Issuu

New Members Help Shape

TxDMV Board Also In This Issue: –T he Growing Risk of Cybercrimes Targeting Dealerships –T IADA Delegation Visits D.C. –M ichael Dunagan on 40 Years of Changes to the Industry –T IADA Auction Days

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2017 TIADA Board of Directors PRESIDENT Kathrine Tolsch/CICO Auto Sales 11050 Harry Hines Blvd. Dallas, TX 75229 Office: 214.352.9282 / Fax: 214.352.8227 Email: cicoauto@verizon.net PRESIDENT-ELECT Greg Zak/Dixon Motors 7902 North Freeway Houston, TX 77037 Office: 281.931.1300 Email: gzak@windstream.net CHAIRMAN OF THE BOARD Phil Lathrop/VP Auto Sales Inc. 2921 S. Garland Avenue Garland, TX 75041 Office: 972.864.1300 Email: phillipl@vpautosales.com SECRETARY Trey Crouch/Trey Crouch’s Wheels On Credit, Inc. 636 E. Business 83 McAllen, TX 78501 Office: 956.972.0700 Email: trey@wheelsoncredit.com TREASURER Robert Beck/Stop N’Drive Motors 711 N. General McMullen Dr. San Antonio, TX 78228 Office: 210.432.1101 Email: stopdrive@texas.net VICE PRESIDENT, WEST TEXAS (REGION 1) Paul Scott/Fiesta Motors – Lubbock 2599 74th Street Lubbock, TX 79423 Office: 806.765.3640 Email: pscott@gofiestamotors.com VICE PRESIDENT, FORT WORTH (REGION 2) Mark Jones/Mike Carlson Motor Company 264 Exchange Burleson, TX 76028 Office: 817.703.7973 Email: markjones_1@att.net VICE PRESIDENT, DALLAS (REGION 3) Wayne Meagher/M D Auto Sales 2002 W. Main Street Grand Prairie, TX 75050 Office: 972.641.9598 Email: wayne@navchiefs.com VICE PRESIDENT, HOUSTON (REGION 4) Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 Office: 713.641.0980 Email: ryan.winkelmann@sbcglobal.net VICE PRESIDENT, CENTRAL TEXAS (REGION 5) Robert Blankenship/Texas Auto Center 6809 N IH-35 Austin, TX 78744 Office: 512.280.5333 Email: bob@texasautocenter.net VICE PRESIDENT, SOUTH TEXAS (REGION 6) Dan Keetch/Keetch Motors 1010 S. Staples Corpus Christi, TX 78404 Office: 361.882.3541 Email: dankeetch51@yahoo.com VICE PRESIDENT AT LARGE Juan Sabillon/Mi Tierra Auto Sales 7935 Gulf Freeway Houston, TX 77017 Office: 713.644.2446 Email: brentfordct@yahoo.com VICE PRESIDENT AT LARGE Greg Reine/Auto Liquidators 39670 LBJ Freeway Dallas, TX 75237 Office: 972.780.0001 Email: greg@autoliquidators.net TIADA EXECUTIVE DIRECTOR Jeff Martin 9951 Anderson Mill Rd., Suite 101 Austin, TX 78750 Office Hours M-F 8:30am - 4:30pm 512.244.6060 • Fax 512.244.6218 jeff.martin@txiada.org

Volume XVI

/ I s s u e 11

/ N o v e m b e r 2 016

texasDealer

4 Officers’ Message

contents

by Trey Crouch, TIADA Secretary

6 House of Delegates Meeting Minutes 8 On The Cover: New Members Help Shape Evolving TxDMV Board by Michael Spurlin

15 Legal Corner: Long-Time Observer Recalls 40 Years of Change by Michael W. Dunagan

16 Upcoming Events 22 Texas Dealers Visit Lawmakers on Capitol Hill by Michael Spurlin

24 TIADA Day at the Auction 2016 Tour 31 Regulation Matters: How to Become (& Remain!) an Independent Auto Dealer by Danny Langfield

32 2016 VIP Auction Card Directory 37 Dealerships Are at Growing Risk of the Latest Cybercrimes by Bryan Laabs

43 TIADA Member Application 44 New Members 45 Local Chapters 46 Behind the Wheel by Jeff Martin

What’s happening at w w w . t x i a d a . o r g ?

DID YOU KNOW... We have announced two new education

seminars: Collect the Cash, Not the Car and Sales Team and Sales Process Growth Intensive. Go to the Education page to learn more about each class and register today. The Editor of the Texas Dealer magazine is Michael Spurlin, Social and Communications Coordinator of TIADA. To change your address for subscription and/or for other TIADA products, call the TIADA state office at 512.244.6060 or fax 512.244.6218. E-mail: info@txiada.org. New Membership/Subscriptions: If you are a member of TIADA, you may receive this magazine free of charge. Membership year runs from Jan 1 to Dec 31. Back issues are available for $20 each subject to availability. Send a check or money order, along with your name and mailing address to TEXAS DEALER, Attn: Back Issues, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750. Sorry, no billing. Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the membership. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured.

officers’ message by Trey

November Decisions

“W

hat are you going to do about inventory between now and Tax Season?” I have asked this question to many dealers across Texas. There has often been a shortage of the right cars at the right prices as we move into the first quarter of the year. What will 2017 look like? What are the factors to consider — presidential election, off-lease returns, repossessions returning to the auctions for re-marketing, and on and on it goes? There is an overwhelming amount of information and data to sort through and analyze. Some will base their decisions on the data. Others will go with their “gut.” How will you move forward as we close out 2016? What will you and your team use to navigate the new course? My guess is we are all asking ourselves those questions now.

The Data: Forecasts suggest that there will be an

abundance of returning off-lease units to purchase at the auctions. Cox Automotive/Manheim seems to be looking for ways to increase lanes and open underserved markets to be ready for the increase in units to be re-marketed. The wildcard is the number of repossessions that will return to market. It is estimated that 80% of all repossessed units find their way back to an auction lane for re-marketing. I believe that we could see a significant increase in repossessions that will drive volume up and wholesale prices down in certain price points.

Crouch

Trey Crouch’s Wheels on Credit, Inc. (McAllen) TIADA SECRETARY

The Technology: Manheim has been providing tons

of data to the marketplace to help the industry make good decisions. The channels for purchasing inventory are as broad as your ability to learn the systems. OVE, Online Live auctions, second chance bidding on the Online Live auctions that didn’t sell. vAuto has also added STOCKWAVE (I called it Shockwave) to their list of products which suggests that all a dealer must do is “turn it on” and hit the purchase button.

Trends: Access to floorpan capital may be the most interesting of all the pieces to the puzzle. As regulators tighten controls on lending across the nation, only the dealers with great processes and selling systems will be able to keep their lines of credit, which will have some additional influence on the prices in the lanes. Fewer buyers for larger supplies of units should drive prices down below the recent trend of increased prices year over year on the current to three year old inventory – especially the trucks and SUVs. Rough cars are really hard to get rid of and they will likely be more difficult to get rid of in the future. Many of our dealers will see this as an opportunity, but is it? As usual, there are more questions than answers but hopefully the discussion you have with yourself, your team, and the other members of TIADA will help you make the right decisions at the right times for the right reasons. Good luck to all as we wrap up 2016 and hope for a brighter new year. Rest assured, you’re not alone!

How will you move forward as we close out 2016? What will you and your team use to navigate the new course? 4

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house of delegates meeting minutes July 24, 2016 | TIADA Conference, San Antonio, TX

compiled by Texas Dealer staff

At its meeting on Sunday, July 24, 2016, TIADA took the following actions: President Phil Lathrop called the meeting to order at 4:00 p.m.

the Bylaws presented by the Bylaws Committee. Moved by John Freeman, seconded by Dan Keetch – Passed.

2017 Officer Elections

A motion was made to accept the proposed changes to the Legislative Program presented by the Legislative Committee. Moved by Keith Hagler, seconded by John Freeman – Passed.

With no contested races, Chairman Brent Rhodes asked for a motion directing the Secretary to submit a single ballot for the following candidates: President: Kathrine Tolsch; Chairman of the Board: Phil Lathrop; President Elect: Greg Zak; Secretary: Trey Crouch; Treasurer: Robert Beck; Vice President Region 1: Paul Scott; Vice President Region 2: Mark Jones; Vice President Region 3: Wayne Meagher; Vice President Region 4: Ryan Winkelmann; Vice President Region 5: Robert Blankenship; Vice President Region 6: Dan Keetch; Vice President at Large; Juan Sabillón; Vice President at Large; Greg Reine. Moved by Keith Hagler, seconded by Mark Brown – Passed.

Bylaws Committee

Mark Brown presented the Bylaws Committee Report. A motion was made to accept the proposed changes to

Legislative Committee

A motion was made to adjourn the meeting. Moved by Baldomero Trevino, seconded by Juan Sabillon – Passed. Meeting adjourned at 5:00 p.m. Respectfully submitted, Greg Zak, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.

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on the cover by Michael Spurlin Texas Dealer Editor

New Members Help

Shape

n late August, Texas Governor Greg Abbott named Raymond Palacios, Jr. as the new Chairman of the Texas Department of Motor Vehicles Board. Additionally, he appointed three new members: Brett Graham, Kate Hardy and Gary Painter. Texas Dealer had the opportunity to visit with Chairman Palacios, Jr. and the other new members to discuss their appointments and the future of the TxDMV Board.

Raymond Palacios Jr. CHAIRMAN

Raymond Palacios Jr. is president of Bravo Cadillac in El Paso and Bravo Chevrolet Cadillac in Las Cruces, New Mexico. He is a past district director of the Texas Automotive Dealers Association, past president of the El Paso New Car Dealers Association, past vice chair of General Motorsâ€™ Minority Dealer Advisory Council, and a past member of the National Chevrolet Dealer Advisory Council and the Hummer Dealer Advisory Council. Palacios is currently a member of the Paul L. Foster School of Medicine Deanâ€™s Advisory Council. He is an executive board member of the Borderplex Economic Alliance and board member of the Council for Economic and Educational Development. Additionally, he is a past president of the Association for the Advancement of Mexican Americans, and a former board member of Leadership Houston, the University of Houston Alumni Association,

TxDMV Board Yucca Council Boy Scouts of America, and El Paso Better Business Bureau. He also served in the U.S. Marine Corps.

TEXAS DEALER What are some of the biggest achievements of the TxDMV Board during your time as a member? RAYMOND PALACIOS, JR. As board members, we strive to have an agency that is customer-centric and provides innovative and optimal services to our clients. To that end, I believe our board has succeeded in creating strategies that have resulted in numerous enhancements to our processes and led to the development of cutting edge technologies that all serve to benefit our public. The development of the E-Licensing, Web-Dealer, the Refactoring of Registration and Titling System and the enhancement of our call center are a few examples of systems that have been put in place for the benefit of our public. TD What big issues do you anticipate the board facing and how will you, as Chairman, help the board address them? RP As we all know, the pace of change of technology is rapid. I believe it is important for us to understand the changing nature of technology. We must also understand how our public and industry stakeholders utilize these changes in their day-to-day lives. Our focus, as board members, should be to ensure that the agency delivers the best services to our citizens and industries in a manner that is efficient and value driven. Our agency should always be open to innovation. We must resist becoming complacent and falling into the practice of maintaining outdated practices simply to not cause disruption with convention. I believe part of my role as Chairman and the role of our board members will be to work with the agency to communicate the vision that will be followed and strategies that will be undertaken for the benefit of the citizens of the state of Texas. TD What should be the role or responsibility of a stakeholder like TIADA? RP I know that TIADA provides great value to its T e x a s

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members. From providing educational seminars to advocating for its members at the State House, TIADA is a great resource for independent used car dealers. I believe TIADA should continue to play a key role in ensuring that its members are able to operate in a fair, competitive and open environment. TIADA also has a role in promoting sound business practices within its industry and working to ensure that the relationship between its dealers and the motoring public is built on one of mutual respect and trust. The Texas DMV has enjoyed the feedback and input that TIADA has provided our agency towards this end. The DMV board is also very fortunate to have one of your esteemed members, Blake Ingram, as one of its members. Board member Ingram’s knowledge and insight of your industry has enabled him to provide key direction to our agency in crafting and streamlining rules that have benefited your industry and the relationship with your customers.

Brett Graham

FRANCHISED AUTO DEALER

After working for two years as a commercial real estate appraiser in Dallas, Brett took over as CEO of Graham International, the family business, in 1993 after the passing of his father who started the business in 1965. Graham International is a franchised International Truck dealership with locations in Sherman and Paris. In 2000, Brett and his wife, Debbie, started Graham Truck Centers, a franchised Bridgestone and Firestone truck tire operation. The company now has 42 employees, with 4 locations in North Texas and Southern Oklahoma. The company is a franchised tire dealership for Bridgestone, Firestone, Dayton, Michelin, BF Goodrich, and Boto. He has served various boards over the past 23 years, and had the opportunity to be the State Chair of the Texas Association of Business in 2011. He currently serves as the BACPAC Chair on the state board of the Texas Association of Business, the board of the Grayson County Appraisal District, Ameristate Bank in Sherman, is current board chair for the Texoma Health Foundation, and was just reelected to his third term as Trustee on the Pottsboro Independent School Board.

“I believe TIADA should continue to play a key role in ensuring that its members are able to operate in a fair, competitive and open environment.” Raymond Palacios, Jr. TxDMV Board Chairman

BRETT GRAHAM I consider it a tremendous honor to

be asked to serve on the TxDMV Board by Governor Abbott. The trucking industry is dominated by large, often publicly traded companies, so for a small business owner to have this opportunity is unique. TD What aspects of your background will help aid you in your role on the board? BG Interestingly enough, I believe the diversity of my background will help me bring a different perspective to the DMV. In addition to being a franchised International dealer, I also have another company that

TEXAS DEALER Can you describe what it means to you to be selected to serve on the TxDMV Board? November 2016

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represents Michelin and Bridgestone truck tires. This background should help me when the board or the agency is dealing with issues involving the Moto Carrier Division or commercial vehicle concerns. I have served for the past twenty years on the State Board of the Texas Association of Business, which gives me a full range of knowledge on state affairs that impact the agency. Lastly, I have also served on a wide array of non-profit and foundation boards. It is my hope that this range of experience will help me be an effective, productive board member for the Texas Department of Motor Vehicles. TD What issues are you looking forward to addressing in the near future? BG I have only attended one board meeting, so by no means do I have my hands around the challenges and opportunities of TxDMV in its entirety. But from the outside looking in, I think the greatest opportunity for TxDMV is to reinvent itself to some degree to serve the citizens of Texas in a modern, technologically driven manner. Agency leadership has already made tremendous strides on this over the past few years. The legislature split TxDMV from TxDOT in the 2009 session. This created significant challenges considering the agencies shared servers and facilities. So much of the work has been on the infrastructure, the foundation which is essential to move forwards. The ways we currently serve

citizens is likely to change dramatically in the coming years, and even the services we provide could look very different. As a small business owner, I am accustomed to reevaluating my organization each year. Change does not bother me; in fact in my business you are either moving forwards or falling back. I intend to support and encourage our staff to continue to make Texas DMV the best, most innovative in the country.

Kate Hardy

VEHICLE MANUFACTURING/ DISTRIBUTION INDUSTRY

Kate Hardy of Trophy Club is director of General Motors (GM) Financial and has held various positions in the sales and marketing group with GM for over 30 years. Hardy received a Bachelor of Science in industrial management from Georgia Tech. (cont’d on pg. 12)

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2/10/16 8:30 2016 AM November

TxDMV Board (cont’d from pg. 10)

TEXAS DEALER What aspects of your background working for a vehicle manufacturer will help aid you in your role on the board? KATE HARDY I have been with GM for over 31 years, I have been working with dealers most of my career. My background has given me perspective on their businesses. I understand how they operate, their processes and concerns. From a manufacturer’s perspective I understand how important it is to streamline and improve efficiency and it is important for a state agency to do that exact thing. I am very happy about my appointment and am excited to serve the state. I am looking forward to sharing the manufacturer’s point of view. With nine members on the board it is important we each share our unique point of view. It’s the reason we are all serving on the board. TD What issues are you looking forward to addressing in the near future? KH I would like to focus on improving upon the efficiencies the agency has already implemented. This is a consumer driven agency and we need to focus on streamlining things for consumers, counties and

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business operators. Additionally, I am looking forward to focusing on transportation and working to keep people safe.

Gary Painter LAW ENFORCEMENT

Gary Painter, of Midland, is Sheriff of Midland County and has over 45 years of law enforcement service. He is a lifetime member of the Sheriffs’ Association of Texas and a member of the National Sheriffs’ Association, Western States Sheriffs’ Association, Southwest Border Sheriffs’ Coalition and the Texas Police Association. He is a gubernatorial appointee on the Commission on Jail Standards, president of the Midland County Bail Bond Board, board member of the Attorney General’s Human Trafficking Task Force, and a member of the Interoperable Communications Board and Law Enforcement Academy Board for the Permian Basin Planning Commission. Painter received a Bachelor of Science in police administration.

TEXAS DEALER What are the biggest challenges for law

enforcement as it relates to the motor vehicle industry? GARY PAINTER The biggest challenge is to be able to provide as much information to the officer in the field as quickly as possible in order to be able to handle his job, business or investigation. That would include registration, titling, and disposal of the vehicle. TD What priorities would you like to see the TxDMV board address in the short term? GP The biggest priority is to improve upon the technology available in the digital age to provide the easiest means possible for the vehicle owners and drivers in Texas to register and title their vehicles. This would mean the expansion of the new progress that we have made with modernization of regulation and titling and spreading that progress across the state in kiosks or secure access. It should be our goal to make it as simple and as fast as possible for the vehicle owners and to keep them from having to stand in line and reduce the costs. TD Any additional thoughts on your appointment? GP I hope I can bring the 45 years of expertise in law enforcement to guide any discussions and help the board. I am very appreciative to the governor. I think it is a worthwhile board that can serve the people of Texas and I am looking forward to serving.

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legal corner

Long-Time Observer Recalls 40 Years of Change

t was in November of 1976 that the newly licensed attorney and a group of dealer-association board members met each other for the first time in Corpus Christi. That the association — TIADA — needed an attorney was generally agreed upon. That the green attorney — me — needed a job was an absolute given. So it was decided after a brief courtship, with mutually suspicious glances, that the association would embrace the enemy as its own and the attorney would, for better or worse, take on this group as his first client. The architect of this marriage was the late I.J. “Irv” Berrier, then executive vice president, who had guided the association to its then high watermark in membership (over 1500) and had managed to build a sizeable reserve in the bank with annual dues of just $150 per member. Berrier was able to convince the reluctant attorney to agree to at least two years of service so the association could hopefully recapture its investment. Somehow that unlikely relationship would surpass the agreed-upon minimum by at least 38 years. During that time I have witnessed the retirement (and, in some cases, the death) of many of the veteran leadership of the group; the transformation of the middle-aged central core of the membership to senior citizen status; and the emergence of second- (and third-) generation dealers as the new leadership. Amazingly, even though my own son was born, received

November 2016

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by Michael

his education, obtained a graduate degree, and was ordained into the ministry, during this same 40-year period, I somehow managed to avoid the aging effect of the years. I have also witnessed fortunes made and fortunes lost, and some individuals have even repeated the cycle several times. I’ve watched the industry itself evolve. Forty years ago the association was evenly split between dealers who sold latemodel merchandise with third-party financing, and those who sold older cars to people with less-thanperfect credit, carrying the paper in house. Today, the dealers from the first category have been replaced by “retail” dealers who rely primarily on sub-prime financing sources. There are now many more independent dealers that fit into the second category. Yet, with all these changes, the association has survived. It has survived regulatory attacks, classaction suits, gas shortages, the collapse of oil and real estate prices, high interest rates, insurance-plan failures, and multiple recessions. Or, more likely, it is precisely because of these things that it survived. TIADA has in recent years, under the leadership of a succession of effective presidents and other officers, and the professional guidance of Executive Director Jeff Martin and his staff, soared to a level of effectiveness for its members that

Dunagan

TIADA GENERAL COUNSEL

TIADA has, in recent years... soared to a level of effectiveness for its members that couldn’t have been dreamed of four decades ago. couldn’t have been dreamed of four decades ago. In addition to serving as counsel, I’ve now become (by default) the unofficial historian of TIADA. I have even managed to keep every issue of the TIADA monthly magazine since those first days on the job. Here are some highlights of my first 40 years of representation of TIADA. Just recalling these victories for the state’s dealers has rekindled my pride in what TIADA has accomplished against incredible odds and my respect for the men and women who led the way. It is hoped that this list of highlights will enlighten the new generation of dealers to the benefits they derive from the labors and sacrifices of a prior generation. 15

The FTC Fight

Upcoming Events TIADA DEALER ACADEMY Register online at www.txiada.org

November 2016 21 Collect the Cash, Not the Car

Sheraton Suites Market Center 2101 N. Stemmons Freeway Dallas, TX 75207

January 2017 1 0 Sales Team and Sales Process

Growth Intensive Dallas, TX

1 1 Sales Team and Sales Process Growth Intensive Houston, TX 1 2 Sales Team and Sales Process Growth Intensive Austin, TX OTHER TIADA EVENTS January 2017 3 0 TIADA Board of

Directors Meeting Austin, TX

3 1 Lobby Day Austin, TX

On my first day on the job in 1976, I was given a file containing the FTC’s Proposed Trade Regulation on Used Cars. The proposal contained a mandatory 72-hour cooling off period and required dealers to post a list of component systems marked “OK” or “not OK.” The effect was that marking “OK” on anything created an express warranty. There was no organized opposition nationally, and only a few state associations (including Texas) had filed protests. Furious at the government for such a ridiculous intrusion into his business, and vowing to stop the proposed rule, the late Marvin Ivy of San Antonio ran for president of the national IADA with the intention of changing things. He was elected and promptly oversaw the transformation of NIADA into a lean fighting machine. He oversaw the hiring of the group’s first professional association executive, the retention of the services of a lobbyist and began a fundraising and membership campaign. The furious last-minute effort resulted in a much watereddown rule (the so-called “buyer’s guide” rule that we currently have) being passed, and NIADA was well on its way to becoming the association it is today. I’ve always felt that Ivy never got the credit he deserved for leading both developments, and I’ve always marveled at the way some modest, unassuming men emerge in a time of crisis to successfully take the mantle of leadership.

Every time a dealer posts a buyer’s guide, he should thank Marvin Ivy that he doesn’t have to grant a 72-hour-cooling-off period and doesn’t have to give a mandatory warranty on the vehicle.

Dealer Licensing and the Bond

In 1983, the dealer license was little more than a permit that authorized the holder to use metal dealer tags and to avoid sales tax on the purchase of inventory. There was no prohibition on anyone else buying and selling cars as a business or otherwise. Curb-stoning was a legal way to do business. Working with

Working with TADA, the state’s franchiseddealer association, TIADA pushed for and passed legislation that set minimum premises requirements, and limits on unlicensed sales. TADA, the state’s franchiseddealer association, TIADA pushed for and passed legislation that set minimum premises requirements and limits on unlicensed sales. Additionally, the requirement that independent dealers have a $25,000 bond was imposed for the first time. Now it seems that no one questions the bond, although many would like to see the amount increased.

Liability Insurance Protection Prior to 1989, vehicle lien holders had no legal claim to insurance T e x a s

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proceeds paid to their customers by liability insurance carriers. With damaged collateral and a debtor flush with insurance money to finance a new car, the lien holder was left holding the bag. But in 1989 TIADA sponsored legislation that placed a statutory lien on liability proceeds for recorded lien holders. When last-minute opposition from trial lawyers surfaced, our bill sponsor, Rep. David Cain (later Senator Cain), skillfully maneuvered the bill through the mine fields to passage. In terms of benefit-tocost, this bill surely ranks up there as dealers have collected untold amounts that would have been lost under prior law. Just about every week, we send a demand letter to an unbelieving insurance company, which usually results in a check being sent to a dealer who had been excluded from the initial settlement.

Sales Tax Reform Act of 1993

Many, if not most, BHPH dealers probably don’t even know that there was a time when deferredsales-tax didn’t exist. Those dealers who led the charge deserve our heart-felt appreciation.

For years, Texas dealers faced an unpleasant dilemma: (1) advance 100 percent of sales tax up front and lose profitability; or (2) don’t pay sales tax up front and risk being put out of business by the Comptroller. Many dealers took their chances with the latter option and got caught, resulting in million-dollar assessments. Others covered up the problem with creative bookkeeping. Some lucky ones never got caught. The late Jim Watson of Dallas knew there had to be a better way. Watson organized the Fair Tax Committee and convinced Bill Plaster of Dallas to chair it. Facing impossible odds,

Watson and Plaster, with the help of Roy Carlson of Fort Worth and Don Fincher of Houston, and too many others to name, raised the necessary money and undertook to achieve what has been described as an

GARAGE LIABILITY WAYMER & ASSOCIATES

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Proud Member for over 20 years

impossible task. Comptroller John Sharp signed off on the deferredsales-tax approach for seller-finance dealers, which eliminated the last obstacle. After the tax reform bill passed, TIADA’s membership shot up to its highest level since 1977. Many, if not most, BHPH dealers probably don’t even know that there was a time when deferred-sales-tax didn’t exist. Those dealers who led the charge deserve our heart-felt appreciation.

Elimination of Liability Insurance Proof at Transfer One of the biggest headaches that dealers faced through much of the 90’s was the convergence of (1) the requirement that dealers handle all title transfers on vehicles they sold, and (2) the requirement that proof of liability insurance in a buyer’s name be presented with all title transfers. When buyers failed to bring in proof of insurance by the time title had to be transferred, dealers became sitting ducks for

state enforcement officers who issued fines for failure to timely transfer title. Again working with TADA, our association pushed for legislation that would exempt dealers from being the liability insurance police. While there might still be plenty of outlaws who don’t timely transfer titles, the honest, law-abiding dealer was, upon passage of this legislation, again able to transfer and record his lien, without being held hostage by a law-breaking customer.

Independent Dealer Appointed to MV Board

In 1997, the legislature restructured the Motor Vehicle Board to include two dealer positions. Then Gov. George W. Bush appointed Houston dealer Patricia Harless of Fred Fincher Motors as the first ever independent dealer to serve on the Board. The importance of having representation for independents on the board that sets dealer regulation policy can’t be overstated.

Attack of the $225 Import Fee

In search of new sources of painless revenue, the legislature, in a late-night session, passed a bill that would create a $225 fee on all vehicles imported into the state (including fleets and wholesale inventories). Out-of-state fleet sellers quickly began making plans to keep their vehicles out of Texas, fearing the fee would reduce their value. TIADA, working with Texas wholesale auctions and new car dealers, led a constitutional challenge to the new law. We were able to have the law declared unconstitutional, averting a major impediment to the free-flow of inventory vehicles into the state.

Defeat of the Dealer Class Action

It came out of the blue, leaving hundreds of Texas independent dealers nervous and fearful. Class action

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lawsuits were filed in multiple cities accusing BHPH dealers of cheating their customers out of hundreds of millions of dollars by charging sales tax that was allegedly never paid to the state. The fact that the suit would eventually be shown to be groundless didn’t change the fact that these dealer/defendants were facing significant liability. Thankfully, dealers Gary Sayre, Blake Ingram, Robert Milligan, Phil Lathrop, and Don Fincher (and, again, others too numerous to name) stepped up the plate and organized a big-time legal defense effort that would eventually shut the class action down.

The Election of the BHPH Dealer to the Legislature

The election of Patricia Harless of Houston to the Texas Legislature heralded a new era of government involvement and respect for our EPI-TIADAhalf_Nov2016.pdf

10/6/16

industry. Harless, who had previously been appointed and reappointed to the Motor Vehicle Board by Governors George Bush and Rick Perry, has been a strong advocate for free enterprise and minimum government interference with small businesses. The election of one of our own to the Legislature was a major breakthrough for the industry and has set the tone for further involvement by our members in government service (see the January 2016 issue of Texas Dealer for a fitting tribute to Patricia Harless).

challenge fraudulent or fictitious claims. Also, the bills made it harder for third-party repair-financing companies, set up to take assignment of mechanic’s liens, to claim a lien superior to a car-creditor’s lien. There are many other persons and events that make up 40 years of TIADA memories and successes, but I don’t have the time or the space to list them all. My hope is that this list offers a guide to anyone who is asked the question: What has TIADA ever done for me, and why should I be a member?

Mechanic’s Lien Reform

Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for 40 years. He has written a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions.

TIADA-sponsored bills passed in 2009 and 2015 have helped car creditors fight off the sting of fraudulent mechanic’s lien claims. While a valid mechanic’s lien is still superior to a prior recorded mortgage lien, the two bills have made it easier to

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Dealer Academy 2016

Presented by Brent Carmichael, Executive Conference Moderator, 20 Groups. NCM Associates, Inc. This has been a challenging year in the Buy Here, Pay Here industry, aided by another odd tax season and increased apathy by our customers in regards to their payments. Dealers are finding that every collection opportunity needs to be capitalized on and that’s where this seminar can help. Collect The Cash, Not The Car is designed to help you and your collection teams maximize your collection opportunities. Through this 1-day course you can expect to learn:

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feature Texas Dealers Visit Lawmakers on Capitol Hill by Michael Spurlin Texas Dealer Editor

he National Independent Automobile Dealers Association held its fourth annual Leadership Conference & Lobby Day on the Hill in Washington, D.C. September 26-29, and Texas dealers were out in full force. During the conference, TIADA members in attendance visited with numerous lawmakers to discuss topics facing the industry on behalf of dealers back home in Texas. Senator Ted Cruz posted this tweet (right) with photos to his 800,000+ Twitter followers regarding the Texas dealers who visited with him on Wednesday, September 28. On Tuesday, NIADA welcomed speakers from several regulatory agencies to provide updates on various matters of interest to dealers. Agencies represented included the Federal Trade Commission, the Consumer Financial Protection Bureau, The U.S. Department of Labor and the U.S. Department of Justice.

The next day dealers from all around the country visited with their representatives and senators about a myriad of issues of interest to the industry, including vehicle safety recalls and numerous issues surrounding the Consumer Financial Protection Bureau. “Each year the National Leadership Conference continues to grow in size and influence and this year’s event was buoyed by the Texas delegation and their efforts to help our dealers better tell their story in Washington, D.C.” said NIADA CEO Steve Jordan. “Our Texas dealers are an important part of the ongoing narrative our association is having in D.C. We couldn’t do what we do without their support and participation.” The TIADA delegation consisted of President Kathrine Tolsch of CICO Auto Sales, Vice President Robert Blankenship and his wife Erika of Texas Auto Center, past President Scott Allen of Auto Land as well as Gary Perdue and Reba Sanchez-Carpintero of Peritus Portfolio Services. Executive Director Jeff Martin and Deputy Executive Director Danny Langfield also joined them in Washington. As seen in the photos he tweeted, U.S. Senator Ted Cruz was among the prominent lawmakers the delegation met with on the Hill. They also met with Congressman Henry Cuellar of South Texas who was the keynote speaker at Wednesday’s Power Lunch event at the conference. Other members of Congress they met with include Roger Williams and T e x a s

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Marc Veasey of Texas and the staffs of Texas Senator John Cornyn as well as Congressmen Lloyd Doggett, Sam Johnson and Congresswoman Kay Granger. We encourage all members to become involved in the legislative process and the next opportunity comes on January 31 for TIADA’s Lobby Day in Austin. Lobby Day is the specific day that TIADA members gather to meet with various political leaders and advocate for

U.S. Congressman Roger Williams meets the TIADA delegation in Washington D.C.

The TIADA delegation is posed with U.S. Senator Ted Cruz in one of the photos posted to the Senator’s Twitter account on September 28.

legislation relevant to the used car industry. Dealers will have the opportunity to tour the Capitol, attend legislative meetings and interact with other dealers from across the state. Attendance is free, but members do need to reserve their place so TIADA staff can arrange the appropriate meetings with legislators. To register today, visit txiada.org and select Lobby Day from the drop-down menu under Events.

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November 2016

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F&I • Vehicle Service Contracts • GAP Insurance • Tire & Wheel Vehicle Protection Products • Property • Wreckers 2 Car Haulers • Cargo • Dealer Bonds • Personal Lines 23

feature

TIADA Day

at the Auction the

1 1) Jose Engler, of Irving Motors in San Antonio, joins the group of top recruiters. He is pictured here with John Swofford, General Manager of America’s Auto Auction in Buda.

2016 was a busy year for the TIADA booth, which made 22 stops at 15 different auctions and one TxDMV seminar location during this year’s TIADA Day at the Auction tour. That is more stops and more sites than ever before! During these visits, a grand total of 233 new members were signed up and a new recruiter was added to the list of our top recruiters! TIADA wants to express our sincere gratitude to the following auctions for their support! Jan 20 . . . . . . . . . . . . . . . . . . . . . . . . Manheim San Antonio April 13 . . . . . . . . . . . . . . . . . . . . . . . . Manheim San Antonio April 26 . . . . . . . . . . . . . . . . . . . Metro Auto Auction Dallas April 26 . . . . . . . . . . . . . . . . America’s Auto Auction Dallas April 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim Dallas April 27 . . . . . . . . . . . . . . . . . . . Alliance Auto Auction Dallas April 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim DFW May 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim Houston May 3 . . . . . . . . . . . . . . . . . . . . . . . . . Houston Auto Auction May 3 . . . . . . . . . . . . . . . . . . . . . . . Manheim South Houston May 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ADESA Houston May 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim Hobby May 5 . . . . . . . . . . . . . . . . . . . . . . . . America’s AA Houston May 12 . . . . . . . . . . . . . . . . . . . . . . . . . ADESA San Antonio Aug 18 . . . . . . . . . . . . . . . . . . . . . . . TxDMV Seminar Austin Aug 30 . . . . . . . . . . . . . . . . . . . . Metro Auto Auction Dallas Aug 30 . . . . . . . . . . . . . . . . . America’s Auto Auction Dallas Aug 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim Dallas Sept 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Manheim DFW Sept 14 . . . . . . . . . . . . . . . . . . . . . . . . Manheim San Antonio Oct 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . America’s AA Buda October 24 . . . . . . . . . . . . . . . . . . . Manheim Central Texas 24

2016

Tour

I have enjoyed helping TIADA reach out to the Spanish speaking dealers and introduce them to the many great benefits of the TIADA membership. I believe that a little effort goes a long way when we try to serve everyone in Texas. Jose Engler, Irving Motors, San Antonio

2) “So many ways dealers can WIN with a TIADA membership,” says Wayne Meagher at Manheim Dallas. T e x a s

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3) Julio Cruz from Turcio’s Auto Sales uses his VIP auction card for the 10th time -That’s $2,000 in savings just for being a TIADA member!

4) Michael Zak from Dixon Motors in Houston sealing the deal with another new member. 5) Remember to always check-in at the TIADA booth when you see us at the auctions. You never know what prizes you can win, like these folks from Howorth Auto Group who won $50 just for checking in.

7 6) A merica’s Auto Auction in Houston was one of the 14 auctions we visited.

7) T IADA staff Cristina Fowler shares the benefits of a TIADA membership at Metro Auto Auction. 8) a nd 9) Moe Abid from Motor Car Finance and Arman Fanaian from A&M Auto Finance smile as each receive the cash they won when spinning the wheel at ADESA Houston.

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Our favorite thing about hosting TIADA day at Americaâ€™s Auto Auction is the extra EXCITEMENT that it brings in the lanes.

Robert Hammonds, General Manager, Americaâ€™s Auto Auction Dallas

14 15

10) W ayne Meagher of M D Auto Sales in Grand Prairie is all set for a new Day at the Auction in the Dallas area. 11) W alter Chea with Auto Star Sales signing up for membership. This gives Jose Engler his 20th recruit which earns him a trip to Las Vegas for the 2017 NIADA convention. 12) F reddy Lerma with Tower Auto Sales joins at the TxDMV seminar and wins $50 cash on the spot. 13) G reat to have the continued support of the auction general managers such as Darren Slack at Manheim Hobby. 14) Mark Brown reaching out to new dealers at Manheim San Antonio. 15) W hich of the Bowers brothers hides under this sombrero during our visit to Houston Auto Auction around Cinco de Mayo? Maybe Michael Zak can tell us. 16) E arly morning hustle and bustle out in the lanes at Manheim Houston. T e x a s

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ur outgoing president and current Chairman of the Board, Phil Lathrop, encouraged every dealer to just get one new member during his inaugural speech when he took on the presidency in 2015. TIADA adopted this ideal in its recruitment process by initiating the â€œJust Get Oneâ€? campaign, punctuated with a tour of an almost life-sized Phil at our spring TIADA Auction Days. Every dealer member who recruited one new member received a $10 gift card, a Just Get One lapel pin, a Phil Fan and a chance to enter a $1,000 drawing if they took a selfie with the Phil Fan and submitted it to our office. We received a handful of entries and we are proud to announce the winner of the drawing was Ahmed Mahmud, with Fleet Auto Finance in Sugar Land. You can see a video of the drawing on our Facebook page.

4 November 2016

Just Ge t One

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1) Phil Lathrop stops by to see how the Just Get One campaign is going. Here with his cardboard twin and Scott Stalder, General Manager of Metro Auto Auction. 2) Just Get One $1,000 drawing winner, Ahmed Mahmud with Fleet Auto Finance 3) Stopping by the new Manheim South Houston where GM Bonnie Williams was happy to support our Just Get One campaign. 4) Launching the Just Get One campaign at Manheim San Antonio, with the help of GM Mike Browning and Mark Brown.

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regulation matters

How to Become (& Remain!) An Independent Auto Dealer

ome press releases are just a little better than others, aren’t they? I have to admit, the one we sent out last month was a heart-warmer: TIADA is genuinely excited and proud to announce the launch of our online pre-licensing education course, which has been in development for the last year. We aimed to make How to Become An Independent Auto Dealer the most comprehensive education initiative ever built for prospective (and current) dealers, and we think we did it. This 3 ½ hour online seminar takes a high-level approach to dealer laws and rules; rather than focus narrowly on TxDMV, OCCC, the IRS, or any particular agency, we designed this course as a complete overview of all dealer laws, federal and state, explained from the dealer perspective, rather than that of any one regulator. Education is the key — and we think completing this course gives any dealer a much better chance to not just survive, but to thrive. An informed dealer is much more likely to be a compliant licensee, a successful businessperson and a credit to our industry.

Now, admittedly I may be a little biased here. The labor of love (!) that was the birthing of this course was heavy on the labor — but it is done! And it IS good. Really good. And, in spite of the name, it is a really powerful maintenance tool for you or anyone on your staff looking for a comprehensive review of compliance requirements. What wasn’t mentioned in the release above is actually the stuff that I think makes the course so valuable, and that’s the material above and beyond the basic content. The course features: examples of 34 required, recommended and situational docs for the deal jacket; 23 additional sample docs, such as emissions poster, dealer metal plate log, doc fee poster, etc…; and 35 links to really useful external resources, such as the Comptroller’s Guide to Vehicle Inventory Tax, NAAA arbitration guidelines, and the most commonly violated dealer advertising rules, among many others. This is starting to sound like a commercial for this seminar. “Act now and get a free set of Ginsu knives with your first registrant! But wait, there’s more…!” November 2016

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by Danny

Langfield

TIADA DEPUTY DIRECTOR

We are really excited about the chance to help dealers outside of our membership get exposure to a significant online compliance resource. Well, this IS the Regulation Matters column, and for those of you interested in, well, matters of regulation, it’s kind of hard to beat the one-stop-shop for compliance that this course offers — and for a measly $149 bucks! As this issue goes to press, How to Become An Independent Auto Dealer is being reviewed by both the OCCC and TxDMV. We are really excited about the chance to help dealers outside of our membership get exposure to a significant online compliance resource. As a matter of fact, we were proud to welcome the OCCC’s Commissioner, Leslie Pettijohn, and Director of Strategic Communications, Administration & Planning, Juan Garcia, to our office last month to get a sneak preview of the course. They appeared to be suitably impressed, and visited with us at some length about how the OCCC and TIADA might work together in the future to help educate both current and future licensees. We hope to continue to grow our online education presence, and we plan to continue to offer our members and all Texas independent dealers the meaningful, relevant professional development opportunities you have come to expect from TIADA. 31

2016 TIADA VIP Auction Card Directory ABILENE

CORPUS CHRISTI

IAA*

Alliance Auto Auction Abliene

IAA*

6657 US Highway 80 West Abilene, TX 79605 325.698.4391, Fax 325.691.0263 General Manager: Jimmy Compton Friday, 10:00 a.m.

4701 Agnes Street Corpus Christi, TX 78405 361.881.9555, Fax 361.887.8880 General Manager: Adriana Serrano Wednesday, 9:00 a.m.

204 Mars Road, Wilmer, TX 75172 972.525.6401, Fax 972.525.6403 General Manager: Henry Valenzuela Wednesday, 9:00 a.m.

www.allianceautoauction.com

C.M. Company Auctions, Inc. www.cmauctions.com

2258 S. Treadaway, Abilene, TX 79602 325.677.3555, Fax 325.677.2209 General Manager: Gregory Chittum Thursday, 10:00 a.m.

AUSTIN ADESA Austin

www.adesa.com

2108 Ferguson Ln., Austin, TX 78754 512.873.4000, Fax 512.873.4022 General Manager: Steve Swanson Tuesday, 9:00 a.m.

America’s AA Austin / San Antonio www.americasautoauction.com

16611 S. IH-35, Buda, TX 78610 512.268.6600, Fax 512.295.6666 General Manager: John Swofford Tuesday, 1:30 p.m. / Thursday, 2:00 p.m.

IAA*

www.iaai.com

2191 Highway 21 West, Dale, TX 78616 512.385.3126, Fax 512.385.1141 General Manager: Geoffrey Rabb Tuesday, 9:00 a.m.

Metro Austin Auto Auction www.metroautoauction.com

8605 Cullen Ln., Austin, TX 78748 512.282.7900, Fax 512.282.8165 General Manager: Brent Rhodes 3rd Saturday, monthly

BELTON Belton Auto Auction New! www.beltonautoauction.com

212 E Loop 121, Belton, TX 76513 254.899.2886, Fax 254.613.4582 General Manager: Joe Lavigne Thursday, 10:00 a.m.

* VIP card accepted for sell fees only 32

Get up to $200 off a buy or sell fee at these participating auctions using your TIADA VIP Auction Card!

www.iaai.com

Corpus Christi Auto Auction New!

(formerly known as Sparkling City AA Corpus Christi) www.CorpusChristiAutoAuction.com

2149 IH69 Access Rd Robstown, TX 78380 361.767.4100, Fax 361.767.9840 General Manager: Wade Walker Friday, 10:00 a.m.

DALLAS / FT.WORTH METROPLEX ADESA Dallas

www.adesa.com

3501 Lancaster-Hutchins Rd. Hutchins, TX 75141 972.225.6000, Fax 972.284.4799 General Manager: Brad Garrett Thursday, 9:30 a.m.

Alliance Auto Auction Dallas www.allianceautoauction.com

9426 Lakefield Blvd. Dallas, TX 75220 214.646.3136, Fax 469.828.8225 General Manager: Christopher Dean Wednesday, 1:30 p.m.

America Can! Cars for Kids www.carsforkids.com

1911 E. Division, Arlington, TX 76011 972.274.5437, Fax 214.944.1950 General Manager: Jennifer Kitchens Saturday, 9:00 a.m.

America’s AA Dallas

www.americasautoauction.com

219 N. Loop 12, Irving, TX 75061 972.445.1044, Fax 972.591.2742 General Manager: Robert Hammonds Tuesday, 1:00 p.m. / Thursday, 1:00 p.m.

IAA*

www.iaai.com

4226 East Main St., Grand Prairie, TX 75050 972.522.5000, Fax 972.522.5090 General Manager: Jennifer Wesner Tuesday, 9:00 a.m.

www.iaai.com

Manheim Dallas

www.manheim.com

5333 W. Kiest Blvd., Dallas, TX 75236 214.330.1800, Fax 214.339.6347 General Manager: Rich Curtis Wednesday, 9:00 a.m.

Manheim Dallas Fort Worth www.manheim.com

12101 Trinity Blvd., Fort Worth, TX 76040 817.399.4000, Fax 817.399.4251 General Manager: Nicole Graham-Ponce Thursday, 9:30 a.m.

Rockwall Auto Auction New! www.rockwallautoauction.com

1810 I-30 Frontage Rd. Rockwall, TX 75087 972.771.9919, Fax 972.722.4827 General Manager: Frank Post Tuesday, 7:00 p.m.

Texas Lone Star Auto Auction www.tlsaa.com

2205 Country Club Drive Carrollton, TX 75006 214.483.3597, Fax 214.483.3814 General Manager: Jeff Dunning Tuesday, 1:00 p.m. / Thursday, 2:00 p.m.

EL PASO El Paso Independent Auto Auction www.epiaa.com

7930 Artcraft Rd, El Paso, TX 79932 915.587.6700, Fax 915.587.6700 General Manager: Luke Pidgeon Wednesday, 9:30 AM In-op Video Sale / 10:00 AM Standard Sale.

IAA*

www.iaai.com

14651 Gateway Blvd. W El Paso, TX 79927 915.852.2489, Fax 915.852.2235 General Manager: Jorge Resendez Friday, 10:30 a.m. T e x a s

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IAA*

SAN ANTONIO

16602 East Hardy Rd. Houston, TX 77032 281.443.1300, Fax 281.443.4433 General Manager: Louis Cappi Thursday, 9:00 a.m.

ADESA San Antonio

www.iaai.com

IAA*

www.iaai.com

Manheim El Paso

www.manheim.com

485 Coates Drive, El Paso, TX 79932 915.833.9333, Fax 915.581.9645 General Manager: Brian Walker Thursday, 10:00 a.m.

HARLINGEN / MCALLEN Big Valley Auto Auction www.bigvalleyaa.com

4315 N. Hutto Road, Donna, TX 78537 956.461.9000, Fax 956.461.9005 General Manager: Lisa Franz Thursday, 9:00 a.m.

IAA*

www.iaai.com

900 N. Hutto Road, Donna, TX 78537 956.464.8393, Fax 956.464.8510 General Manager: Ydalia Sandoval Tuesday, 9:00 a.m.

HOUSTON

2535 West. Mt. Houston Houston, TX 77038 281.847.4700, Fax 281.847.4799 General Manager: Michelle Casper Wednesday, 9:00 a.m.

Manheim Houston www.manheim.com

14450 West Road Houston, TX 77041 281.924.5833, Fax 281.890.7953 General Manager: Eddie Pope Tuesday, 9:00 a.m. / Thursday 6:30 p.m.

Manheim Texas Hobby www.manheim.com

8215 Kopman Road Houston, TX 77061 713.649.8233, Fax 713.640.6330 General Manager: Darren Slack Thursday, 9:00 a.m.

www.adesa.com

4526 N. Sam Houston, Houston, TX 77086 281.580.1800, Fax 281.580.8030 General Manager: Mark Lindenmuth Wednesday, 9:00 a.m.

America’s AA Houston New!

200 S. Callaghan Rd. San Antonio, TX 78227 210.434.4999, Fax 210.431.0645 General Manager: Clifton Sprenger Thursday, 9:00 a.m.

IAA*

www.iaai.com

11275 S. Zarzamora San Antonio, TX 78224 210.628.6770, Fax 210.628.6778 General Manager: Brian Sell Monday, 9:00 a.m.

Manheim San Antonio www.manheim.com

2042 Ackerman Road San Antonio, TX 78219 210.661.4200, Fax 210.662.3113 General Manager: Mike Browning Wednesday, 9:00 a.m.

San Antonio Auto Auction New!

(formerly known as Sparkling City AA San Antonio) www.SanAntonioAutoAuction.com

LONGVIEW

13510 Toepperwein Rd San Antonio, TX 78233 210.298.5477, Fax 210.298.5484 General Manager: Brandon Walston Tuesday, 10:00 a.m.; Thursday, 1:30 p.m.

Alliance Auto Auction Longview

TYLER

www.allianceautoauction.com

ADESA Houston

www.adesa.com

6000 East Loop 281 Longview, TX 75602 903.212.2955, Fax 903.212.2556 General Manager: Jeff Loftin Friday, 10:00 a.m.

IAA*

www.iaai.com

Greater Tyler Auto Auction New! www.greatertyleraa.com

11654 Hwy. 64 W, Tyler, TX 75704 903.597.2800, Fax 903.597.3848 General Manager: Wayne Cook Tuesday, 5:00 p.m.

WACO

1826 Almeda Genoa Rd., Houston, TX 77047 281.819.3600, Fax: 281.819.3601 General Manager: Rob Frazier Thursday, 2:00 p.m.

5577 Highway 80 East Longview, TX 75605 903.553.9248, Fax 903.553.0210 General Manager: Robert Dunning Thursday, 9:00 a.m.

America’s AA North Houston

LUBBOCK

15735 I-35 Frontage Road Elm Mott, TX 76640 254.829.0123, Fax 254.829.1298 General Manager: James Barron Friday, 10:00 a.m.

1440 FM 3083, Conroe, TX 77301 936.441.2882, Fax 936.788.2842 General Manager: Buddy Cheney Monday, 6:30 p.m.

IAA*

Heart of Texas Auto Auction

www.americasautoauction.com

Big Texas Auction of Houston New! www.bigtxauctions.com

2000 Cavalcade St. Houston, TX 77009 832.204.7500, Fax 832.204.7499 General Manager: Joe Lavigne Friday, 10:00 a.m. www.houstonautoauction.com

6767 North Freeway, Houston, TX 77076 713.644.5566, Fax 713.644.0889 President: Tim Bowers Tuesday, 1:00 p.m. T e x a s

5311 N. CR 2000 Lubbock, TX 79415 806.747.5458, Fax 806.747.5472 General Manager: Lori Davee Tuesday, 9:30 a.m.

D e a l e r

www.allianceautoauction.com

www.heartoftexasautoauction.com

2508 Old Marlin Hwy. 6 Waco, TX 76705 254.755.7713, Fax 254.755.7746 General Manager: Allan Wichkoski Thursday, 7:00 p.m.

MIDLAND / ODESSA

OKLAHOMA CITY, OK

IAA*

Dealer’s Auto Auction of OKC, Inc.

701 W. 81st Street Odessa, TX 79764 432.550.7277, Fax 432.366.8725 General Manager: Barbara Hallmark Thursday, 11:00 a.m.

1028 South Portland Oklahoma City, OK 73108 405.947.2886, Fax 405.943.8370 General Manager: Gary Smith Thursday, 8:30 a.m.

www.iaai.com

Houston Auto Auction

November 2016

www.iaai.com

Alliance Auto Auction Waco

www.daaokc.com

Dealer Academy 2017

Presented by Wayne Herring, Founder of www.strongersalespeople.com In this one day workshop, we will roll up our sleeves and work side by side on your growth plan for 2017. Wayne is the founder of www.strongersalespeople.com and especially focuses on growth via Sales Team build and Sales Process Automation. We will start by working on your Growth plan, mindset, what is holding you back, what you would like to change for this year. Then we will talk about building automation into your business…amplifying the effectiveness of systems and processes that are working while you are at auction, while you are on vacation or while you are sleeping.

9:30am - 4:00pm $199 TIADA Members, Each Additional $149 (must be from same dealership)

$399 Non-members

Key focus areas will include: • Why is it so hard to hire and develop salespeople? When you have the answers you will have a starting point • Hiring the best salespeople for your business… we will work on your unique and ideal salesperson, then formulate a plan to attract those team members and to pick the best from the available candidates • Sales Process — use the baseball diamond as a metaphor to drive sales and sales activity • Salesperson Accountability — how do you get people to follow up and do the activities necessary to keep the flow going • Salesperson Coaching and Motivation — we will develop your custom plan and schedule for coaching to achieve salesperson growth • Salesprocess Automation — using email sequences, crm, text sequences to their full capacity to drive the sales process automatically, while you are away from the business Why should dealers attend: • Develop a custom Sales Team Build and Sales Growth plan for 2017 • Increase their Profit, Increase their Freedom, and Reduce your Frustration • You are already spending money to Drive leads and probably for CRM and follow up systems… let’s make the most of those investments.

Tuesday, January 10, 2017

Sponsored by:

Arlington, Texas

Wednesday, January 11, 2017 Houston, Texas

www.passtimeusa.com

Thursday, January 12, 2017 Austin, Texas

www.mulleninsurance.com

Texas Independent Automobile Dealers Association

e-Tag Supplies —

In Stock for Immediate Shipment!

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feature

Dealerships Are at Growing Risk of the Latest Cybercrimes by Bryan Laabs

CliftonLarsonAllen, LLP

ybercrimes have reached a whole new level of insidiousness and sophistication. They are so sophisticated, in fact, that many schemes can make you and your dealership’s employees unknowing participants in the crime, tricking you into handing over money and personal information without your awareness. Every business is a target — that means your dealership, too — and your first line of defense is to acknowledge that fact.

Growing Risk of Cybercrime Against Dealerships

Many industries have already been considerably impacted by cybercrimes, but dealerships as a group have not experienced quite those levels of devastating security breaches — yet. According to the National Cyber Security Alliance, 71 percent of all security breaches target small- and mediumsized businesses, and most dealerships fit that profile. They also maintain a good deal of personal information about both employees and customers, which is attractive to fraudsters; just think of the data that flow in and out of your finance and insurance department alone. Dealerships also make significant payments via wire transfers or ACH transactions — lucrative targets for cybercriminals. As these crimes become more prevalent, dealerships

November 2016

T e x a s

D e a l e r

will inevitably become part of the growing pool of victims. Cyberattacks can not only rob you of funds and information, they can damage your reputation and customer trust. Many businesses have been crippled or forced to close up shop after the ravages of cybercrimes, but the good news is that most of these attacks are preventable. Knowing all you can about online banking scams, malware, and ransomware, as well as what you can do to keep them at bay, can help limit your dealership’s vulnerability.

Online Banking Scams

Online banking scams are common these days, and they work best when employees are tricked into unwittingly participating in the fraud. In one type of the scam (also known as “phishing”), an email that appears to come from a highranking individual within the dealership (such as the owner or general manager) is sent to the controller, office manager, or an employee in accounts payable with online payment capabilities, 37

What’s included: Funding for receivables

requesting urgent payment of an invoice. Everything about the email appears legitimate: the address, the sender’s signature, and the supporting attachments with amounts due and payable — but it in fact is sent from the scammer posing as the company executive. The employee processes the payment without giving it a second thought, unknowingly depositing the dealership’s money into a fraudulent account. Usually he or she is eager to accommodate the “urgent” request from a ranking individual and responds dutifully and quickly. In another method, a scammer impersonates a vendor who

disappoint after such an engaging and friendly conversation, the employee complies. In most of these scenarios, the victim’s email has previously been hacked or compromised unbeknownst to the dealership. The fraudsters spend a great deal of time studying their victims, learning how they communicate, identifying who performs what functions, and eventually precisely targeting the employees with the ability to perform the wire transfer. They are so well prepared and in possession of so many personal details that it can be difficult to detect the fraud.

an employee directly transacts with on a regular basis. The imposter-vendor and the employee exchange niceties via email, possibly discussing personal details specific to that employee, then the “vendor” requests payment of an invoice attached to the email. The sham vendor often says the payment is overdue and that the employee needs to process it right away to avoid late fees or disruptions in service. Not wanting to

Theft of Sensitive Information via Malware

You collect or We collect Floorplan Lines Simplified Insurance tracking

reports package training DBA - AmAc Acceptance corporation in texas

704-882-7100 ext. 7509 AcemotorAcceptAnce.com 38

Organized crime groups based primarily in Russia, Eastern Europe, and China are stealing and selling information such as payroll data (name, address, social security number, driver’s license number, and bank account number) and customer credit card details T e x a s

D e a l e r

November 2016

— whatever they can get their hands on. These are old-school, but sophisticated, hacks where your information systems are penetrated and freely accessed. Typically, the theft is initiated by tricking an employee into clicking on a legitimate-looking link that actually downloads malicious software and allows the hacker unhindered access to your network. The way they go about this trickery is continuing to become more underhanded. These days, hackers are creating fake social media profiles, complete with connections and networks that all look authentic. A hacker may stalk an individual in your dealership to get a feel for his or her role and function, professional and personal interests, and other habits. With all this personal information at the hacker’s disposal, he uses his online character to make a connection with your employee. Then he sends a wellcrafted email that appeals to that employee, who is lured into clicking on the malicious link. Just like that, the hacker has free reign over your bank accounts, customer data, and other sensitive information. And you won’t know it until the damage has been done.

Paying Money to Ransom Your Data

Ransomware is an increasingly popular type of attack used by hackers. Think of it as “digital kidnapping.” Because ransomware is a way for the criminals to get paid quickly, its use has increased exponentially in the past few years. Ransomware is a malware that encrypts virtually all data and files that it can find, both on the local machine and on every network device that it can connect to. This renders the data unusable by your dealership. Typically the hacker requests payment (the ransom) in exchange for decrypting the

November 2016

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TIADA MEMBERDEALER VICTIM OF

ecently, TIADA member Jamie Brown of Brown Auto Sales found out that his Victoria dealership itself was a victim of identity theft! Earlier this year, Brown began receiving several strange phone calls inquiring about higher end cars that he does not sell at his local note lot. Ferraris. Mercedes. BMWs. Then a dealer in Missouri called to inquire about a vehicle he saw on Brown’s website. However, Brown does not even have a website for his dealership. It was then that he realized somebody had created a fraudulent website in order to scam people trying to buy cars. The dealer in Missouri had received a falsified title, bill of sale and a copy of Brown’s dealer license, only they were all fake. The license had a different control number from the real one.

“When I laid eyes on the title I knew it was fake,” Brown told Texas Dealer. “But if you were sending that to average Joe, they probably wouldn’t.” That’s exactly what this criminal did. Several people called Brown for information on cars he wasn’t actually selling. “They were always way underpriced, too good to be true,” Brown recalled. One poor victim of the scam had already wired the imposter $20,000 for a Toyota Sequoia before calling Brown to arrange delivery. As soon as the calls began, Brown reported it to local police who very quickly began working with state investigators and the FBI. “If you discover you are a victim of this, you need to open a case,” Brown advises. “It’s the best source of protection. Quickly circle your wagons and get a case filed with local authoritites and TxDMV to insulate yourself from the crime.” Sometime around the end of the summer, the calls finally stopped coming in, much to relief of Brown. He advises anyone in a similar situation to act quickly. 39

affected data. This is how the hacker hopes to make his money. Users typically become victims when they click on an attachment or link that appears legitimate but which actually contains the ransomware code. Many business owners will pay the ransom and keep mum about the crime to protect their reputation, which makes the crime all the more invidious and allows perpetrators to continue their crimes unscathed.

Protecting Your Dealership from Cybercrime Dealerships can implement several best practices to avoid becoming the victim in these scams:

Build a Strong Defense

Utilize bank security tools for online cash management, including: – Multifactor authentication – Daily and individual transaction limits – Wire call-back features Keep current on technical defensive measures such as firewalls, intrusion detection systems, and spam filters. Keep up-to-date on the anti-virus software on each de vice, and complete regular scans to keep them clean.

Keep all network servers and PC workstations current with the latest security updates and patches. Make better passwords. A strong password is at least 12 alphanumerical characters long. Encrypt sensitive data, such as personal financial information. Make regular backups of key data and systems and store them in a secure, off-site location. USBs and other external devices can be infected by viruses and malware. Use your security software to scan them. Remove administrative privileges on work stations and laptops from the general user population. Engage a specialist to perform periodic vulner ability or penetration tests to determine if your system is susceptible to attacks and validate that controls are functioning as intended.

Communication and Training

Educate employees about electronic payment scams and other attacks and call on them for heightened awareness. Be on the lookout for “urgent” requests for pay ment or sudden changes in business processes, such as a vendor requesting payment outside of the normal protocols. Instill skepticism in your people of online connections. Consider cyber liability insurance, understand policy definitions and exceptions, and ensure adequate coverage to keep your dealership afloat in the aftermath of an attack.

Bryan Laabs is a Dealership Professional with CliftonLarsonAllen LLP. He can be reached at bryan.laabs@claconnect.com or 414-721-7575.

T e x a s

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November 2016

America’s Auto Auction

LOCATIONS IN TEXAS!

BUY ONLINE AT www.americasautoauction.com

TUESDAYS & THURSDAYS AT 1PM

Dallas

219 N. Loop 12, Irving, Texas 75601 Phone: 972.445.1044

North Houston

MONDAYS AT 6:30PM

2 HOUSTON LOCATIONS

1440 FM 3083,Conroe, Texas 77301 Phone: 936.441.2882

Houston

THURSDAYS AT 1:30PM 1826 Almeda Genoa Rd, Houston, Texas 77047 Phone: 281.819.3600

Austin/San Antonio

TUESDAYS & THURSDAYS AT 1PM

16611 South IH 35, Buda, Texas 78610 Phone: 512.268.6600

America’s Auto Auction Austin, Dallas & Houston Feature Units From:

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TIADA Membership Application

2016

Business Name: ____________________________________________ Select one:

Dealer Member

TIADA texas independent automobile dealers association

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Contact Person: ____________________________________________ Address: __________________________________________________

2016 TIADA Membership Dues:

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Jan. / Feb. / Mar.

$425

Apr. / May / Jun.

$320

Jul. / Aug. / Sep.

$215

Oct. / Nov. / Dec.

$425

E-mail address: _____________________________________________ Phone: _______________________ Fax: ________________________ Dealer P Number: ___________________________________________ Who referred you to TIADA? __________________________________ Mailing Address (if different from above): __________________________________________________________ City: _________________________ State: _______ Zip: ___________

(includes all of 2017) (all dues include NIADA membership)

PLEASE INDICATE PAYMENT METHOD: Check or Money Order payable to TIADA Check # __________ Credit Card Card Number: __________________________________________________ Sec.Code: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Expiration Date: ____________ Monthly Payments - $35.42 per month Via Credit Card (Please enter card information above. Authorization Agreement required - contact state office) Via Bank Draft (Authorization Agreement & voided check required - contact state office)

Mail or Fax Application To: TIADA Membership Services, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750 FAX 512.244.6218

www.txiada.org

512.244.6060

Dues are not deductible as charitable contributions for income tax purposes but may be deductible as miscellaneous itemized deductions, subject to IRS restrictions. It is estimated that 20 percent of your dues dollars is used for lobbying activities and is therefore not deductible.

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Please Welcome Our Newest TIADA Members DEALER MEMBERS A Motors Sales and Finance Ahmad Elashqar 5630 San Pedro San Antonio, TX 78212 All Star Auto Group Ken Smith 2000 Avenue H Rosenberg, TX 77471 Alliance Auto Remarketing Muhammad Khan 13733 Pinnacle Cir W, #928 Euless, TX 76040 Alonso Auto Sales Juan Alonso 3022 Sonora Mesa San Antonio, TX 78232 Alpha Car Dealership, LLC Mario Garza 4700 San Pedro Ave. San Antonio, TX 78212 Austin’s Used Cars Bradley Rogans 901 Garison Rd Buda, TX 78610 Auto Finance La Meta Oscar Talamantes 3300 SW Military Dr San Antonio, TX 78211 Auto Finance La Meta Branch Oscar Talamantes 719 Brighton San Antonio, TX 78212 Auto Star Sales Walter Chea 7131 Grissom Rd San Antonio, TX 78238 Auto Value Finance Asheesh Krishan 8475 Highway 6 S Houston, TX 77083 Bills Auto Sales Robert Raney 3547 SW Military Dr San Antonio, TX 78211 Brother’s Auto Sales, LLC Ruben Garces 31007 IH 10 W, #119 Boerne, TX 78006 CXL Motors LLC Cesar Leal 3501 W. State Hwy 107, #C McAllen, TX 78504 DS3 Auto Source Daniel Saenz 412 Potter St. Cedar Hill, TX 75104 44

DT’s Motors David Legett 154 Lullwood Dr. New Braunfels, TX 78130

Regal Classic Cars LLC George Mallery 100 Deanna Street Robinson, TX 76706

Espper Auto Sales Jose Santos 2305 Pearl Ave. Fort Worth, TX 76164

San Pedro Auto Sales Antonio Espinosa 731 W. Hildebrand San Antonio, TX 78212

FC Motors Feliciano Aviles 5223 Blanco Rd. San Antonio, TX 78216 Finn’s Discount Auto, Inc Steve Finn 8020 Alameda El Paso, TX 79915 Fleet LLC Nached Abousamra 7500 Branford Pl, #3208 Sugar Land, TX 77479 GDT Auto Sales Miguel Vanoye 3505 Darby St. Austin, TX 78721 Global 1 Auto Khaled Bader 2601 Meadowbrook Dr. Fort Worth, TX 76103 High Creek Motors Matt Canavan 5302 State Highway 276 w Royse City, TX 75198 JD Byrider Hobby Marcela Rodriguez 7990 Bellford St Houston, TX 77061 Kresta Auto Group Pete Kresta 1802 Greenwood Rd. Weatherford, TX 76088 Lone Star Auto Sales Victor Vasquez 1020 E. Court St. Seguin, TX 78155 Lonestar Car and Truck Jocque Cappelli 1912 Old Denton Rd. Carrollton, TX 75006 Mercer Motor Company Richard Mercer 1224 E. Kingsbury St. Seguin, TX 78155

San Pedro Auto Sales - Branch Antonio Espinosa 5411 San Pedro San Antonio, TX 78212 Square Base LCC Blake McClintil 593 Lower Red Rock Rd Bastrop, TX 78602 Trevino’s Auto Mart Mike Trevino 2409 S 23rd St. McAllen, TX 78503 Universal Auto Group Eddie Rosas 4633 W Commerce St. San Antonio, TX 78237 W W Motors LLC Brian Schneider 701 US Hwy 45 Pelican Lake, WI 54463 Weber Creek Motors Mark DeVos 7649 Weber Rd. Corpus Christi, TX 78415 ASSOCIATE MEMBERS Floorplan XPress LLC - SAT Maria Chase 9504 IH 35 N, Suite 206 San Antonio, TX 78233 InterActive Financial Marketing Group Travis Weisleder 1509 West Main St Richmond, VA 23220 Legacy Dealer Services Billy Moss 212 Highland Terrace Norman, OK 73069 MOLOCAR, Inc. Michael Hanna 2591 Dallas Parkway, Suite 300 Frisco, TX 75034

Miranda Cars Diogo Miranda 31 Caswell Circle San Antonio, TX 78240

VappusNet GPS Petter Graff 10713 RR 620 North, Bldg F; Suite 621 Austin, TX 10713

Perry’s Affordable Auto Dan Perry 6830 N. Eldridge Parkway, #406 Houston, TX 77041

Verified First Sarah Davis 1550 S Tech Lane Suite 200 Meridian, ID 83642 T e x a s

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resource guide The TIADA Website: www.txiada.org

Members can log in with their username/password and access our Dealer Member Directory, Legislative Action Center, Legal Consultation Service and much more. Register for all upcoming TIADA events online at the Calendar of Events; access our online membership application; find contact information for all our Local Chapters, and find many additional resources at our Knowledge Base.

Texas Department of Motor Vehicles 888.368.4689 www.txdmv.gov

Office of Consumer Credit Commissioner 800.538.1579 www.occc.state.tx.us

Texas Comptroller

800.252.1382 www.window.state.tx.us

NIADA

800.682.3837 www.niada.com

REPOSSESSIONS

American Recovery Association 972.755.4755 www.repo.org or contact TIADA state office

FORMS Burrell Printing

800.252.9154 www.burrellprinting.com

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Local Chapters VICTORIA Butch Hartman Hartman’s Auto Sales 361.575.1009 hartmanautosales@gmail.com Meeting – 1st Monday (Monthly) FORT WORTH Mark Jones MCMC 817.703.7973 mjones@mcmcauto.com Meeting – 4th Thursday of Jan–May and Sep–Oct DALLAS COUNTY Eddie Hale Neighborhood Autos 940-539-2272 ehale@neighborhoodautos.com Meetings as needed/TBD HOUSTON John Freeman Galena Park Motors 713.675.0559 houiada@houiada.com Meeting – 2nd Tuesday (Monthly) SAN ANTONIO Robert Beck Stop N’ Drive Motors 210.432.1101 stopdrive@texas.net Meetings quarterly (dates announced at www.txiada.org) EL PASO Ricardo Gardea Cars Plus 915.778.8285 cars_plus@att.net Meeting – 3rd Friday (Monthly) 45 45

behind the wheel

Your Industry Needs You to Be Involved in Your Association

t our board meeting last month we welcomed three new officers to the board. Most associations struggle to find good new leaders to serve on boards and committees. We have been fortunate to not only have had great leaders in the past, but to also have new leaders step up to carry the torch further and continue to advance the interests of the industry. Most of our past board members continue to serve on committees and help guide and shape the association in a less high-profile position. Their knowledge of the industry and experience with the association make them invaluable leaders to us. Others have used the association as a springboard to have even more influence on the industry by serving on the NIADA board, the Texas Department of Motor Vehicles Board or even serving as a Texas State Representative. One of the items of business during last month’s board meeting was to walk through our budget. We use this not only as a financial tool but more as a governance slash management tool. It’s a great way for the board and the staff to stay on the same page and keep moving the association forward. The new leaders brought their unique experiences and talents to help foster new ideas. The combination of the experienced leader and new leader creates a lot of energy and much-needed continuity. The end result is a well-defined road map for the association’s future.

by Jeff

Martin

TIADA EXECUTIVE DIRECTOR

So who will fill the leadership role for next year, or the next, or the next five years? Is there a bottomless well of talented leaders in the industry? The answer to that question is yes! Does that mean you have to serve on the board of directors? No, you simply have to be engaged. You can serve on a committee, help recruit new members at our TIADA Day at the auction membership drives (see page 24), get to know your legislator, make a contribution to INDEPAC and/or attend the annual conference. There is a plethora of opportunities for you to use your talents to help the association as we all work to improve our industry. Teddy Roosevelt once said, “Every man owes a part of his time and money to the business or industry in which he is engaged. No man has a moral right to withhold his support from an organization that is striving to improve conditions within his sphere.” Over the last couple of years we have seen a wave of new dealers becoming more involved with the association and there is no doubt the industry has been the beneficiary. Find the right place for your talents and join so many of your fellow dealers who understand the importance of being involved. If you are not sure how to become more active or where the association can use your talents, please give me a call. We have an industry that needs you to be involved in your association.

Find the right place for your talents and join so many of your fellow dealers who understand the importance of being involved. 46

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913.396.5480

*Substantial Discounts for TIADA Members

TEXAS INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION 9951 Anderson Mill Rd., Suite 101 Austin, TX 78750

PRSRT STD

U.S. POSTAGE

PA I D

JEFFERSON CITY, MO

PERMIT NO. 210