Page 1

OK.indd 1

5/18/12 11:41 AM

OIADA, P.O. Box 6905, Moore, OK 73153 PRSRT Standard U.S. Postage

PAID

DALLAS, TEXAS Permit No. 2079

Change Service Requested

Oklahoma Forms Requirements Lending Discrimination Vehicle Exports Rising


OK.indd 2

5/18/12 11:41 AM


MAGAZINE CONTENTS 04 12 20 30

Lending Discrimination Go All In on Service Oklahoma Forms Requirements Vehicle Exports Rising

PRESIDENT

ADVERTISERS INDEX 71B Auto Auction...................................................11 ADESA...........................................Inside Back Cover Ally........................................................................17 Albright Insurance...................................................7 AutoTrader.com.......................................................5 Dealer’s Auto Auction of OKC.................. Back Cover Jordan Insurance Group..........................................9 Loftis & Wetzel Insurance......................................18 Manheim North Texas...................Inside Front Cover Manheim.com.......................................................13 NIADA Certified......................................................16 Nowcom................................................................15 United Acceptance................................................19 Voisys....................................................................30

WHAT’S NEW

Sirius XM Satellite Radio is America’s

satellite radio company. Independent dealerships can now offer a free SiriusXM three-month trial on all pre-owned vehicles with factory-equipped satellite radio. In addition to selling your customers a quality vehicle, you’ll be giving them the opportunity to enjoy satellite radio. And there’s no cost to your customer. Visit www.siriusxm.com/niadaprogram to enroll your dealership today!



NIADA Member Health Plans, administered by JLBG Health, bring you choice and flexibility when designing your personal health plan while providing potential savings of thousands of dollars annually. To review the plan details and receive an instant online rate, visit www. NIADAHealthPlans.com or call 1-888-308-9340. 813 NORTHWEST 34TH MOORE, OK 73160

EMAIL: odell.morgan@sbcglobal.net AMBER SNOOK, Administrative Assistant

JACKIE GARNER, Office Manager

JARED MORGAN, Electronics/ Software Technician

Chris Goad Regal Motors 3515 N. May Oklahoma City, OK 73112 405-917-5800 managerokc@regalcars.com

CHAIRMAN OF THE BOARD

John Easttom Auto Mart of Elk City P.O. Box 981 Elk City, OK 73648 580-225-1100 automart@cableone.net

SECRETARY/ TREASURER

LYNNA KAY, Programmer STEVE MORGAN, Consultant MIKE MORGAN, Technical Aide

FOR INFORMATION ON HOW TO BECOME A MEMBER OF OIADA PLEASE CONTACT ROSE OR ODELL MORGAN AT 405-232-2947.

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 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.

DEALERS’ RESOURCE IS A PUBLICATION OF AUTOMOTIVE DEALERS RESOURCE OF OKLAHOMA (ADR) PRODUCED ON BEHALF OF THE OKLAHOMA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION (OIADA), P.O. BOX 6905, MOORE, OK 73153. THE DEALERS’ RESOURCE IS PUBLISHED MONTHLY BY THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION SERVICES CORPORATION. PERIODICAL POSTAGE PAID AT ARLINGTON, TX, AND AT ADDITIONAL OFFICES. POSTMASTER: SEND ADDRESS CHANGES TO OIADA, P.O. BOX 6905, MOORE, OK 73153. THE STATEMENTS AND OPINIONS EXPRESSED HEREIN ARE THOSE OF THE INDIVIDUAL AUTHORS AND DO NOT NECESSARILY REPRESENT THE VIEWS OF ADR OF OKLAHOMA, THE OKLAHOMA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION OR THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION. LIKEWISE, THE APPEARANCE OF ADVERTISERS, OR THEIR IDENTIFICATION AS MEMBERS OF OIADA OR NIADA DOES NOT CONSTITUTE AN ENDORSEMENT OF THE PRODUCTS OR SERVICES FEATURED. COPYRIGHT © 2011 BY O&R MORGAN, INC. DBA OIADA. ALL RIGHTS RESERVED. DEALERS’ RESOURCE IS A PUBLICATION OF AUTOMOTIVE DEALERS RESOURCE OF OKLAHOMA ON BEHALF OF THE OKLAHOMA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION (OIADA), BUT IS MAILED TO ALL DEALERS IN THE STATE IN AN EFFORT TO EDUCATE AND ENCOURAGE NON-MEMBERS TO JOIN THE ASSOCIATION AND SUPPORT OUR EFFORTS TO IMPROVE THE IMAGE AND PROFIT POTENTIAL OF THE INDUSTRY. FOR 55 YEARS, WE HAVE WORKED TO REPRESENT THE INDEPENDENT MOTOR VEHICLE DEALER IN OKLAHOMA. WE NEED YOUR SUPPORT. FRONT COVER BY Mike Morgan STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITOR Andy Friedlander • andy@niada.com ART/PRODUCTION MGR. Christy Haynes • christy@niada.com PRINTING Nieman Printing

IRS Tax Calendar

The IRS website offers a helpful tax calendar for small businesses and the self-employed that can be viewed online or installed as a desktop calendar tool. The online calendar includes due dates and actions by month. You can see all events or filter them by employer excise or general event types. Alternatively, you can install the IRS Calendar Connector app and access “important Tax Dates for Small Businesses” right from your desktop, even when you’re offline. As new events are added, they will be automatically updated via the desktop tool. To access the IRS Tax Calendar for Small Businesses page, visit the business section of the IRS website at www.irs.gov/ businesses/index.html.

Bruce Beam Dealers Auto Auction of OKC 1028 S. Portland Oklahoma City, OK 73147 405-947-2886 www.daaokc.com

BY ADR STAFF

VICE PRESIDENTS

Facing a $2 million dollar judgment, a Missouri dealership recently filed for bankruptcy protection. The dealership, Blue Springs Ford, indicated its decision to file bankruptcy “is the direct result of the debtor’s involvement in pending state court litigation.” Blue Springs had previously been sued by plaintiffs alleging that, during the course of a used vehicle sale, the dealership failed to fully disclose the vehicle’s damage history. The case was heard in state court and resulted in a jury verdict against Blue Springs for $171,520 in actual damages and $1.75 million in punitive damages. The sale price of the vehicle in question was $14,000.

John T. Longacre, IV Taft Motors, Inc. 722 S. Linden St. Sapulpa, OK 918-224-7700 taftmotorsinc@msn.com Julian Codding Reliable Motors, Inc. 9201 S. Shields Oklahoma City, OK 405-912-5000 juliancodding@msn.com Monte Shockley Shockley Auto Sales 2605 N. Broadway Poteau, OK 74953 918-647-3999 sas@clnk.net

OIADA OFFICE

ROSE & ODELL MORGAN, Executive Directors

OIADA BOARD OF DIRECTORS

Dealership Files Bankruptcy

BY ADR STAFF

Glenn McDaniel I-35 Credit Auto 1113 SE 51st St. Oklahoma City, OK 73129 405-670-4100 gtamcd@aol.com David McQuerry McQuerry Motors, Inc. 1302 N. Harrison St. Shawnee, OK 74801 405-273-8171 mcquerrymotors@yahoo.com

OIADA CONTACT INFO

Primary Number (OKC): 405-232-2947 Toll Free: 800-346-4232 BUSY SIGNAL? The 405-2322947 number is designed to roll over to any of four other lines in our office, but has recently not been working correctly. If you encounter a busy signal at the 232 number, please call the 800 number or any of the following: 405-799-7116 405-799-1113 405-799-8115 405-799-3759

For your convenience, we have recently added a toll-free fax number: 877-804-3449. 3

w w w. e - o i a d a . c o m

OK.indd 3

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:46 AM


Lending Discrimination The Consumer Financial Protection Bureau (CFPB) is responsible for enforcing the Equal Credit Opportunity Act (ECOA) and the implementing Regulation B. The Office of Fair Lending and Equal Opportunity at the CFPB recently issued notice that it is prepared to use every tool at its disposal to ensure lenders abide by both the letter and the spirit of the ECOA. “We are letting both lenders and consumers know that in our examination and enforcement work, we will combat unlawful, discriminatory practices – including those that have an illegal disparate impact on protected borrowers. We will look not only at mortgage lending, but also at other types of credit, including student loans, loans for cars and credit cards,” the agency said. As a reminder to our dealers, the ECOA prohibits discrimination based on: • Race or color • Religion • National origin • Sex • Marital status • Age (provided the applicant has the capacity to contract) • The applicant’s receipt of income derived from any public assistance program • The applicant’s exercise, in good faith, of any right under the Consumer Credit Protection Act. The courts have recognized three types of proof of lending discrimination under the ECOA: • Overt evidence of disparate treatment • Comparative evidence of disparate treatment • Evidence of disparate impact. It’s important to realize that discrimination in lending practices is not necessarily obvious. Discrimination can occur by discouraging an applicant, by withholding assistance or even by establishing a business policy that – however unintentionally – has

the effect of excluding certain classes of persons. Following are examples of situations the courts would consider lending discrimination. Overt Evidence of Disparate Treatment Overt evidence of disparate treatment exists when a lender openly discriminates on a prohibited basis. Example: A lender offers a credit card with a limit of up to $750 for applicants age 21-30 and $1,500 for applicants over 30. The policy violates the ECOA’s prohibition on discrimination on the basis of age. Overt evidence of discrimination also exists even when a lender expresses – but does not act on – a discriminatory preference. Example: A lending officer tells a customer, “We do not like to make loans to Native Americans, but the law says we may not discriminate and we have to comply with the law.” This statement violates Regulation B, which prohibits discouraging applicants on a prohibited basis. Comparative Evidence of Disparate Treatment Disparate treatment occurs when a lender treats a credit applicant differently on the basis of one of the prohibited factors. It’s important to note that intention to discriminate does not have to be present. Discrimination can occur, for instance, based on the level of assistance provided by the lender in completing a credit application. Example: A nonminority couple applies for an automobile loan. The lender finds adverse information in the couple’s credit report. The lender discusses the credit report with the couple and determines that the adverse information – a judgment against the couple – was incorrect, as the judgment had been vacated. The nonminority couple is granted a loan. A minority couple applies for a similar loan

NOTE:THIS ARTICLE IS INTENDED FOR I N F O R M AT I O N A L P U R P O S E S O N LY. F O R I T S A P P L I C AT I O N T O YO U A N D YO U R B U S I N E S S , P L E A S E C O N S U LT YO U R C O U N S E L .

with the same lender. On discovering adverse information in the minority couple’s credit report, the lender denies the loan application on the basis of the adverse information without giving the couple an opportunity to discuss the report. Evidence of Disparate Impact A disparate impact occurs when a lender applies a racially (or otherwise) neutral policy or practice equally to all credit applicants but the policy or practice disproportionately excludes or burdens certain persons on a prohibited basis. Example: A lender’s policy is to deny loan applications for single-family residences for less than $60,000. The policy has been in effect for 10 years. This minimum loan amount policy is shown to disproportionately exclude potential minority applicants from consideration because of their income levels or the value of the houses in the areas in which they live. Although the law on disparate impact as it applies to lending discrimination continues to develop, it has been clearly established that a policy or practice that creates a disparity on a prohibited basis is not, by itself, proof of a violation. To not be considered a violation, however, the practice must first be justified by “business necessity.” If business necessity is established, the practice might still be a violation if an alternative practice could serve the same purpose with less discriminatory effect. It’s important to note, again, that discriminatory intent is not necessary to establish discrimination. If your dealership is involved in financing your sales, take steps to ensure you are abiding by both the letter and the spirit of the ECOA. Consider posting a written statement of non-discrimination, educating your staff and reviewing your policies. Be in compliance.

BY ADR STAFF

4

DEALERS’

OK.indd 4

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


OK.indd 5

5/18/12 11:41 AM


Used Motor Vehicle and Parts Commission Report Chairman John Longacre convened the April 10, 2012 session of the Used Motor Vehicle and Parts Commission. Following roll call and approval of the March 13 meeting minutes, Longacre called on director John Maile for the director’s report. Maile called the commissioners’ attention to the expenditure report, which was included in the agenda packet. Maile then reported that the commission’s legislative agenda had not fared well and that commissioner Roy Burch had submitted his resignation due to health issues. Following a vote affirming receipt and approval of the expenditures report, Longacre called on deputy director Kenneth Whitehead for his report. Whitehead reported there were no informal hearings or District Court actions in the previous month. However, two dealerships were fined for rules violations. Exit 24 Auto Sales was fined $100 for improper assignment on title and Superb Motors was fined $300 for a late title violation and two tag violations. Whitehead’s written report indicated commission staff had issued 14 cease and desist letters and completed 33 inspections during the period. Staff also handled 39 written complaints – 18 title issues, 12 contract violations, six related to mechanical issues and three complaints of a miscellaneous nature. The education program had 30 in attendance. Applicants for a new license and dealers involved in significant rule violations are required to attend the commission’s education program as a part of acquiring or maintaining a state license. The education sessions are held at the commission conference room at 2401 NW 23, Oklahoma City. Classes are held on Monday prior to the commission meeting on the second Tuesday of each month. The sessions run from 9 a.m. to about noon or 1 p.m. You are asked to make reservations so staff can be prepared to accommodate you. Call the commission at 405-521-3600 to make reservations.

REPORT OF CEASE AND DESIST LETTERS ISSUED

These letters direct the individual or business to cease violations of laws or rules ENTITY Larry Baranski Valecia Dirck Adrian Ducan Rigoberto Efrain Esqueda Tony Gantor Micky Garcia Micky Garcia David Hernandez Allen Kester Chad Krittenbrink Jose L. Rios Billy Tate Kevin Turee Pedro O. Villarrvel

TYPE OF VIOLATION Used Dealer Insurance Pool Used Dealer Insurance Pool Insurance Pool Rebuilder Used Dealer Used Dealer Insurance Pool Used Dealer Insurance Pool Used Dealer Used Dealer Used Dealer

CITY Oklahoma City Sapulpa Oklahoma City Del City Midwest City Oklahoma City Oklahoma City Oklahoma City Oklahoma City Oklahoma City Oklahoma City Thackerville Oklahoma City Oklahoma City

DATE ISSUED 03/01/2012 03/21/2012 03/02/2012 03/06/2012 03/06/2012 03/02/2012 03/02/2012 03/14/2012 03/21/2012 03/14/2012 03/21/2012 03/08/2012 03/14/2012 03/02/2012

CLOSED COMPLAINT REPORT

These are complaints that have been resolved one way or another. They do not necessarily reflect any wrongdoing on the part of dealers. ENTITY CITY COMPLAINT Big Red Sports/Imports Norman Mechanical Bob Howard Automall Oklahoma City Title Broken Arrow Motor Company Broken Arrow Title David Stanley Chevrolet, Inc. Oklahoma City Title Edmond Hyundai Edmond Miscellaneous Express Credit Auto Tulsa Mechanical Frontline Motor Company Tulsa Title Heartland Cars & Leasing Chandler Title Heartland Motors #2 Muskogee Title Hudiburg Chevrolet, LLC Midwest City Mechanical Integrity Auto Finance, LLC #2 Oklahoma City Contract J & S Used autos Woodward Title J-F Mobile Home Caney Title Jim Glover Chevrolet Tulsa Contract Jim Phillips Cars & Trucks Cushing Title Joe Cooper Ford/Midwest City, LLC Midwest City Miscellaneous Joe Cooper Ford/Midwest City, LLC Midwest City Mechanical KarzNTrux Muskogee Title King’s Auto Sales Oklahoma City Contract Lawton Chry Jeep Dodge/B. Altstatt Lawton Contract Midwest Muscle & Elite Motorsports, LLC Moore Title Mike Mowdy Autoplex Midwest city Mechanical Mike Mowdy Autoplex Midwest City Contract Momentum Toyota of Tulsa Tulsa contract Momentum Toyota of Tulsa Tulsa Contract Momentum Toyota of Tulsa Tulsa Contract Norman Chrysler-Jeep Dodge Norman Contract Pemberton Chevrolet Ponca City Contract Ronald David Used Cars Tulsa Title Sandy Creek Cars Byars Mechanical South Pointe Chevrolet Tulsa Title Stillwater Auto Center Stillwater Title Stillwater Auto Center Stillwater Title Superb Motors, LLC Tulsa Contract Tony’s Auto Oklahoma City Title Turn Key Auto Mart, LLC Oklahoma City Title United Sports & Autos Muskogee Miscellaneous Viper Motors Oklahoma City Title Wheeler Rental & MH Sales, LLC Hinton Contract

RESOLVED 03/26/2012 03/06/2012 03/19/2012 03/20/2012 03/26/2012 03/12/2012 03/09/2012 03/21/2012 03/12/2012 03/07/2012 03/03/2012 03/06/2012 03/23/2012 03/12/2012 03/26/2012 03/21/2012 03/20/2012 03/02/2012 03/09/2012 03/28/2012 03/03/2012 03/12/2012 03/30/2012 03/12/2012 03/12/2012 03/12/2012 03/26/2012 03/30/2012 03/12/2012 03/09/2012 03/12/2012 03/26/2012 03/26/2012 03/12/2012 03/30/2012 03/23/2012 03/15/2012 03/05/2012 03/28/2012

LICENSES SUSPENDED OR ABANDONED

In other action, the following licenses were suspended or abandoned: 15th Street Motors, Oklahoma City: Out of business, per owner Frank Aufiero 360 Motors, Inc., Beggs: Out of business, phone disconnected Benedict Car Sales, Altus: Out of business, per Tracie Benedict Resort RV, Lone Grove: Out of business, failure to complete requirements for change of location, photo of sign mounted Sam’s Car Sales, El Reno: Out of business, per owner Marsha Dahlenburg

BY ADR STAFF 6

DEALERS’

OK.indd 6

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


Auto Loan Payoff Schemes Stopped The Federal Trade Commission recently filed charges and requested that a U.S. district court put a stop to the allegedly deceptive tactics of two California-based auto loan modification operations. The FTC asserted the two separate operations charged hundreds of dollars in up-front fees based on bogus promises that they could reduce consumers’ monthly car loan payments and help avoid repossession of their vehicles. Consumers were instructed to pay fees to the companies and to stop paying their auto lenders. Subsequently, at least one consumer’s car was repossessed and one set of defendants told other consumers to “hide [their] car[s] to avoid repossession.” The FTC charged the companies deceived consumers with false promises, then did not provide promised refunds when they failed to obtain car loan modifications. The FTC has asked the court to order the defendants to stop the allegedly illegal conduct while the FTC moves forward with the cases. The FTC alleged one company typically promised to reduce consumers’ monthly auto loan payments by 30 to 50 percent for fees ranging from $200 to $500. The FTC alleged the second company typically promised to reduce consumers’ monthly payments by 25 to 40 percent for fees ranging from $350 to $799. The cases are the FTC’s first against companies offering auto loan modifications. They come at a time when the volume of auto repossessions remains high. Recognizing that a car is second only to a home as the most expensive purchase many consumers make, the FTC has been very involved in auto-related consumer issues. The agency recently held a recent series of roundtable workshops to gather information on possible consumer protection issues that may arise during the sale, financing or lease of motor vehicles.

BY ADR STAFF

7

w w w. e - o i a d a . c o m

OK.indd 7

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:41 AM


Low Loyalty to Hybrids T H E S T U DY F O U N D O N LY 3 5 P E R C E N T O F H Y B R I D O W N E R S B O U G H T A N O T H E R H Y B R I D W H E N T H E Y R E T U R N E D T O T H E M A R K E T I N 2 0 1 1 .

Owners of hybrid vehicles are not likely to choose a hybrid as their next vehicle, according to a new study by automotive research firm R.L. Polk. The study found only 35 percent of hybrid owners bought another hybrid when they returned to the market in 2011. If repurchase behavior among owners of the high-volume Toyota Prius is not considered, hybrid loyalty drops to less than 25 percent. However, hybrid owners appear to maintain brand loyalty when returning to the new car market. For example, in 2011, 60 percent of Toyota hybrid owners returned to the market to purchase another Toyota, according to Polk, while 41 percent of them purchased another hybrid from any brand. More than 52

percent of Honda hybrid owners stayed with the Honda brand, while less than 20 percent bought another hybrid vehicle from any brand. Research presented on Edmunds.com suggests a twofold reason for the low levels of loyalty. First, more traditionalfuel vehicles are available with greater fuel efficiency, and, second, even with $4 and $5 fuel, the payback on hybrid price premiums often takes longer than the consumer plans to own the vehicle. “The lineup of alternate-drive vehicles and their premium price points just aren’t appealing enough to consumers to give the segment the momentum it once anticipated, especially given the growing strength of fuel economy among compact and midsize competitors,” Edmunds.com

chief economist Lacey Plache said. For more information, visit www. edmunds.com/Industry-center and www.polk.com.

Polk is a provider of automotive information and marketing solutions. The organization collects and interprets global data, and provides extensive automotive business expertise to help customers understand their market position, identify trends and build brand loyalty. Edmunds Inc. publishes two websites that empower, engage and educate automotive consumers, enthusiasts and insiders: www.edmunds.com and www. insideline.com.

BY ADR STAFF

Eco - Friendly

Who Buys the “Greenest” Cars? Does the West Coast Boast More Eco-Friendly Drivers? Looking for “green” cars? Go west. California boasts the most shoppers looking for vehicles with fuel efficiency ratings of 40 miles per gallon or better, according to research by Cars. com. The data, taken from Cars.com searches, also showed Southern states were the “least green.” “There’s a perception that Californians are more eco-conscious, and our car shopping data shows that’s true,” Cars.com editor-in-chief Patrick Olsen said. “With more charging stations than any other state and dedicated car-pool lanes, it’s easy to understand why manufacturers typically choose California as the place to launch their new green vehicles. “The hard workers in the South need their pickup trucks. For these workers, a hybrid or fuel-efficient vehicle would likely be a second car, and that’s just not as feasible for many in this economy.” The website also ranked the cities and towns with the most and least fuel-efficient vehicle shoppers. Not surprisingly, California dominated the most green list with six of the top 10 cities, led by the San Francisco Bay area, while five Southern markets were among the 10 with the fewest 40-mpg cars, with Midland-Odessa, Texas at the top.

The top 10 eco-friendly cities: 1. San Francisco-Oakland-San Jose, Calif. 2. Madison, Wis. 3. Monterey-Salinas, Calif. 4. Portland, Ore. 5. San Diego, Calif. 6. Green Bay-Appleton, Wis. 7. Santa Maria-Santa Barbara San Luis Obispo, Calif. 8. Sacramento-Stockton-Modesto, Calif. 9. Chico-Redding, Calif. 10. Zanesville, Ohio  he 10 with the fewest green car shoppers: T 1. Odessa-Midland, Texas 2. Laredo, Texas 3. Fairbanks, Alaska 4. Albany, Ga. 5. Bluefield-Beckley-Oakhill, Va./W. Va. 6. Glendive, Mont. 7. Helena, Mont. 8. Columbus-Tupelo-West Point, Ala./Miss. 9. Casper-Riverton, Wyo. 10. Baton Rouge, La.

T H E R E ’ S A P E R C E P T I O N T H AT C A L I F O R N I A N S A R E M O R E E C O - C O N S C I O U S , A N D O U R C A R S H O P P I N G D ATA S H O W S T H AT ’ S T R U E .

8

DEALERS’

OK.indd 8

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


Reassignments Completed in NonNotary States

IRS Tax Tip: Claiming the Small Business Health Care Tax Credit

The following advisory was issued by the Oklahoma Tax Commission to all motor license agencies: Reassignments of Oklahoma titles by out of state dealers in non-notary states are not required to be notarized. Neither would the first assignment (to the out of state dealer) be required to be notarized, as the assignment was completed in a non-notary state. Some additional dealer reassignmentrelated reminders: Oklahoma dealers may reassign on another state’s reassignment sheet (for example, Texas assigned to an Oklahoma dealer on a Texas reassignment sheet by a Texas dealer) only when attached to that state’s title. An Oklahoma dealer may not reassign on another state’s reassignment sheet attached to an Oklahoma title (example: an Oklahoma title assigned to Texas dealer, then reassigned to an Oklahoma dealer on a Texas reassignment sheet). In that situation, the Oklahoma dealer must apply for an Oklahoma title in the dealership’s name.

If you are a small employer with fewer than 25 full-time equivalent employees who earn an average wage of less than $50,000 per year, and you pay at least half of employee health insurance premiums, there is a tax credit that can put money in your pocket. The Small Business Health Care Tax Credit is specifically targeted to help small businesses and tax-exempt organizations. The credit can enable small businesses and small tax-exempt organizations to offer health insurance coverage for the first time. It also helps those already offering health insurance coverage maintain the coverage they already have. Here is what small employers need to know so they don’t miss out on the credit for tax year 2011: • Qualifying businesses calculate the Small Business Health Care Credit on Form 8941, Credit for Small Employer Health Insurance Premiums, and claim it as part of the general business credit on Form 3800, General Business Credit, which they would include with their tax return. • Tax-exempt organizations can use Form 8941 to calculate the credit and then claim the credit on Form 990-T, Exempt Organization Business Income Tax Return, Line 44f. • Businesses that couldn’t use the credit in 2011 may be eligible to claim it in future years. Eligible small employers can claim the credit for 2010 through 2013 and for two additional years beginning in 2014. For tax years 2010 to 2013, the maximum credit for eligible small business employers is 35 percent of premiums paid. For eligible tax-exempt employers the maximum credit is 25 percent of premiums paid. Beginning in 2014, the maximum credit will go up to 50 percent of qualifying premiums paid by eligible small business employers and 35 percent of qualifying premiums paid by eligible tax-exempt organizations. Additional information about eligibility requirements and calculating the credit can be found on the Small Business Health Care Tax Credit for Small Employers page of IRS.gov.

9

w w w. e - o i a d a . c o m

OK.indd 9

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:41 AM


NHTSA RECALLS F O R M O R E I N F O R M AT I O N , V I S I T W W W. N H T S A . G O V O R W W W. S A F E R C A R . G O V.

BMW 5-Series & 5-Series Gran Turismo, MY 2011 BMW 6-Series & 7-Series, MY 2012 BMW X5 SAV & X6 SAV, MY 2012 NHTSA ID number: 12V161000 Engine and engine cooling: Engine: Other fuel types: Turbocharger Units affected: 2,846

BMW is recalling certain model year 2011 5-Series, 5-Series Gran Turismo, model year 2012 6-Series convertible, 7-Series, X5 SAV and X6 SAV vehicles equipped with eightor 12-cylinder turbocharged engines because the circuit board for the electric auxiliary water pump can overheat. That could lead to a smoldering BMW 6-Series of the pump or an engine compartment or vehicle fire. BMW will notify owners, and dealers will replace the auxiliary water pump free of charge. The safety recall is expected to begin during April 2012. Owners can contact BMW customer relations and services at 1-800525-7417. This recall is an expansion of Safety Recall 11V521. Buick Enclave, MY 2011-2012 Chevrolet Traverse, MY 2011-2012 GMC Acadia, MY 2011-2012 NHTSA ID number: 12V151000 Visibility: Windshield wiper/washer: Linkages Units affected: 50,001

General Motors is recalling certain model year 2011-2012 Chevrolet Traverse, Buick Enclave and GMC Acadia vehicles currently registered in Alaska, Colorado, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Maine, GMC Acadia Maryland, Massachusetts, Michigan, Minnesota, Montana, Nebraska, New Hampshire, New Jersey, New York, North Dakota, Ohio, Pennsylvania, Rhode Island, South Dakota, Utah, Vermont, West Virginia, Wisconsin, Wyoming and the District of Columbia. Snow or ice buildup on the windshield or on the wiper might restrict the movement of the wiper arm, causing the wiper arm to loosen and the wiper to become inoperative. If this occurs, driver visibility could be reduced, increasing the risk of a crash. GM will notify owners, and dealers will tighten the wiper arm nuts, free of charge. The safety recall is expected to begin on or about April 16, 2012.

Ford Focus, MY 2012 NHTSA ID number: 12V149000 Visibility: Windshield wiper/washer: Switch/wiring Units affected: 140,310

Ford is recalling certain model year 2012 Focus vehicles manufactured from Aug. 1, 2010 through Oct. 18, 2011. A seal in the wiring harness connector to the passengerside wiper motor may be missing. Water or other contaminants can accumulate in the connector, resulting in an intermittent or inoperative passenger-side wiper motor, reducing visibility and increasing the risk of a crash. Ford will notify owners, and dealers will inspect and as necessary, clean and properly seal the passenger-side wiper motor connector. Any inoperative wiper motors will be replaced. This service will be Ford Focus provided free of charge. Ford expects the recall to begin on or about May 21, 2012. Owners can contact the Ford Motor Company Relationship Center at 1-866-436-7332. Ford’s Safety Recall campaign number is 12S29. Jeep Compass, MY 2012 Jeep Patriot, MY 2012 NHTSA ID number: 12V142000 Fuel system, gasoline: Storage: Tank assembly Units affected: 1,689

Chrysler is recalling certain model year 2012 Jeep Patriot and Compass vehicles manufactured from Dec. 17, 2011 through Jan. 2, 2012. Some vehicles may have been built with a fuel tank assembly containing a damaged rollover valve. In the event of an impact or rollover, fuel leakage could occur, increasing the risk of a fire. Chrysler will notify owners, and dealers will replace the fuel tank, free of charge. The safety recall is expected Jeep Patriot to begin during June 2012. Owners can contact Chrysler at 1-800-853-1403. Chrysler’s Recall Number is M11.

Chrysler Town and Country, MY 2012 Dodge Grand Caravan, MY 2012 NHTSA ID number: 12V141000 Suspension: Rear Units affected: 289

Chrysler is recalling certain model year 2012 Town and Country and Dodge Grand Caravan vehicles manufactured from Nov. 15, 2011 through Nov. 21, 2011. Some vehicles may be equipped with right rear hub and bearing assemblies that were not fully machined. This could result Chrysler Town and Country in a decrease in durability, which may lead to wheel separation, increasing the risk of a crash. Chrysler will notify owners, and dealers will replace the right rear hub and bearing assembly, free of charge. The safety recall is expected to begin during April 2012. Owners can contact Chrysler at 1-800-853-1403. Chrysler’s Recall Number is M13. Honda CR-V, MY 2002-2004 Honda Pilot, MY 2003 NHTSA ID number: 12V136000 Exterior lighting: Headlights: Switch Units affected: 554,428

Honda is recalling certain model year 2002-2004 CR-V and model year 2003 Pilot vehicles. Due to tension from the combination switch wiring harness, wear on the surface of the electrical terminal can occur, yielding copper oxide, which increases electrical resistance. Increased electrical resistance can cause the terminal ends to melt within the wiring harness connector. If this occurs, the low beam headlights can become inoperative, reducing driver visibility and increasing the risk of a crash. Honda will notify owners, and dealers will repair the low beam terminal harness Honda CR-V or replace the lighting switch as necessary, free of charge. The safety recall is expected to begin on or about April 24, 2012. Owners can contact Honda Customer Service at 1-800-999-1009. Honda’s recall campaign number is S34.

BY ADR STAFF (SOURCE: WWW.NHTSA.GOV)

10

DEALERS’

OK.indd 10

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


OK.indd 11

5/18/12 11:41 AM


BACK TO THE BASICS: GO ALL IN

A Service Department Can Be a Big Edge for Dealers Willing to Make the Commitment For independent dealers, having a service department isn’t something that should be taken lightly. Not all dealerships offer service – it isn’t for everybody – but for those that do it should be an integral part of the business, used to give the dealer an opportunity to attract, retain and better understand customers. Joe Lescota, the NIADA’s new director of dealer development, said he knows many dealers who lose money in the service department because the money that comes in through service goes into one big pot. “There’s a whole process in operating a service department,” said Lescota, the longtime instructor for NIADA’s Certified Master Dealer program. “Dealers think they are selling service when what they’re really doing is selling time. “A dealership only has so many hours in the day to operate. So a dealer should take the number of techs he has and multiply that number by the number of hours in operation. So a dealer might have 80 hours a day of time to sell. From a profit standpoint, it doesn’t matter if the dealer is changing oil or dropping an engine.” Doug and Nyla Borgmann, owners of Creighton Auto, Inc., in Creighton, Neb., manage to keep their mechanic and their body man pretty busy, which is good for their business. That means doing repairs for everyone, not just customers. “Offering service works for us,”

Doug Borgmann said. “We advertise on our store sign. Service accounts for between 25 and 30 percent of business. Our mechanic has been with us since the early 1980s. He’ll retire in four or five years and that has me worried. Replacing him will be hard. Our body man has been with us for about three years. Before getting him, we had a hard time getting someone full time to do our body work.” J.R. Westbrook, owner of Tyro Auto Sales in Bay City, Texas, has been offering service at his store since 1971. He does outside work in addition to working on the cars of customers, but he doesn’t advertise. He depends on word of mouth. Westbrook has kept his technician for years, operating on the theory that it’s easier to keep the person you have happy than go out and find new people. Staff is a key component to offering a good service department. Getting good help was one of the reasons Randy Yates, owner of Yates Motors in Gering, Neb., closed his service center. Yates is a third-generation dealer. His lot has been around for 66 years, and for much of that time, it offered service. Eventually, though, it wasn’t worth the trouble. “We got rid of our old service center, must be around nine years ago,” Yates said. “It was hard getting and keeping good people. I’d train people and they would get the skills they needed to do the job. But then they’d go to

dealerships, often franchise operations, that would pay better wages and I’d have to start the process all over again.” Yates said he realized he was better off if he stuck to what he did best – sell cars. Now he sends his cars to be fixed by people who do what they do best – repair and recondition cars. By letting the work get done by specialists, he doesn’t have to bother with the hassle of hiring and training technicians, then replacing them as they leave his business. Yates said he ended up spending a lot of time trying to drum up business for his mechanics instead of selling cars. “If the mechanics aren’t busy all the time, then they aren’t making as much money as they could be,” Yates said. “It finally came to the point where it became too much work for me to find work for them and for myself. Now I have less headaches just selling the cars and farming any mechanical work out.” He also didn’t have to keep up with the expense of getting new equipment all the time. For one thing, the types of tools a service provider must own has changed dramatically. Gone are the days when a mechanic could do all his work with a lift and some wrenches. Cars now are computerized, and dealers and shop owners have to invest their own money in the purchase of scanners and other electronic devices used to communicate with a vehicle’s electronics. Lescota said Yates’ situation reflects a reality of operating a service department – it’s not easy. But, he C O N T I N U E D O N PA G E 1 4

12

DEALERS’

OK.indd 12

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


OK.indd 13

5/18/12 11:41 AM


C O N T I N U E D F R O M PA G E 1 2

| A Service Department Can Be a Big Edge for Dealers Willing to Make the Commitment |

added, the payoff can be tremendous when the job is done right. “It’s always a challenge to get good technicians,” Lescota said. “So I suggest that dealers go the technical schools and start grooming technicians before they even graduate. Also, you have to give someone a reason to stay at your dealership.” Usually that means giving them enough to do. As Yates discovered, if technicians don’t have enough to do, they’ll go somewhere where their skills will be in more demand. It might also mean giving them more money. After all, technicians have to eat too, Lescota said. “When I hear that a dealer can’t keep a technician, my thoughts first run to him not getting either enough work or enough money,” Lescota said. “And you can’t cheat on the equipment. It’s the cheap man who pays the most for things. By trying to save money on new equipment needed to work on today’s computerized cars, a dealer will end up having to spend a lot of money trying to keep technicians. “People like to work in comfortable environments and technicians are no different from anyone else. I always say if a dealer can’t keep good mechanics, it can usually be traced back to poor lighting, poor parts and poor work conditions. There’s a demand for technicians and they’ll go where they feel most comfortable.” Having a service department is a full commitment, Lescota said. And getting good technicians is a competitive sport between dealers. Maybe that tech left to go to a franchise operation because the boss there promised to send him to an ASE-certified program, where the tech could improve his skill set. Independent dealers should consider similar actions. Bill Elliff, owner of Elliff Motors in Harlingen, Texas, is an example of a dealer who is committed to his service department. His lot provides a full variety of services, and he long ago realized that in order to have a service department, he had to have enough service work to keep his employees busy. To better service his customers, his dealership can do anything from changing oil to engine replacement. He owns a couple of lots with a total

of seven service bays and 10 people working them. He advertises in print and on the signage around his lots. He said finding qualified people isn’t that hard. Finding qualified people who are dependable and can be counted on to show up on time ready to work every day is the tough part, Elliff said. But the effort is worth it. By hiring the right people, a dealer can have a service department that drives potential customers to the store, Elliff said. While they’re getting their car worked on, many of his service customers will wander around the lot and take a look at inventory. Maybe that person is looking for something new, and if he sees something he likes that service customer can be converted into a vehicle customer. Elliff estimates his service department accounts for about 20 percent of his total business. He said some of his fellow dealers don’t realize that a service department has to be able to make it on its own. It shouldn’t be a loss leader. Additionally, he sees dealers actually short-changing themselves when it comes to pricing their cars. A dealer might, for example, put $100 worth of reconditioning in a car he bought for, say, $5,000. When it comes time to price the car, he’ll want $1,000 profit. So he’ll price the vehicle at $6,100, Elliff said. That’s a mistake. Any work put into a vehicle using the dealership’s own service department should be reflected positively in the price of the vehicle. If $100 of work was put into the car, that should translate into adding, say, $200 to the back-end value of the vehicle. So that car should be priced at $6,200, not $6,100. “As an owner, you have to put the money in to develop the infrastructure needed to run a good service department,” Elliff said. “That means having the latest diagnostic equipment. But if you charge right for your services, you will always come out ahead.” Ultimately, having a good service department should mean more than another revenue source, Lescota said. By having a service department aimed at serving the public at large and not just his current customer base, Elliff is bringing in new potential buyers to look at his inventory.

BACK TO THE BASICS: GO ALL IN

He’s creating a captive audience. But a good service department can do even more. When a customer brings in a car, a dealer can glean all sorts of information about the customer. It’s built-in market research. “The smart dealer should now know all sorts of things about that customer,” Lescota said. “The dealer should know how that service customer uses his car. Does he baby it or does he really run it through the ringer and wear it out? With that knowledge, the dealer can better help the customer make an informed decision on the best vehicle to buy when it comes time to get another car.” By having a complete service department, a dealer can get a customer used to bringing his vehicle to his dealership. Need an oil change? Bring the car to good old Joe’s. In an accident? Have the car towed to Joe’s. Need some engine work? Go to Joe’s. “There comes a time in every car’s life when it becomes counter-productive to keep putting more money in that vehicle,” Lescota said. “If you have a good relationship with your customers, and they bring their cars to you for service, you can tell that customer when it’s time to get a new car.” A service department can also help Buy Here-Pay Here dealers with their bottom line, Lescota said. It’s a rule of that segment of the used car business that when a car stops running, the payments stop coming. If a dealer has a service department, the customer can bring the car in to get fixed and the cost of repairs can be added to the payment schedule. A customer might not have $300 on him right then and there, but he can usually make his payments if that $300 is spread out over the rest of the payment schedule. “A good service department gives dealers control,” Lescota said. “It gives the customer a reason to keep coming back to you. But if you’re going to have a service department, you can’t go in halfhearted. As they say in poker, you have to go all in – but the rewards can be huge. “These days, dealers need every edge they can get. Now more than ever, dealers who don’t keep up, fall behind and go out of business.”

BY JIM STICKFORD

14

DEALERS’

OK.indd 14

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:41 AM


OK.indd 15

5/18/12 11:42 AM


INDUSTRY NEWS

| for more information (877) 310-0288 or email automotivesales@amtrustgroup.com

NIADA Gets Independents into the Hottest Thing in the Auto Industry: Certified Pre-Owned Why all this excitement about selling CPO vehicles? As an independent used vehicle dealer, you are likely aware of the recent trend in the automobile industry toward selling certified pre-owned vehicles. The trend began with manufacturer-backed programs for new vehicle franchised dealers and has expanded into the independent used car segment. A vehicle is normally designated as “certified” after undergoing a thorough inspection of key components for both functionality and safety, and completing the needed repairs and reconditioning. Most CPO programs require that the vehicle meets CARFAX standards, assuring the potential buyer he is purchasing a safe and dependable vehicle that is a step above a typical used car. The programs generally include a mechanical breakdown warranty for a specific term and most provide extended coverage options. You might have found it difficult to

compete against dealers selling a certified program, even with a price advantage, because consumers seem willing to spend more for a vehicle that has been certified and comes with some term of mechanical protection coverage. So what are the advantages to you, as an independent dealer, of selling CPO vehicles? There are several: • An enhanced image in your marketplace. • Improved gross revenue and increased profitability created by the sale of more vehicles. • The ability to compete with franchise dealerships that offer CPO programs. • An edge on the competition. • Increased customer satisfaction and confidence. CPO is very much the cutting edge of the used auto industry. Sales are growing rapidly. As reported in Auto Remarketing, CPO sales reached 174,471 vehicles in March, the most certified units ever sold in a month, according

to the latest numbers from Autodata Corp. That closed the best quarter ever for CPO sales – a record 454,944 vehicles sold in the first three months of 2012, up 8.4 percent from the first quarter of 2011. In its 2010 Used Vehicle Market Report, J.D. Power and Associates found 67 percent of all used car buyers began their purchase process planning to buy a certified vehicle, and 21 percent of CPO buyers were not originally looking for a certified vehicle. Given the obvious consumer interest in them, it’s no wonder CNW Market Research found certified vehicles turn almost 20 days faster than non-certified, with an average 24.8-day turn. CNW’s March statistics also showed CPO sales provide dealers with 12 percent to 17 percent additional profit – an average of $2,274 per unit – versus the sale of non-certified used vehicles. And that premium has been rising steadily since January 2011. The market potential is huge. More than C O N T I N U E D O N PA G E 1 8

16

DEALERS’

OK.indd 16

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


OK.indd 17

5/18/12 11:42 AM


C O N T I N U E D F R O M PA G E 1 6

| NIADA Gets Independents into the Hottest Thing in the Auto Industry: Certified Pre-Owned

35 million used vehicles were sold in 2011, but less than 2 million were certified by manufacturer programs. Independent dealers sold 22.4 million cars in 2010. An independent dealer who chooses to sell certified pre-owned vehicles can expect to earn a larger share of that enormous market and earn a higher percentage of repeat customer sales as a result of the higher level of customer satisfaction with a CPO vehicle. Victor Salvato, president of Auto Sales Outlet in Rochester, N.Y., is an independent dealer who has experience offering a CPO program to his customers. Salvato said advertising certified vehicles made an immediate impact on his dealership in a variety of ways. “The quality and volume of the responses to our advertising improved immediately,” he said. “It was obvious that we were reaching a higher quality prospect who was interested in a higher quality vehicle based on the customer’s perception of what a certified vehicle is. We can thank the manufacturers and franchise dealers for educating our customers through their promotion of certified vehicles. “Not only have we sold more cars, but our profits have increased as well. Being a certified dealer has definitely improved our image and our credibility in the

marketplace, and we are beginning to see an increase in repeat sales as well.” The New NIADA CPO Program NIADA has partnered with Warrantech, an AmTrust Financial company, in the design and administration of its new certified pre-owned program. NIADA completed extensive research with its dealer members to assure that the program it is providing is exactly what the dealers want. The combined efforts of NIADA and Warrantech, and the input of the dealers consulted, have resulted in a program that is innovative, marketable, flexible and financially sound. The NIADA CPO program is much more than a 125-point inspection and a warranty. The program is truly a “selling system.” All eligible vehicles must be certified, a requirement that insures the integrity and credibility of the program. The dealer selects one of three limited warranty terms that are complemented by flexible and affordable wrap-around and extended coverage options for the consumer. With three unique plans under the NIADA CPO program, dealers will be able to select the option that is right for their market and their customer base. The options include: • A three-month/3,000-mile

limited warranty that includes 36 months/36,000 miles of engine and air conditioning component coverage. • A six-month/6,000-mile limited warranty that includes 36 months/36,000 miles of engine and AC component coverage. • A 12-month/12,000-mile limited warranty. The NIADA CPO limited warranty options include coverage of engine, air conditioning, turbocharger or supercharger, automatic and manual transmission, transfer case, drive axle, steering components, select electrical components and seals and gaskets. For more consumer choice and confidence, the NIADA CPO limited warranty options can be supplemented by adding the extended NIADA Total Care or the NIADA Total Care Plus coverage, which includes front and rear suspension, brakes, fuel system, cooling system and additional electrical components. “In re-tooling the NIADA CPO program, we recognized independent dealer business models vary widely and that we had to offer additional CPO options to specifically meet the operational demands of our dealers,” NIADA chief operating officer Steve Jordan said. “Warrantech’s successful track record with independent auto dealers, varying product offerings, world-class

18

DEALERS’

OK.indd 18

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


claims operation, nationwide sales footprint and long-term commitment to support the success of our dealer members made the partnership decision easy to make.” The program is easy to sell, provides coverage from day one and a solid benefits package, day one rental coverage (no minimum shop time), simplified pricing, low-cost surcharges and eligibility guidelines that are very generous – current plus 14 model years and 100,000 miles at time of sale. The program is supported by a wealth of top-quality marketing and merchandising materials to promote the program throughout the dealership, all proudly displaying the familiar logo of NIADA. An NIADA-backed CPO program adds even more credibility for dealers who choose to market it. NIADA brings the strength of more than 18,000 dealers nationwide, the stability of 66 years of experience and the dependability of being the dealers’ voice to regulators, suppliers and, most importantly, consumers. “Warrantech is honored to have been selected by the 66-year old NIADA as its CPO program administrator,” Warrantech CEO Sean Stapleton said. “We applaud the time-honored tradition of excellence NIADA member dealers observe, including their adherence to a strict code of ethics.

We feel that commitment mirrors Warrantech’s dedication to excellence and drive to provide superior products and continued quality customer service.” NIADA, with the support and participation of the state independent dealer associations around the country, is excited to make this program available to its member dealers. Warrantech and AmTrust In selecting Warrantech/AmTrust as the administrator of the program, NIADA has partnered with a worldclass provider of warranty products and administrative services. For more than three decades, Warrantech has been the solution for manufacturers, retailers, dealers, distributors and other sales organizations seeking increased profitability, enhanced market differentiation and long-term customer loyalty. Those clients include Volvo, Mazda, General Motors, Ford, Chrysler, Sony, Samsung, Panasonic, PepBoys and many more familiar names. AmTrust, rated “A” Excellent, FSC IX by A.M. Best, fully insures the NIADA CPO program, adding the financial strength and security necessary to protect the dealers who market the program and the consumers who are protected by the product.

Warrantech provides a state-of-theart claims center that houses more than 300 experienced claims adjustors. All automotive adjustors are ASE-certified technicians with an average tenure of more than 10 years with the company. Claims service highlights for the CPO program include: • Instant credit card payment. • Repairs can be completed at the selling dealership or sublet to any licensed shop or franchised dealer. • Multiple, convenient methods of submitting claims. The NIADA Certified Pre-Owned program is designed to give dealers more options to better serve their customers, allow them to compete with manufacturer CPO programs and provide them with a competitive edge against other used car dealers in their marketplace that do not offer a CPO advantage. If you are interested in marketing the new program or just want more information, please call (877) 310-0288 or email automotivesales@amtrustgroup.com.

BY PATRICK REED PATRICK REED IS BUSINESS DEVELOPMENT MANAGER FOR WARRANTECH/AMTRUST GROUP IN BEDFORD, TEXAS. HE HAS MORE THAN 35 YEARS OF AUTOMOTIVE INDUSTRY EXPERIENCE, FOCUSING ON VEHICLE SERVICE CONTRACTS. HE CAN BE REACHED AT PATRICK. REED@AMTRUSTGROUP.COM OR (817) 785-6248.

19

w w w. e - o i a d a . c o m

OK.indd 19

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


OIADA Forms

In order to provide maximum protection for dealers and their customers, OIADA staff goes to considerable effort and expense to provide forms that comply with federal and state laws, rules, and regulations. The use of non-compliant forms, incompatible forms and improperly used forms are among the first things consumer attorneys look for as a way to break a car deal or sue a dealer. In tough economic times, it is more important than ever that dealers do all they can to protect themselves and their dealerships against federal and state enforcement officers and consumer attorneys. Both the federal government and the state of Oklahoma have forms requirements. Some requirements overlap; others don’t. To make compliance easier and less expensive for you, we have in some cases combined one or more document requirements into a single form. For example, the OIADA Retail Purchase Agreement/Multiform satisfies the requirements of seven separate forms. OIADA also offers forms that are not necessarily required by either state or federal agencies, but are designed to protect the dealership’s assets resulting from misunderstandings that may occur in a car deal. These forms have been developed as a result of court rulings in lawsuits against dealers. The following table is a partial listing of forms available from OIADA, the requirement or purpose that the form is intended to satisfy, and whether the form is required or optional based on the type of sale. Cash Sale * Finance Sale ** OIADA Form Requirement / Purpose Required Optional Required Optional Before the Sale F04 FTC As Is Buyers Guide X X FEX 100 Customer Proposal Worksheet X X FEX 102 Test Drive Agreement X X F13 Credit Application X At time of Sale F06 Retail Purchase Agreement / Bill of X X Sale - Satisfies the following requirements Retail Purchase Agreement Vehicle Buyer’s Order Dealer Warranty Statement Deposit / Down Payment Receipt Trade-In Record Other Material Understandings Additional Terms and Conditions F10.3 or FEX 123 “We Owe” or Delivery Confirmation X X F02 Odometer Disclosure Statement (Purchase Vehicle) X X F02 Odometer Disclosure Statement (Trade-In Vehicle) X X OR F06.2 Retail Purchase Agreement/Multiform: Satisfies same requirements as F06 plus FEX 123 Delivery Confirmation and both F02 Odometer Disclosures. F08 or F08.3 Finance or Security Agreement X F205 Privacy Notice X FEX 119 Authorization to Release Payoff Information X FEX 121 Credit Insurance Disclosure X FEX 120 Notice to Co-Signer (If co-signer is involved) X F09 Oklahoma Lien Entry Form (If vehicle has lien) X F206 Risk-Based Pricing Form or Credit Score Exception Notice (If Dealer engages in Risk-Based Pricing, i.e. set APR based on credit report) X FEX 101 Trade-In Vehicle Appraisal X X FEX 125 Acknowledgement of As Is Sale X X F12 “Good Will” Repair Acknowledgement (If repairs are to be made after the sale.) X X At time of Sale F03 30-Day Notice Title Receipt X X F11 Deal Jacket X X * “Cash Sale” -- Dealer IS NOT involved in financing. Customer pays cash or arranges own financing. ** “Finance Sale” -- Dealer IS involved in financing. Dealer either arranges third-party financing or finances directly. 20

DEALERS’

OK.indd 20

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


21

w w w. e - o i a d a . c o m

OK.indd 21

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


Stars GPS We are pleased to include Stars GPS as an OIADA Branded Provider of vehicle tracking and recovery solutions for our industry. Stars GPS specializes in providing the best technology with personal service, training and support for the independent and franchise dealership. For more information, go to www.stars-gps.com, email info@ stat-gps.com or call 877-828-4770.

David L. Nunn, Esq. David L. Nunn heads the Edmond, Okla., law office of David L. Nunn, P.C., which serves the greater

License Applicants Approved

The following applicants, as listed in the agenda for the Used Motor Vehicle and Parts Commission regular meeting of April 10, were considered for issuance of used motor vehicle dealer licenses and wholesale vehicle dealer licenses. The applications were approved pending compliance with state licensing laws and rules, and subject to final approval by commission staff. The following applicants had compliance issues that affect final approval: Legacy Motors of Oklahoma City lacked attendance to the educational program and was subject to further financial review. Weird Al’s Auto Sales, LLC, in Claremore was subject to further financial review. The application of Superb Motors, LLC, of Tulsa was deferred for further action.

metro Oklahoma City area. We

Used Dealer Licenses

are pleased to include Mr. Nunn as

COMPANY NAME CITY Alameda Auto Lube & Car Care David Clark Norman Auto World of Muskogee, Inc. #2 Ronnie Boswell Muskogee Automay Car Sales, Inc. Fareb Shadaram Oklahoma City Amer Shadaram D & L Auto & Boat Sales Charles Larry Herrelson Grove Billy Doug Hulse Down the Road Motors Casey Enlow Sapulpa Hitchin Post motors Trevor Lackey Fairview Tresa Lackey Legacy Motors Mehran Mohtashami Oklahoma City Lumpy’s Auto Sales Lawrence Kevin Hall Oklahoma City Pratt Auto Sales Ryan Pratt Checotah Smart Auto Wholesale, LLC Brandon Foster Tulsa Spirit Credit Auto Sales Randy Armstrong Sapulpa Ben Armstrong Jesse Webb Superb Motors, LLC Adrienne Whitworth Tulsa *Twin Peaks Auto Sales Howard Weinard Shawnee (Salesperson James Weinrich is a resident of Oklahoma City; salesperson Dylan Weinrich is a resident of Mustang) *US Auto Center Sales, LLC Katherine Karney Bixby (Two on a lot with Thrifty Car Sales of Bixby) Robert Cummings Jonathan Lilly T. Posey Consulting, LLC Arthur A. Johnson, Jr. Weird Al’s Auto Sales, LLC Allen Clark, II Claremore Win-Sons Motors, LLC Tim S. Ferree Oklahoma City Claud Edgar “Edd” Windle

an OIADA Select Provider of legal services to the industry. David L. Nunn, P.C. is located at 17 East First Street, Edmond, OK 73034. He can be reached at 405-330-4053 or by fax at 405-330-8470. Mr. Nunn is included as a Select Provider not because he asked to be, but because we know the quality of service that he provides to dealers.

B & C Auto Transport, Inc. B & C Auto Transport takes pride in providing fast, dependable transport service to auto dealers nationwide. We are pleased to include B & C Auto Transport, Inc. as an OIADA Select Provider of transport services for auto dealers nationwide because of its record of providing outstanding service at reasonable rates. Call 405-381-0114 or 405-641-6057 (cell), or email BCAutoTransportInc@ gmail.com.

* Special circumstances

Wholesale Dealer Licenses

COMPANY NAME CITY Awesome Auto Sales Keith Whitehouse Tulsa Jackie Pemberton Motors, LLC John L. (Jackie) Pemberton Oklahoma City Karen L. Pemberton Rhynes Auto Sales Leland Rhynes Madill

22

DEALERS’

OK.indd 22

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


23

w w w. e - o i a d a . c o m

OK.indd 23

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


T H E L AT E S T

| visit carfax.com

CARFAX Introduces Its Latest TV Ads

CARFAX has launched its newest wave of television ads as part of the national “Show Me the CARFAX” campaign. Starring again in all of the ads to deliver the message of smarter used car shopping is the knowledgeable Car Fox. The spots, which humorously depict people buying used cars from various types of sellers, illustrate how CARFAX vehicle history reports can build confidence in the cars people buy as well as the dealers from whom they’re buying. Car Fox issues a friendly reminder for consumers to make an educated buying decision from a trusted seller by saying, “Show Me the CARFAX.” “Smart used car shoppers make good buying decisions by consulting the experts first,” CARFAX communications director Larry Gamache said. “An inspection by a qualified mechanic and a trusted CARFAX Report is the best one-two punch. “We’ve watched Car Fox help boost traffic at dealerships and build confidence with consumers everywhere since he became part of the ‘Show Me the CARFAX’ campaign. We fully expect that success to increase with these latest ads.” The new ads can be viewed on the CARFAX channel on YouTube or the company’s website, carfax.com. “The ads featuring Car Fox have been wildly successful,” said Zevin Auerbach, a creative partner at Zimmerman Advertising. “The new series will give fans something to really look forward to. In essence, they’re mini-TV shows with a car dealer as a recurring character. The imaginative dealer is constantly trying to outfox Car Fox with a series of gimmicks like a ‘seal of approval,’ which is actually a live sea lion. “Of course at the end, the customer says ‘Show me the CARFAX,’ as our dealer makes one last humorous attempt to provide an alternative.” Carfax gives free marketing materials featuring Car Fox to dealers, including an inflatable Car Fox for Carfax Advantage Dealers.

24

DEALERS’

OK.indd 24

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


SMALL BUSINESS DEPARTMENT OF THE TREASURY IRS ENTERPRISE COMPUTING CENTER P.O. BOX 33116 DETROIT, MI 48232-0116

Person to Contact: Dail Hughes, ID#02-37367 Tax Law Specialist Telephone Numbers: 1(866)270-0733 option# 3 or (313)2346146 Refer Reply to: SE: S:/FBSA:PO:DCC: CTR SG120487 Date: April 5, 2012 Dear Sir or Madam, The Financial Crimes Enforcement Network (FinCEN), via the Internal Revenue Service Enterprise Computing Center-Detroit (ECC-D), has received the Form(s) 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, dated February 27, 2012. We are unable to process the Form(s) 8300 because you did not submit the correct form version. FinCEN updates Bank Secrecy Act

forms approximately every three years and financial institutions must submit the most current version of a form. Please resubmit the form(s) as soon as possible and no later than 10 business days upon receipt of this letter. Failure to properly file a BSA form may result in fines or other penalties. If you need to resubmit this form(s) on paper, please visit FinCEN’s website to obtain and download the most current version of the form: http://www.fincen.gov/ forms/bsaforms/. Make sure that you mail the form(s) to the address identified in the “When and Where to File” section of the particular form. Do not mail the form(s) to the address at the top of this letter. If you have any questions about this letter, please contact Dail Hughes @ 1 (866) 270-0733 option #3. Thank you for your assistance.

OIADA New and Renewal Members MARCH 2012

The following list includes members who joined or renewed their OIADA/NIADA membership during March. We express our sincere appreciation for all the members of OIADA and extend our invitation to dealers who are not members. A membership application can be found elsewhere in this newsletter. We urge you to be an active part of maintaining a strong and effective used car industry voice in the legislative and regulatory environment. With the current administration’s attitude toward the motor vehicle sales industry, we need that voice more than ever!

COMPANY

NAME

JOINED CITY

R

Jerry Petty Motor Co.

Jerry Petty

1991

Tulsa

R

Jerry Carter’s Used Cars

Jerry Carter

2007

Park Hill

R

David Stanley Hyundai

David Stanley Hyundai 2006

Oklahoma City

R

Randy Bowen Chevrolet, Inc.

Randy Bowen

1997

Chandler

R

Premier Motors, Inc.

Craig A. Hacker

1991

Bartlesville

R

McNair’s Auto Sales

Phil McNair

1992

Marlow

R

German Auto Sales

Leland German

2004

Manchester

R

Sooner Sports & Imports

Eemen Raunak

2005

Moore

R

Johnson’s Miscellaneous Used Cars Gayle Johnson

2007

Altus

R

The Car Store of Oklahoma City

Jim Holman

2006

Oklahoma City

R

Meek’s Auto Sales

Mark Meek

1995

Marlow

N

Generation Auto Sales, Inc.

Tiffany Claunch

2012

Lexington

R

American Auto Mart

D.C. Enterprises of Tulsa 2005

Tulsa

R

3 N 1 Auto Group

3 N 1 Auto Group

2011

Oklahoma City

R

Vassar Motors

Ronald Vassar

1999

Woodward

R

Rick Jones Auto Sales #2

Rick Jones

2010

Warr Acres

R

Auto Pro Auto Sales

Ron Hockett

1995

Oklahoma City

R

A & D Auto Sales, LLC

Dennis R. Dean

2001

Tulsa

R

Ben’s Used Cars

Carrol Strum

2001

Bartlesville

R

Car Search Auto Sales

Tyson Heltzen

2006

Norman

R

Express Motor Company

Kelly Burrows

2003

Chickasha

R

Wetzel Agency, Inc.

Wetzel Agency, Inc.

2005

Ponca City

25

w w w. e - o i a d a . c o m

OK.indd 25

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


26

DEALERS’

OK.indd 26

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


OIADA Can Help Make

Your Path

Certain.

Oklahoma Independent Automobile Dealers Association For $295 You Get Membership In Both OIADA and NIADA Plus All Of The Following Benefits And Even More That Are Not Listed!

Programs for Extra Profit

• Access to Insured Warranty & Service Agreements • How to Structure a Related Finance Company • Networking Opportunities With Other Dealers

Programs to Help Keep Profit

• NADA Guide Books – single copy or subscription • Black Book Guide Books – single copy or subscription • Dealer Bonds - Salesmen’s Bonds • Discount on complete line of State approved Business Forms • Discount on Dealer supplies National Dealer Network Skip Tracing Contacts

Publications Public

• OIADA Magazine/Newsletter • Federally Required Safeguards Policy Document • Federally Required Red Flags Rules Policy Documents • IRS Audit Technique Guide For the Independent Used Car Dealer • Current Industry Information • Legislative Alerts • NIADA Monthly Magazine • NIADA Annual Buyer’s Guide

Professional Development

• Dealer Educational Seminars • Certified Master Dealer Program • Regional Professional Development Compliance Seminars • Free Access to NIADA.tv Training at Your Business • Access to IndependentDealer.com where dealers go for answers • NIADA Membership and Window Decal • OIADA “Symbol of Integrity” Logo, Window Decal and Membership Plaque • NIADA Annual Convention and Trade Show • Individual Assistance by phone • Code of Ethics

Representation

• State Lobby and Consultant Services • State Legislative and Regulatory Tracking and Reporting • Federal Lobby and Consulting Services • Federal Legal, Legislative and Regulatory Tracking and Reporting • Used Motor Vehicle and Parts Commission Liaison • Oklahoma Tax Commission Liaison • Oklahoma Department of Consumer Credit Liaison • Full Time Professional Staff to assist you when problems arise

Members Can Also Sign Up For Automotive Dealers Rewards From

Automotive Dealers Resource Of Oklahoma and Earn Money Saving Coupons For Their Future Purchases. Visit http://rewards.buyadr.com/

Automotive Dealers Rewards is open to Members and Non-Members Who Purchase From ADR of Oklahoma

Join OIADA online at http://www.e-oiada.com/join 27

w w w. e - o i a d a . c o m

OK.indd 27

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


28

DEALERS’

OK.indd 28

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


29

w w w. e - o i a d a . c o m

OK.indd 29

JUNE 2012

DEALERS’

RESOURCE

5/18/12 11:42 AM


Continued Rise in Used Vehicle Exports Note from ADR staff: Several dealers have mentioned to us recently what appears to be a significant trend – an increasing number of used vehicles bought at auction are destined for overseas markets. Dealers report the trend is driving up wholesale prices and reducing inventory. The following information on vehicle export trends is excerpted from a March 28 article by Thomas Klier of the Chicago Federal Reserve Board. The article in its entirety can be accessed online at http://midwest.chicagofedblogs.org/archives/auto_industry/. The graphs are based on data from the U.S. International Trade Commission (USITC). According to the data presented by Mr. Klier, 50 percent of the used vehicles exported from the U.S. are being sent to markets in Africa and the Middle East. FIGURE 1

Exports During the past two years, exports of new and used vehicles from the U.S. have continued the strong growth exhibited since 2003. After the sharp decline of activity during the latest recession, exports rose again sharply and by the end of 2011 had nearly matched the prerecession peak reached in 2007 for new vehicles and in 2008 for used ones (figure 1).

Table 1 provides more detail regarding destination countries and regions for exports of new and used light vehicles from the U.S. While Canada and Mexico together represent the primary destinations [for new vehicles], the relative importance of these two NAFTA partners has fallen a bit since 2007, representing 55 percent in 2011, down from 64 percent four years ago as most of the growth in exports of U.S.-produced new vehicles originated from elsewhere. Last year, Germany and China were as important as Mexico as destinations for U.S.-produced new vehicles. Exports of used vehicles, on the other hand, are much more dispersed. Nigeria, Benin and the United Arab Emirates jointly account for nearly one-third of all U.S. used-vehicle exports. One of the factors behind this trend is the implementation of new trade agreements, such as the U.S. free trade agreement with South Korea that was ratified in November 2011 and reduces South Korea’s tariff on passenger vehicle imports from 8 percent to 4 percent. Both the Detroit-based carmakers – Ford, General Motors, and Chrysler – and Honda and Toyota have announced a noticeable increase in exports of vehicles produced in the U.S. to South Korea. In the case of the Japanese-based carmakers, the decision to export to South Korea from North America instead of from Japan is likely influenced by exchange rate trends, which have strengthened the yen for some time. TABLE 1

BY THOMAS KLIER SOURCE: USITC

30

DEALERS’

OK.indd 30

RESOURCE

JUNE 2012

w w w. e - o i a d a . c o m

5/18/12 11:42 AM


s

OK.indd 31

5/18/12 11:42 AM


OK.indd 32

5/18/12 11:42 AM

Oklahoma Dealers Resource  

Oklahoma Independent Automobile Dealers Association

Read more
Read more
Similar to
Popular now
Just for you