide a stack of photocopies, the best way to present your financials would be to scan them then send the digital files via email or USB thumb drive. Make sure everything is clearly labeled, and when applicable, provide more detail as opposed to less. Anything out of the ordinary should be accompanied by a letter of explanation. In addition to the basic requirements, or if you are requesting a large line of credit (over $250k) to stock a start-up dealership, you should be prepared to provide some or all of the following: 1) Resume (for each owner/signer) 2) Photos of Dealership 3) Business Plan 4) Pro Forma Financial Statements Presenting Bank Statements If you have had any NSF’s, those will need to be explained in detail. Also, you are going to want to make sure that your business checking exhibits positive cash flow, meaning that, in general, you have more money coming in than you have going out. Take note of your average daily balance. Hopefully this figure is strong enough to support the line of credit you are requesting. In an ideal world, you would have at least 20-30% of your floor plan line of credit in the form of cash money in your business checking account at all times. If you fall short of that mark, business equity via owned inventory can help bridge the gap. Personal Financial Statement When it comes to your personal financial statement, ideally you should have some liquid assets. Cash, 401k, IRA, CD’s, bonds, etc. are all desirable elements to have in your portfolio given that they are accessible or you may be able to borrow against them if need be. This is ideal because it demonstrates that you have reserves in place to “weather the storm” should you encounter a few bad months or an unforeseen industry shift. A word of caution: some dealer principals place an inordinate value on the shares of their dealership within their personal financial statement. Although this may beef up your net worth, a floor C O N T I N U E D O N N E X T PA G E
16
AIADA
AL_0813.indd 16
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
If your business isn’t building and growing, you probably shouldn’t be seeking more floorplan dollars. More flooring won’t turn around a failing business model. You would just be adding more fuel to the fire. Instead, focus on perfecting your operation. plan lender will probably not take that into consideration. The “real” value of your business is predicated on what a buyer is willing to pay for it. Hence, the stated value on your personal financial statement is merely hypothetical on paper. And bear in mind that if your dealership were to go into default, your shares probably wouldn’t be worth much at that point. Another item to keep in mind is that if all of your assets are in the form of equities against mortgaged real estate, you may encounter difficulties with potential lenders. Banks have become skeptical of real estate equities given the recent real estate crisis. High dollar homes and commercial properties are slow to move and hard to appraise. Don’t over-exaggerate your real estate equity on your financial statements. Be realistic. Conversely, if your property is actually worth $500k and you only owe $100k on your mortgage, this would be an entirely different story. Having
minimally leveraged or free and clear real assets should comfort a lender to some extent. Income Statements The income statement can be quite revealing, and often is used in part to determine what the true business need is when it comes to setting a floor plan credit limit. For instance, if a dealer were to a request a $500k line of credit but only turned $500k in gross sales last year, that request would surely be denied unless there were some major material changes in the operation that justified the increase. Additionally, this statement shines a spotlight on the overall sophistication of the operation. If you are generating additional revenues from F & I products and repairs for instance, that will all be itemized on this statement. Balance Sheet Simply put, the less you OWE, and the more you OWN, the lower the credit
risk. Again, banks like to lend when the probability of repayment is the highest. Having too few assets and too much debt can become a downward spiral towards insolvency. All of this ties into the overall viability of your operation. A thriving business should be building equity while reducing debt. A thriving dealer principal should be building net worth, not acquiring debt to keep their business above water. If your business isn’t building and growing, then you probably shouldn’t be seeking more floor plan dollars. More flooring won’t turn around a failing business model. You would just be adding more fuel to the fire. Instead, focus on perfecting your operation. However, if your business is building equity and turning a profit, having some additional buying power can surely help you shift into the next gear!
BY GARRETT JOREWICZ
REGIONAL DIRECTOR FOR NEXTGEAR CAPITAL.
17
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 17
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
VENDOR FEATURED
INDUSTRY NEWS
Wayne Reaves Software DEDICATION TO DEALERS, ASSOCIATIONS AND THE INDUSTRY
Wayne Reaves started Wayne’s Auto Sales in 1972 in Macon, Ga. Soon after, Wayne was paid a visit by the then GIADA executive director, Ron Widener. Wayne has been a member ever since. In 1983, he was named Georgia State Quality Dealer of the Year; he also became a lifetime wheel club member, helping to bring more than 20 dealers on board. Wayne became president of the GIADA in 1984. Wayne has always been a strong supporter of dealer education. When re-licensing education was passed in Georgia in 1982, he was named the first instructor. Through this association with new dealers, Wayne became aware of the need for a system that would allow dealers to focus on sales more than paperwork and accounting. With that, his idea for dealer management software, and the task of producing it, was born. In 1987, Wayne started Wayne Reaves Software and began to deliver his newly developed dealer management software while still running his dealership. Since then, the company has been a strong advocate for the importance of participating in state associations. Wayne has always strived be a leader in all of his endeavors. In 1988, his used car dealership was awarded the title of Small Business of the Year by the Macon Chamber of Commerce. In 2003, he was awarded the special eagle award for outstanding recruitment for the Florida IADA. In 2007, in appreciation for his efforts and involvement with the Alabama IADA, he was inducted into the Alabama President’s Hall of Fame. As recently as 2012, he was awarded an Eagle Award by the Florida IADA for recruitment of new members in the state. His numerous awards and achievements are a testament to his belief in state associations and his dedication to those associations, and the industry, over the decades. Wayne is still active in association
business. He serves on the board for the GIADA and sponsors many annual events for the Georgia, Alabama, Mississippi, Tennessee, Florida and the Carolinas associations. There can be no doubt that Wayne Reaves truly values the state associations and is a firm believer that every dealer should be an active, participating member. He believes seizing every opportunity to learn, and then applying what is learned, has made all the difference in his career. Wayne once commented it would be hard to imagine life without a state association. Where would a dealer go to learn what’s happening in this fastpaced, ever-changing industry? Who would look after the political interests of small dealers when it comes to legislative changes? In Georgia, the used car licensing board was privileged to have Wayne serve from 1982 until 2000. His natural leadership and concern for fellow dealers undoubtedly helped cement Georgia’s standing as one of the most dealerfriendly states in the country, with favorable sales tax, repossession, retail installment and title pawn laws. Today, Wayne Reaves Software serves thousands of dealers across 24 states, and Wayne has positioned his company to be the premier choice of web-based dealer software well into the future. Wayne’s son, Jason, graduated from Mercer University with an accounting degree. Armed with this degree and his knowledge of computer programming and business management – not to mention growing up in the car business - Jason also contributes to the growth of the company. The company currently employs 35 and is adding additional staff almost monthly. When most in the industry are looking to tighten their belts and cut overhead, Wayne Reaves software is still going strong. Wayne Reaves has been an integral part of AIADA for many years. He has supported AIADA at every opportunity. We wish to thank Wayne for his participation and support. We are pleased to feature Wayne Reaves Software as our featured vendor.
Jeep, Acura Have Best Retained Value
Jeep and Acura earned the top spots in Edmunds.com’s third annual Best Retained Value Awards, which recognize the brands and new car models that have the highest projected residual values after five years based on their average True Market Value price when sold new. Jeep won in the non-luxury division with a projected 50.6 percent residual value after five years, while Acura took the luxury title for the second consecutive year with a projected five-year residual value of 45.1 percent.
ACURA … CLEARLY HAS DONE A GREAT JOB DISTINGUISHING ITS VALUE IN A HYPERCOMPETITIVE LUXURY MARKET. “Jeep’s small lineup is led by two popular models – Wrangler and Grand Cherokee – that deliver big residual value for their owners,” Edmunds.com Director of Auto Remarketing Joe Spina said. “The Wrangler is especially vital to the brand because its retained value sits at an elite level matched by few other vehicles in any segment. … Acura … clearly has done a great job distinguishing its value in a hypercompetitive luxury market.” In addition to the brand-level awards, Edmunds.com issued model-level awards in 22 categories – Ford and Toyota tying for the most model winners with four apiece. u FOR THE FULL LIST , VISIT WWW.EDMUNDS.COM/ CAR-REVIEWS/BEST-RETAINED-VALUE-CARS.HTML.
18
AIADA
AL_0813.indd 18
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
New Models & Increasing Wholesale Inventory Make Price Waves in the Lanes
Though overall auction values remain relatively flat, showing small decreases here and there, increasing inventory and new models hitting the market are making waves, says Black Book’s Ricky Beggs. The midsize pickup segment saw 64 percent of its models change in price, with 59 percent of those being downward changes. Entry-level cars were also active in necessary adjustments at 54 percent, reported Beggs in “Beggs on the Used Car Market.” On the more stable side, full-size pickups had less vehicles adjusted, with only 20 percent being altered. Why so many changes? Beggs touched on a few factors that may be contributing price adjustments. “With the level of increasing wholesale inventory from the new car sales level and trades, and the many new models and major refreshed models coming into the market – especially the later model vehicles – pricing must adjust to allow for another model year of vehicles to enter the used market,” Beggs shared. Beggs shared that both cars and trucks did seem to be declining by smaller amounts than previously. Overall, car segments saw an average drop of $37 the second week in July, while trucks saw an average decline of $40. Full-size vans (both cargo and passenger versions) and the full-size crossovers, on the other hand, all saw large declines, dropping by $80 or more. Compact SUVs were the only segment to increase at a substantial rate for the first two weeks in July, rising by an average of $61, or 0.51 percent.
N A T I O N A L I N D E P E N D E N T A U T O M O B I L E D E A L E R S A S S O C I A T I O N 2521 BROWN BOULEVARD ARLINGTON, TX 76006-5203 817.640.3838 / FAX 817.649.5866 WWW.NIADA.COM
Memorandum
To: State Association Presidents & Association Executives From: Mike Linn, NIADA CEO Steve Jordan, NIADA, COO Date: June 6, 2013 RE: Anti‐trust Lawsuit Filed Against CARFAX You may be aware that the New York law office of Bellavia, Blatt, Andron & Crossett, PC has filed an anti‐trust lawsuit against CARFAX citing oppressive business practices and illegal alliances. You likely have received or will receive communication from this law firm to join or recruit the members in your state to join this lawsuit against CARFAX. NIADA was approached directly by Leonard Bellavia to participate in the lawsuit and/or recruit dealers to join. After discussing this issue with our Executive Committee, we want to share the following NIADA position and additional background:
1. NIADA has taken a neutral position on this issue and will neither encourage nor discourage dealers from participating in the lawsuit. The decision to participate or not in the lawsuit should be left to individual dealers based on their own operational practices and experiences. 2. NIADA members use a variety of vehicle history reports, including Experian’s AutoCheck, CARFAX and those provided by the National Motor Vehicle Title Information System (NMVTIS). 3. NIADA encourages our state associations to take a similar position and let your dealers make their own well‐informed decision based on their best interests. 4. NIADA is not in a position to comment or encourage comments on any perceived business damage sustained by our members based on the alleged business practices of CARFAX in this lawsuit. 5. NIADA has a National Corporate Partnership with both Experian’s AutoCheck & CARFAX. We also continue to work with many of the approved vendors who offer NMVTIS reporting.
If you have any additional questions, thoughts or concerns, please feel free to contact Steve at NIADA headquarters at (817) 640‐3838.
NIADA Welcomes United Auto Credit
NEWS
NEWS
ASSOCIATION
MARKET
M A K E M O R E M O N EY A N D G ET YO U R D EA L S F U N D ED FA S T
The National Independent Automobile Dealers Association (NIADA) has added United Auto Credit as a National Member Benefit Partner. United Auto Credit is a national nonprime to near-prime indirect automotive lender dedicated to helping its dealer partners sell more cars, make more money and get their deals funded fast. Combining cutting-edge technology and common sense underwriting, their programs produce approvals based on customer qualifications rather than FICOdriven scoring models. “Because NIADA and United Auto Credit share the common goal of making our dealer partners more successful, and ultimately more profitable, becoming a National Member Benefit Partner of the association is a natural for us,” said United Auto Credit president & CEO Jim Vagim. “The success and ability of United Auto Credit to achieve our objectives stems directly from our ability to provide value and ensure that our dealers succeed.” United Auto Credit programs include financing for customers in open and recently discharged bankruptcies – at an interest rate set to gain approval from trustees across the country; a cash income program for customers who are unable to provide regular monthly paystubs; a GPS program that enables financing of the most credit challenged customers. In addition to its finance programs, United Auto Credit also offers GAP and Warranty programs designed to protect customers and enhance their dealers’ bottom line. “We are thrilled to have United Auto Credit as our newest NIADA National Member Benefit Partner. They provide best in class sub-prime finance programs to our member dealers, ensuring that retail deliveries can be made with the confidence that their profit is intact and their contracts will be funded promptly. United Auto Credit provides programs and service that will benefit all of our dealership members,” said Scott Lilja, NIADA senior vice president of member services. To learn more about benefits included with NIADA membership, visit www.niada.com. To learn more about United Auto Credit, visit www.unitedautocredit.net . 19
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 19
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
ASSOCIATION NEWS
WHY SHOULD I JOIN THE ALABAMA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION FROM THE DESK OF RANDY JONES
Why should I join? What can you do for me? These are questions that we often get when we invite dealers to join AIADA. As you read this, maybe you’re asking the same questions. If so, also ask yourself, “Do I ever have a legal question about a sale or a customer problem or any other aspects of my business?” My guess is that you do have legal questions. But, do you know where to find the answers? If you could get access to two of the top attorneys in the nation, some of the best consultants in the nation for businessrelated questions and a network of active professionals who’ve experienced nearly every industry problem first hand, would you use it? What if that access only cost $290 per year? That’s what you get when you join the AIADA. We can and will get you the answers you need to make your business more successful. What’s that you say? You need to think about it? Okay. But, between you and me, we both know how it feels when you give the customer the deal of a lifetime and they want to wait and think about it. You feel sure nobody could pass up a great deal – but they often do. So, you need more convincing? The AIADA provides expert advice on financing, marketing, taxes, legal matters, and much more – all to help you achieve and maintain compliance. We also alert you to new or changing laws and help you understand how they can affect your business. And if all that isn’t enough, we will help you learn how to be the
best dealer you can through various educational opportunities, workshops at AIADA’s Annual Convention and other conferences. To top it off, you’ll automatically be joining a nationwide network of thousands of used car dealers who want to see your business succeed alongside their own. Together with the NIADA, we’ll work to protect your business and make used car dealers’ voices heard with Congress, the IRS, NHTSA, FTC, and others. All you have to do is attend local chapter meetings, listen and ask questions. (The meal is usually paid for by Jim Phillips and his team at ABC Auction, so you even eat for free!) Heard enough yet? At this point, most dealers have found the membership application in the magazine and faxed it over. With a strong voice that can only come from a national organization, we’ll look out for the best interests of the used motor vehicle industry, and you as a dealer. Remember, this is your livelihood - don’t leave it to chance. Joining the association is one of the most important business decisions you can make for yourself, and for the industry. We can’t do what we do without you. In today’s market, you and I need all the help we can get. I don’t know about you, but I’m not going to leave my business decisions up to the government. Yes, sometimes we need their help, but often they don’t understand how decisions impact us and our businesses. That’s where AIADA comes in – we make sure elected officials keep your well-being in mind when passing legislation.
I could go on and on, but by now my opinion should be pretty clear: I believe every dealer should belong to AIADA. Haven’t filled out the application yet? Still reading? Well, here’s more. Did you know auctions believe so strongly in association benefits that they offer members over $11,000 of savings in the form of buy/sell coupons (included at no extra charge with your membership)? In addition, your state association membership automatically includes membership in the National Independent Automobile Dealers Association, with access to all of the added benefits they provide? Ask any of our members if membership is worth it, and they’ll tell you: it’s a no-brainer. For only $290 per year, it’s one of the best deals around. Members will tell you it’s one of the best decisions they ever made. Seriously, remember this: The spirit of the Alabama Dealers is the wiliness to serve automotive buyers with honesty and integrity; to help the customers of Alabama be confident in getting the right vehicle; to help customers enjoy the buying experience and understand you have their back. In the end, customers will trust you with their friends and family members, not because of the vehicle, but because of you, the dealer. I only have so much room in the magazine. So I ask you, “Can you really give me one good reason to think about more?” I don’t think so. Yes, it costs to join – but it pays more to belong! Randy Jones Executive Director, AIADA
20
AIADA
AL_0813.indd 20
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
WELCOME RENEWALS COME JOIN US - WE ARE GROWING Membership in AIADA is an investment in the growth and protection of the Independent Automobile Business in Alabama. Between January 1st and April 15th of this year these 54 dealers decided to invest in their future. From the rest of us who are already member we welcome you aboard and THANK YOU for your caring. MICHAEL & BEVERLY KELLER 278 WEST AUTO & EQUIPMENT AUCTION LLC CULLMAN DENNIS RICHARDSON 4 LANE AUTO SALES INC. FOLEY JIM PHILLIPS ABC BIRMINGHAM MOODY TONY COFIELD ACTION AUTO SALES GROVE HILL SCOTT GOVIN AFFORDABLE USED CARS & TRUCKS HUNTSVILLE LES MCCOOK, EXE. DIR/TRICIA CORKERN AMERICAN RECOVERY ASSOCIATION IRVING, TX CHIP HOLLOWAY AMERICA’S AUTO AUCTION PENSACOLA INC. PENSACOLA, FL BASMA LUBBAD ANAHEIM AUTO AUCTION BIRMINGHAM ANDREW FUSAIOTTI ANDREWS IMPORTS INC. MOBILE ANTHONY UNDERWOOD ANTHONY UNDERWOOD AUTOMOTIVE BESSEMER KENT LAMB & PARKER ARMSTRONG ARMSTRONG & LAMB AUTO SALES LLC DOTHAN ELAINE FIKES AUTO DEPOT, INC. HAMILTON DALE PRIDGEN AUTONET, INC. BESSEMER LESTER AVERY AVERY AUTO SALES INC. OXFORD GRACE & ROLAND WILSON B. W.’S AUTO SALES SUMMERDALE PHILIP KNOX BAYOU MOTOR COMPANY BAYOU LABATRE KEN MCFARLAND BIRMINGHAM AUTO AUCTION OF HUEYTOWN GLORIA MAYFIELD BUDGET AUTO & TRUCK SUMMERDALE CHARLES E CRAFT/STEPHEN CRAFT C. C. RYDER INC. GADSDEN CARY & GLENDA SEARS C. J. SEARS AUTO SALES INC. MONTGOMERY E. W. CANADA CANADA AUTO SALES INC. BESSEMER JERRY & SYLVIA SHEPPARD CAR CITY AUTO SALES BRUNDIDGE TONY & ELAINE DAVIS CAR COUNTRY GRAYSVILLE JEFF HILL CARPRO FORESTDALE
CHRIS & TRACY MULLINAX CRM MOTORS INC. HOOVER
FRANK POLHILL FRANKLIN AUTOMOTIVE BIRMINGHAM
LARRY KIRBY LCM MOTORCARS LLC THEODORE
RICKEY RILEY RICK’S AUTO SALES GADSDEN
BRUCE SHAW CHAMPS TONEY
RANDY CRUMP FRIENDLY AUTO SALES INC. JASPER
TONY LEE LEE’S AUTO SALES INC. SELMA
DONALD MATTOX RIVER CITY AUTO SALES INC. DECATUR
DAVID BYNUM CHATTANOOGA AUTO AUCTION CHATTANOOGA, TN
GERALD TURNER G & R AUTO SALES ATHENS
LENN COSTNER JR. LENN COSTNER AUTO SALES ALEXANDRIA
RONNIE ELLISON RONNIE ELLISON AUTO SALES INC. CALERA
DAVID PHILLIPS CLASSIC MOTORS BIRMINGHAM
JOHN MARTIN GALESE/JEFF INGRAM GALESE & INGRAM P.C. BIRMINGHAM
ROGER STEWART LEO STEWART MOTOR CO. INC. BUTLER
DUANE YESSICK RV COLLISION THEODORE
WILLIE J. COLVIN SR. COLVIN AUTO SALES & SERVICE LLC TUSCALOOSA
LOWELL GILMORE/KAREN GILMORE GILMORE AUTO SALES EUFAULA
BILLY LEVINS LEVINS AUTO & TRUCK SALES MONTGOMERY
BUDDY & DAVID SHAW SHAW MOTORS INC. WEST OVER
GEORGE L. COOK COOK AUTO SALES GREENVILLE
KIM GOOD GWC WARRANTY WILKES-BARRE, PA
JOHN H PIERCE JR. LINDA PIERCE INC. CHELSEA
BRIAN WITCHER SOUTH PARK AUTO SALES CULLMAN
DARRYL FAIRCHILD COTTAGE HILL MOTORS MOBILE
LARRY TEAGUE H & L MOTORS CEDAR BLUFF
GERALD & JEROME LOGAN LOGAN & LOGAN AUTO SALES HAMILTON
FRANK DIGESU SOUTH PARKWAY MOTORS HUNTSVILLE
SHEILA CLARK COUNTRY AUTO SALES LLC ARAB
H. M. FREEMAN/RANDY BURNS H. M. FREEMAN MOTORS GADSDEN
RONNIE KILGORE/JERRY WILLIAMS STAR AUTOMOTIVE INC. JASPER
CHRIS & TRACY MULLINAX CRM MOTORS INC. HOOVER
MIKE THROWER H & W MOTOR CO OPELIKA
MIKE JONES M. JONES LLC /DBA ECONOMY AUTO SALES DOTHAN
R. H. CULPEPPER CULPEPPER TRAILER SALES INC. CULLMAN
DANNY HAND HAND MOTOR CO LLC DOTHAN
NATHANIEL DAVENPORT DAVENPORT MOTORS DECATUR
TONY DRAKE HARVEST WHOLESALE ATHENS
SONNY & BILLY DAWSON DAWSON’S AUTO & TRUCK SALES INC. BESSEMER
MARTY THOMAS HOMETOWN AUTO SALES MERIDIANVILLE
LEWIS DEWBERRY DEALER FUNDING LLC ALPHARETTA, GA DAVID ANDREWS DEALER’S AUTO AUCTION OF THE SOUTH LLC HORN LAKE, MS ROGER FIELDS DEALERS AUTO AUCTION/HUNTSVILLE ATHENS ED FOY, PRESIDENT DEALERSHIP CAPITAL PARTNERS LLC MACON, GA STEVE BAILEY/KATHRYN BAILEY DON BAILEY AUTO SALES PHENIX CITY JOHN L. TUCKER DOWNTOWN MOTOR CO INC. TUSCALOOSA MONICA CHATAGNIER EAN HOLDINGS LLC BIRMINGHAM EARL LEE EARL LEE AUTO SALES LLC MT. OLIVE KENNETH RANDALL WOOD EARL WOOD USED CARS EUFAULA ERIC & JOE ELLIOTT ELLIOTT BROTHERS AUTO SALES LLC ATHENS CHERYL ELLISON/CHAD TILLERY ELLISON AUTO SALES INC. JEMISON FARRELL ALFORD FARRELL ALFORD AUTO SALES ALEXANDER CITY BILLY FAUCETT FAUCETT MOTORS OF BOAZ, INC. BOAZ
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 21
JOHNNY DOUGLAS J. D.’S USED CARS SYLACAUGA BRENDA WOOK, PRESIDENT J.M. WOOD AUCTION CO INC. MONTGOMERY BETTY & RUDY KING JACKSON USED CARS INC. ANDALUSIA JIM WOODS JASPER AUTO SALES JASPER JAVAN SNOWDEN JAVAN SNOWDEN AUTO SALES LLC MONTGOMERY JEFF DONALDSON JEFF’S CLASSIC MOTORS TUSCALOOSA JERRY GREENWOOD JERRY GREENWOOD AUTO SALES ANNISTON JIM PREUITT JIM PREUITT FORD INC. TALLADEGA MARK & MIKE COMPTON JUNIOR COMPTON MOTORS INC. ALBERTVILLE KEITH KINGAN KEITH KINGAN’S CLASSIC CARS MOBILE JACKIE ALEXANDER KELLEY AUTO AUCTION ATTALLA PEGGY GILLILAND KELLEY CARS/DBA LAKESIDE AUTO SALES ALBERTVILLE KEN & LISA BATES KEN BATES AUTOS ALES ATHENS
WES MCCURRY MCCURRY MOTOR CO INC. ATHENS CHARLES MORING MIDTOWN MTORS MIDLAND CITY JAMES A MILLS JR MILLS CAPITOL AUTO SALES INC. MONTGOMERY LARRY MORRIS MORRIS AUTO SALES BIRMINGHAM CHRISTIAN WORLEY, GM MOTORMAX OF MONTGOMERY INC. MONTGOMERY RON & DEANNA NELSON NELSON WHOLESALE AUTOMOTIVE LLC WETUMPKA JEFF LAVENDER OLYMPIA MOTORS INC. ALBERTVILLE P. K. BROOKS & ANITA WESTFALL P. K. BROOKS USED CARS INC. ANNISTON RYAN SCHWARZ PASSTIME LITTLETON, CO LANCE TURNER PEE WEE TURNER MOTORS ANNISTON FRANK DOERFLINGER & ROBERT DORTCH PEN-MAR AUTO SALES INC. FLORENCE DAN HORTON PERRY HILL AUTOMOBILE CO INC. MONTGOMERY LARRY POLLARD POLLARD MOTORS BRILLIANT TRACEY W YOUNG PRIORITY AUTO SALES LLC HUNTSVILLE MARY BARNES REPTON USED CARS INC. REPTON RICK & TRACY PHILLIPS RICK PHILLIPS MOTORS JASPER
PEI SWANN SWANN MOTORS INC. TUSCALOOSA ROBERT JAMES TEBO FINANCIAL SERVICES CANTON, OHIO TERRY/RENEE’/RANDY CULVER TERRY’S USED CARS SYLACAUGA ROBERT L HENBREE JR/TIM THOMAS THE DRIVING FACTOR AUTO SALES GUNTERSVILLE MORRIS TILLEY, EUGENE TILLEY, LINDA TILLEY TILLEY USED CARS INC. ALICEVILLE TIM DUKE TIM DUKE AUTO SALES TRUSSVILLE RICHARD D. POSTMA TOWN & COUNTRY AUTOS JACKSON MONTY KLONARIS TRANSOUTH REMARKETING INC. MONTGOMERY WAYLON/GREG/JEFF ADAMS TRIPLE A AUTO SALES MONTGOMERY CHARLES HUNTER, CONTACT TRITON MANAGEMENT MONTGOMERY MATT MILES VALUE AUTO MART HEFLIN RONNIE WALDROP WALDROP MOTORS INC. JASPER STACY T AND LESLIE A HILL WEST MOBILE AUTOMOTIVE MOBILE PAUL CLABORN WHOLESALECARS.COM ALBERTVILLE ROBERT COX XTRME MOTORSPORTS LLC ENTERPRISE RICKY & BILLY YOUNG YOUNG MOTORS BOAZ
21
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
A.I.A.D.A. FORMS
Designated agent#________________Dealer License#___________________ Residential _____Commercial Address_______ Dealership____________________________________________Contact______________________________Date_________ Address______________________________________________________City__________________St_____Zip__________ Phone_________________________Fax___________________Email_____________________________Member Yes No QTY DESCRIPTION MEMBER PRICE TOTAL NON MEMBER PRICE TOTAL _____ FTC Window Stickers Buyers Guide/2Part NCR paper $10.00 per 100 _______ $18.00 per 100 _______ _____ Spanish FTC Window Stickers Buyers Guide/2 Part/NCR $20.00 per 100
_______
$25.00 per 100
_______
_____ Title Supplemental Reassignment Forms (MVT 8-3)
$11.00 per 100
_______
$18.00 per 100
_______
_____FTC Buyers Guide Holders (Clear Plastic)
$
.75 each
_______
$ 1.00 per 100
_______
_____Odometer Forms/3 part/NCR paper
$12.00 per 100
_______
$20.00 per 100
_______
_____Odometer Disclosure Statement (Sales Transaction-NewCar) $12.00 per 100 ________ $20.00 per 100
_______
_____Secure Power of Attorney (MVT 8-4)
$18.00 per 100
_______
$20.00 per 100
_______
_____Secure Affidavit of Correction (MVT 5-7)
$18.00 per 100
_______
$26.00 per 100
_______
_____Authorization for Payoff/Demand for Title
$ 7.75 per 100
_______
$11.25 per 100
_______
_____Agreement & Acknowledgement of Good Will Service
$10.00 per 100
_______
$16.25 per 100
_______
_____Blank Bill of Sale with Disclaimer (2 Parts)
$18.50 per 100
_______
$24.00 per 100
_______
_____Vehicle Invoice Bill of Sale (3 Part)
$25.00 per 100
_______
$32.00 per 100
_______
_____Arbitration Agreements (2 Part NCR)
$25.00 per 100
_______
$32.00 per 100
_______
_____Credit Applications
$ 9.00 per 100
_______
$16.00 per 100
_______
_____Damaged Vehicle Disclosure Prior Body Repair
$ 9.00 per 100
_______
$15.00 per 100
_______
_____Warranty Disclaimers-AS IS (not for window display
$10.00 per 100
_______ $18.00 per 100
_______
_____Affidavit for Out of State Vehicles
$10.00 per 100
_______ $15.00 per 100
_______
_____Disclosure of Prior Use of Vehicle
$22.00 per 100
_______ $25.00 per 100
_______
_____No. 14 Inventory File Jackets (9 ½ X12)
$30.00 per 100
_______ $40.00 per 100
_______
_____General Power of Attorney (MVT 5-13)
$12.00 per 100
_______ $18.00 per 100
_______
_____UCC “Notice of Our Plan to Sell Property”(repossession)
$ 6.25 per 50
_____UCC “Explanation of Surplus or Deficiency (repossession) $ 6.25 per 50
_______ _______
$10.00 per 50
_______
$10.00 per 50
_______
_____Agreement to Provide Insurance /2 Part NCR
$20.00 per 100
_______
$28.00 per 100
_______
_____Test Drive Agreement-2 Part NCR
$16.00 per 100
_______
$23.00 per 100
_______
________
$350.00
________
_____Buy Here Pay Here Guide-170 pg book-Laws $250.00 & Regulations, Sample Letters prepared by John Galese/Association Attorney SHIPPING RATE CHART ON BACK VISA, MC, DISC, AMEX FORM ON BACK RESIDENTIAL CHARGES ON BACK
Sub Total _________ Sub Total __________ Shippimg & handling __________ Shipping & Handling ___________ SUB TOTAL __________ SUB TOTAL __________ 4% State Sales Tax __________ 4% State Sales Tax ___________ (only if business is in Jeff. Co) 6% Jeff. Co. Tax __________ 6% Jeff. Co. Tax ___________ (see chart on back for Residential Shipping Charge __________ Residential Shipping Chg __________ TOTAL __________ TOTAL __________
22
AIADA
AL_0813.indd 22
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
WE ALSO HAVE A NABCO CATALOG YOU CAN ORDER PENDANTS, FLAGS, BANNER, KEY TAGS, DECAL, ETC. IF YOU WISH A CATALOG, CHECK THE YES BELOW. AS A MEMBER YOU WILL RECEIVE UP TO 25% DISCOUNT ON THESE ITEMS. Yes, I want a catalog ______ PLEASE US THE CHART BELOW TO DETERMINE THE AMOUNT FOR SHIPPING YOUR ORDER MEMBER SHIPPING & HANDLING CHART HANDLING CHART
NON MEMBER SHIPPING &
AMOUNT UP TO $25.00 $26.00 TO $50.00 $51.00 TO $100.00 $101.00 AND UP
AMOUNT UP TO $25.00 $26.00 TO $50.00 $51.00 TO $100.00 $101.00 AND UP
UPS $11.00 12.60 16.50 19.40
UPS $11.15 13.15 19.15 22.60
****CASES OF FORMS WILL BE WEIGHED AND CHARGED ACCORDINGLY. RESIDENTIAL SHIPPING CHARGES: →ADD $2.00 FOR RESIDENTIAL SHIPPING ADDRESS →ADD $2.50 FOR RURAL RESIDENTIAL SHIPPING ADDRESS →ADD $2.00 FOR RURAL COMMERCIAL SHIPPING ADDRESS
MAKE CHECKS PAYABLE TO A.I.A.D.A. , P O BOX 19627, BIRMINGHAM, AL 35219 * MEMBERS MAY FAX ORDER TO 205-942-3565 AND BE BILLED IF YOUR ACCOUNT IS IN GOOD STANDING. * NON MEMBERS CAN FAX ORDER IF CHARGED TO VISA, MASTERCARD, DISCOVER OR AMERICAN EXPRESS. NOTE: Orders received without proper sales tax and shipping charges cannot be processed. email address is judy@alabamaiada.com website is www.alabamaiada.com PLEASE FILL IN IF YOU WANT TO CHARGE ON YOUR VISA, MASTERCARD, DISCOVER OR AMEX: CREDIT CARD TYPE: MASTERCARD_____VISA_____DISCOVER_____AMEX_____ EXPIRATION DATE_______________________CVV#_______________(3 or 4 Digit Code on front or back of credit card) CARD # ___________________________________________________________________ CARD NAME:________________________________________________________________ ADDRESS FOR CARD_________________________________________________________ SIGNATURE:_________________________________________________________________ revised 12/14/2012 23
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 23
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:48 AM
AUCTION DIRECTORY ABC – ATLANTA 444 Joe Frank Harris Parkway Cartersville, GA 30120 Sale every Tuesday 6 p.m. & Friday 11 a.m. Phone: (770) 382-1010
GEORGIA DEALERS’ AUTO AUCTION 7205 Campbellton Rd. Atlanta, GA 30331 Sale every Tuesday 10 a.m. Phone: (404) 349-5555
ABC BIRMINGHAM 1046 A.E. Moore Drive Moody, AL 35004 Sale every Wednesday 12:30 p.m. Inops at 12 pm Phone: (205) 640-4040
GREATER NEW ORLEANS AUTO AUCTION 61077 St. Tammany Ave. Slidell, LA 70460 Sale every Wednesday 9:30 a.m. Phone: (504) 643-2061
ADESA ATLANTA AUTO AUCTION 5055 Oakley Industrial Blvd. Fairbum, GA 30213 Sale every Wednesday 8:30 a.m. Phone: (770) 357-2277
HIGHWAY 101 DEALERS AUTO AUCTION 2100 Hwy. 101 Rogersville, Al (256) 247-3600 Sale Day – Thursday 10:30 a.m.
ADESA OF BIRMINGHAM 804 Sollie Dr. Moody, AL 35004 Sale every Monday 6:30 p.m. & Wednesday 9 a.m. Phone: (205) 640-1010
KELLEY AUTO AUCTION 3485 US Hwy. 431 Attalla, AL 35954 Sale every Tuesday night Phone: (256) 538-9095
ADESA KNOXVILLE 1011 Adesa Pkwy Lenoir City, TN 37771 Sale every Tuesday 6:30 p.m. & Friday 9:30 a.m. Phone: (865) 988-8000
LONG BEACH AUTO AUCTION, INC. 8494 County Farm Rd. Long Beach, MS 39560 Sale every Wednesday 3 p.m. Phone: (228) 452-2030
ADESA OF MEMPHIS 5400 Getwell Rd. Memphis, TN 38118 Sale every Tuesday 9 a.m. Phone: (901) 365-6300
LOUISIANA’S 1ST CHOICE AUTO AUCTION 18310 Woodscale Rd. Hammond, LA 70401 Sale every Tuesday 8:30 a.m. Phone: (985) 345-3302
ALBANY AUTO AUCTION 1421 Liberty Expressway SE Albany, GA 31702 Sale every Thursday 6:30 p.m. Phone: (229) 435-7709 AMERICA’S AUTO AUCTION 6615 Mobile Hwy. Pensacola, FL 32526 Sale every Tuesday 9:30 a.m. Phone: (850) 944-1945 ATLANTA AUTO AUCTION 4900 Buffington Rd. Red Oak, GA 30272 Sale every Thursday 9 a.m. Phone: (404) 762-9211 AUTO AUCTION OF MONTGOMERY 6142 Troy Highway Pike Road, AL 36064 Sale: every Thursday 10:00 a.m. Phone: (334) 288-3399 BAMA AUTO AUCTION 4103 Gault Avenue South Ft. Payne, AL 35967 Sale: every Thursday 6:00 p.m. Phone: (256) 304-0947 BIRMINGHAM AUTO AUCTION 125 Meadland Circle Birmingham, AL 35023 Sale every Thursday 6 p.m. Phone: (205) 744-4030 CENTER POINT AUTO AUCTION 100 13th Ct. NE Birmingham, AL 35215 Sale every Monday 6 p.m. Phone: (205) 856-6527 CHATTANOOGA AUTO AUCTION Chattanooga Auto Auction, Public Sale every Tuesday @ 6:30 PM, Dealer Sale Thursday @ 10:00 AM and IN-OP sale begins 9:00 on Thursdays DEALERS AUTO AUCTION OF HUNTSVILLE 26125 Hwy 72 Athens, AL 35613 Sale every Tuesday 9:30 a.m. Phone: (256) 232-0201 DEANCO AUTO AUCTION 3664 South Oates St. Dothan, AL 36301 Sale every Wednesday 10 a.m. Phone: (334) 792-1116 GEORGIA-CAROLINA AUTO AUCTION 884 E. Ridgeway Rd. Commerce, GA 30529 Sale every Wednesday 3 p.m. & Friday 6 p.m. Phone: (706) 335-5300
MANHEIM CENTRAL FLORIDA 9800 Bachman Rd. Orlando, FL 32824 Sale every Wednesday 9 a.m. Phone: (407) 438-1000 MANHEIM NASHVILLE 8400 Eastgate Blvd. Mt. Juliet, TN 37122 Ford Factory Sale every other Monday 11 a.m. Open Sale every Wednesday 9 a.m. GM Factory Sale every other Thursday 10 a.m. Nissan Factory Sale once per month Friday 9 a.m. Phone: (615) 773-3800 MANHEIM MISSISSIPPI 7510 US Hwy. 49 N Hattiesburg, MS 39402 Sale every Monday 5 p.m. & Thursday 9 a.m. Phone: (601) 268-7550 MANHEIM METRO ATLANTA 2244 Metropolitan Pkwy SW Atlanta, GA 30315 Sale every Tuesday noon Phone: (404) 767-3652 MIDFIELD CAR AUCTION 1468 Hartman Industrial Blvd. Midfield, AL 35228 Sale every Wednesday and Saturday-6:30 p.m. Phone: 205-923-6535 PENSACOLA AUTO AUCTION 401 West Burgess Rd. Pensacola, FL 32503 Sale every Thursday 9:30 a.m. Phone: (850) 477-3063 SHOALS NORTH ALABAMA AUTO AUCTION 651 Fairground Road Muscle Shoals, AL (256) 381-2745 Sale every Tuesday night @ 6:30 p.m. SOUTH ALABAMA AUTO AUCTION LLC 27472 Wilcox Road Robertsdale, Al 251-964-7012 Sale Days – Tuesday & Thursday 6:30 p.m. Sat. Auction @ 11 a.m. YOUR AUCTION 3010 Scherer Dr. N St. Petersburg, FL 33716 Sale every other Tuesday 11 a.m. – Birmingham The Jim Burke Automotive Group Phone: (800) 675-4444
VENDOR
SPOTLIGHT
Why Gateway is Becoming Popular in Alabama
IT’S NOT UP TO A COMPUTER USING A LOGARITHM TO DECIDE WHO RIDES
AIADA would like to welcome the newest member of the association, Gateway One Lending & Finance, LLC. Gateway is a leader in the indirect auto finance marketplace, having built relationships across 45 states. They currently have two credit teams in Alabama, and are planning to increase their presence in the state. Hank Briley and Joe Kruszewski currently handle the northern half of the state, while Beth Gibson and Mark Whatley cover the southern half. Hank, their newest team member, should be a familiar face: he’s been a regular at the AIADA state conventions over the past 5 years. “At my previous bank, I met a lot of good prospects at the AIADA conventions, and I can’t wait for July’s convention to come around, so I can tell them all about Gateway,” says Hank. Gateway specializes in prime and near-prime offerings. They pride themselves on their flexibility and ability to help dealers deliver more cars. They offer financing for cars up to 12 years old, and often finance cars with over 100,000 miles. “At Gateway, we take the time to qualify each customer individually. It’s not up to a computer using a logarithm to decide who rides,” said credit underwriter Joe Kruszewski. In November 2011, TCF National Bank finalized its acquisition of Gateway. The transition has enabled tremendous growth for Gateway, and enabes them to offer highly competitive rates. If you’d like to be a part of Gateway’s growth here in Alabama, don’t hesitate to call Hank Briley (Prattville and North) at 205-789-5768, or Beth Gibson (Montgomery and South) at 251-680-9221. They will be happy to go over all of Gateway’s plans and programs, and how they might work for you and your business.
AUCTIONS PARTICIPATING AUCTIONS PARTICIPATING IN THEBENEFIT 2012IN THE 2013 AIADA 2013 AIADACOUPON BENEFIT COUPON BOOK BOOK BUY FEE OR SELL 1. ABC Birmingham 2. ADESA Birmingham 3. AMERICA’S AUTO AUCTION –Pensacola 4. ANAHEIM AUTO AUCTION –Birmingham 5. AUTO AUCTION OF MONTGOMERY 6. BAMA AUTO AUCTION – Fort Payne 7. BIRMINGHAM AUTO AUCTION 8. CITY AUTO FINANCE – 9. DEALERS AUTO AUCTION OF HUNTSVILLE LLC 10. DEALERS AUTO AUCTION OF MURFREESBORO 11. DEALER’S AUTOMOBILE AUCTION OF MOBILE 12. DEALER’S AUTOMOBILE AUCTION MISSISSIPPI 13. DEANCO AUTO AUCTION - Dothan 14. DRIVER’S WAY AUTO AUCTION - Birmingham 15. FORT PAYNE AUTO AUCTION 16. HIGHWAY 101 DEALERS AUTO AUCTION 17. INSURANCE AUTO AUCTION(Huntsville, Birmingham & Dothan Locations) 18. KELLEY AUTO AUCTION - Attalla 19. LONG BEACH AUTO AUCTION - Mississippi 20. LOUISIANA’S 1st CHOICE AUTO AUCTION 21. MANHEIM ATLANTA 22. MANHEIM GEORGIA 23. MANHEIM NASHVILLE 24. MANHEIM PENSACOLA 25. MIDFIELD CAR AUCTION 26. MID SOUTH AUTO AUCTION Pearl, Mississippi 27. SHOAL’S NORTH ALABAMA AUTO AUCTION 28. TALLAHASSEE AUTO AUCTION
TOTAL VALUE IS
$250.00 $1800.00 $500.00 $600.00 $600.00 $600.00 $100.00 Floor Plan $600.00 $600.00 $600.00 $600.00 $600.00 $200.00 $600.00 $50.00 each $600.00 $100.00 $200.00 $750.00 $750.00 $600.00 $250.00 $900.00 $600.00 $300.00
$ 13,825.00
$250.00 $1800.00 $500.00 $600.00 $600.00 $600.00 $100.00 Floor Plan Fee $600.00 $600.00 $600.00 $600.00 $600.00 $225.00 $200.00 $600.00 $150.00 $600.00 $100.00 $200.00 $750.00 $750.00 $600.00 $250.00 $300.00 $900.00 $600.00 $300.00
$13,450.00
(COUPON BOOK IS AVAILABLE WHEN YOU RENEW YOUR MEMBERSHIP)
24
AIADA
AL_0813.indd 24
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:48 AM
Please call the association office before sending in your membership application as we are rolling everyone over to March renewals and prorating dues until March 14. 25
w w w. a l a b a m a i a d a . c o m
AL_0813.indd 25
AUGUST/SEPTEMBER 2013
AIADA
7/19/13 11:49 AM
COMPLIANCE OVERDRIVE
Indirect Lending Comes Under Spotlight D O N ’ T B E F O O L E D I N T O T H I N K I N G C F P B G U I DA N C E D O E S N ’ T M AT T E R T O YO U
The Consumer Financial Protection Bureau published CFPB Bulletin 201302 in March. The subject: Indirect auto lending and compliance with the Equal Credit Opportunity Act. It has prompted a great deal of analysis, discussion and concern among CFPB-regulated entities. But if you’re an auto dealer, you’re probably not regulated by the CFPB. So does the bulletin really affect you? Yes. Here’s why it matters: Protect your lender relationships: A critical component of a successful dealership is strong lender relationships. The bulletin provides guidance to entities that purchase completed retail sales contracts from auto dealers. The CFPB and dealers refer to them as indirect lenders, but a more appropriate term is “assignees” because dealers assign (sell) completed auto finance contracts to them. The assignees are regulated by the CFPB, so the guidance is important to them. The bulletin criticizes common pricing practices used in purchasing contracts from dealers, which could cause assignees to change their pricing terms. ECOA applies to you, too: The Equal Credit Opportunity Act prohibits a creditor from discriminating in any aspect of a credit transaction because of race, color, religion, national origin, sex, marital status, age, receipt of income from any public assistance program, or the exercise in good faith of a right under the Consumer Protection Act. It defines “creditor” to include “any person who regularly extends, renews or continues credit” as well as “any assignee of an original creditor who participates in the decision to extend, renew or continue credit.” There is no doubt and no debate that you, as a dealer, are a creditor when you finance the sale of a motor vehicle, because you are regularly extending credit in the form of a retail sales contract. A retail contract is clearly a credit agreement and the dealer is clearly a creditor subject to the ECOA. That’s a critical concept because the bulletin addresses assignees’ compliance with the ECOA when it purchases dealer retail sales contracts. It isn’t a stretch to think the same criticism applies to dealers who are subject to the same ECOA requirements. Federal and state regulators might take the CFPB’s nudge and begin examining
dealers’ conduct. Your assignees might also take the nudge and scrutinize whether dealers they purchase contracts from are complying with the ECOA. Which means reviewing ECOA compliance policies should be at the top of every dealer’s compliance “to do” list. Here are a few CFPB questions for assignees that also make sense for dealers: u Do you have a well-defined policy and management program to ensure fair lending compliance? Does it include training for any employees involved in credit transactions, regular monitoring and compliance review of lending policies? u Do you communicate your policies and expectations for ECOA compliance to all of your employees and have a process to review fair lending policies within your dealership to identify potential fair lending violations? u Do you have a defined course of action to pursue corrective measures if discrepancies or disparities are discovered? Can dealer rate markup create an ECOA violation? Attorneys and regulators have been pondering that question for a while, but the CFPB’s bulletin put it in the spotlight. To be clear, “dealer rate markup” refers to when a dealer collects basic information regarding a potential buyer and forwards it to potential assignees. After evaluating the applicant and sale terms, potential assignees can tell the dealer it is willing to purchase the retail sales contract for a certain price – the “buy rate” – which establishes a minimum interest rate it requires to purchase the contract. The potential assignee can allow the dealer to increase the interest rate above the quoted buy rate. If the dealer contracts for more than the buy rate, the credit sale closes and the contract is assigned, the assignee shares a portion of the increased rate with the dealer. The concern is that the dealer rate markup practice creates risk that some buyers will pay more for credit than others, resulting in pricing disparities on the basis of race, national origin or other reasons prohibited by the ECOA. Even if a creditor doesn’t intentionally discriminate, it can violate the ECOA if its practices result in pricing disparities harming protected classes. A dealer’s “I’ll take what I can get” approach to rate markup pricing might appear to treat all buyers equally, but if it results in a
protected group paying more than others it can be an ECOA violation. The CFPB’s bulletin asserts that assignees bear some ECOA compliance risk for the dealer rate markup practice. That’s controversial because an assignee generally isn’t directly involved in dealerbuyer negotiations and markup analysis and decisions. Dealers are, so regulators might take a cue from the CFPB and begin examining those areas. Here are some of the CFPB’s questions for assignees that also make sense for dealers: u What controls do you have in place to document markup and compensation policies? Are those controls documented as part of your retail sales contract review process? u Do you take steps to monitor and address pricing disparities so you can identify problematic or prohibited decision-making practices? u Do you have documented policies related to your process for marking up buy rates? If you continue to allow rate markups, what controls are in place to prevent practices that could be deemed discriminatory? u Do you conduct regular analyses of portfolio-wide retail sales contract pricing data for potential disparities on a prohibited basis resulting from your markup and compensation policies? Don’t be fooled into thinking CFPB guidance doesn’t matter to you. Federal and state regulators might take its lead and start examining dealers for the same ECOA issues. According to recent reports, the CFPB has issued subpoenas in an expansive probe into indirect auto lending practices and the Justice Department is investigating auto dealers for their rate markup practices, hinting that legal action targeting dealers could be coming. Dealers who take proactive measures to demonstrate ECOA compliance will be in a better position to defend their business in case of scrutiny by state or federal regulators. And they’ll be better prepared to remain in good standing in the eyes of lenders seeking reassurance that the contracts they are purchasing won’t result in regulatory enforcement actions from the CFPB.
BY CHIP ZYVOLOSKI
CHIP ZYVOLOSKI IS A SENIOR ATTORNEY FOR INDIRECT LENDING AT WOLTERS KLUWER FINANCIAL SERVICES. FOR MORE INFORMATION, VISIT WWW. WOLTERSKLUWERFS.COM/INDIRECT.
26
AIADA
AL_0813.indd 26
AUGUST/SEPTEMBER 2013
w w w. a l a b a m a i a d a . c o m
7/19/13 11:49 AM
AL_0813.indd 27
7/19/13 11:49 AM
AL_0813.indd 28
7/19/13 11:49 AM