Mid-Atlantic Dealer News - March 2024

M A R C H 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

FEATURE:

Should you track your calls?

ABSOLUTELY: 100% PA Title and Registration Services for MidAtlantic IADA Members MIDATLANTIC INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION 1501 North Front St., Harrisburg, PA 17102

Predicted APR Drop Expected to Spur Auto Sales Wholesale Auction Prices Could Flatten PLUS

5 Ways Independent Auto Dealerships Can Harness User-Generated Content for Marketing Success

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Save the 4 D

CONVENT ate ION AND V ENDO TAILGATE! R S ee page 4

AMERICA’S AUTO AUCTION HARRISBURG | THURSDAY, APRIL 4TH ND

ANNIVERSARY

Spring Fling Sale!

Classic Cars and Trucks - Motorcycles

4 Wheelers - RV’s - Boats - Golf Carts Commercial Trucks and Equipment

And Much More, including a t-shirt giveaway & Free Lunch for all!

1100 South York Street | Mechanicsburg, PA 17055 717-697-2222 | aaaharrisburgpa.com | #americasautoauction

MARCH 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

FEATURES 6 |

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Vacant, President - Elect 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

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Dan Limongelli, Vice-President Jo Dan Motors, Plains, PA jodanmotors@gmail.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

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Should you track your calls? ABSOLUTELY: 100% Did you know that customers spend an average of 14 hours online doing vehicle research? That means before they even call you, they have been shopping around. Therefore, you are going to want to nail your first phone call with the customer!

PA Title and Registration Services for MidAtlantic IADA Members Check out all the reasons to choose us!

Predicted APR Drop Expected to Spur Auto Sales High loan rates of late have scared off some would-be car buyers. A MarketWatch study foresees interest rates finally coming down. That’s good news in general but especially for the auto world, one of the most credit-driven industries.

Wholesale Auction Prices Could Flatten Average wholesale auction prices enter 2024 in an ongoing, downward trend, but that trend could flatten out over time, according to the December Manheim Used Vehicle Value Index.

5 Ways Independent Auto Dealerships Can Harness User-Generated Content for Marketing Success Not surprisingly, user-generated content (UGC) has become a powerful tool for businesses to connect with their audience. Dealerships, in particular, can benefit significantly from harnessing UGC to build trust, enhance brand awareness, and drive sales. In case you aren’t convinced though, consider these stats.

Consumer Attitudes Shift Away from EVs, Toward Affordability Car buying behavior is shifting in various ways. But shopper attention to vehicle price, performance and quality are constants that continue to influence purchase decisions. That’s according to Deloitte’s “2024 Global Automotive Consumer Study.”

Early-bird registration opens for 2024 NIADA Convention & Expo Registration is now open for the event of the year in the used vehicle industry at the Wynn in Las Vegas. The early-bird registration is $545 at niada.com/convention through May 20.

DEPARTMENTS 2 | 4 | 4 |

President’s Message Executive Director’s Message We’re Hiring - MidAtlantic Employment Ad

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Advanced Issuing Agent Training Courses Carlawyer Auction Directory

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MIDATLANTIC INDEPENDENT AUTO DEALERS ASSOCIATION SPONSORS

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

q PRESIDENT’S MESSAGE

REVVING UP: NAVIGATING THE FAST LANE OF ONLINE CAR AUCTIONS Let's talk about the future of online car auctions, shall we? Now, I've been in this business long enough to see the digital landscape evolve, and let me tell you, it's been quite the ride. From humble beginnings in the early days of the internet to today's sophisticated platforms, online car auctions have come a long way. We've seen everything from static listings to real-time bidding, and their convenience has made them a go-to for buyers and sellers alike.

Bert Straub President MidAtlantic IADA

Now, let's talk trends. Virtual auctions? They're booming.

People love being able to bid from the comfort of their homes, and who can blame them? Plus, with AI and machine learning getting in on the action, we're seeing more accurate predictions and personalized experiences than ever before.

And let's remember the cars themselves. It's not just your run-of-the-mill vehicles anymore. We're talking classics, electric cars, you name it. The market's more diverse than ever, meaning there's something for everyone.

Now, let's talk about the flip side of the coin regarding online auto auctions. While they offer a lot of convenience and opportunities, there are certainly some downsides to consider: •

Limited Inspection: One of the most significant drawbacks is the inability to physically inspect the vehicles before bidding. Sure, you can look at pictures and read descriptions, but it's different from kicking the tires and checking under the hood in person. This can lead to surprises or hidden issues once you purchase.

• Risk of Fraud: Unfortunately, online auctions can attract less-than-scrupulous individuals looking to exploit unsuspecting buyers. There's always a risk of encountering fraudulent listings or sellers misrepresenting the vehicle's condition.

Without proper precautions, buyers could end up with a lemon on their hands.

• Competitive Bidding: While competition can be good, it can also drive up prices.

With online auctions, getting caught up in the excitement of bidding wars is easy, leading some buyers to overspend or exceed their budget. Staying disciplined and knowing your limits is critical.

• Additional Fees: Watch for hidden fees or unexpected costs associated with online auto auctions. These can include buyer's premiums, registration fees, and shipping costs. It's important to factor in these expenses when bidding.

• Limited Return Policies: Unlike buying from a traditional auction, online auctions often have strict return policies or no returns at all. Once you've won the bid and the transaction is complete, the responsibility falls squarely on the dealer. This lack of recourse can be stressful, especially if you discover issues with the vehicle after the fact.

• Lack of Personal Interaction: Some Dealers prefer the personally touch a feel the car in lane. Online auctions can feel impersonal, with transactions conducted entirely through digital platforms. This lack of human interaction can be a turn-off for some buyers who value the trust and rapport that come with in-person dealings with the Auction Manager.

Continued on page 3 2 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024

IT’S TIME TO NOMINATE THE BEST OF THE BEST Please take a moment to consider a nomination for the 2024 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

A big shoutout to friend and fellow associate, the President of OHIADA, Scott Shook (right) and myself at the Mountain State Auto Auction.

Continued from page 2 Overall, while online auto auctions offer a convenient way to buy and sell vehicles, they're not without their drawbacks. Dealers must do their due diligence, exercise caution, and be aware of the potential pitfalls before diving into online car auctions. And hey, you never know who you'll run into in the lanes at the auction. Whether you're a seasoned pro or a newbie just dipping your toes in the water, there's a sense of camaraderie among fellow dealers. You might strike up a conversation with a fellow bidder who shares your passion for classic cars, or you might spot a familiar face from the local car scene. It's all part of the fun and excitement of the auction experience.

Warm regards,

Bert

Bert (left) and Linda (right) Straub were deeply honored to have attended the momentous event at Union Station as the President and “Firstlady” of the MidAtlantic Independent Auto Dealers Association. The event announced the "More to Get Done" re-election campaign for State Senator Dan Laughlin (center). The large crowd was a testament to the enthusiasm and dedication for our industry.

Senator Laughlin serves on several Senate committees including Banking and Insurance, Community, Economic, Recreational Development, Labor and Industry, and Rules and Executive Nominations. He is also the Senate representative on the Advisory Council of the Pennsylvania Soldiers' and Sailors' Home in Erie, one of Pennsylvania's six veterans' homes.

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 3

q EXECUTIVE DIRECTOR’S MESSAGE

Q1 ENDS WITH A BANG! Hello Dealers, TAX SEASON IS HERE! Hopefully, your lots are bustling with customers who just received their tax money and are looking to drive away in their next vehicle. For those of us who have been in the biz for a while, we now look at “tax season” more like “tax week” these days. All in all, it’s still the most exciting time of the year for the independent dealer. Best of luck to you all.

TITLE & REGISTRATION TRAINING Executive Director Speaking of exciting times, after almost four years, MidAtlantic IADA we are offering in-person Basic and Advanced Title & Tommy Brandis Registration Training classes. Our Deputy Executive Director Kathy Sabaski has passed the rigorous PennDOT examination to earn the title of “Certified Messenger and Agent Services Trainer.” Kathy is working with PA auctions to nail down dates for in-person training.

Our plan is to hold monthly group training at auctions across the state, along with on-site training at your dealership. We are excited to once again offer this mandatory training to our members. Please check our website (midatlanticiada.org) for more information.

MIDATLANTIC 20 GROUPS Another exciting event happened in January. The charter meeting of the MidAtlantic BHPH Dealer 20 Group took place at the Le Meridien hotel in Philadelphia January 28-30. I have been a part of 20 Groups for close to 25 years and I have to say that I was blown away by this first meeting. The charter members are some of the most passionate and knowledgeable dealers I have ever met. I can’t tell you how excited I am to help grow this group. The next meeting will be in the Harrisburg area on May 5-7. This group will fill up fast, so reach out ASAP! There are plans already in the works for a second BHPH group and a RETAIL group. Please reach out to me or John Dismukes, the 20 Group Sales Manager at NIADA, for more information. He can be reached by email at john@niada.com or niada.com/20-groups. If you have any questions about 20 groups, title training, or anything else, please send me an email or give me a call and I will make sure you get the information you need. I can be reached at tom@midatlanticiada.org or my direct cell (215-805-2034).

SAVE THE DATE: MIDATLANTIC IADA CONVENTION, SEPTEMBER 15-17 The second annual MidAtlantic IADA Convention, happening September 15-17, at Ceasar’s in Atlantic City, is full steam ahead! Last year’s success is still buzzing among industry insiders. This year promises two full days of training and education, ending with our renowned “Monday Night Football Vendor Tailgate.”

Our board is diligently crafting the agenda, with numerous vendors and presenters already confirmed.

Save the date!

Until next month,

Tommy

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MIDATLANTIC IADA is GROWING!

MidAtlantic IADA is currently seeking qualified candidates for these roles: •

•

•

Title Department Lead – Pennsylvania (starting at $23/ hour)Ideal candidate will have a minimum of 3 years PennDOT and/or CVR experience Title Clerk – Pennsylvania, Retail and/or Salvage (starting at $20/hour) Ideal candidate will have a minimum of 1 year PennDOT and/or CVR experience Administrative Assistant (starting at $18/hour) Administrative Assistants are given preference for future title clerk positions.

All pay plans are based on proven experience. We also offer medical, dental, vision and retirement plans.

There will be additional upcoming advancement opportunities.

Submit resume and cover letter to: kathy@piada.org or call Kathy at 717-238-9002 for more information.

ADVANCED ISSUING AGENT TRAINING COURSES

GET TO KNOW YOUR MID-ATLANTIC STAFF

ONLINE COURSES

How may we help you?

Learn more about the Association staff members serving you! Our friendly and knowledgeable staff is always here to help members.

for your convenience The online training courses will be provided by Pennsylvania Association of Notaries, a PennDOT approved instructor.

Members/Nonmembers: $169

Call or email us today!

Tommy Brandis Executive Director (717) 317-3098 tommy@piada.org

REGISTER ONLINE AT

MidAtlanticDealerNews-MARCH2024-PRINT.pdf

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2/9/24

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MIDATLANTICIADA.ORG

Kathy Sabaski

Deputy Executive Director (717) 238-9002 kathy@piada.org

Steve Smith

Office Manager (717) 238-9002 x118 steve@piada.org

Cynthia Slemons

Membership Specialist (717) 238-9002 x16 cynthia@piada.org

Nicole Autry

Dealer Set-Up Unit (717) 317-1966 nicole@piada.org

Christine Everett

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Y

CM

Lead Title Clerk (717) 238-9002 christine@piada.org

MY

India Thomas

CMY

Title Clerk (717) 238-9002 india@piada.org

CY

K

Ally Lanious Title Clerk (717) 238-9002 ally@piada.org

Tammy Farmer Receptionist (717) 238-9002 tammy@piada.org

MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 5

Should you track your calls?

ABSOLUTELY: 100%

By Maggie Pugesek, Partner, C&M Coaching

Customers will call before visiting! Did you know that customers spend an average of 14 hours online doing vehicle research? That means before they even call you, they have been shopping around.

Therefore, you are going to want to nail your first phone call with the customer; they have options, and they have been doing their research!

It always surprises me when I work with a new client, and they do not have call recording established. In my opinion, this is an essential component of any successful BDC, collections, service, or sales team. The bulk of your customers will call before visiting the dealership, and if the first contact they have is poor, they are more likely to find another dealership.

Your phone calls are literally the heartbeat of your business. If you do not know what is being said to potential customers, then you have no way to gauge the success of any department. Much like your reputation online in the form of reviews,

phone calls demonstrate what a customer can expect if they do business with you.

If the calls are terrible, the customer can expect their experience to be the same.

Sure, you can sit by your staff and listen to one end of the conversation occasionally, but it is not the same as actually tracking calls.

WHY IT'S IMPORTANT TO RECORD CALLS: One of the best ways to ensure your team is practicing good phone etiquette is to record their calls. This is also a great tool to have if you receive customer complaints, as it allows you to validate their concerns and address them if necessary. The most important reason to track calls, however, is so you can use them for training purposes to help your team improve. If you record their calls, you can hold them accountable for providing great customer service. Plus, they know someone is always able to go back and listen, and that itself is motivation.

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Additionally, if you have a collections team, being able to access those calls is incredibly helpful. Customers can easily lie about interactions with collectors, and if you aren’t tracking their calls, you have no way to hear what was actually said.

Even in sales situations, there is always room for improvement if you can play back the calls.

Some of the most successful dealerships I have trained sit and listen to calls with their staff. The Sales Manager or BDC Manager will pull each team member aside once a week and simply review a call with them. Sometimes managers will even sit with their staff and listen to calls that we have coached for their team.

This way everyone can hear a good call or a bad call and learn together from an expert coach.

The goal with recording calls is to ensure we are using the phone to its fullest potential. Hearing voice inflection and actual verbiage is the easiest way to

provide constructive feedback. When we review calls here at C&M Coaching, we give your staff a chance to hear themselves and our coach provides feedback that staff can use on their very next call. Constant improvement and encouragement are what we are aiming for.

Recording calls gets your team in the mindset of providing awesome customer service.

If they know you are going to listen to their calls, they are going to want to be sure they are quality calls.

Tracking calls allows you to hear exactly what your team says to customers over the phone and evaluate if they need additional training. Alternatively, you can hear the customer’s response, evaluate their vocal tone, and even hear common objections your team needs to overcome. All these things combined can increase success in every department.

You can’t be everywhere all the time and you can’t listen to every call on a daily basis. You always have the option of choosing a call training company like mine if you don’t want to listen to calls regularly on your own. This will help them get the training they need to improve and show that you care about the customer service they provide. Investing in your team is always a win!

Accountability is key and if you can provide them with tips on how to improve for future calls, you will hear them improve with each phone call they take. The important thing is to stay on the gas.

Set up call recording, listen to calls, provide training, and then track their phone call skills. Evaluate everyone as a team and individually to determine where the weakness lies. Either way, having access to these recordings will always be a good safety net.

If you are looking for a company to record calls, there are several. I suggest first starting with your actual phone company. If they don’t do it, ask your CRM provider. If none of these options work, you can try companies like Vonage, but they do require you to purchase their phone system. A quick internet search for ‘dealership call recording’ will provide you with some options. You are always welcome to reach out to me personally if you would like feedback on some of the recording options. Maggie@ candmcoaching.com is the easiest way to get in touch with me.

Good luck, and happy recording! n

A passionate expert in phone skills & internet leads since 2010, Maggie Pugesek specializes in customizing word tracks and processes to fit the needs of individual dealerships. C&M Coaching, focuses on improving call quality for Sales, BDC, Collections & service departments. Maggie also offers free training and tips on her podcast, Elevate with C&M Coaching.

Maggie has spoken at previous national dealership conferences, Compliance Unleashed and directly to dealer 20 groups.

Don’t forget about the MidAtlantic

DEALER SERVICE PROVIDER DIRECTORY Visit piada.org/vendors-auctions/vendor-directory to search the database of vendors and service providers who work specifically with independent dealers. You’ll even find special discounts and offers exclusive to MidAtlantic members. Please let us know if you have any questions.

Auto Dealer/Garage Insurance Specialists * Garage and Automobile Liability * * Dealer Physical Damage * * Garagekeepers * * Work Comp * * Quick Quote Turnaround *

Telephone: 215-860-6510 Website: www.aatins.com Langhorne, Pennsylvania

Your One-Stop Shop for Auto Dealer Insurance MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 7

CarGurus Names ‘Used Car of the Year’

By Auto Remarketing Staff The 10th-generation Honda Accord came out on top in the online automotive shopping platform’s 2024 Best Used Car Awards, earning the title of Used Car of the Year as judged by CarGurus’ panel of reviewers.

CarGurus said the reviewers referenced an expansive set of pricing and availability data, consumer trends, and experience test driving more than 1,000 cars in identifying the best used cars in 10 categories and the Used Car of the Year.

CarGurus said the awards are timed to allow shoppers to prepare for what the company’s research has determined to be the best time to buy a used car in 2024.

Its analysis of national weekly average price and inventory data over the past seven years — accounting for pre- and post-COVID market shifts — showed the average used car price during the week of Feb. 12 to be

2.8% less than the average week, with more than 6% more listings.

Based on the current average used-car listing price of $28,731, CarGurus said, consumers have the potential to save about $800 on a purchase during that week.

“With many shoppers feeling the pinch of higher interest rates and new-car prices remaining 30% above pre-pandemic levels, all eyes will be on used cars as a more cost-effective alternative to finding a great deal this winter,” CarGurus deputy editor Matt Smith said in a news release. “Now in its sixth year, the CarGurus Best Used Car Awards aim to help consumers pinpoint their ideal car match with added confidence.”

Smith said the Accord, which was also named the best city car, is “a fantastic allaround vehicle. Few vehicles combine the

8 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024

Accord’s impressive performance and efficiency with its level of practicality, build quality and safety.”

Other category winners include: • Best midsize crossover/SUV: Hyundai Santa Fe (fourth generation).

• Best large pickup truck: Ford F-150 (14th generation).

• Best luxury sedan: Audi A4 (fifth generation).

• Best family car: Kia Telluride (first generation).

• Best sports car: Porsche 911 (992 Series, eighth generation).

• Small crossover/SUV: Toyota RAV4 Hybrid (fifth generation).

• Large SUV: Ford Expedition (fourth generation) • Luxury crossover/SUV: MercedesBenz GLS-Class (third generation).

• Small pickup truck: Honda Ridgeline (second generation). n

PA Title and Registration Services

COMI NG SOON 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 MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 9

ATTENTION! GARDEN AUTO

SP TAUCTION S ‘

Title Office Is OPEN!

Monday-Friday 8:00 AM to 4:00 PM

717-738-7920 We are here to help our dealers make life a bit easier. Our goal is to expedite the process of getting a new title.

We will be processing for PA dealers only.

Driver’s License and Dealer Registration Cards are required to process transactions.

Commonwealth of PA Title Fee

67

$

00

Garden Spot Auto Auction Processing Fee

20

$

00

10 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024

We will accept cash, money orders or company checks.

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

Dealer Only Sale Every Wednesday @ 5:00 PM Simulcast in Every Lane!

Gates Open @ 4:00 PM INOPs Run @ 4:45 PM All Major Floor Plans Accepted!

• AFC • Westlake Financial • Veicle Acceptance Corp • Auto Use • Auction Credit • NextGear Capital

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5:00 PM W EDNESDAY REMINDER! TIME TO LOG ON!

WWW.LEHIGHVALLEYAUTOAUCTION.COM MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 11

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MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 13

Predicted APR Drop

Expected to Spur Auto Sales

High loan rates of late have scared off some would-be car buyers.

By Steve Finlay Dramatic loan-rate increases since 2022 have scared off some would-be auto buyers. But relief may be on the way this year.

The higher interest rates have also spurred some consumers – who are keen on buying a car but don’t want to take on a high-rate loan – to instead pay cash up front. More about that and its effect on dealers in a moment.

The higher rates stem from the Federal Reserve pushing up the federal funds rate in an effort, largely successful, to combat inflation. The inflation rate dropped by 38.5% by late last year, says MarketWatch, a Dow Jones subsidiary.

The overall average auto loan interest rate was 7.03% for new cars and 11.35% for used cars in 2023’s third quarter, according to credit bureau Experian.

(Rates vary by credit scores.)

A MarketWatch study foresees interest rates finally coming down. That’s good news in general but especially for the auto world, one of the most credit-driven industries.

Lower rates are expected to goose auto sales. MarketWatch says lower auto loan rates could make 2024 a good time to buy a car for the first time 2022.

The MarketWatch report cites economist James Knightley of financial services company ING who predicts the Fed will start to lower rates as soon as this year’s second quarter.

Lower APRs (annual percentage rates) would reduce overall purchase prices, but not manufacturers’ prices. MSRPs. The average transaction price for a new vehicle in December was $48,759, according to Kelley Blue Book, which expects that to decline this year.

The higher interest rates of late have spurred some car buyers to pay cash rather than take out a loan. A recent CDK survey indicates 29% of car consumers opted to do that.

That’s particularly the case in relatively affluent markets, says Justin Gasman, head of Gasman Solutions, who is a finance and insurance trainer and a former finance director at a CadillacBuick-GMC dealership in Boulder, CO. But he warns that “it’s not cash” if car consumers are borrowing from their retirement accounts or home equity.

“Where I worked, it was real cash,” he tells WardsAuto, referring to the prosperous Boulder market. “But a dealer told me that when people are tapping into

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

their 401(k)Ks to buy a car, it’s not real cash. He calls it ‘an alternative form of financing.’ To me, borrowing against your own money is silly.”

Most car financing is indirect lending.

That means dealers act as a middleman between consumer and lender. For services rendered, dealers collect a fee (usually 1% or 2% added to the loan), called a “reserve.”

Consequently, F&I managers may quietly moan when a customer pays cash for a car. It cuts the dealership out of the financing action.

But Gasman says that shouldn’t shut down resourceful F&I managers.

“The ones who rely on reserves hate cash deals because they don’t make any money off the financing,” he says. “But they shouldn’t think ‘no deal.’ They should think, ‘Now I can sell F&I products (such as extended service contracts).’”

Why does a cash deal increase the likelihood of a consumer purchasing aftermarket products and services?

“Because if a guy is handing you a $100,000 cashier’s check for a Cadillac Escalade, that’s probably not his last 100 grand,” Gasman says. n

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

THE CARLAWYER©

The CARLAWYER

©

By Eric Johnson, Partner in the law firm of Hudson Cook, LLP, Editor in Chief of CounselorLibrary.com’s Spot Delivery®

Here’s our monthly article on selected legal developments we think might interest the auto sales, finance, and leasing world.

This month, the developments involve the Department of Justice, Federal Trade Commission, State of Connecticut, Consumer Financial Protection Bureau, and Federal Reserve Board. As usual, our article features the “Case(s) of the Month” and our “Compliance Tip.” Note that this column does not offer legal advice. Always check with your lawyer to learn how what we report might apply to you or if you have questions.

FEDERAL DEVELOPMENTS On January 2, a California-based lead generator and its president agreed to a proposed court order settling charges brought by the Department of Justice, on behalf of the Federal Trade Commission, alleging that they sold the personal information of consumers as leads to telemarketers who then used those leads to make millions of illegal telemarketing calls. Specifically, the complaint alleged that the defendants operated more than 50 websites, which offered mortgage refinance loans and other products and services to consumers, that used deceptive “dark patterns” to induce consumers to provide their personal information and provided inadequate disclosures about how that information would be used. The defendants allegedly stored and then sold consumers’ personal information to telemarketers without obtaining consumers’ informed consent to receive telemarketing calls. The

telemarketers who bought the consumers’ personal information used that information to make illegal telemarketing calls to sell products and services such as solar panels, hearing aids, and extended auto warranties.

To resolve allegations that this conduct violated the FTC Act, the Telemarketing and Consumer Fraud and Abuse Prevention Act, and the Telemarketing Sales Rule, the defendants agreed to a $7 million civil penalty, which will be suspended based on their inability to pay. The proposed order also permanently enjoins the defendants from initiating, causing others to initiate, or assisting others in initiating any outbound telephone call that plays or delivers a prerecorded message and any outbound telephone call to a person whose number is on the National Do Not Call Registry. Additionally, the proposed order permanently enjoins the defendants from the collection, sale, transfer, or disclosure of covered personal information in connection with lead generation.

On January 4, the Federal Trade Commission and the State of Connecticut filed a complaint for a permanent injunction, monetary judgment, and civil penalty judgment in the U.S. District Court for the District of Connecticut against a vehicle dealership, its principals, general manager, finance manager, and two sales managers, alleging deceptive and unfair practices in the advertising, sale, and financing of vehicles in violation of the FTC Act and the Connecticut Unfair Trade Practices Act. Specifically, the FTC and Connecticut alleged that the defendants charged improper fees in connection with the sale of certified pre-owned vehicles. Certified pre-owned vehicles have been inspected and repaired to the manufacturer’s specification and are covered by a manufacturer’s extended warranty. According to the complaint, when consumers attempted to purchase certified vehicles for the prices advertised, the defendants charged them hundreds to thousands of dollars in additional fees for

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services that are part of certifying a vehicle (e.g., fees for inspection, “CT Safety and Reconditioning,” “certification upgrades,” and “CPO,” which stands for certified pre-owned). In addition, the complaint alleged that the defendants represented that consumers were required to pay these additional inspection, safety and reconditioning, and certification fees to purchase vehicles when, in fact, consumers are not required to pay such fees to purchase vehicles that are already advertised as certified. The complaint also alleged that, despite stating in advertisements that vehicles are certified and come with a limited warranty, the defendants did not get the vehicles certified by the manufacturer.

The defendants allegedly advertised a vehicle as certified but did not report the sale of that vehicle or pay the certification fee to the manufacturer. Therefore, the consumer did not receive a certified vehicle or the benefits of the limited manufacturer warranty that come with certification. The FTC and Connecticut also alleged that the defendants charged consumers for addon products that they did not authorize, including guaranteed asset protection products, service contracts, maintenance contracts, and total loss protection coverage, or deceived consumers into paying for them by saying that they were required. Finally, the complaint alleged that the defendants made misrepresentations about registration and other state-imposed fees, such as by stating that certain fees were required by the state when, in fact, they were not and by inflating the amount of required state fees.

On January 11, the Consumer Financial Protection Bureau issued two advisory opinions that address consumer reporting agencies’ obligations under the Fair Credit Reporting Act with respect to background screening reports and disclosure of a consumer’s credit file to a consumer upon the consumer’s request.

The advisory opinion on background screening reports highlights that CRAs

must maintain reasonable procedures to avoid producing reports with false or misleading information. Specifically, the procedures should: (1) prevent the reporting of public record information that has been expunged, sealed, or otherwise legally restricted from public access; (2) ensure disposition information is reported for any arrests, criminal charges, eviction proceedings, or other court filings that are included in background check reports; and (3) prevent the reporting of duplicative information. In addition, the advisory opinion on background screening reminds CRAs that they may not report outdated adverse information and that each adverse item of information is subject to its own reporting period, the timing of which depends on the date of the item itself. The advisory opinion on credit file disclosures provides that consumers requesting their files: (1) only need to request their reports and provide proper identification; they do not need to use specific language to be provided their complete files; (2) must be provided their complete files with clear and accurate information that is presented in a way that an average person could understand; (3) must be provided the information in a format that will assist them in identifying inaccuracies, exercising their rights to dispute any incomplete or inaccurate information, and understanding when they are being impacted by adverse information; and (4) must be provided with the sources of the information in their files, including both the original sources and any intermediary or vendor sources, so they can correct any misinformation.

The Small Business Review Panel recently issued its final report on the Consumer Financial Protection Bureau’s Fair Credit Reporting Act proposals. Under the Small Business Regulatory Enforcement Fairness Act, which amended the Regulatory Flexibility Act, the CFPB must convene and chair a Small Business Review Panel if it is considering a proposed rule that could have a significant economic impact on a substantial number of small entities. The panel considers the impact of the proposals under consideration by the CFPB and obtains feedback from representatives of the small entities that would likely be subject to the rule. On September 15, 2023, the CFPB released an outline of proposals under

consideration for its consumer reporting rulemaking. In the outline, the CFPB states that it is “considering proposals to regulate many data broker activities as covered under the FCRA, which would prohibit the sale of covered data for purposes other than those authorized under the FCRA. Most notably, this would limit the sale of certain data broker data for advertising or marketing, for the most part constraining the sale of data to only those companies or persons to whom the consumer applied for credit, insurance, employment, housing, or some other service, or to whom the consumer otherwise authorized access.

This would also subject certain data brokers to FCRA obligations, ensuring, for example, that consumers have a right to obtain data about themselves held by data brokers and to dispute inaccuracies in that data.” Second, the CFPB is considering proposals relating to the reporting of medical debt. Specifically, the CFPB is considering proposals that would prohibit consumer reporting agencies from including medical debt collection information on consumers’ credit reports used by creditors in making underwriting decisions and prohibit creditors from obtaining or using medical debt collection information when evaluating consumers’ credit applications. The proposal would not stop creditors from obtaining medical debt collection information for certain other purposes, such as evaluating loan applications to pay for medical services.

Third, the CFPB is considering a proposal that would clarify circumstances in which data breaches may result in a CRA violating the FCRA’s permissible purpose provision.

Finally, the CFPB is considering proposals relating to consumers’ rights under the FCRA to dispute the completeness or accuracy of information contained in their consumer reports, either by filing a dispute directly with a CRA or by filing a dispute directly with the entity that furnished the disputed information. Noting how costly, ineffective, and time-consuming the consumer reporting dispute process can be for consumers, the CFPB is considering proposals related to two types of disputes: (1) those that are classified by a CRA or furnisher as involving legal matters; and (2) those involving systemic issues at a CRA or furnisher. As the CFPB proceeds in the rulemaking process, it will conduct

additional analyses and obtain additional information, including in response to the small entity representatives’ feedback and the panel’s findings. A proposed consumer reporting rule will reflect such additional analyses and information. The panel’s report includes the following: (1) a description of the proposals that the CFPB is considering and that the panel reviewed; (2) background information on small entities that would likely be subject to the proposals under consideration and the small entity representatives selected to advise the panel; (3) a summary of feedback from the small entity representatives; and (4) the findings and recommendations of the panel. The panel’s findings and recommendations address the following: (1) a description of and, where feasible, an estimate of the number and type of small entities that would likely be impacted by the proposals under consideration; (2) a description of the projected compliance requirements of the proposals under consideration; (3) a description of any significant alternatives to the proposals under consideration that may accomplish the stated objectives of the CFPB’s rulemaking and minimize the economic impact on small entities of the proposals under consideration; and (4) an identification, to the extent practicable, of relevant federal laws or regulations that may duplicate, overlap, or conflict with the proposals under consideration.

On January 18, the Federal Trade Commission issued an order postponing the effective date of the Combating Auto Retail Scams Trade Regulation Rule (“CARS Rule”) while a legal challenge to the rule is pending judicial review.

The CARS Rule was published in the Federal Register on January 4, and the FTC designated an effective date of July 30, 2024. On or about January 5, the National Automobile Dealers Association and the Texas Automobile Dealers Association filed a Petition for Review (“PFR”) in the U.S. Court of Appeals for the Fifth Circuit, challenging the rule on the grounds that it is “arbitrary, capricious, an abuse of discretion, without observance of procedure required by law, or otherwise not in accordance with law[.]” On January 8, the industry associations filed a motion with the Fifth Circuit seeking a stay of the rule and expedited consideration

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THE CARLAWYER© CONTINUED of their PFR. The FTC’s order states: “Petitioners’ assertions and suggestions that legally compliant dealers have to make unnecessary changes to satisfy Petitioners’ misunderstandings of the Rule have created uncertainty. Additionally, Petitioners are seeking expedited consideration of the PFR, and if that request is granted, a stay of the effective date pending expedited review should not postpone implementation of the Rule by more than a few months, if at all. Balancing the equities here, the Commission has determined that it is in the interests of justice to stay the effective date of the Rule to allow for judicial review. A Federal Register notice to reflect this action is forthcoming. Once the PFR’s merits are resolved, the Commission will publish a new document in the Federal Register establishing a new effective date.”

On January 19, the Federal Reserve Board announced that it entered into a consent order with Industrial and Commercial Bank of China Ltd., which conducts operations in the U.S. through a branch in New York, resolving allegations that the bank and the branch disclosed confidential supervisory information to a third party without obtaining prior approval of the FRB. The FRB determined that the bank’s branch lacked any formal policies, procedures, training, or other internal controls designed to instruct employees regarding how to properly handle confidential supervisory information or how to prevent the unauthorized dissemination and use of that information. The FRB imposed a civil money penalty of $2,431,956 on the bank and the branch. The consent order requires the bank and the branch to submit a written plan to enhance their internal controls and compliance regarding the identification, monitoring, and control of confidential supervisory information. The FRB’s action was taken in conjunction with an action by the New York Department of Financial Services, the state supervisor of the bank’s New York branch, which imposed a $30 million penalty on the bank and the branch for unlawful disclosure of confidential supervisory information and Bank Secrecy Act/Anti-Money Laundering violations.

On January 24, the Consumer Financial Protection Bureau issued a proposed rule that would prohibit covered financial institutions from charging non-sufficient funds fees when consumers initiate withdrawal, debit, payment, or transfer transactions that are declined instantaneously or nearinstantaneously. The charging of such fees would constitute an abusive practice under the Consumer Financial Protection Act’s prohibition on unfair, deceptive, or abusive acts or practices. The CFPB notes that many financial institutions have stopped charging NSF fees in recent years, but, “[a]s technological advancements may eventually make instantaneous payments ubiquitous, the CFPB believes that it is important to proactively set regulations to protect consumers from abusive practices.”

Comments on the proposed rule are due

by March 25, 2024.

CASE(S) OF THE MONTH Florida Resident Failed to State Claim Against Kansas Dealership for Violating Kansas Consumer Protection Act Where Sale Documents Were Executed in Florida: A Florida resident bought a used car from a Kansas dealership. The Florida resident did not come to Kansas to negotiate or complete the purchase of the car; instead, the dealership sent a representative to Florida to sign the documents with him.

After the purchase, the car was titled in Florida. The buyer sued the dealership in Kansas for committing deceptive and unconscionable acts, in violation of the Kansas Consumer Protection Act, by failing to deliver the car’s title timely, falsely stating that he must purchase an extended warranty or service contract, and failing to engage in the sales contract’s arbitration procedure. The parties crossmoved for summary judgment, and the U.S. District Court for the District of Kansas granted the dealership’s motion and denied the buyer’s motion. Determining that it must engage in a conflict of laws analysis because Kansas law and Florida law do not align on the issues of deceptive and unconscionable acts and the effect of failing to deliver title timely, the court went on to note that resolution of the

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conflict turned on whether the case was a tort case or a contract case. If the case were a tort case, the court found that the law of Florida, which is where the buyer’s injuries occurred because he allegedly failed to receive title in Florida in a timely manner, would govern. If the case were a contract case, the court found that Florida law would similarly govern because Florida was where the contract was made and where the parties would have arbitrated the buyer’s claims. Because the buyer was not a Kansas resident, because Florida law rather than Kansas law governed, and because the buyer did not state claims under Florida law, the court granted summary judgment for the dealership. Moreover, the court determined that even if it had not undertaken a conflict of laws analysis and merely addressed the KCPA claims, the dealership would still be entitled to summary judgment because the KCPA requires that the consumer transaction complained of take place within Kansas, which the buyer’s car purchase did not. See Moccaldi v. Pratt City Ford, LLC, 2024 U.S. Dist. LEXIS 1850 (D. Kan. January 4, 2024).

COMPLIANCE TIP Have you read the FTC’s newly issued Combating Auto Retail Scams Trade Regulation Rule (“CARS Rule”) related to the sale, financing, and leasing of covered motor vehicles by covered motor vehicle dealers? The CARS Rule is a modified version of the FTC’s initial proposed Motor Vehicle Dealer Trade Regulation Rule, called the Vehicle Shopping Rule.

The CARS Rule, among other things: (i) prohibits certain motor vehicle dealers from making certain misrepresentations, expressly or by implication, in the course of selling, leasing, or arranging financing for motor vehicles; (ii) requires accurate pricing disclosures in dealers’ advertising and sales communications; (iii) requires dealers to obtain consumers’ express, informed consent for charges; (iv) prohibits the sale of any “add-on” product or service that confers no benefit to the consumer; and (v) requires dealers to keep records of certain advertisements, sales scripts, consumer complaints, and customer transactions.

The Rule will have a profound impact on how covered motor vehicle dealers advertise vehicles, communicate with its customers, and sell vehicle protection products. The Rule will also require new disclosures and forms, require additional trainings, monitoring, and compliance responsibilities, require a dealer to make substantial recordkeeping changes, and increase the time it takes to sell and finance a vehicle. If a covered motor vehicle dealer violates the CARS Rule, it is considered an unfair or deceptive act or practice (UDAP) punishable by a $51,744 fine for each violation.

The CARS Rule was originally scheduled to take effect on July 30, 2024, but on January 4, the NADA and the Texas Automobile Dealers Association challenged the CARS Rule with a petition for review filed before the U.S. Court of Appeals for the Fifth Circuit. Shortly after this filing, the NADA and the TADA moved to stay the final rule and for expedited consideration.

After telling the NADA that the FTC could oppose the stay, the FTC issued an order staying the effective date of the final rule pending judicial review. If the court upholds the rule, the FTC will announce a new effective date for compliance.

Dealers can’t afford to wait to see what happens in the litigation before getting ready to comply with the Rule. When looking at the civil penalties for violations that could easily bankrupt a dealership, it’s better to risk preparation that may not ultimately be needed over being unprepared if the Rule becomes effective this year.

So, there’s this month’s roundup! Stay legal, and we’ll see you next month. n Eric (ejohnson@hudco.com) is a Partner in the law firm of Hudson Cook, LLP, Editor in Chief of CounselorLibrary.com’s Spot Delivery®, a monthly legal newsletter for auto dealers, and a contributing author to the F&I Legal Desk Book. For information, visit www.counselorlibrary.com. ©CounselorLibrary.com 2024, all rights reserved. Single publication rights only to the Association. HC# 4863-5957-3410.

Rev Up Your Dealership Reading:

Top Picks for MidAtlantic Independent Dealers With summer around the corner, dealers may want to consider some summer reading ideas. Whether you're lounging on a beach chair or taking a break in the shade, a good book can be the perfect companion. We've compiled a list of top summer reads tailored specifically for used car dealers. From industry insights to inspirational tales, these books are sure to rev up your motivation and fuel your success.

"THE ART OF SELLING CARS: MASTERING THE GAME"

BY MAX M. POWER In this comprehensive guide, Max M. Power shares his decades of experience in the automotive industry, offering invaluable tips and strategies for closing deals and maximizing profits. From mastering the art of negotiation to building lasting customer relationships, this book is a must-read for any ambitious used car dealer looking to excel in the competitive market.

"DRIVEN: THE STORY OF A CAR DEALERSHIP SUCCESS"

BY RACHEL WHEELER Follow the journey of Rachel Wheeler as she transforms a struggling car dealership into a thriving business empire. Filled with practical advice and real-life anecdotes, this book provides inspiration and motivation for dealers looking to overcome challenges and achieve their goals. Get ready to be inspired and motivated to take your dealership to new heights.

"THE PSYCHOLOGY OF BUYING AND SELLING CARS"

BY DR. ALAN SPARKS Delve into the minds of car buyers and sellers with Dr. Alan Sparks as he explores the psychological factors that influence purchasing decisions. From understanding consumer behavior to leveraging persuasion techniques, this insightful book offers valuable insights that can help dealers close more deals and increase their bottom line.

"MILES TO GO: A ROADMAP FOR USED CAR DEALERSHIPS"

BY SARAH MILES In this practical guidebook, Sarah Miles provides a roadmap for success in the used car industry. Drawing on her own experiences as a successful dealer, Miles offers practical advice on everything from inventory management to marketing strategies. Whether you're a seasoned pro or just starting out, this book is packed with actionable tips to help you navigate the road ahead.

"WHEELING AND DEALING: TALES FROM THE TRENCHES OF USED CAR SALES"

BY JACK REYNOLDS Get ready for a wild ride with Jack Reynolds as he shares his most outrageous and entertaining stories from the world of used car sales. From eccentric customers to bizarre trade-ins, this book offers a humorous glimpse into the day-to-day realities of life on the lot. Sit back, relax, and enjoy the ride!

So there you have it, a selection of summer reading material guaranteed to entertain, educate, and inspire used car dealers everywhere. Whether you're looking to sharpen your sales skills, gain a deeper understanding of consumer behavior, or simply enjoy some light-hearted anecdotes, these books have got you covered. Happy reading, and here's to a successful summer on the lot! n MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024 | 19

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 Monday thru Friday 9:00 AM - 4:30 PM capitalautoauction.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

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

PERRYOPOLIS AUTO AUCTION Route 51 S. Perryopolis, PA 15473 724.736.4445 / Fax: 724.736.0466 Friday 9:45 AM perryautoauction.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

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

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 Fax: 814.474.4969 Tuesday 1:45 PM greater-erie.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 Every Friday Sale 8:30 AM manheim.com MANHEIM PHILADELPHIA 2280 Bethlehem Pike, Hatfield, PA 19440 215.822.1935 / Fax: 215.822.8140 Tuesday 9:30 AM TRA Sale - Tuesday 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

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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 PUBLIC AUCTIONS Capital Auto Auction 5135 Bleigh Ave., Philadelphia, PA 19136 215.332.2515 / Fax: 215.332.2534 capitalautoauction.com Capital Auto Auction 5001 Beech Rd, Temple Hills, MD 20748 301.316.4980 / Fax: 301.316.4982 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

5 Ways Independent Auto Dealerships Can Harness User-Generated Content for Marketing Success

By Professional Mojo Marketing Not surprisingly, user-generated content (UGC) has become a powerful tool for businesses to connect with their audience.

Dealerships, in particular, can benefit significantly from harnessing UGC to build trust, enhance brand awareness, and drive sales. In case you aren’t convinced though, consider these stats.

According to The State of User-Generated Content 2022 Report and Business.com: • 72% of consumers trust peer reviews and testimonials more than the same content coming from the brand itself • 64% of consumers have tagged a brand on social media • Customers are 3 times more likely to engage with a brand’s social media content Given the power of UGC, here are five ways your dealership can leverage user-generated content to accelerate success.

(Hint: You are probably doing some of these already.)

Improve Your Social Media Engagement: It’s no secret that your customers often turn to social media to research and share experiences. Tap into this wealth of usergenerated content by actively engaging with customers where they are: Instagram, Facebook, X and/or TikTok. Provide your social media links and encourage your customers to share photos of their new vehicles, positive testimonials, and experiences at the dealership! This creates a sense of community centered around your dealership.

Ask for Customer Feedback: User-generated reviews and testimonials are powerful influencers. During after-sale care, your team should actively encourage satisfied customers to leave reviews on popular review sites, the dealership website, or your social media pages.

Positive reviews not only enhance credibility but also serve as valuable social proof for potential buyers. Acknowledging and responding to reviews, whether positive or negative, demonstrates transparency and a commitment to customer satisfaction, so follow-up on each one. .

Collaborate with Influencers: Collaborating with influencers can amplify a dealership’s reach and credibility - even on a small scale. Consider identifying influencers in your community and target audience who align with the dealership’s brand values and then explore partnerships for sponsored content. Influencers often have a dedicated following, and their endorsement can impact potential buyers’ decisions. Dealerships can also encourage local influencers or customers with a substantial social media presence to create content featuring their vehicles, creating authentic and relatable marketing material.

Encourage Customer Videos: People love video, and video content is a dynamic and engaging way to showcase your vehicles and dealership experiences. Don’t be afraid to encourage customers to create and share videos of their test drives, vehicle features, or overall experiences. Then, when the customer shares the video, your team can repost and comment - maybe even use them in marketing campaigns. You may want to consider hosting video contests or challenges, where users create content related to their vehicles, further boosting engagement and foster a sense of community among customers.

Continue Your Community Engagement: You are probably already participating in or sponsoring local community events. If not, you should be. Community engagement offers an opportunity to generate user content organically. Whether it’s a local car show, charity event, or festival, your dealership team should encourage attendees to share their experiences online using specific hashtags or tags.

This not only generates UGC but also positions the dealership as an active and engaged member of the community.

We can’t stress enough the value of user generated content.

When the praise, information and endorsement comes from a third-party, your prospects are more likely to listen. n

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Wholesale Auction Prices Could Flatten

Prices are still in a downward trend, reports Cox Automotive.

By Jim Henry, Wards Auto Average wholesale auction prices enter 2024 in an ongoing, downward trend, but that trend could flatten out over time, according to the December Manheim Used Vehicle Value Index.

For December 2023, the Manheim Index was 204.0. That’s down 7% vs.

December 2022, and was the 16th month in a row the index was below the year-ago month.

The corresponding seasonally adjusted average price was $18,657 in December, down 7% from $20,060 a year earlier, Manheim says.

For dealers, affordability and availability should improve this year, and that should stimulate demand.

“That’s not necessarily all good news for dealers,” Charlie Chesbrough, Cox Automotive senior economist, says in a recent webinar. That’s because profit per unit is likely to shrink in proportion.

The Manheim Index is designed to be a single measure that tracks used-vehicle wholesale price changes, weighted for a changing mix of product segments and mileage, and seasonally adjusted. The index is calculated relative to a starting point, where January 1997 equals 100.

It's important to note that while the Manheim Index has been declining, it’s still much higher than it was before the COVID-19 pandemic and supply-chain problems cut into new-car production, and the resulting shortage drove newand used-car prices higher.

“It’s still 33% higher than the end of 2019,” says Jeremy Robb, senior director, Economic and Industry Insights for Cox Automotive. Auction firm Manheim is a Cox Automotive company.

It’s early in 2024, but Cox Automotive forecasts that with some ups and downs, the Manheim Index will end the year roughly flat to up slightly, vs. the end of 2023. Specifically, the newly issued Manheim Index forecast for December 2024 is an increase of just 0.5%.

That’s a big reversal from minus-7% in 2023, but it’s still a relatively bearish forecast for 2024, Robb says.

That’s because in an average year, the Manheim Index tends to increase around 2% because of inflation.

“A rise of less than 2% is less than normal,” he says.

What’s holding used values down?

Affordability – read, interest rates.

While interest rates on auto loans are starting to come down, they’re still high enough to curb some consumer demand, especially for used-car shoppers and borrowers with subprime credit, says Jonathan Smoke, Cox Automotive chief economist.

Cox reports the average new-vehicle loan rate in December was 9.2%, vs.

8.4% at the beginning of 2023; the average used-vehicle loan was 13.8%, up from around 12%. n

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Consumer Attitudes Shift Away from EVs, Toward Affordability

Deloitte’s Global Automotive Consumer Study also explores range anxiety, brand loyalty.

By Steve Finlay Car buying behavior is shifting in various ways. But shopper attention to vehicle price, performance and quality are constants that continue to influence purchase decisions.

That’s according to Deloitte’s “2024 Global Automotive Consumer Study.”

The business consultancy's 14th annual report is based on analysis of survey results gathered from more than 27,000 consumers in 26 countries last fall.

The report particularly focuses on interest in electric-vehicle adoption but also explores vehicle-purchase intent, brand loyalty, connectivity and people’s interest in vehicle-subscription plans. Price tops the list of factors motivating consumer vehicle choice in the U.S. (59%), Japan (58%) and Germany (55%). Vehicle performance is top of mind in South Korea (55%) and China (53%). Product quality is of utmost interest in India (65%).

Here are other study takeaways: — EV MOMENTUM SLOWS. In the U.S., intent to purchase an internal-combustion engine (ICE) vehicle is up nine percentage points (to 67%), while hybrid-electric and battery-electric vehicle (BEV) purchase intent has slowed, dropping four and one percentage points year-over-year (to 21% and 6%), respectively.

Globally, consumer interest in ICE vehicles also rebounded in Germany, Japan and South Korea (up 4% in each market).

The sustained interest in traditional ICE vehicles telegraphs significant near-term challenges in the shift toward automotive electrification, Deloitte says.

Consumer interest in BEVs is highest in China (33%). Japanese consumers (41%) continue to show the highest preference toward hybrid and plug-in hybrid-electric vehicles (HEV/PHEV) (41%).

Despite price cuts and government incentives, EV adoption faces a multitude of challenges, says Masa Hasegawa, Deloitte principal- global automotive, and strategy and operations practices.

“Some consumers are steering back towards ICE platforms,” Hasegawa says. “This presents a challenge for a wide variety of ecosystem stakeholders, including government regulators, that are making generational investments to achieve ambitious EV adoption targets on an aggressive timeline.”

And while EVs are touted as a way to reduce carbon emissions, many consumers have less high-minded views on the subject: A desire for lower fuel costs is the main reason consumers cite for choosing EVs in the U.S., Southeast Asia, South Korea, Japan and Germany.

Only in India is concern for the environment the top motivator for purchasing an EV. In China, it’s the driving experience.

— RANGE ANXIETY IS REAL. To consider a battery-electric vehicle as a viable option for their next vehicle, almost half (46%) of non-BEV intenders in the U.S. would expect a driving range of at least 400 miles (640 km) on a full charge.

Time required to charge has taken over as the top concern hindering EV adoption in the U.S. (50%), Japan (48%), South Korea (48%), Southeast Asia (45%), India (43%) and China (42%).

Regarding range limitations on today’s EVs, dealer executive Eric Frehsée, president of the Tamaroff Automotive Group in metro Detroit, says, “A lot of people don’t like to plan the use of their vehicle.”

— PRICE IS A CONCERN, REGARDLESS OF A VEHICLE’S PROPULSION SYSTEM. Amid economic uncertainty and high interest rates, affordability remains a major issue for U.S. car consumers. Most people expect to pay less than $50,000 for their next vehicle, whether it is an ICE (81%) or EV (74%) powertrain.

In the U.S., 59% of U.S. consumers surveyed cite price as a top consideration when selecting a vehicle brand.

— LESS THAN HALF OF CONSUMERS ARE BRAND-LOYAL. More than half (51%) of U.S. consumers say they are likely to switch automotive brands for their next vehicle purchase, according to the report.

More than 4 in 10 surveyed intend to leave their current brand family, citing as main motivators a desire to try something different, affordability and access to the latest features.

“Brand loyalty has been flat for a long time,” says auto industry analyst Tom Libby.

Meanwhile, although interest in connectivity is growing, the Deloitte report says only 25% of U.S. consumers surveyed are willing to pay extra for connected services. Many car buyers have come to expect new vehicles as a way for brands to differentiate themselves in the market.

The study also says vehicle-subscription plans (as opposed to outright purchases) are of interest to consumers who are rethinking their financial commitments toward vehicle ownership.

Nearly 30% of U.S. consumers ages 1834 are considering bypassing traditional vehicle ownership for a vehicle-subscription service, according to Deloitte. n

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

uEarly-bird registration opens for 2024 NIADA Convention & Expo Registration is now open for the event of the year in the used vehicle industry at the Wynn in Las Vegas. The early-bird registration is $545 at niada.com/convention through May 20. The early-bird discount is $200 off the standard registration.

Registrants can also take advantage of the discounted rooms at the beautiful Wynn Hotel, starting at $174 per night, plus taxes and a reduced resort fee of $25 per night.

The education truly offers valuable training for everyone in every area of the dealership from ownership, management, service, compliance and collections. Five tracks feature multiple sessions led by dealers and industry experts, including several panel discussions.

More education sessions are being added to the current lineup.

“We are excited about the great education schedule we are presenting for our dealers at this year’s convention,” said NIADA CEO Jeff Martin. “The quality of our education is the primary reason dealers attend our convention. We work with our members throughout the year to identify topics and speakers that match our dealers’ needs.”

In addition to the dozens of breakout education sessions, the convention will feature three general sessions. The opening session 9 a.m. Tuesday, June 18, will include the annual analytics report to provide benchmarks for dealers as they start the convention. That afternoon the keynote address will be delivered. Sugar Ray Leonard, John Taffer, Michael Irving, Dick Vital, Captain Richard Phillips and Bobby Bowden are just a few of the big names who have addressed the NIADA attendees on the big stage in the past.

A celebration of the industry and the crowning of the National Quality Dealer of the Year will close the convention Thursday afternoon. Throughout the convention, there will be opportunities to visit the largest expo hall for the used vehicle industry and network with more than 800 dealers from across the country. We can’t wait to see you in Las Vegas for the 2024 NIADA Convention and Expo. Register today! n

Trade Groups Force Postponement of FTC CARS Rule

By Jeffery Bellant The Federal Trade Commission has issued an order postponing the effective date of the Combatting Auto Retail Scams (CARS) Rule while a legal challenge against the rule is pending.

The NADA and Texas Automobile Dealers Association have petitioned to overturn the rule, asserting that the rule should be stayed while the court challenge is pending. In its order, the commission alleges these assertions rest on “mischaracterizations of what the rule requires. Specifically, the commission’s order disagrees with the argument that the rule will increase compliance costs for car dealers, which is the FTC not true for dealers who currently follow the law.”

However, NADA President Mick Stanton issued a statement supporting the stay.

“We are pleased that the FTC has determined that ‘it is in the interests of justice to stay the effective date of the rule to allow for judicial review.,” he said. “We continue to believe the rule is unnecessary, redundant, confusing, and will needlessly lengthen the car sales process for consumers.

“The FTC failed to demonstrate the need for the rule and has not tested the effectiveness of its mandates with consumers. NADA will continue to advocate in the courts and in Congress to keep this ill-conceived rule from taking effect.”

The FTC, while arguing that the rule “… does not impose substantial costs, if any, on dealers…” it added “…to the extent there are costs, those are outweighed by the benefits to consumers, to law-abiding dealers, and to fair competition—as honest dealers will not be at a competitive disadvantage relative to dishonest dealers.”

The rule was set to go into effect July 30, 2024. n

24 | MIDATLANTIC DEALER NEWS | MIDATLANTICIADA.ORG • MARCH 2024

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