Mid-Atlantic Dealer News - August 2024

AU G U S T 2 0 2 4 • M I D AT L A N T I C I A D A . O R G

MIDATLANTIC

DEALER NEWS

H I G H L I G H T I N G P E N N S Y L V A N I A • M A R Y L A N D • D E L A W A R E

The 2024 Convention & Tailgate is around the corner!

Check out the agenda, speakers, sponsors & more!

Enhancing Operations for Independent Used Car Dealers!

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MIDATLANTIC INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION 1501 North Front St., Harrisburg, PA 17102

Revving Up:

Senate Bill 1129 Advances to Streamline Vehicle Salvage and Auction Processes

The quiet before the storm:

NADA vs FTC/CARS Rule

NIADA Policy Conference PLUS

The Other Shoe Just Dropped

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AUGUST 2024 | CONTENTS

The official magazine of the

MIDATLANTIC INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION PENNSYLVANIA • MARYLAND • DELAWARE 1501 North Front St., Harrisburg, PA 17102 (717) 238-9002 midatlanticiada.org Noah Melamed, Chairman Ticket to Ride Auto, Lancaster, PA nmelamed@yourttr.com Bert Straub, President 1st Choice Auto LLC, Fairview, PA bertcstraub@gmail.com Dan Limongelli, President-Elect Jo Dan Motors, Plains, PA jodanmotors@gmail.com Lisa Cohowicz, Interim Treasurer North East Pennsylvania A/A, Scranton, PA lisac@nepautoauction.com Clint Weaver, Secretary America’s Auto Auction Harrisburg, Mechanicsburg, PA clint.weaver@americasautoauction.com Tom Hodges, Vice-President Tom Hodges Auto Sales, Hollywood, MD tom@tomhodgesauto.com Michael Mansour, Vice-President Car Connection, Inc., New Castle, PA mike@carconnection1.com Beth Melamed, Vice-President Ticket to Ride Auto, Lancaster, PA bmelamed@yourttr.com April Hollobaugh ajautosalestitusville@gmail.com A&J Auto Sales, Titusville, PA James Makia james@exclusivemotorcarsmd.com Exclusive Motorcars, Randallstown, MD Dan McNamee dtlcars@aol.com Daniel Thomas Auto Sales, Croydon, PA Gregg Pachik gregg.pachik@manheim.com Manheim Philadelphia, Hatfield, PA Kerri Rotunda kerrir@corryade.com America’s Auto Auction Erie, Corry, PA

FEATURES 5 | 2024 Convention & Tailgate You're invited to join us at our annual convention! It promises to be an inspiring gathering filled with valuable insights and networking opportunities.

6 | Convention Agenda & Featured Speakers MARIADA has invited some of the industry’s most reputable experts to share their knowledge with dealers. We look forward to your feedback! And check out the exciting offerings at this year’s big event in Atlantic City! From a fun opening reception to a football party and countless industry speakers, it will be our best convention yet!

7 | Convention Sponsors Without the generosity of these industry partners, our Convention and Expo would not be possible. When you see these gracious representatives around this year, please thank them for their support.

10 | Revving Up: Senate Bill 1129 Advances to Streamline Vehicle Salvage and Auction Processes This legislation aims to prevent economic waste and encourages dealers not to abandon their vehicles at auction 14 | The Other Shoe Just Dropped The costs of failing to prepare for cyberattacks can be staggering and can include economic damages, reputational risk, and regulatory and legal scrutiny.

16 | The quiet before the storm: NADA vs FTC/CARS Rule Get prepared, because I believe that this rule will go into effect before the end of the year!

19 | Enhancing Operations for Independent Used Car Dealers!

Introducing SmartLot, an advanced automotive application powered by state-of-the-art AI technology, designed specifically for independent and retail auto dealers.

DEPARTMENTS 2 | 4 | 15 |

President’s Message Executive Director’s Message Basic Agent Training Course

20 | 22 | 24 |

PA Title & Registration Services NIADA Policy Conference Auction Directory

q

MIDATLANTIC INDEPENDENT AUTO DEALERS ASSOCIATION SPONSORS

Danielle Royer royers322motors@gmail.com Royer’s 322 Motors, DuBois, PA _____________________________ Tom Brandis • Executive Director tom@midatlanticiada.org WOULD YOU LIKE TO RECEIVE A DIGITAL EDITION OF THE MIDATLANTIC DEALER NEWS MAGAZINE? Email steve@midatlanticiada.org Copyright 2024 MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 1

q EXECUTIVE DIRECTOR’S MESSAGE

GEARING UP FOR COOLER DAYS AND HOT EVENTS Hello Dealers, First off, before I recap the NIADA Convention and promote our upcoming MidAtlantic Annual Convention & Vendor Tailgate, I want to send a shout out to all of the dealers who are out in this crazy heat, grinding in the lanes, doing it old school, and buying iron to support their families. You all are the heart of our industry. I just want to say thank you and cooler days are coming.

A few weeks ago, I, along with members of our Board, were honored to represent MidAtlantic IADA at the NIADA Annual Convention at the Wynn Hotel in Las Vegas. We were able to gain knowledge from some of the best presenters and vendors in our industry along with sharing ideas and networking with dealers from across the nation. If you haven’t had the opportunity to attend the National Convention, I recommend planning to attend next year.

Executive Director MidAtlantic IADA Tommy Brandis

For those who were unable to spend time in Vegas, I have some great news for you. We are bringing the Vegas convention experience right here - to the east coast. The MidAtlantic Annual Convention & Vendor Tailgate is taking place at Caesar’s Atlantic City September 15-17, 2024. This event will offer the highest quality training along with opportunities to interact with vendors at the industry's only Vendor Tailgate for a fraction of the price and no jet lag. Trust me, you do not want to miss this!

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Your One-Stop Shop for Auto Dealer Insurance 2 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

If you want to hear all the details, give me a call or scan the barcode below to register.

I can’t wait to see everyone at Caesar’s Atlantic City!

If you have any questions, concerns, or ideas, I look forward to hearing from you at tom@midatlanticiada.org or at my direct cell phone (215) 805-2034.

Until next month,

Tommy

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q PRESIDENT’S MESSAGE

REFLECTING ON THE NIADA CONFERENCE IN LAS VEGAS: A PRELUDE TO THE MID-ATLANTIC IADA CONFERENCE The National Independent Automobile D e a l e r s Association ( N I A D A ) Conference in Las Vegas was a unique experience packed with exclusive industry insights, unparalleled networking opportunities, and cuttingedge trends. Held at the vibrant heart of Las Vegas, this conference brought together the most brilliant minds and influential players in the automobile industry, creating an atmosphere of learning and collaboration that was truly one-of-a-kind.

HIGHLIGHTS FROM THE NIADA CONFERENCE: KEYNOTE SPEAKER AND WORKSHOPS A standout at the NIADA Conference was keynote speaker Marcus Luttrell. Luttrell, a decorated Navy SEAL and author of 'Lone Survivor,' shared his harrowing experience in Afghanistan, captivating the audience with his tale of bravery and resilience.

Industry leaders also shared their visions and strategies, addressing current market trends, future forecasts, and the evolving landscape of the automobile sector. Workshops and breakout sessions provided practical knowledge on various topics, from digital marketing to inventory management. For instance, attendees learned specific skills, helping dealers enhance their operations and adapt to constantly changing market dynamics.

Luttrell's keynote address inspired and offered profound insights into leadership and perseverance. The conference

also provided numerous networking opportunities, fostering a strong sense of community among attendees. These interactions were invaluable, not just for business growth and development but also for personal connections. The energy was palpable as professionals exchanged ideas, shared experiences, and explored potential collaborations, creating a network beyond the conference walls.

INNOVATIVE EXHIBITS The exhibit hall was a hotspot of innovation, featuring the latest products and services designed to streamline dealership operations and improve customer experiences. The exhibits showcased how technology is revolutionizing the industry, from cutting-edge software solutions to advanced financing options. Seeing so many innovative solutions addressing the challenges independent dealers face was inspiring.

EXCITEMENT FOR THE MID-ATLANTIC IADA CONFERENCE Reflecting on the NIADA Conference's success, we eagerly anticipate the upcoming Mid-Atlantic Independent Automobile Dealers Association (IADA) Conference in September. This event promises to be equally enriching and impactful, tailored to our region's unique needs and opportunities. We can't wait to see you there!

ANTICIPATED HIGHLIGHTS The Mid-Atlantic IADA Conference, themed around the Vendor Tailgate Party, will feature a similar mix of insightful presentations, hands-on workshops, and extensive networking opportunities. It will be a chance to delve deeper into regional market trends, legislative updates, and best practices specific to the MidAtlantic area. The conference will also provide a platform to discuss strategies

4 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

for navigating the post-pandemic market landscape, focusing on resilience and growth.

NETWORKING AND COMMUNITY BUILDING One of the most rewarding aspects of these conferences is the opportunity to strengthen our community. The connections made at these events are professional and personal, forming the bedrock of a supportive network that propels us all to success. I am particularly excited about reconnecting with familiar faces and meeting new colleagues who share our passion for the automobile industry.

CONTINUING THE JOURNEY OF INNOVATION Continuing the innovation journey, the Mid-Atlantic IADA Conference will undoubtedly showcase cutting-edge solutions and emerging technologies. This platform will inspire us to explore new tools and strategies, motivating us to stay ahead of the curve and continue providing exceptional customer service.

The NIADA Conference in Las Vegas was a testament to the vibrant and dynamic nature of the independent automobile dealers' community. It reinforced the importance of continuous learning, adaptation, and collaboration, serving as a reminder of the ever-evolving nature of our industry.

As we gear up for the MidAtlantic Convention and Vendor Tailgate in September at Caesars in Atlantic City, I am filled with anticipation and excitement. This upcoming event represents another step forward in our journey toward excellence in the automobile industry, a journey that is fueled by our collective commitment to innovation and growth. n

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Reflecting on an Impactful Year: Curing Kids Cancer's Ongoing Mission

By Gráinne Owen, Co-Founder and President, Curing Kids Cancer PROCEEDS FROM THIS YEAR'S CONVENTION CHARITY AUCTION BENEFIT CURING KIDS CANCER

As we share another impactful year with our supporters, I am both astonished and excited by the incredible progress we’ve made together in the fight against childhood cancer. With the unwavering support of our community, Curing Kids Cancer has raised over $29 million, a testament to our collective efforts. Yet, the true measure of our success lies not in the amount we raise, but in what we can achieve with it to help “our” children.

against Acute Lymphocytic Leukemia impact and your generous contributions, (ALL) continues to inspire Curing Kids we honor Killian’s memory and pledge to Cancer. Although Killian’s time with us continue the fight until no child has to was too short, his bravery, resilience, endure the pain of cancer. and spirit fuel our mission to eradicate childhood cancer. His legacy lives on Thank you for your dedication and support in every life saved, every breakthrough as we strive to create a future where no child MidAtlanticDealerNews-AUGUST2024-PRINT.pdf 1 7/12/24 10:54 AM achieved, and every family given hope suffers from cancer. With heartfelt gratitude through our efforts. As we reflect on our and many blessings to you all. n

Everyone’s contributions are vital to advancing pediatric cancer research, enabling the development of more effective and less toxic treatments tailored to the unique needs of children.

C

M

Y

Traditional adult therapies are often too harsh CM for young bodies, and your support ensures that we can continue to make significant MY strides in creating better treatment options.

CY

Thanks to our dedicated donors and CMY community, we have empowered doctors to make remarkable advancements through K collaborations with medical institutions, researchers, and philanthropic partners. Our successful fundraising events, such as fire truck pulls and golf tournaments, have not only raised essential funds but also united communities in the fight against pediatric cancer. Additionally, patient families have become ambassadors for CKC, organizing events in partnership with us to honor their children and all children who have battled these diseases.

Our resilience mirrors the enduring strength of Killian Owen, whose courageous battle MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 9

q LEGISLATIVE UPDATE

Revving Up: Senate Bill 1129 Advances to Streamline Vehicle Salvage and Auction Processes

BY TYLER BURKE, ASSOCIATE, MILLIRON & GOODMAN GOVERNMENT RELATIONS On June 11th, the Senate Transportation Committee considered Senate Bill 1129 (Flynn-D), which amends Title 75 (Vehicles) regarding certificates of title and security interests, further providing for the transfer to vehicle salvage dealers and scrap metal processors. The bill adds subsections outlining the conditions under which a vehicle salvage dealer and a scrap metal processor can purchase a vehicle from an insurer, on which a total loss payment has been made, without obtaining a certificate of title or salvage certificate for the vehicle.

During this meeting, Minority Chairman of Transportation and bill sponsor, Senator Marty Flynn, offered an amendment that added language to Senate Bill 1129. This amendment authorizes wholesale vehicle auctions or salvors to remove vehicles that have been abandoned at auction for three or more days. The amendment was unanimously adopted, and the bill was reported unanimously by the committee.

The language added to Senate Bill 1129 is identical to House Bill 103, which was introduced

by Rep. Louis Schmidt in the House. This language ensures that auctions are compensated for any expenses incurred during the wholesale vehicle auction process. These expenses include the cost of storing, providing notice, obtaining title, and processing the vehicle.

The remaining proceeds from the sale shall be paid to PennDOT and transmitted to the State Treasurer for deposit in the Motor License Fund.

This legislation aims to prevent economic waste and encourages dealers not to abandon their vehicles at auction. In addition, licensed auction entities are entrusted with auctioning these vehicles between licensed dealer buyers and dealer sellers. This sale can reduce the loss of funds from unpaid storage fees and potentially combat the waste associated with older vehicles, which are often abandoned.

Senate Bill 1129 is now before the Senate Appropriations Committee for consideration.

As this legislation progresses through the legislative process, we will keep you updated. n 10 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

IT’S TIME TO NOMINATE THE BEST OF THE BEST Please take a moment to consider a nomination for the 2025 MidAtlantic IADA Dealer of the Year and send it in today!

Each year, MidAtlantic IADA recognizes and presents the Dealer of the Year Award to one carefully selected dealer.

The award was created to recognize the remarkable accomplishments of MidAtlantic independent dealers. For many years, award recipients have exemplified their commitment to quality and excellence in the industry, outstanding customer service, and giving back to their community to make it a better place for everyone.

This prestigious award not only celebrates business success, but also honors dealers who embody ethical practices and community stewardship.

Your nomination plays a crucial role in acknowledging and spotlighting those who go above and beyond in shaping the automotive industry with integrity and a positive impact.

EMAIL NOMINATION TO: STEVE@PIADA.ORG Steve Smith, Office Manager

3880 Lehigh St, Whitehall, Pa 18052 PH: 610-435-5554 - FAX- 610-435-5557 Email: lehighvalleyautauction1@gmal.com

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We built a marketplace that makes sourcing and selling inventory easier than ever, whenever, wherever, and however you want. With six physical auction locations in the Mid-Atlantic, and access to 10k new listings a day online, you can fill your lot quicker and reach your goals faster. Because our mission is yours.

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THE OTHER SHOE JUST DROPPED

By Steve Levine, Ignite Consulting Partners “Waiting for the other shoe to drop” is an expression used when two bad things are expected to happen, one after the other.

Ever since the FTC’s Safeguards Rule was announced a few years ago, which was the first “bad” thing, I’ve been waiting for a second, and in my mind inevitable event, which is someone in our industry having an incident that brings scrutiny upon everyone else.

THE CYBER ATTACKS ON CDK In my view, the cyberattacks (believed to be ransomware) on CDK Global, a leading provider of dealership management software, is such an event. The other shoe has now dropped, and dropped quite loudly.

It may have even put a hole in the floor.

At this point it’s unknown whether any personal identifiable customer information was obtained by the CDK attackers, but the fact that the attacks forced the company to shut down many of its systems, which resulted in thousands upon thousands of dealerships halting sales and causing other disruptions to business, has grabbed nationwide headlines. In my view, it’s inevitable that the FTC will dig into this event to determine whether the company’s cybersecurity efforts and Safeguards systems were sufficient.

I don’t think they’ll stop there, either. I think that the FTC will want to dig deeper and look into the company’s dealership clients, how they were impacted, and whether they conducted proper vendor management and performed due diligence on vendors, as the Rule requires. The bottom line, in my mind, is that the FTC now has all the reasons it needs to “look under the covers” of vehicle sales and finance companies, service providers, and other industry participants.

A CALL TO ACTION Consider this a call to action. For those of you that have taken the Safeguards Rule seriously, good for you, but I challenge you to ask yourselves whether you’ve been keeping up with your efforts as your business practices have evolved over the past few years. It’s time to confirm that your data protection is robust, that your employees are being adequately trained, and that you have robust incident response plans. If operational changes have taken place since you implemented your Safeguards policies and practices, then it’s time to update your content and stay on top of your business.

For those of you that have chosen, either intentionally or not, to not invest in Safeguards compliance, I implore you to reconsider your approach in light of this

14 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

development. I’ll be candid, I talk to lots of dealers, and I think many fall into this bucket and take a “we’re too small” or “how are they going to find out” approach. That way of thinking is a tremendous risk. Are you willing to bet your business on it?

Whether your IT function is in-house or you outsource this work, now is the time to have a candid conversation with your subject matter experts and find out if they are truly up to the task. In my experience, most IT professionals are great at hardware and system infrastructure, but not everyone has cybersecurity expertise, which is necessary to formulate a defense and protect your business. As part of your review, take a look at the following:

1

Security Assessment: Assess your current cybersecurity measures and look for vulnerabilities. I know of a multiple store dealership that suffered an incident because of one vulnerability. It’s important to understand all of the hardware you’ve deployed, who has access and how. Be sure that you have a process in place to recover laptops, I-pads and phones from terminated employees and turn off their system access.

2

Protect your Data: Be sure to implement robust data encryption that all business data is protected both in transit and at rest.

I realize that dual factor authentication takes time and is inconvenient, but dealing with breach issues is even worse.

3

Employee Training: Your personnel is your first line of defense. Be sure to provide them with training on data protection and best practices. I’m a fan of phishing tests to identify those most likely to open an errant email. Make sure that your entire team uses their own passwords and usernames and aren’t sharing any to save a few dollars on a software license.

a priority. The Boogeyman does exist, and has the powers of investigation and enforcement, thousands of employees, and a big war chest behind it. The recently effective amendment to the Rule that mandates that breaches of 500 or more unencrypted records must be reported to the FTC means that even small companies suffering an incident must self-report and a failure to do so can truly break a business.

THE BOOGEYMAN IS REAL

The CDK security breach should serve as a wake-up call for the entire auto sales and finance industry. Even the smallest stores have lots of personally identifiable information, which makes them an attractive target for the “bad guys”. You’ve solicited the customer’s data, and it’s your duty to protect it. The costs of failing to do so can be staggering and can include economic damages, reputational risk, and regulatory and legal scrutiny. n

It’s time to drop what you are doing and make Safeguards Rule Compliance

Please reach out to Steve at info@ignitecp. com if you’d like to discuss your data

4

Have an Incident Response Plan: The Safeguards Rule places the burden on you to have an Incident Response Plan where you outline the steps you’d take if there was any sort of breach of security incident. It’s well worth the effort to plan ahead.

protection needs. The risk of failing to act can be devastating.

Steve Levine is an auto finance lawyer with over 30 years of experience protecting car dealers and finance companies. He is an owner and Chief Legal and Compliance Officer of Ignite Consulting Partners, which offers guidance on compliance, operations and best practices. In 2022 he published Winning the Fight: A Guide to Protect Car Dealers, which is available on Amazon, or contact info@IgniteCP.com to learn more and get your complimentary copy. Please follow Steve on X @LawyerLevine for compliance and industry related content.

Steve will be appearing at the MidAtlantic Convention and Vendor Tailgate in September and will be hosting Compliance Unleashed East - a three hour workshop packed with information to help dealers protect their business and manage risk.

Attendees will receive a Certificate of Completion from Ignite Consulting Partners.

BASIC AGENT

TRAINING COURSE PENNDOT AGENT AND TITLE TRAINING These in-person courses are conducted by an authorized PennDOT certified trainer.

This required training is designed for motor vehicle agents and their employees who provide agent services to the public. This course covers standard titling and registration forms and procedures.

Course tuition ($225 for members and $300 for non-members) includes a spiral bound 300+ page detailed training manual for attendees and a course completion certificate to retain with their Agent Services Contract for compliance auditing.

If your auction, dealership, or associated business is interested in hosting a public or private training, please email kathy@midatlanticiada.org for details!

Questions? Call Kathy or Cyndi at 717-238-9002.

Upcoming Schedule: July 25 – North East Pennsylvania Auto Auction (860 N. Keyser Ave, Scranton PA 18517) July 31 – Manheim Pennsylvania (1190 Lancaster Rd, Manheim PA 17545) August 13 – ADESA PA (30 Industrial Rd, York PA 17347)

REGISTER AT MIDATLANTICIADA.ORG/EDUCATION

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 15

The quiet before the storm: NADA vs FTC/ CARS Rule

By Ace Christian

I

have been following the progress of the CARS Final Rule for the past 7 months, even more so after the NADA filed suit against the FTC to stop the Rule from going into effect July 2024. Based on everything I have read, the conferences I have attended, and the counsel I have sought, I have one quote that comes to mind: "The man who is prepared has his battle half fought" by Miguel de Cervantes.

So, get prepared, because I believe that this rule will go into effect before the end of the year!

The FTC and the NADA/NIADA have completed submitting their responses to the court.

"The man who is prepared has his battle half fought."

- Miguel de Cervantes

In their filings to the Fifth District courts over the past few months, both parties requested oral arguments. With no changes made to the rule yet, both parties are standing their ground. Due to the impact and gravity the CARS rule will have on the industry, the court will likely grant the request for oral arguments even though in the past the courts have only granted 20% of such requests. We should hear from the courts in the next few months when they will hear these oral arguments.

Based on the submitted responses from both sides and the recent sessions at the NIADA conference by the FTC and the CFPB along with recent responses, history, and the many recent rulings in favor of the FTC and the CFPB by the courts, my prediction is the rule will move forward.

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THE BRIEFS

First, let us look at the recent responses by both parties.

On May 14, 2024, the FTC submitted its brief to the court outlining its argument along with cited cases, statutes, and current regulations already in existence. The FTC’s introduction states the importance of cars in modern-day life, and that the current process of purchasing a car is time consuming, complicated, and opaque. The crux of the FTC argument is that unscrupulous dealers have an unfair advantage over honest dealers. These unscrupulous dealers take advantage of consumers during the sales process and during closing using unfair and deceptive practices where current laws already exist but are not followed. The FTC issued the CARS rule to curb some of these practices (which they list in their brief) and outlined four specific pillars on which they will hold dealers accountable. The FTC claims that these pillars add no new paperwork requirements and that the only increased work by the dealer is to keep records of all sales conversations.

The FTC claims that the NADA challenge under the Administrative Procedure Act, lacks merit and the petition for review should be denied. NADA’s claim that the commission needed to publish an advance notice of proposed rulemaking (ANPRM) was incorrect and that NADA has not shown any prejudice from the lack of an ANPRM. All other arguments, cost-benefit analysis, and the claim that the commission didn’t clearly document the factual basis

for why the rule is needed are all meritless according to the FTC. On June 13, 2024, the NADA submitted its brief to the court outlining its argument along with cited cases, statutes, and current regulations already in existence along with a list of one hundred and eleven certified persons of interest. The NADA petition states that the Rule has several legal flaws, both procedural and substantive, that the FTC wrongly assessed many factors, used unreliable evidence, and miscalculated the cost and benefits of such a rule, and therefore must be set aside. The NADA claims that the CARS Rule will cause more harm than good to the industry and the requirements will cause more confusion and will be burdensome instead of helpful to the consumer.

Again, the NADA stated its challenges that the FTC failed to follow procedures under the Administrative Procedure Act and claimed that the commission needed to publish an advance notice of proposed rulemaking. The NADA claims the FTC used unsupported and unreasonable assumptions to quantify the Rule’s purported time-saving benefits, ignored ways in which the Rule’s new paperwork and disclosure burdens will slow down transactions, and overlooked major categories of ongoing compliance burdens such as third-party vendor fees and disclosure requirements and therefore the rule should be set aside.

THE REASON

I believe the rule will go into effect based on a combination of the briefs and the history of how the rule came to be. The FTC Final rule, the key word being “Final”, has been a long time coming and it is not going away.

To understand why I have this opinion you need to understand the reason behind the rule and its motive. SecureClose wanted to understand the history so we started researching, and this is what we found.\

THE HISTORY

Three meetings were held back in 2011 (Yes that’s right, this all started back in 2011) at

industry roundtables that were presented to industry experts. These round tables were by invitation only and occurred in Detroit, Washington D.C., and Atlanta, where the rule was discussed, argued, and reduced.

This first rule was more robust, while the current version is a slimmed down version resulting in the final rule.

"Get prepared, because I believe that this rule will go into effect before the end of the year!"

THE MOTIVATION

The motivation behind this final rule is believed to be the result of a 2021 Supreme Court ruling that determined that the FTC doesn’t have the authority to seek monetary relief. The FTC could only collect monetary relief in a restitution or a disgorgement. A Disgorgement is a remedy requiring a party who profits from illegal or wrongful acts to give up any profits they made, back to the party, due to illegal or wrongful conduct.

The FTC gets nothing, this NEW Rule allows the FTC to collect monetary relief.

YOUR MONEY! (Reference SCOTUS/ AMG Case 2021) FTC dislikes Voluntary Protecting products or VPP’s. – They want to decrease the volume of these products significantly. In fact, they will be looking closely at any and all add-on products. If you have sold them and have a high closing ratio, they will want to see proof that the consumer agreed. A signature will not be good enough to stand as your proof, you will need Expressed Informed Consent.

THE FIRESIDE CHAT

Lastly, at the 2024 NIADA conference, an associate director of the FTC, Malini Mithal, talked about the CARS Rule in a session called Fireside Chat with the FTC.

In it, Mithal candidly discussed the CARS Rule, why she believed it was necessary, and current practices the FTC hopes to curb.

I know that speaking in front of a, let’s say “semi-hostile” group can be a challenge for anyone and it takes some guts to do.

For that, I am appreciative that the FTC agreed to do the session. The NIADA was very grateful that the associate director agreed to participate and the questions were obviously sent beforehand to give the FTC a leg up on their responses, and that is essentially the entire session. A scripted question and answer is normal with any fireside chat, especially if you want the speaker to come back. The most exciting part of the session was at the end. With only 3 min left, the moderator asked the audience if they had questions. The first hand up was Jeff Bellant with Used Car News, who asked a very direct question, “Explain expressed informed consent and how you will regulate it?” The response was “The rule defines expressed informed consent, you need to interpret it the way you see fit, when we regulate it at a dealership we will notify you if your interpretation was correct or not at that time.” There were two more questions with the same type of response and after the session ended, 20 or more attendees ran up to the front to ask additional questions, I gave up after waiting 10 minutes to ask my own questions. The FTC response made me feel like they are not willing to be pinned down to give specifics and that everything needed to be left open to interpretation to make the new rule work toward the FTC’s ultimate goal of stopping unscrupulous dealers. I fear the end result may be more broad. A few years ago in an enforcement action, two commissioners made the concerning statement that they would like to see the FTC assert more rule making power over “DEALERS.” (Ref-Commissioners Rebecca Kelly Slaughter 2018-Rohit Chopra 2021) Based on this history, the recent briefs, past meetings, recent court rulings, and the comments made by the commissioners that “this will not go away”, I believe that before the end of the year, you can expect the CARS rule to be in full effect. n

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 17

T R U S T E D P ROV I D E R O F

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18 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

Texas Office 9819 Whithorn Dr. Houston, TX 77095

Indiana Office 116 Main St PO Box 620 Sweetser, IN 46987

100% Web-based Secure Delivery Multi-Company Support Sales & BHPH Calculations

Enhancing Operations for Independent Used Car Dealers!

BY ADVANTAGE GPS

Introducing SmartLot, an advanced automotive application powered by state-ofthe-art AI technology, designed specifically for independent and retail auto dealers.

Engineered and supported in the USA, SmartLot enhances dealership operations, boosts vehicle protection, and maximizes F&I back-end profits.

Revolutionize Your Dealership SmartLot provides realtime GPS inventory intelligence, including monitoring battery life and fuel gauge levels, reducing the risk of missed sales opportunities or mismanaged assets. It also expedites floor plan audits, saving time and effort.

Fortified Security Measures Inventory represents the lion's share of a dealer's investments, and SmartLot ensures they are well protected. The platform offers comprehensive theft and fraud recovery services, providing robust solutions to mitigate losses and safeguard inventory.

A dedicated 24/7/365 recovery hotline is available to support dealers when needed most, and instant notifications of any unauthorized vehicle movements enhance lot security and provide peace of mind.

Accelerated Revenue Growth SmartLot boosts dealership revenue by enhancing finance and insurance offerings through its connected features. Not only do these features increase F&I income, but the inventory becomes more appealing to potential buyers, leading to faster sales and higher turnover rates.

Drive F &I Profit with Pulse Upon sale, the vehicle transitions to the consumer app Pulse, offering features like location tracking and stolen vehicle recovery.

Dealers sell Pulse as a hard add, boosting profits. This high-value, low-cost addition enhances inventory appeal, leading to faster sales and higher turnover rates while launching new profit centers.

A Commitment to Excellence SmartLot is engineered, designed, tested, and supported entirely in the U.S., ensuring quality and reliable performance with strict quality control and top-notch support for U.S. dealers. Using proven technology trusted by over 4,000 clients nationwide, SmartLot

by Advantage GPS delivers efficiency, profitability, and increased customer engagement.

"We are excited to bring Smartlot to the automotive retail market," said David Meyer, President at Advantage GPS. "Our clients have been asking for a solution that streamlines processes and drives new revenue streams. At the core of Smartlot is a gamechanging platform that enables dealers to be successful as the market continues to evolve.

We encourage dealers to discover the future of inventory management and customer engagement."

Dealers will increase their inventory management technology and profits with the most trusted name in automotive analytics.

To learn more or schedule a demo, visit AdvantageGPS.com.

Advantage GPS, a leading provider of advanced GPS technology, telematics, and analytics, serves all used car dealer business models.

Their tools reduce risks, boost profitability, and safeguard dealer assets. With a proven track record, they support over 4,000 customers across North America and manages over 4 million connections monthly.

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 19

PA Title and Registration Services

COMI N SOON G MD T itl Regist e & rati Servic on es!

FOR MIDATLANTIC IADA MEMBERS SERVICE Dealer Title / Duplicate Dealer Title Dealer Title / Duplicate Dealer Title (Waiting) Dealer Title / Duplicate Dealer Title with Lien Dealer Title / Duplicate Dealer Title with Lien (Waiting) Lost Title for Customer into Dealer Title Dealer Repo Title Dealer Repo Title with Lien Salvage Certificates

SERVICE FEE 15.00 20.00 15.00 20.00 30.00 30.00 30.00 30.00

PENNDOT FEE 67.00 67.00 100.00 100.00 134.00 67.00 100.00

TOTAL FEE 82.00 87.00 115.00 120.00 164.00 97.00 130.00

PennDOT Messenger Service: $15.00 Make one check payable to “PIADA” for the service fee, with an additional check for appropriate PennDOT fee for attached request made payable to “PennDOT.” Messenger service includes cursory review of documents for completion and correctness before submission.

Includes forms orders, inspection sticker orders, temp tag orders and those ineligible for online processing.

Reasons to choose us!

PIADA offers Dealer & Salvage Certificate processing on the Spot, Messenger, and Retail Services Immediate Window Services (limited to 10 items per dealer per day) 1 - 2 Business Day Turnaround on most work Training coming soon! Keep an eye out on our website.

Here for you!

RETAIL Online Title & Registration Service Fee: $25.00 RETAIL Tag Issuance (excluding PennDOT required replacement): $38.00 Make ONE check per deal for the total of all sales tax, PennDOT fees, and service fees payable to “PIADA.” Any item submitted with third party or retail customer check for title and registration fees will be forwarded to PennDOT for processing, as PIADA has no recourse for non-negotiable payments.

Visit us Monday - Friday 8:30am to 3:00pm or submit docs to be processed via FedEx, UPS or USPS to PIADA 1501 N Front Street Harrisburg, PA 17102 We accept cash, credit cards, business checks and money orders payable to “PIADA.”

midatlanticiada.org • 717-238-9002

20 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

Dealer Services Blending innovation and technology, DriveSmart offers F&I Products with a broad range of eligibility and competitive pricing. Allowing our dealers the best opportunity to drive sales and success. We are growing at an accelerated speed, and want you to be a part of our growth.

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A D IA .

C I T D.C N LA ON, T DA NGT I M HI N I S JO WA IN

Represent yourself before policymakers and regulators in Washington, D.C.

Learn what happens in Washington, D.C. and how it impacts your business, by going shoulder to shoulder with members of Congress, discussing real legislative and regulatory issues facing our industry.

Book your hotel now!

The hotel group rate is $262/night.

Room rate available until Tuesday, August 13, 2024.

If you need assistance booking a room at The Ritz-Carlton Pentagon City, contact NIADA Events at registration@ niada.com.

REGISTER TODAY! niada.com/policyconference 22 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024

GET CERTIFIED.

MidAtlantic IADA is proud to announce a partnership with Portfolio and Superior Solutions that brings our members a custom CPO program specifically designed for the independent dealer.

For details and eligibility, contact Superior Solutions at (814) 897-3478 or jax@superiorfisolutions.com.

superiorfisolutions.com

portfolioco.com ©2023 Portfolio Holding, Inc. All rights reserved.

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 23

AUCTION DIRECTORY PENNSYLVANIA ADESA MERCER 758 Franklin Road, Mercer, PA 16137 724.662.4500 / Fax: 724.662.8716 Friday 9:00 AM Office M-W: 9-4:00; TH: 9-5:00; F: 8-5:00 adesa.com ADESA PA I-83 Ex. 28 (Old Ex. 12), 30 Industrial Rd. York, PA 17406 717.266.6611 / Fax: 717.266.7650 Wednesdays 9:00 AM; INOPS 8:30 AM Specialty Sale every 4th Wed 8:30 AM adesa.com ADESA PITTSBURGH 378 Hunker Waltz Mill Rd. New Stanton, PA 15672 724.925.4700 / Fax: 724.925.4701 Tuesday 9:00 AM pittautoauction.com AMERICA'S AA - HARRISBURG 1100 S. York St., Mechanicsburg, PA 17055 717.697.2222 / Fax: 717.697.2234 Thursday 8:45 AM harrisburgautoauction.com AMERICA’S AA - LANCASTER 1040 Commercial Ave., P.O. Box 406 East Petersburg, PA 17520 717.569.5220 / Fax: 717.569.3109 Wednesday 9:00 AM; INOPS 8:30 AM americasautoauction.com AMERICA’S AA - PITTSBURGH 55 E. Buffalo Church Rd. Washington, PA 15301 724.225.1777 / Fax: 724.225.7223 Thursday 12:30 PM americasautoauction.com AMERICA’S AA – ERIE P.O. Box 317, 12141 Route 6 West Corry, PA 16407 814.664.7721 / Fax: 814.664.7724 Thursday 10:00 AM 3 Lanes Dealer Consign, Fleet/Lease americaserie.com BLAISE ALEXANDER AUCTION 350 Fairfield Rd., Montoursville, PA 570.435.8391 Mondays: 10:45am blaisealexanderauction.com BLOOMSBURG AUTO AUCTION 25 Ridge Road, Bloomsburg, PA 17815 570.784.2306 Wednesday 10:00 AM bloomaa.com

CAPITAL AUTO AUCTION 5135 Bleigh Ave., Philadelphia, PA 19136 215.332.2515 / Fax: 215.332.2534 Monday thru Friday 9:00 AM - 4:30 PM capitalautoauction.com CARRIAGE TRADE PUBLIC AUTO AUCTION 1200 W Ridge Pike, Conshohocken, PA 19428 800.441.6717 / Fax: 610.834.8274 Monday Sale Day 3:00 PM carriagetrade.com CENTRAL PENNSYLVANIA AA Exit 178 of I-80, Lock Haven, PA 17745 800.248.8026 / Fax: 570.726.7841 Thursday 9:45 AM Office: MTF 8-5:30 W-Th 8-6:00 cpaautoauction.com FREEDOM AUTO AUCTION 3580 Emmitsburg Road Gettysburg, PA 17325 717.338.1516 / Fax: 717.334.9314 Thursday 6:00 PM freedomauction.com GARDEN SPOT AUTO AUCTION Robert Rd. & Apple St., Ephrata, PA 17522 717.738.7900 / Fax: 717.738.7930 Tuesday 10:00 AM gardenspotautoauction.com GREATER ERIE AUTO AUCTION 7700 Avonia Road, (Exit 16 of I-90 & PA Route 98) Fairview, PA 16415-0916 814.474.3900 / 877.474.GEAA Tuesday 1:45 PM greater-erie.com KELLER BROS AUTO AUCTION 1030 Schaeffer Rd., Lebanon, PA 17042 717-949-2349 Wednesday 2:00 PM kbautoauction.com LEHIGH VALLEY AUTO AUCTION 3880 Lehigh St., Whitehall, PA 18052 610.435.5554 / Fax: 610.435.5557 Wednesday 5:00 PM lehighvalleyautoauction.com MANHEIM KEYSTONE 488 Firehouse Road, Grantville PA 17028 717.469.7900 / Fax: 717.469.2842 Every Monday 11:00 AM manheim.com MANHEIM PENNSYLVANIA 1190 Lancaster Rd., Manheim, PA 17545 717.665.3571 / Fax: 717.665.9265 Exotic Highline Sales every other Thursday - 9:00 AM; Fridays Sale 8:30 AM manheim.com

24 ||MIDATLANTIC MIDATLANTICDEALER DEALERNEWS NEWS| MIDATLANTICIADA.ORG | MIDATLANTICIADA.ORG • AUGUST • AUGUST 2024 2024

MANHEIM PHILADELPHIA 2280 Bethlehem Pike, Hatfield, PA 19440 215.822.1935 / Fax: 215.822.8140 Tuesday 9:30 AM; TRA Sale - Tues 12:30 PM Office: M-Th 8:30-5:00; F 8:30-1:00 manheim.com MANHEIM PITTSBURGH AA 21095 Route 19, Cranberry Twp., PA 16066 724.452.5555 / Fax: 724.452.1310 Wednesday 9:00 AM manheim.com NORTH EAST PENNSYLVANIA AA 860 N. Keyser Ave., Scranton, PA 18504 570.207.CARS / Fax: 570.207.1860 Tuesday 10:00 AM nepautoauction.com PERRYOPOLIS AUTO AUCTION Route 51 S. Perryopolis, PA 15473 724.736.4445 / Fax: 724.736.0466 Friday 9:45 AM perryautoauction.com MARYLAND BSC AMERICA/BEL AIR AUTO AUCTION 4805 Philadelphia Rd., Belcamp, MD 21017 410.879.7950 / Fax: 410.893.1515 Thursday 8:30 AM at Clayton Station Thursday 8:00 AM at Bel Air in Belcamp bscamerica.com CAPITAL AUTO AUCTION 5001 Beech Rd, Temple Hills, MD 20748 301.316.4980 / Fax: 301.316.4982 capitalautoauction.com MANHEIM BALTIMORE-WASHINGTON 7120 Dorsey Run Rd., Elkridge, MD 21075 410.796.8899 / Fax: 410.799.0512 Tuesday Sale, 9:30 AM Tuesday Frontline Sale, 9:00 AM TRA/Salvage, 1:00 PM manheim.com NEW YORK STATE LINE AUTO AUCTION 830 Talmadge Hill Rd. S., Waverly, NY 14892 607.565.8151 / Fax: 607.565.3915 Ally Financial Open Sale –EVERY FRIDAY, 9:20 AM GM Financial Open Bi-weekly.

Simulcast in all lanes. statelineauto.com WEST VIRGINIA MOUNTAIN STATE AUTO AUCTION Route 2, Box 835, Shinnston, WV 26431 304.592.5300 / Fax: 304.592.3510 Monday 10:30 AM; Office: 9:00-5:00 mtstateaa.com

WED. SEPT. 18

TH

AAA LANCASTER 12TH ANNIVERSARY SALE America’s Auto Auction Lancaster

1040 Commercial Ave, East Petersburg, PA 17520 717.569.5220 | www.aaalancaster.com www.edgepipeline.com MIDATLANTIC |DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024 | 25

26 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • AUGUST 2024