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1-800-554-1026 November 2, 2015

ON THE WEB: Mexican Creditor Buys U.S. Finance Firm

Credito Real S.A.B de C.V., SOFOM, E.R. has acquired 65 percent of the equity interests issued by AFS Acceptance LLC. The main purpose of this transaction is to diversify the loan portfolio and to allow Credito Real to gain access to the Hispanic market in the United States.

Agency Warns of Flood Cars, Fraud

The National Insurance Crime Bureau is working with law enforcement agencies, insurance and car rental companies to identify and catalog water-damaged vehicles.

FTC Says Mini Pushed Its Own Parts

The Federal Trade Commission has approved a final consent order against Mini for allegedly violating the Magnuson-Moss Warranty Act by telling consumers that their warranties would be voided unless they used Mini parts and Mini dealers to perform repair and maintenance work.

Rush - Dated Material

Consumers Often Take a Pass on Recalls By Ted Craig

Getting drivers to bring in recalled vehicles for repairs usually proves challenging. The Volkswagen emission fix might prove especially so. VW faces regulatory ire after admitting its diesel cars were designed to cheat emissions tests, such as those in California. The company announced it would retrofit all affected vehicles, a process that could take years and come at a huge cost. But will consumers bring in their cars for the fix? Anil Goyal, vice president of automotive valuations and analytics at Black Book, said the recall creates a dilemma because there is no safety threat to consumers and it might actually hurt the car’s performance. “What is the incentive for the customer to get the recall fixed?” Goyal said. A recent survey by Public Opinion Strategies found about 25 percent of the owners of recalled vehicles never complete the free repair. The research indicates that many consumers are doing their own risk

FIX IT OR FORGET IT: Volkswagen is recalling all its diesel vehicles, like this Passat, to correct a software issue that allows the cars to cheat emissions tests. The question now is how many consumers will actually bring in their vehicles if they don’t have to.

assessments when they receive a notice. Many survey respondents showed a reduced likelihood to repair a recalled vehicle if they perceived the recall to be “low” or “moderate” risk, saying it seemed

to be “no big deal.” Used vehicle owners are even less likely to be motivated to respond to recall communications, even when they are aware of a recall on their vehicle. The difficulty increases

when recalls cover older vehicles. For example, Ford recently recalled 283,413 model year 1998-03 Windstars for axle issues. The company exited the minivan segment nearly a decade ago.

Credit Agencies Offer New Tools for Auto Finance Decisions Two of the large consumer credit agencies are offering as it does today: the consumer completes a credit applicanew tools to help make decisions about auto credit. tion either online or in the dealership and the dealer runs a Equifax Inc. launched a new suite of credit-based market- full credit report to ensure final eligibility. ing products fueled by its consumer credit data and fraud TransUnion has released CreditVision Link, a credit score processes. that combines both trended credit bureau data and alternaThe products enable Dealer Service Provider (DSP) tive data sources. marketing solutions to help their dealers generate high The combination of the data within CreditVision Link quality, identity-verified leads sourced from their web sites, was designed to allow users to score with more precision. and within their showrooms and service centers. Many current customers and applicants of financial instiThe suite consists of three products, deployed together or tutions may be assessed as lower credit risks, receive more B:7.175” separately. beneficial pricing or possibly switch from a decline to an In each case, the auto loan application process concludesT:7.175” approval when this score is applied. S:7.175”


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10/22/15 10:07 AM


Slow and Steady Brands Win the Reliability Race By Jenny King

DETROIT – New models boost sales, but they often hurt an automaker’s reliability score. In announcing its 2015 auto reliability survey results, Consumer Reports credited a conservative approach to the design of new vehicles to their success in pleasing buyers over time. Lexus and Toyota once again topped the most reliable list and earned a solid “recommended” from the Yonkers, N.Y.-based consumer products testing operation. “Lexus and Toyota tend to be conservative,” Jake Fisher, Consumer Reports auto test director, told members of the Automotive Press Association. Automakers favoring a slower rollout of new technologies are more likely to avoid both serious and annoying problems with their products. The 2015 reliability study was based on Consumer Reports subscribers’ feedback

on over 750,000 vehicles. Fisher used a good news, bad news approach to introduce the 2015 study results. It was bad news for models deemed least reliable - models including the Fiat 500L, Ford Fiesta, Jeep Cherokee, Chevrolet Suburban/GMC Yukon XL and Nissan Pathfinder. With multiple major and minor issues, Fiat 500L scored the lowest in this year’s study. Ford Fiesta complaints included transmission issues. The owner of a Nissan Pathfinder said its continuously variable transmission “violently shakes the car.” Fisher said this year’s digital survey allowed respondents to comment in detail about problems. And many did. Infotainment systems continue to garner complaints, but Fisher zeroed in on engine and transmission problems like the troublesome nine-speed Jeep Cherokee transmission and a six-speed dual-clutch transmission available in the Dodge Dart and Fiat 500L.

Photo by Jenny King STANDARD: Jake Fisher of Consumer Reports explains to reporters why Toyota and Lexus once again topped the magazine’s reliability rankings.

Pressure to increase fuel economy has automakers installing powertrain components that may need further refinement, Fisher said. He emphasized that engine and transmission problems have heavier weighting in survey results than infotainment and cosmetic issues. The automakers and their suppliers are “going through

a learning curve,” he said of infotainment options. Until now, transmissions have not been a source of concern for several years, he noted. Many vehicles required repair and/or replacements because of rough gear shifting or slipping CVT belts, the report summary stated. Fisher said Lexus was the only strong Japanese luxury

brand. Buick was the only domestic brand to make the top tier of most reliable brands. Kia beat out long-time favorite Honda in reliability this year. For a variety of reasons, most domestics numbered among the least reliable brands, many because of complicated or disappointing electronics.

Can someone, for the love of profitability, tell me how to turn more of my subprime apps into cash?

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10/26/15 10:58 AM



NEWS BRIEFS CPS Sees Higher Earnings

Consumer Portfolio Services Inc. announced earnings of $8.8 million for the third quarter. This compares to net income of $7.8 million in the third quarter of 2014. Revenues for the third quarter were $94 million, compared to $77.1 million for the third quarter of 2014. Total operating expenses for the third quarter were $78.3 million, compared to $63.2 million for the 2014 period. It purchased $287.5 million of new contracts during the third quarter, compared to $279.3 million during the third quarter of 2014. The company’s managed receivables totaled $1.941 billion as of Sept. 30. This was an increase from $1.822 billion as of June 30 and $1.519 billion as of Sept. 30, 2014. Annualized net charge-offs for the third quarter were 6.27 percent of the average owned portfolio as compared to 6.18 percent for the third quarter of 2014. Delinquencies greater than 30 days (including repossession inventory) were 8.81 percent of the total owned portfolio as of Sept. 30, as compared to 6.66 percent as of Sept. 30, 2014.

GE Capital Sells Commercial Lending, Leasing Platforms

GE has reached an agreement to sell GE Capital’s global Commercial Distribution Finance, North American Vendor Finance and Corporate Finance platforms to Wells Fargo & Co. The sale includes ending net investment of approximately $30 billion (about $32 billion of assets) and approximately 3,000 employees. It is expected to be completed in the first quarter of 2016. Other terms of the transaction were not disclosed. The transaction includes the leadership, employees and platforms of GE Capital Commercial Distribution Finance (CDF) and GE Capital Vendor Finance. CDF serves customers in 60 countries providing customized inventory financing to fund the flow of finished durable goods from manufacturers to dealers. The business operates globally in six core industries: marine, recreational vehicles, motorsports, outdoor products, technology, electronics and appliances. Vendor Finance is a leading provider of private label and co-branded programs for OEMs, dealers and end users across four core industries in the U.S. and Canada: office imag-

ing, construction, material handling compared to 2 percent for the quarter ended Sept. 30, 2014. and technology. GM Financial had total available GM Financial Reports Profit liquidity of $11.6 billion at Sept. 30, General Motors Financial Com- consisting of $1.6 billion of cash pany Inc. announced net income of and cash equivalents, $8 billion of $179 million for the quarter ended borrowing capacity on unpledged Sept. 30, compared to $158 million eligible assets, $1 billion of borrowfor the quarter ended Sept. 30, 2014. ing capacity on unsecured lines of Consumer loan originations were credit and $1 billion of borrowing $4.7 billion for the quarter, com- capacity on a junior subordinated pared to $4.3 billion for the quarter revolving credit facility from GM. ended June 30, and $4.1 billion for the quarter ended Sept. 30, 2014. DealerSocket Debuts New DMS Operating lease originations were DealerSocket’s new dealer man$6.2 billion for the quarter, com- agement system, iDMS, will go live pared to $5.6 billion for the quarter in the second quarter of 2016. ended June 30 and $1.8 billion for The new system merges aspects of the quarter ended Sept. 30, 2014. FEX DMS and AutoStar Solutions’ The outstanding balance of com- Fusion DMS. mercial finance receivables was $7.8 Nothing will be left behind from billion at Sept. 30, compared to $7.2 either platform, and many features billion at Sept. 30, 2014. will be added. Consumer finance receivables The new iDMS will include a 31- to 60-days delinquent were 4 single login and an intuitive user percent of the portfolio at Sept. 30, interface among other features. compared to 3.9 percent at Sept. 30, 2014. C R O S S WO R D Accounts more than 60 days delinby Myles Mellor quent were 1.6 percent of the portfolio, compared to 1.7 percent at Sept. PAGE 18 30, 2014. Annualized net credit losses were 1.9 percent of average consumer finance receivables for the quarter, Published By General Media LLC USED CAR NEWS (ISSN 1555-7413) is published at 24114 Harper, St. Clair Shores, MI 48080 Phone: 586-772-5200 or 800-794-0760 Fax: 586-772-9400 Charles M. Thomas - Founder (1947-2002) Lynda R. Thomas, Publisher Colleen Fitzgerald, General Manager Editorial: Ted Craig, Managing Editor Jeffrey Bellant, Staff Writer

Advertising: Shannon Colby, Account Manager Megan Frump, Account Manager Marie Hingst, Account Manager

Contributing Writers: Ed Fitzgerald, Jenny King, Sheila McGrath

Circulation: Emily Brown Baker, Helen Thomas

Columnist: Tony Moorby

Production: Josie Godlewski, Media Manager Tim Montie, Graphic Designer

&#/& Used Car News is published the first and third Monday of each month.

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Subscribers: We print advertisements as sent to us by auctions and other advertisers. It is not possible to verify the correctness of listed vehicles in auction ads. Most lists are partial and all lists are subject to last minute changes by auto auctions, so before travelling a long distance for a particular auto auction event, contact the auction by telephone for a fax of vehicles in the sale. Used Car News assumes no guarantees or liabilities concerning the accuracy of

any advertisements. All Rights Reserved. Reproduction in any form is prohibited without the written consent of the publisher. OUR ADVERTISING APPROVAL POLICY Please submit clear, legible copy. Payments from first time advertisers must accompany the insertion order. Distribution is guaranteed by U.S. Postal Carriers. The advertising reservation deadline is 5:00 p.m. Friday, 10 days prior to the issue date. Camera ready ads must be received by noon on Monday prior to the issue date.

Join the Conversation! Visit Used Car News online at or scan this QR code with your smartphone to be taken directly to the website.

10/26/15 12:33 PM


100-Year-Old Cars Shine in Spotlight at Show

HERSHEY, Pa. (AP) – The Antique Automobile Club of America’s Eastern Division held its National Fall Meet here Oct. 7-10. Billed as “the largest antique car show in the world” there were over 1,500 antique cars on display and 9,000 flea market spaces. RM Sotheby ran a special sale along with the event, generating an overall sales total of $16,344,387, with a very strong 96 percent of all lots sold. The result represents the company’s strongest performance in Pennsylvania, besting its 2014 total by more than 16 percent. RM’s Hershey sale drew bidders from 20 countries. Top sale honors went to the 1913 Pierce-Arrow Model 66-A sevenpassenger touring, chassis no. 66667, which sold for $830,500. “Hershey proved once again to be the perfect venue for the offering of important early automotive design,” said Gord Duff, car specialist for RM Sotheby. The focus of this year’s automobile club gathering was to honor any car 100 years or older. One of those cars was a 1915 Model T, the result of years of labor by mechanic Harry Smith. Smith always wanted a Model T and bought a burned out one for

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$100 in 1965. He spent years restoring it with his two sons. Harry Smith died in 1999, but his sons brought the old Ford to the show and left with first prize in Class 10B – Model Ts built from 1913 to 1916. The brothers didn’t expect to win anything. In fact, they skipped the banquet where winners were announced. Harry Smith had never entered it in any contests, because he never thought it was good enough to win, or even to enter, for that matter. He had only taken one picture of the car when he bought it because he didn’t want there to be much evidence of it if his project failed. Ford made some 16 million of them from 1908 to 1927. Ford famously said customers could have them in any color they wanted, as long as it was black. In truth, the early models came in gray, blue, red and green. But in 1914, Ford settled on a particular brand of black paint – durable and fast-drying – to speed production. Thus, the Smiths’ Model T is black. It has a leather roof and a brass radiator, a complicated transmission operated by foot pedals and a 21-horsepower, four-cylinder engine that can bring the car to 40 mph or so.

Photo by The Associated Press MEMORY LANE: Mid-’50s Thunderbirds are displayed at the Antique Automobile Club of America, Eastern Division, National Fall Meet in Hershey, Pa., Oct. 8.

It’s hard to say, because it has no speedometer. The cushioned front seat bench lifts to reveal a metal plate and – a gas cap? Yes, the Model T’s gas tank was directly beneath the driver and frontseat passenger. “That was before Ralph Nader,’’ said Dennis Smith.

The metal plate, incidentally, presumably meant to protect the occupants in case of explosion, is the one part of the car Harry Smith didn’t restore. It’s as rusted and flaky as the day he bought it. “He wanted to keep it as it was originally, as a reminder of what the car was like when he got it,’’ Dennis said.

10/26/15 2:39 PM



NAAA Adapts ADESA’s Safety Program for All By Ted Craig

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Visit, and see why our vehicles are good for business. * To register please visit an IAA location, go online to and use Promo Code: UCN2015 or call Buyer Services at (877) 937-4243. The registration will allow you full access to buy where you meet state licensing requirements for six months. This offer is for new, first-time buyers at IAA only. Must mention the promo code at the time of registration; provide a government issued I.D., and business license if applicable. A $200 registration fee is required after six months to extend your buying privileges. The six month period starts from the day your account is activated. Expires: 12/31/2015. Š 2015 Insurance Auto Auctions, Inc. All rights reserved.

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The National Auto Auction Association has adapted a safety program created by ADESA in an effort to reduce accidents at all its member auctions. The move fulfills a focus on safety that former NAAA president Ellie Johnson made a goal of her term. Johnson said she had seen the damage accidents wreak growing up at her family’s auction. Johnson formed the NAAA Safety Committee and charged the group with researching safety within the industry and developing a comprehensive strategy to reduce the number of accidents on the auction lot and in the auction lanes. The committee, which includes representatives from Manheim, ADESA and independent auctions, unanimously agreed on the adoption of KAR’s program after researching existing options. ADESA executive vice president of strategic improvement David Vignes developed the program building on his experience working for the Walt Disney Co. “The first time I saw an auction, I freaked out,� Vignes said. “When you think about it, we work in a very dangerous environment.� Vignes said Disney taught him the importance of training and also of mascots. That’s why the program uses the character of Safe T Sam to educate staff and promote best practices. The first step in the process was documenting the most common accidents. This allowed ADESA to create training modules and developed specific solutions. One of these is increasing the distance between cars and mark that space in the auction lanes. Vignes said while this slows down the flow of the live auction slightly, it benefits the online buyers because it gives them more time to look at the vehicles. One of the simplest and most visible practices ADESA instituted is the wearing of safety vests. All ADESA staff, from the general manager on down, must wear yellow safety vests when out in the lanes. Education is at the center of the program. ADESA has created a series of videos, hosted by the Safe T Sam mascot. ADESA tailors the training to the staff’s needs and responsibilities. For example, workers in the recon shop learn about the safety regulations for handling various chemicals.

Auctions, of course, have far more non-employees on sale day. So the ADESA auctions created banners with six points of safety to display for the dealers. The Safe T Sam program is an ongoing effort, Vignes said. His staff monitors all accident reports and watches for trends. Auctions are also rewarded for their safety performance with Safe T Sam trinkets. The mascot also visits the auctions to mark safety milestones. NAAA will introduce the program in stages, starting with familiarizing auction personnel with the Safe T Sam safety mascot and mentor. The next step will be the adoption of the safety vest policy. Highvisibility safety vests, rated for varying level of speeds, will be offered for purchase through NAAA’s website. The yellow or orange vests are uniform in type and color and expected use: whenever employees and temporary workers are in traffic areas or are operating vehicles. At the start of 2016, NAAA will implement a series of Safe T Sam training videos, which includes standardized messages for all employees and specialized messages based on an employee’s role. The seven- to 12-minute videos are followed by a short quiz for adoption.

12/19/14 9:11 AM 10/26/15 10:56 AM




Add-ons Bring Trouble

By Sheila McGrath

A Connecticut used-car store violated state and federal laws by requiring buyers to purchase extra services in order to get financing, according to a pair of recent decisions. Two different plaintiffs with similar cases sued Better Way Wholesale Autos, in Naugatuck, and their cases were recently decided in the plaintiff ’s favor. In the first case, customer Sharay Freeman put down $2,500 for a 2007 Honda Odyssey EX-L priced at $10,995. She chose the dealership, which was an hour away from her home, because the advertised price was $2,000 lower than she had seen for comparable vehicles. But when she came in to sign the paperwork, they told her the monthly payment would be more than $500, not the $320 she had calculated. Added in to the car’s price were fees for tire and wheel service, service contract and lifetime oil changes, none of which she wanted because she lived an hour away. When she told them she couldn’t afford that payment, they came back with proposals that would have required her to pay $21,292 over the life of the loan, according to her court complaint. When she declined

to purchase the vehicle under those terms, Better Way refused to return her $2,500 deposit, saying she could apply it to a different vehicle. “Certainly in the Freeman case, they had an opportunity to resolve this directly with the consumer,” said Dan Blinn, Freeman’s attorney. “By withholding the deposit, they wound up exposed to significantly greater liability. Problems like that are best addressed promptly and fairly when the consumer raises a complaint.” Blinn said when dealerships advertise artificially low prices, intending to add costs when customers come in, it harms other dealers. “Freeman traveled halfway across the state to get to the dealership, and there were a lot of local places that would have been happy to sell her a vehicle at a fair price,” Blinn said. “But instead, her deposit was locked up, depriving other dealerships who engaged in ethical advertising and marketing practices.” Kenneth Votre, the attorney who defended Better Way in the cases, did not respond to requests for comment. But a Better Way finance manager testified that about a third of their customers have poor credit, requiring them to go to a subprime lender. Conintued on page 9

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10/26/15 11:01 AM



Growing up in the car business left Lisa Compagno with little interest in following in her parents’ footsteps at Palm Tree Auto Sales in Stuart, Fla. “I saw my mom and dad’s struggles in a small business and I always wanted to know where my paycheck was coming from and not have to struggle for it,� Compagno said. Instead, Compagno wanted to be an attorney. “I always wanted to be a federal prosecutor,� she said. “So I followed that path, that dream.� Compagno graduated New York Law School in 2002. After law school, she was hired by the U.S. Department of Justice as part of its honors program. Compagno eventually earned a spot in the immigration section of the department. “My title was ‘staff attorney,’ but it was in the appellate review board,� she said. “I handled every type of immigration litigation case that was being appealed from an immigration judge.�

popular celebrity in her native country. “She had magazine and newspaper clippings to back it up,� she said. Slobodan Milosevic was in power at the time. “He would use the media to propagate his message,� Compagno said. “So (the woman) had a friend – who was a political plant – who asked her to offer public support of Milosevic and say some positive words about him.� She decided she didn’t want to do it and received this response from her friend: “I’m not asking you. I’m telling you.� The celebrity refused and fled to Germany. She met an American man there and had a child with him before coming to the United States. But the man came down with a rare form of cancer and died before they married. “Now she has no sponsor and no way of getting her green card,� Compagno said. “So the only option was to apply for asylum.� But Yugoslavia had since broken up and Milosevic was no longer in power. “So she had no basis to ap-

ABOVE: Lisa Compagno, far right, stands with Sheriff Bob Crowder, second from left, to celebrate the Cars for Kids event benefitting the Florida Sheriffs Youth Ranch program. TOP: Compagno poses with her parents and brothers. Compagno said one of the most interesting cases she had involved a woman from the former Yugoslavia, who claimed to be a

ply for asylum,� Compagno said. “Her case landed on my desk. I had to decide and it was a tough case because the law was not in her favor.�

Compagno drafted a decision and it went to the board members, who are the judges. Her decision went against the applicant, but the woman appealed and the court sent it back on a procedural issue. “The court was telling us to grant it,� Compagno said. She said today’s immigration difficulties result from various issues, including legislation not being enforced the way it’s supposed to be and diplomatic issues. The continued struggle of dealing with immigration law and the ensuing problems made Compagno feel like she was wasting time. “I wasn’t doing anything to help my family and felt I wasn’t doing anything to help society,� she said. “There were a lot of limitations as to what I could do as a government attorney.� She decided it was time to go into the family usedcar business. Compagno moved back to Florida, working with Homeland Security in Or-

lando during the week and at her parents’ store on weekends. Over the years, she had talked to her brothers about how to market the dealership and she finally had a chance to put her ideas into practice. Her family has been in business for decades and at the current location for about 11 years. The store carries about 55 vehicles on average, with about 20 units sold each month. The average retail price is $10,000. Compagno is still involved in law. “I do consulting work for other immigration firms,� she said. “When they get difficult or unusual fact patterns and they’re not sure how the law is going to turn out, they ask me to research the issue and give my opinion. “Or if they have a client that has criminal convictions and they’re not sure what the immigration consequences might be (they ask for my help).�

Compagno’s job at the dealership has also lead her to charity work. She has served on the board of the Florida Sheriffs Youth Ranch, a statewide organization that helps troubled children. It’s a group the Florida Independent Automobile Dealers Association supports. The homes consist of four to five boys of a similar age. They are raised as a family. They stay two to a cottage and go to school. After all this time, Compagno retains some concern about the uncertainty of running her own business. “It’s still a scary prospect to know you have no one else to fall back on – you’re paycheck is in your own hands,� she said. “But, at the same time, it makes you want to work harder. It’s much more rewarding, personally and professionally. I’m helping my family, helping our community and doing things I couldn’t otherwise have done.�

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10/26/15 1:54 PM


Add-ons – from page 7 In Freeman’s case, he testified, they had to add in the extra charges because her poor credit rating required them to pay a loan acquisition fee. The dealership could not pass the fee on to Freeman because that would have raised the interest rate above the statutory limit of 19 percent, he said. So to offset the loan costs, the dealer added in the additional services. Better Way also argued that Freeman had not actually lost the $2,500

because she could have used it to buy a different car on their lot. But Hartford Superior Court Judge Sheila Huddleston disagreed. “By requiring a deposit that won’t be refunded if they can obtain any kind of financing, Better Way forces customers to either buy cars under terms they did not previously accept, or forfeit their deposits.� Huddleston awarded Freeman $2,500 in compensatory damages, and $7,500 in punitive damages, along with interest.

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10/26/15 3:41 PM



Muscle Cars Remain Strong By Jenny King

For over 20 years dealer Fred Murfin has been following an interest that dates to his high school days. Then, says the 53-year-old businessman, “we could pick up a used Camaro for maybe $1,200.� Now Murfin’s Red Line Auto Sports in Wilson, Okla., stocks muscle cars, from Z-28s and Trans Ams to Dodge Chargers and other Mopar favorites. He sometimes offers something newer like the 2007 Corvette with 34,000 miles he couldn’t resist buying. With inventory prices averaging $25,000, these cars may look good to a high schooler, but are more targeted to middle-aged buyers. Buyers aren’t just local enthusiasts. Murfin sells internationally and has served customers in Australia, Germany and Dubai. In keeping with his keep-it-simple approach to business, Murfin directs buyers to domestic and international shipping specialists who are better equipped to handle the transportation. Murfin also insists on personally looking at everything he buys. “I put my hands on every car, testing, driving and inspecting making sure my customers can

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depend on my almost 25 years of expertise in every car, Murfin said. “I search online but I won’t rely on anyone to tell me about a car, I don’t buy anything without an inperson look. Deals are done with handshakes.� The Internet has leveled the playing field, however, allowing him to expand his options for buying and selling. Red Line Auto Sports typically does not take trades, though Murfin sometimes bends if a car is “interesting.� He has tried consignments over the years. Today they account for less than one percent of his business, he says. “We sell about 150 cars a year,� says Murfin. Everything on the lot must have power steering, power brakes and sometimes air conditioning. Murfin says his primary business is ‘60s and ‘70s muscle cars and sometimes ‘50s classics with a nice low rumble. The cars are mostly from Oklahoma and Texas. “The cars here are solid and usually are better cars,� he said. Is there still an interest in yesterday’s muscle cars? “Absolutely. I love to get to know my customers and here in Oklahoma a hand shake deal works just fine,� he said.

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10/22/15 11:47 AM

12 • November 2, 2015


IADA Honors Dealers

Photo by Surprenant Photography TOP QUALITY: Quality Dealer Nigel Fox from Sovereign Auto Purchasing, center, poses with current President Ray Campise, right, and new elected President Otto Hahne.

event in Dearborn Heights, Mich. Longtime board member Ray Nigel Fox, owner of Sovereign Campise of Certified Motors in St. Auto in Flushing, Mich., received Clair Shores, Mich., talked about the Michigan Quality Dealer Award the event afterward. “Nigel does a great job selling all last month. The Michigan Independent Au- types of cars,” Campise said. “He’s involved in the neightomobileCarolina_UCN Dealers Association Nov2.pdf 1 hon10/23/15a guy 8:55that’s AM ored Fox and others at its annual Continued on next page By Jeffrey Bellant









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10/26/15 3:56 PM


November 2, 2015 • 13

IADA – from prior page

SCHOLAR: Karli Godlewski, granddaughter of Michigan IADA founder

4 Car Dealers

up ahead

Sam Lafata accepts a Michigan IADA scholarship. Levi Muilenberg, son of Todd Muilenberg of Lakeland Car Co., was also awarded a scholarship. borhood and always gives back to schools and the (community).” Campise said Fox has three employees who have been around about as long as he’s been in business. “He has such a great partnership with his employees,” Campise said. The Michigan IADA also gave its

special Nancy Ruttenberg Award to board member Ted Cooper of Genesys Systems. The award is for the member that has displayed the greatest effort, time and dedication to the Michigan IADA. Jerry Drouillard, of Autohaus, a Royal Oak dealership, won an award for lifetime achievement.



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10/26/15 3:51 PM



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(The following is from a speech by Comptroller of the Currency Thomas J. Curry before the Exchequer Club.) It’s the point in the cycle where we customarily see an easing of loan underwriting standards, as banks drop or weaken protective covenants, extend maturities, and take other steps to build market  share. It’s also  a time in which we see banks develop larger loan concentrations, without concurrent increases in reserves. It’s a natural byproduct of competition during the later stages of the economic cycle, and so it’s a time when supervisors and bank risk officers need to be most vigilant. We should not be surprised that we are seeing all of that seven years into an economic recovery. The OCC’s annual survey of credit underwriting standards documents rising credit risk. So do all of the other assessments from our examiners on the ground. We are not yet seeing a uniform or comprehensive industry response to these early warning signs. We are encouraged, however, by those institutions that 3:44 PM are building loan loss reserves or, in some cases, reducing credit risk by avoiding or reducing their exposure to higher risk loan products. It’s all too easy to overlook increasing credit risk and continued loan growth when asset quality is still strong and lending is profitable. In the fourth quarter of 2014, asset quality metrics in OCC-supervised banks nearly matched the historically strong levels achieved in the fourth quarter of 2006, right before the start of the financial crisis. Those numbers have basically stabilized, but at levels that can easily breed a sense of complacency. The same is true for loan growth, which shows no sign of abating. Commercial and industrial loans have now increased for 18 straight quarters, with the fastest growth occurring in loans for businesses, non-depository financial institutions, multifamily housing, energy, and municipalities. Loan growth in community banks has been particularly strong. These facts are impressive. But they can also be a misleading indicator of the fundamental health of the banking system. Credit quality, after all, reflects the outcome of decisions made when loans are originated, perhaps months or years earlier, possibly under tougher standards than those in effect today. So the indicators that many are looking at most closely actually say little or

nothing about the risk now embedding itself in bank portfolios. We won’t see the results of those decisions for many months to come. But given the trends in underwriting and risk selection that I’ve already mentioned, we should be asking whether banks have the appropriate risk management processes and structures in place to measure, monitor, and control the increased credit risk they are taking on. Auto lending is another area of credit risk that we’ve had our eye on for several years. It’s good news for automakers and for the economy as well that sales are rolling along at record levels. It’s also good for banks, which have supplied a significant amount of the financing that makes this activity possible, either directly to purchasers or indirectly through car dealerships. At the end of the second quarter of 2015, auto lending represented more than 10 percent of retail credit in OCC-regulated institutions, up from 7 percent in the second quarter of 2011. And, increasingly, banks are packaging these loans into asset-backed securities rather than holding them in a portfolio. These securities are being greeted by strong demand from investors, who no doubt remember that securities backed by auto loans outperformed most other classes of asset- back securities during the financial crisis. But what is happening in this space today reminds me of what happened in mortgage- backed securities in the run up to the crisis. At that time, lenders fed investor demand for more loans by relaxing underwriting standards and extending maturities. Today, 30 percent of all new vehicle financing features maturities of more than six years, and it’s entirely possible to obtain a car loan even with very low credit scores. With these longer terms, borrowers remain in a negative equity position much longer, exposing lenders and investors to higher potential losses. Although delinquency and losses are currently low, it doesn’t require great foresight to see that this may not last. How these auto loans, and especially the non-prime segment, will perform over their life is a matter of real concern to regulators. It should be a real concern to the industry. Neither auto loans nor home equity loans are inherently unsafe. That’s true for most asset classes. However, what is inherently unsafe are excessive concentrations of any one kind of loan. You don’t need a very long memory to recall the central role that concentrations— whether in residential real estate, agricultural land, or oil and gas production—have played in individual bank failures and systemic breakdowns. It’s an old movie that’s been reprised on a regular basis.

10/26/15 11:04 AM




Bryan Sanders, president, Credit King Auto Sales, Wichita, Kan. : “We’ve been in business 11 years. We have one primary dealership and two smaller ones under different names. “I bought a Chrysler dealership that had gone out of business. It’s set up as a new-car store but it’s strictly buy-here, pay-here. We have a full-service department and body shop. The other ones are more traditional buy-here, pay-here dealerships. “I don’t buy hardly anything online. Myself and two other employees go to auctions the day before a sale and we drive every single vehicle that we want to buy. “For 10 months out of the year, we carry in the 150- to 160-unit range. During tax season we juice everything up to about 300. We sell from 80 to 100 a month for the 10 months. Then in February and March we sell 150 to 170 a month.

“Sales are off a little bit for this year. Our tax season this year was actually better than 2014, but the summer months were a little bit slower than last year’s. “It just seems like the new-car stores are buying a little deeper. “We buy cars mostly from dealer auctions – ADESA, Manheim and independents. “The average retail price for a car is probably $7,000 to $9,000. A truck/SUV – which we sell more of – are probably $13,000 to $15,000. “We get a 15 percent down payment. Kansas has a little bit of a disadvantage because the dealer is required to collect the sales tax from the customer and pay it to the state for the customer. “The average term length is probably 30 months. “We have both the starterinterrupt and GPS (devices). We don’t use the starter-interrupt unless we’re ready to pick up the car. It’s not used as a reminder. “Probably right now, our

cars are mostly 2009-10, on average. Average model year on trucks and SUVs are probably 2007-08. “Average mileage is 100,000 for trucks and SUVS. Cars are in the 80,000 miles range. “There are certain model year trucks I don’t buy because of mechanical issues. For example, the 2004-2010 Ford F-150s – the 5.4 liter – are just horrible vehicles. The cam phasers go out and the motors blow. We’ll buy them if they don’t have the 5.4, but 90 percent of them have the 5.4. “I probably carry 65 percent truck and SUVs, 35 percent cars. “We service our own vehicles. Average recon costs – minus the GPS units – is probably between $300 and $400. “We are getting a little more into Internet and social media advertising. We’ve cut back on TV and radio. “Between Halloween and Christmas, I go out and

!"&#& $ buy pretty heavy for tax season. I could buy 300 cars in February; I just wouldn’t have the time to get them reconditioned and ready. “We recently sold a 2006 Silverado. We sold it for $12,995. It had 118,000 miles.


Steve Bounds, president, AC Auto Sales, Union Gap, Wash.: “We opened in 1989. We’ve been at this location since 2008. We have two locations. The other is in Yakima, which borders Union Gap. The one in Yakima has lower inventory. “At Union Gap, I carry right around 100 (vehicles). It’s about all we can get on this lot. “We used to average 60 to 65 (sales) per month. Now we’re down to 40 or 45. “We sell both buy-here, pay-here and straight finance. Probably 60 percent of the business is buy-here, pay-here.

“Term length, on average, is about 13½ months. The average down payment is probably $2,000 to $2,500. “I put these guidelines (for down payment and term length) in place a long time ago and it keeps working. So I’m not going to change it. “I get my vehicles from all over. I get them from off the street, and different dealers. I don’t go to auctions anymore. They’re way too expensive. “Average retail price – between bank and in-house – $8,000 to $9,000. “The average model year is probably around 2005 to 2007. The average mile is probably 135,000. “Our inventory is (evenly split) among cars, trucks and SUVs. “Our average reconditioning is probably $400 to $500 per car. That hasn’t changed. We do some of the work here and some of it we sub out. All of the minor work we do here. But if we have to get a transmission fixed, we farm it out.â€?

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10/26/15 2:44 PM

16 • November 2,2015


Jim L. Williams, president, KASP, Lexington, Ky.: “We’ve been in business since 1982. “We’ve got six lanes that we can run, but most of the time we’re running four to five. “(As far as volumes) we’re running 700 to 800 a week. This time last year we may have been up a hair from today. “Overall, we’re selling about 50 percent of our volume. That’s very comparable to last year, a little bit better perhaps. “We’ve got some ’90day’ lanes where we will float the cars for the buyers for 90 days. Those lanes are converting about 87 percent. “(Dealer attendance) is probably somewhere between 150 and 225 per week. “On the retail side, dealers in the lanes are saying things are really tight right now and slow. But we’re up a little bit, so that’s the im-

16_UCN.indd 1

portant part. “We’re mostly dealer consignment. Our volume is probably 80 percent or 85 percent, something like that. The rest of the volume is made up of repossessions from banks, credit unions, etc. That’s typical. “We also have a public sale Thursday night in addition to our (dealer sale) Wednesday morning. We run probably 300 to 350, on average. “We have some dealers that show up for that. Those are dealers who like the night sale better because they find it easier to get away from their lots. But those are mostly the smaller dealers. “The average price coming through the lanes is about $5,500. The public sale (average price) is about $3,900. It was probably around $3,300 last year. “Trucks are always hot here in this area. With winter coming up, trucks are getting (premium) prices in the lanes.

“Also, the better the car, the better the dollar and quicker the sale. In our case, if it’s anywhere between $10,000 and $15,000, it’s hot. “We had a bad winter last year. We lost five sales due to the weather. Since 1982, I never lost more than one or two sales until last year.”


Kristie Goben, president, Greater Milwaukee Auto Auction, Milwaukee, Wis.: “We have five lanes and we run five lanes. “We’re running 800 a week, same as last year. “Conversion rates are up. It was 64 percent on Oct. 22 and 61 percent the week before. We’re not sure why it was so strong in October this year, but it (was). “We’re getting 400 bidders consistently every week. We actually have fewer dealers (bidding), but they are buying more. But we have a strong online

presence. All of our lanes are simulcast. “We use Auction Pipeline. Auction Pipeline has a really large dealer base. “Our (in-lane bidders) come from Wisconsin and Illinois. Our online attendance is from Michigan, Iowa, Minnesota, etc. “A lot of times the online bidders do win. But there are emotions involved with bidders on the floor. They get invested and, a lot of times, win the bid. “More often than not, however, we see buyers come here the night before, look at the cars, then bid online on the day of the sale so they don’t have to leave their dealerships. So it works out. “(Our volumes) are 90-percent dealer consignment. “ “Our average price is $4,000. “We had the General Motors sale for five years, but lost it to Manheim in July. But GM leaving has had a positive effect. “We had over-allocated


Compiled by Jeffrey Bellant resources to the GM account. They had a large staff dedicated to their account. So we have become far more profitable. “All we did was take the (benefits) that GM wanted and gave those same benefits to our dealers. “For example, GM had wanted simulcast. So now we put all of our cars on simulcast. GM wanted bar codes on their car stickers, so now we’ve put bar coded stickers on dealer cars. GM gave out special handouts, so now we give our dealers special handouts. “Another example is that GM wanted stand-alone check-in lanes, so now we provide stand-alone check-in lanes for our dealer consignment. “We improved so many processes from what they taught us. Logistically and operationally, we learned so much from GM. “We really stepped up our game in our market. We treat everybody like they are a factory account.”

10/26/15 3:55 PM


Compact Car

TCI $1,878 1 $13,502 2 $11,990 3 $10,884 4 $9,184 5 $7,433

Subcompact Car TCI $1,109 1 $12,477 2 $11,213 3 $10,565 4 $8,158 5 $6,657

Midsize Car

TCI $2,304 1 $15,920 2 $13,938 3 $12,422 4 $10,635 5 $9,280

Large Car

TCI $4,055 1 $18,611 2 $15,750 3 $14,774 4 $11,684 5 $9,332

September-15 % Change ‘14-’15

$2,135 13.68% $12,588 -6.77% $11,572 -3.49% $10,247 -5.85% $8,877 -3.34% $7,295 -1.86% $1,651 48.87% $11,126 -10.83% $10,285 -8.28% $9,318 -11.80% $8,026 -1.62% $6,345 -4.69%

Entry Luxury Car

Compact Truck

Entry Luxury SUV

TCI $2,994 1 $34,148 2 $29,381 3 $26,701 4 $23,228 5 $17,876

TCI $4,174 1 $27,652 2 $25,642 3 $22,294 4 $18,942 5 $17,099

Large Truck


TCI $3,107 1 $22,060 2 $20,061 3 $17,947 4 $12,830 5 $10,195

$3,301 -10.74% $26,521 4.05% $23,396 6.08% $19,704 -1.45% $15,826 1.31% $12,446 -3.44% $2,594 -13.36% $33,891 -0.75% $31,498 7.21% $27,471 2.88% $24,127 3.87% $20,516 14.77%

$737 51.65% $21,771 0.98% $20,557 6.68% $17,973 9.23% $15,260 4.43% $13,366 4.80% $4,112 $29,439 $25,840 $24,024 $20,161 $17,619

Entry Sport Car

Midsize Traditional Suv

Midrange Sport Car

TCI $1,694 1 $25,539 2 $23,010 3 $21,291 4 $17,313 5 $13,916

$2,636 14.56% $20,553 -4.37% $19,426 -0.90% $16,752 -1.66% $13,652 1.08% $11,520 -3.86% $2,125 25.44% $26,723 4.64% $23,377 1.59% $20,978 -1.47% $18,821 8.71% $16,289 17.05%

TCI $2,223 1 $20,625 2 $19,217 3 $18,634 4 $16,658 5 $13,038 TCI $1,506 1 $41,304 2 $33,910 3 $31,021 4 $27,369 5 $24,623

-1.49% 6.46% 0.77% 7.76% 6.44% 3.04%

$2,601 -16.29% $20,068 -9.03% $19,388 -3.35% $17,050 -5.00% $14,379 12.07% $9,964 -2.27%

Midsize Crossover Suv TCI $2,301 1 $21,492 2 $19,602 3 $17,035 4 $13,506 5 $11,983

September-15 % Change ‘14-’15

Large Traditional Suv

$3,465 -14.55% $20,815 11.84% $16,956 7.66% $13,871 -6.11% $12,120 3.73% $9,417 0.91% -4.94% -4.22% 1.94% -0.64% -2.53% 0.31%


Premium Sport Car

TCI $3,698 1 $25,488 2 $22,055 3 $19,993 4 $15,622 5 $12,890

TCI $486 1 $21,559 2 $19,269 3 $16,454 4 $14,613 5 $12,754

$1,636 $17,802 $16,477 $14,290 $11,698 $10,491

September-15 % Change ‘14-’15

Large Crossover Suv

$2,788 21.01% $15,046 -5.49% $13,758 -1.29% $11,682 -5.96% $9,495 -10.72% $8,346 -10.06%

Compact Crossover Suv TCI $1,721 1 $18,587 2 $16,163 3 $14,382 4 $12,002 5 $10,459


$1,690 -23.98% $21,094 2.27% $18,680 -2.79% $17,016 -8.68% $15,265 -8.36% $14,670 12.52% $1,131 -24.90% $45,335 9.76% $34,380 1.39% $30,104 -2.96% $28,618 4.56% $24,093 -2.15%

TCI $3,297 1 $73,425 2 $63,184 3 $60,405 4 $49,176 5 $42,461 TCI $2,194 1 $26,213 2 $21,994 3 $20,866 4 $16,878 5 $14,277 TCI $1,514 1 $30,820 2 $26,940 3 $24,230 4 $20,305 5 $16,146

$1,692 $80,985 $61,215 $51,898 $57,085 $44,173

-48.68% 10.30% -3.12% -14.08% 16.08% 4.03%

$3,201 45.90% $26,619 1.55% $21,737 -1.17% $18,830 -9.76% $16,262 -3.65% $13,774 -3.52% $2,221 46.70% $30,198 -2.02% $26,552 -1.44% $22,877 -5.58% $19,728 -2.84% $16,592 2.76%

Midrange Luxury Car TCI $3,437 1 $36,691 2 $33,315 3 $29,546 4 $21,079 5 $16,831

$2,519 -26.71% $36,907 0.59% $30,889 -7.28% $27,004 -8.60% $22,683 7.61% $17,094 1.56%

Midrange Luxury SUV TCI $942 1 $42,036 2 $37,149 3 $30,150 4 $25,690 5 $21,706

$1,066 13.16% $43,160 2.67% $36,503 -1.74% $30,701 1.83% $25,189 -1.95% $20,365 -6.18%

Premium Luxury Car TCI $2,589 1 $60,331 2 $48,894 3 $42,826 4 $35,917 5 $27,421

$4,476 72.89% $60,767 0.72% $48,387 -1.04% $39,035 -8.85% $36,173 0.71% $29,029 5.86%

Premium Luxury SUV TCI $3,068 1 $56,857 2 $46,947 3 $40,309 4 $30,772 5 $26,483

$2,574 -16.10% $57,875 1.79% $49,031 4.44% $38,743 -3.88% $32,969 7.14% $25,675 -3.05%’s monthly True Cost of Incentives (TCI) report takes into account all of the manufacturers’ various United States incentives programs, including subvented interest rates and lease programs as well as cash rebates to consumers and dealers. To ensure the greatest possible accuracy, bases its calculations on sales volume, including the mix of vehicle makes and models for each month, as well as on the proportion of vehicles for which each type of incentive was used. TCI data (and other data products) can be viewed industrywide, import vs. domestic, by country of origin, by make, by model and by segment. True Market Value (TMV) is the transaction price for vehicles.

17_UCN.indd 1

10/26/15 11:41 AM


DISCONNECTED JOTTINGS FROM I saw my breath this morning – one of the first heralds of an autumnal nip in the air, along with the scent of falling leaves, early deserters of participating in Mother Nature’s fall palette.


middle of the afternoon. Summer’s cloying humidity is now the stuff of uncomfortable memory. Doing chores in the yard is now a pleasure, just to be outside without dripping from ev-

Tony Moorby

• 40-year veteran of the industry • President from 1997–2000 of ADT Automotive • Served as ADESA’s executive vice president of sales and marketing • Moorby & Associates 2006–present • Awarded the Ring of Honor by NIADA • NAAA Hall of Famer

The thrumming of lawn mowers is now more often replaced with the revving buzz of leaf blowers, the only things to disturb the still dry air here in the MidSouth; there’s nary a breath to stir the trees. There’s not a cloud to mar the crystal clear, cerulean blue sky. Just the cheerful sun that moves the mercury from the low 30s at dawn to the mild, mid-70s by the

ery pore. The flowerpots from the patio, emptied and washed now grace the garage, giving comfort to spiders for the coming months. It looks barer out there now – even the furniture cushions have been secreted away for the duration. Crickets have replaced cicadas; their warm and friendly trill, distant and shy, still around before too much frost sees them off and ends


their evening lullaby. I walked around Radnor Lake this morning – a threemile indulgence that I hope will become a daily event like it used to be. It’s best in the fall, winter and spring as there seems to be more to look at than in the heat of the sweltering summer – you’d have to be there at sun-up to avoid the heat, not something I’m very good at these days. Radnor Lake was created by the L&N Railroad Company back in 1914 to supply water to locomotives and to water livestock that was being transported. It was later purchased by the Tennessee in 1973 and pronounced a State Natural Area. The lake and surroundings take up about 1,350 acres of beautiful land in Oak Hill, a suburb of southern Nashville and amazingly close to town. Wildlife abounds including otters, beavers, bobcats and coyotes. White tail deer are so tame they don’t even get off the trail as you walk

20. A good suspension system will give you one, 2 words 23. Profit 25. 1957 ___ Super 88 Holiday Coupe 29. Sport compact car from Isuzu (goes with 15 down) 30. Brit auto maker that made an Ace and a Frua 31. Soccer ___ (she drives the kids to games) 32. Google have been testing this type of car 35. Cars offer different ___ levels 39. Cool 41. Downsides 42. Earlier style 44. Scion ___ 45. Early 20th century car from Hudson Motor Company 46. Tire in the trunk

by within touching distance. A rafter of some 22 turkeys refused to allow me passage this morning and I had to wait for them to finish foraging in my path. The lake is temporary home to lots of migrating birds and ducks, while full time residents such as woodpeckers; hawks and all the usual locals hang around to entertain. Bald Eagles have even built a nest in the last couple of years. I was walking around the Lake Trail two years ago in the spring when a bald man was holding his profusely bleeding head. I approached with some trepidation to ask what was wrong when he pointed to a female barn owl in an adjacent tree, protecting five young chicks. No doubt she would have meted out the same punishment to me had I intruded

further into her territory. The place is a riot of color right now and even in the winter; the evergreens are profuse enough to spike the pinkish gray woods with fresh color. In the spring frogs and toads, making their way to the water to mate are in such numbers as to qualify for a plague. With all the madness going on around our busy lives these days, it’s good to find some respite so locally. It’s free too and amazingly, during the week, it’s not overrun, just a few folks with their kids or birdwatchers and hikers. There’s a ridge top trail for the real hikers and I’m sure the views are rewards unto themselves. For me, I’ll stick to the relatively flat Lake Trail, the exercise being its own reward.

To see past columns from Tony Moorby, visit


By Miles Mellor

Across 1. Aston Martin’s new V2, limited edition 4. French automaker that sells luxury electric vehicles such as the Atlantique 8. “Tommy� band, The ___ 10. GMC SUV 11. Brit car manufacturer that produced the Robin, Bond Bug and Scimitar 13. Courage 14. Isuzu SUV 16. Prefix for new 17. Setting for many auto ads 18. A lot of care, abbr.



Down 1. Bugatti Supercar 2. Facebook approvals 3. Massachusetts’ Cape __ 4. XC60, XC70 or XC90 5. Celtics and Lakers are part of it, abbr. 6. Increase the risks and stake in the game, 3 words 7. Q50 makers 8. Mechanic’s tool 9. “You are ___� : mall map intro 12. That is, for short 15. See 29 across 17. Vectra maker 19. Light, for short 21. Blue shade for a car 22. “___ make a deal for you!� 24. Front-wheel drive sport compact car manufactured between 1983 and 1991, 2 words 26. Account amount 27. Frozen rain 28. Ambulance group, abbr. 29. London time setting, abbr. 33. Exhibitions



4 8








13 14

15 18 20







24 25




30 32








38 39 42 44



43 45


Answers to the 10/19/15 puzzle 1

34. Green color 36. Brand that was bought by BMW 37. One time Formula One racer, Sir Stirling _____ 38. Road sign 40. Country in the EU, for short 43. Edward, familiarly



U 12



























A 36

























































K 48


O 26









G 39








R 20






























O W R 47


E 32

C 38








15 18


S 37




P 34


21 24



S 17

O 31



A 23




C 16


Answers to this puzzle in the 11/16/15 issue. Call 1.800.794.0760 for a FREE subscription.

18_UCN.indd 1

10/23/15 10:44 AM


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Auctions Across America “My Worst Decisions” – Dealer Stories

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Dealer Life [Technology Spotlight Advertorial] NADA Convention Issue Marketing

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CHEERS FROM A CLOWN: NextGear Capital staff, from left, Lucas Collis, Tom Merrill, Emmy Pitman and Amber Molina accept a special recognition from Ronald McDonald.

NextGear Capital was one of three companies honored Sept. 25 with the 2015 Helping Hands Award from Ronald McDonald House of Indiana. This award recognizes individuals, organizations and businesses who have responded to the needs of families staying at the Ronald Mc-

Donald House through outstanding in-kind gifts, advocacy and/or volunteer efforts. This is among the highest honors bestowed by the Ronald McDonald House and the Carmel, Ind.-based inventory finance company’s first time receiving the award. NextGear Capital’s involvement

with the Ronald McDonald House of Indiana spans close to a decade. A dedicated group of employees, led by accounting director Emmy Pitman and business development representative Tom Merrill, have been serving a monthly breakfast for nine years at the House, which provides accommodations for more than 5,000 families of children every year receiving medical care at Riley Hospital for Children at IU Health and other area hospitals. “Every time I go to the Ronald McDonald House, I feel so encouraged knowing that what me and the rest of my co-workers are doing is helping someone, even if for just a small portion of their day,� Merrill said. NextGear Capital has also collected over 871,300 pop tabs since 2011 for the Ronald McDonald House of Indiana and is also a 2015 room sponsor for families that can’t afford to pay.

Auction Hosts Hunting Event Carolina Auto Auction hosted its Camo Sale recently, with 600 dealers attending. Dealers received camouflage visors, and had a chance to win a Browning special edition shotgun and compound bow. Landon Owens from Country Side Auto Sales won the shotgun and Jonathan Garrett from New 2 You Auto Sales won the bow. The sale was in held in conjunction with the auction’s larger Casino Royale event, where dealers received a poker chip for every unit bought or sold and could cash in those chips for prizes and a drawing for a poker gaming table and chairs. To start the action, David Vickery from DV Motors in Canon, Ga., played Carolina’s Beat the House blackjack game as the auction’s “Dealer of the Week.� Vickery also received free breakfast and a special parking place.

We invite news items and top-quality photos from our readers to be considered for “Around the Block.� Please include the name of a contact person and a telephone number. Send items and photos to: Jeffrey Bellant. Mail: Used Car News, 24114 Harper Ave., St. Clair Shores, MI 48080. Fax: (586) 772-9400 e-mail:

FULL SPECTRUMLENDING Financing for EVERY SINGLE retail customer.

RE-DESIGNEDWEB PLATFORM Dealer friendly online portal that can generate a simple approval for any retail customer.


The smartest programs combine for the simplest experience with the highest profit.

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(800) 873-2907

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$250 GIFT CARD! 21_UCN.indd 1

Drawing held on January 4, 2016 10/26/15 9:27 AM

22 • November 2, 2015


Special Advertising Section


SPOTLIGHT Atlas Acquisitions, LLC ...................................... 22 & 30 CARite .......................................................................... 24 Credit Acceptance Corporation ........................... 23 & 28 GWC Warranty ............................................................. 23 iMetrik Solutions ............................................... 26 & 27 NextGear Capital ....................................................... 25 Northland ........................................................... 24 & 26 Payteck Technologies ................................................ 30 Skypatrol, LLC .................................................... 2 &  Vehicle Acceptance Corporation ................................ 30


Call Leah Bar today at 888-762-9889, x103 for more information.

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Special Advertising Section

GWC Warranty Rewards Top Dealers Grow Your Business Through Additional Sales and Profits For Protecting Their Customers WILKES-BARRE, Pa. – Essentially all buy-here, pay-here dealers know there are three reasons a customer would stop paying on their loan: they can’t pay; they won’t pay; or they experience a mechanical breakdown. Essentially all buy-here, pay-here dealers also have processes and technology in place to avoid customers who are unable or unwilling to pay. What about mechanical breakdowns? Yes, offering a vehicle service contract serves this purpose, but when you’re financing a deal yourself, what are the benefits of adding in an extra cost? Will a customer even agree to an added expense once they’re presented with the option? To help alleviate both of these concerns, GWC Warranty has two programs that can help buy-here, pay-here dealers easily add a vehicle service contract to every deal and keep their customers on the road and paying their bills – all while getting rewarded for doing it. First is the GWC Warranty Certified Pre-Owned Program. With reasonable 90-day, 180-day and 12-month coverage terms to go along with certified marketing materials, GWC’s CPO program makes it easy to add a vehicle service contract to every single deal and differentiate

your lot from the competition at the same time. When you certify every vehicle on your lot, you eliminate the opportunity for a customer to decline the vehicle service contract while also providing reliable Day One, Mile One coverage. Then, thanks to the certified contracts you’re submitting, you can quickly become a member of the GWC Elite Dealer Program. The Elite Dealer Program rewards top dealers with exclusive benefits like online claims, special certified pricing, a dividend program that awards accelerated payouts on earned underwriting profits and much more. Once a burden for many buy-here, pay-here dealers to include in a deal, GWC Warranty has now not only made it easier to protect buy-here, pay-here customers after the sale with a vehicle service contract, but also made it a rewarding experience. To learn more about the GWC Warranty Elite Dealer Program, visit

Dealers succeed in this business by selling more cars and making more money, yet many consistently lose profitable business. Credit Acceptance, a publicly traded finance company founded in 1972, gives independent and franchise dealers the ability to provide an approval to every customer on nearly any vehicle. With their Portfolio and Purchase programs, dealers can maximize every deal and choose which to use on a deal-by-deal basis. Designed to capture lost customer opportunities, the Portfolio program enables dealers to make money now, and with residuals on the Portfolio contracts, well into the future. The Purchase program gives dealers all of their money up-front, similar to traditional financing. These programs can work in any market and align with existing staff, sales management and F&I protocol in a manner that complies with the policies governing your business. Recently, Credit Acceptance has made enhancements that make it even easier, faster and more profitable to do business. Their patented Credit Approval Processing System (CAPS®) makes it easy to receive approvals (in 30 seconds or less) and structure compliant deals. CAPS

integrates with®, AutoClick®, ProMax® and many other dealer and inventory management systems. The easy, 5-step process guides dealers through submitting an optimally structured approval, prints contracts, and keeps track of inventory, approvals and funding – allowing dealers to control the sale from start to finish. Reporting capabilities help dealers monitor their business, portfolios and customers. The Credit Acceptance Dealer Service Center provides the tools and guidance needed to achieve fast funding and long-term profitability. Currently, 62% of contracts are funded in 1 day or less, with the average deal funded in under four days! In 2014, Credit Acceptance paid dealers over $1,576,642,550 in Advances, over $41,707,140 in accelerated Portfolio Profit Express (Portfolio Profit money), and over $138,854,420 in Portfolio Profit. Visit to find out how you can sell more cars and make more money.

RIDE WITH THE BIG DOG. PARTNER WITH THE NATION’S LARGEST, BEST-IN-CLASS SERVICE CONTRACT PROVIDER. As the nation’s largest provider of used vehicle service contracts for independent dealers, we have more than 20 years of experience helping dealers give car shoppers the confidence to become car buyers. And with over $350 million in claims paid, you know that your customers will be taken care of. Find out how you can partner with the nation’s largest service contract provider!

844-256-8121 | @GWCWarranty

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Special Advertising Section

The Total Package The Lease’T’OwnŽ and Ren’T’OwnŽ business models have been successfully used throughout the United States for more than 25 years. They have brought proven solutions to your everyday problems of delinquent payers, customer bankruptcies, costly and time consuming repossessions, customer retention, advertising costs, and tax burdens. As added enhancements to the

With Northland’s finance program, the application process is easy! Fill out their 1 page application and provide 3 months bank statements. That’s it! Within one business day you are presented with an attractive and competitive rate quote. From there, you can decide if you want to proceed or not. It’s that easy!

already successful business model, GPS tracking devices, engine & transmission warranties, excess contingent liability insurance, rental/loaner car insurance, and dealership office, lot, and detailing supplies are readily available as well. So what’s missing from this package? FUNDING TO BUY MORE CARS! Northland has that problem solved with their “Fast Funds� program. Money is now available for working capital and vehicle funding for your Lease’T’OwnŽ, Ren’T’OwnŽ, buy-here, pay-here, lease-here, payhere, and rental cars!

Fast Funds rounds out the total package designed for your success! You have it all with Lease’T’OwnŽ - higher profits than you’re seeing with buy-here, pay-here, leverage over delinquent payers, federal statute protection from your customers’ bankruptcies, elimination of repossessions, higher customer retention, relief from tax burdens, and now funds to help grow your lease or rental fleet! For more information on Northland’s total package, contact them at 800-879-3433 or on-line at www.

Join the CARite Dealership Family Are you an entrepreneur at heart? Have you ever thought about opening a CARite dealership in your market, or converting your existing store to our growing national brand? With several turn-key stores available in early 2016, it’s a great time to consider your very own CARite store. CARite operates a growing network of branded car dealers throughout the United States. We’re growing fast. While many of our locations are owned outright by our company, we also offer independent operators a chance to participate in our national brand. That’s right, you can own and operate your very own CARite store. For those who join our team, CARite provides products and services that help you focus on one thing: Selling more cars. With centralized support and a suite of offerings to support your dealership needs, you won’t be alone in your quest to build a valuable business. We’ll be right there with you. We provide centralized marketing, HR and IT support on top of a professionally branded presence. We also provide access to the capital needed to grow your business as well as an available floor plan to support your inventory needs.

Our centralized buying team can even help you find cars that fit our brand standards. CARite was founded based on three simple principles: 1. Better Cars: Offer customers carefully selected late-model low-mileage cars at an affordable price (often below Blue Book value) 2. Better Experience: No haggle pricing and an amazing retail experience with well-trained people 3. Peace of Mind: Supporting products and policies to ensure every customer knows we are on their side We partner with several lenders to serve our customers. CARite dealers enjoy access to our captive leasing arm, BRite Leasing, to provide an additional option to customers. We are looking for entrepreneurs to be become CARite partners as we continue our national expansion. If you are looking to grow your business with the power of national branding and a cohesive product suite, please visit www.carite/opportunity and complete our initial inquiry form. Your future starts now!

dealer partnerships!

Entrepreneurs Wanted! Add YOUR Dealership To Our Growing National Network!

National Branding! Captive Lender! Access to Capital!

Driven To Impress!

Access to Floorplan! Access to Inventory! /opportunity

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NextGear Capital is part of the strongest portfolio in the automotive industry – providing end-to-end inventory finance solutions to independent dealers both big and small.

Industry Expertise

Real-Time Technology

Unparalleled Resources

In today’s industry, resources matter. What Matters Most to You? Join the conversation at or call 855.372.2329

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10/22/15 12:52 PM



Special Advertising Section

Great GPS Technology Is Nothing Without Great Customer Support • “What is your cost per unit?â€? • “What are the airtime renewal costs?â€? • “What are the advantages of your product’s functionality?â€? • “What is your GPS technology platform? All good questions. Sales agents, reps, and resellers hear them every day from their prospective customers. Of course, most everyone in the subprime automotive lending community who manage their assets are interested in great value and competitive pricing. Anyone whose job involves asset management and automotive loan repayments knows that questions will occasionally arise concerning the payment assurance technology offered by their service provider: “I remotely disabled the delinquent customer’s car and was about to call our repo guy, but the customer’s sister-in-law just came in to pay-up on his behalf. Now the device is unreachable, and I need to do an immediate override procedure! Can you help me?â€? Or, “My new GPS installer just did five cars, but I’m not getting a signal on any of them.â€? Or, “I want to create a

geo-fence around every tow-lot from Texas to Tennessee, so how do I do that?� As a dealer or a lender, here are a few replies you definitely do NOT want to hear from your service provider: 1. Please leave your name and number after the beep. 2. Yeah, well Pete is usually the one to handle this type of call, but he’s not in right now. 3. I’m new here and I haven’t been trained on that yet. 4. We suggest that you refer to your online user guide documentation. Bye-now! 5. Your call is important to us. Please hold. 6. We are currently experiencing heavy call volumes; please try again later. 7. Um‌what is a geo-fence? There are recent studies which suggest that up to 60% of Americans would be willing to try a new brand or company for a better service experience. Very few organizations actually put an emphasis on delivering outstanding customer service, which is defined as rapid service provided by a highly competent and friendly staff whose focus is to efficiently

resolve issues and surpass customer expectation. At IMETRIK, we pride ourselves on our advanced top-tier GPS technology but we also understand the vital importance of providing excellent customer service. Whereas almost 100% of car deals are negotiable, IMETRIK understands that delivering unparalleled stellar customer service is 100% non-negotiable. Our customer support team is knowledgeable, efficient, helpful and friendly, even when the phones are ringing and the emails are pouring in with questions requiring quick and precise replies, such as: • “Do you have any tips for my new installer?â€? • “Can you tell me why I can’t reach my device right now?â€?

• “I want to schedule an automatic locate command for every 6 hours and 18 minutes.â€? • “I need to transfer a device to my sub-account in Albuquerqueâ€?. • “I need my new collections manager to be trained on the system.â€? • “I have a device that I installed five years ago, and it just lost functionality; what’s the warranty; can I still return it?â€? • “I need you to train me on how to implement landmark services to geo-fence every tow lot in the country.â€? • “I need to order 2000 IMETRIK devices and have them all by tomorrow.â€? Do the IMETRIK customer service agents get flustered or bewildered? No way! They solve problems quickly and

efficiently, every time. They listen and ask the right questions. They perform real time investigations, assess the situation, and determine the correct solution. They always resolve the issue. IMETRIK agents have up to ten years of continuous experience so they have perfect product knowledge, and can explain every functionality. They know how to install a device, and what wires go where. They can train you on the web applications and can help you locate an asset. Whatever your question, they will provide a helpful answer. IMETRIK’s unparalleled customer service and support makes all the difference and you can count on them every time you call.




Increased Customer Loyalty No Repossessions Bankruptcy Protection Delinquency Leverage

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10/23/15 10:27 AM

Simply The Most Reliable GPS Solution



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Special Advertising Section

Better GPS Devices, Superior Networks, Powerful Software Drive BHPH Profitability About half of buy-here, payhere dealers use GPS-enabled systems to track, locate and help recover cars sold to sub-prime borrowers. If you’re ready to adopt this profit-boosting technology, or change providers, be aware that GPS devices are not all the same. There’s more to these systems than just the hardware. Device design and network coverage have a lot to do with locating a vehicle, but it’s the software behind a system that works before and after a sale to help minimize risk, improve collections and increase your bottom line. The Defender GPS platform powered by Skypatrol combines high quality hardware, vast network coverage and powerful software reporting to support you throughout a loan’s entire life. Better Decisions Now Reduce Defaults Later From the start, Skypatrol’s Data Verification Tool (DVT) helps you make better lending decisions. In buy-here, pay-here, you don’t need a credit report to know the customer has poor credit or no credit. You need other information

to judge a borrower’s character and assess risk. With just their name and address, a DVT Discovery Search can validate customer information, including address history, email addresses, driver’s license, relatives and

Delinquency Cut by One-Fourth Sign and Drive installs a Skypatrol GPS device in every car it finances. This, of course, helps locate vehicles should an account default. But it’s Skypatrol’s web-

“Our delinquency rate was 17-22%, now after just a couple of months with Skypatrol and using the Data Verification Tool it is down to 13 to 17%!� Michael Atchly, Collections Manager Sign and Drive / Charlotte, NC. bankruptcies, liens and judgments for less than the cost of a credit report. After the sale, Skypatrol’s Virtual Collector system helps assure timeliness of payments and reduce defaults by sending automated payment reminders by email and text. Even when the customer appears to be headed to default, Skypatrol helps dealers avoid the last resort of repossession. That’s been the experience of Michael Atchly, collections manager at Sign and Drive, a three-location buyhere, pay-here dealership in Charlotte, NC.

based Defender software and DVT that enabled Atchly to rapidly cut Sign and Drive’s delinquency rate by one-fourth. “When I started, our delinquency rate was 17 to 22 percent. After just two months with Skypatrol and using the Data Verification Tool, it is down to 13 to 17 percent,� Atchly said. Atchly leaves the office one day a week to locate customers and vehicles before turning matters over to a repossession agent. “Just yesterday, I used a DVT Search report to locate two customers, and they were baffled as to how I found them,� he says. “It was basically because I

pulled a DVT report, but I also looked at the history report for the last 90 days. I told them, be happy that I did find you because I’m actually here to help you save the account.� Multiple Ways to Aid Recovery When repossession becomes necessary, Defender’s oneclick Repo Mode Tool (patent pending) lets you give secure temporary smartphone access to recovery teams so they can determine the current location and reliably follow moving vehicles in real time. Here’s where Skypatrol’s advanced chipset, superior antenna (tested at twice the signal strength of others) and vast coverage on the Verizon CDMA network combine to assure a vehicle can be tracked virtually everywhere. Even if the GPS unit were disabled, Skypatrol captures all location history and vehicle stops, prioritizing the top 10 most visited locations so tow operators know where to look first. For challenging defaults,

the DVT Recovery Search helps dealers locate vehicles by revealing information on known associates and family. It also provides asset data for financial restitution. Atchly says a recovery search report immediately led to a vehicle he’d been trying to find for over 100 days. Any device can help you recover a car. To build and maintain positive and profitable relationships with your customers, you need Skypatrol.

The only finance company you can’t afford to live without! §

Longer terms


Compliance checking


Broader funding policies


Contract printing


Newer vehicles


Fast funding


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Quick approvals

“I opened my business in 1998 with about 15 different lenders and selling around 30 cars a month. In 2004 most of the lenders dried up and so did my volume and cash flow. My first Portfolio Profit Express check was $47,000. Credit Acceptance not only saved my dealership, it’s allowed me to increase my sales. The program has been life-changing for me and my customers.�

Joe Kaisk

Magic City Motorcars (OH)

 & &   | 800.873.0512 |

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Special Advertising Section

Are Curtailments Killing Your Cash Flow? Jonathan Neubauer, President & CEO, Vehicle Acceptance Corporation

Are curtailments keeping you up at night wondering when that ACH is going to hit your account? Do you purchase fewer units on auction day to avoid multiple curtailment payments coming due on the same day? We can help. The VAC No Curtailment Floorplan Program offers you piece of mind, knowing that no payments are due until payoff. The VAC Dealer Portal allows you to schedule a payoff from your computer, tablet or smart phone up to 10 days out and know exactly

how much and when that ACH will hit your account. Putting control of your cash flow back in your hands. That’s how VAC can help grow your business. Fees starting at $49, personal service, local branches, quick funding, no hidden fees and no curtailments. Let VAC earn your business today. Learn more at or call 1-888-571-7092 for more information.

Missed Payments: When GPS Is Not Enough While GPS is the newest, sexiest technology, it is not foolproof. Unfortunately, you can still lose cars with it. So what’s a dealer to do? First, understand that GPS is a “reactive� answer to the problem after things are already out of control. Now you have to say, “We’ve had enough. Go get the car.� Obviously, most dealers would rather get paid than go through a repo. Second, consider using a twopronged approach that adds a proactive component to the reactive GPS component. Add our PT2000 as a proactive behavior-modification device that encourages your customers to pay

as agreed. The PT2000 can be used as an “active decoy� (ask us). Mounted right there on the dashboard, it is a visible daily reminder to your customers that they must make their payment by the due date. Having a PT2000 is like having your own proactive collector in each and every car so that you can modify bad behavior before an account becomes delinquent. Contact PayTeck at 1-800-880-3081 or


When a Customer Files Bankruptcy‌ You’ve just received notice from the bankruptcy court that one of your borrowers has filed for bankruptcy. Now what? • Are you aware that your borrower can convince the court to reduce the principal owed? • Are you aware that your borrower can reduce the interest rate on the note to 3-5%? • Are you aware that your borrower can reduce monthly payments and drag the term out an additional sixty months? • Do you know that it is illegal to repossess the vehicle without court approval while your borrower is in bankruptcy, even if they stop paying?! • Do you know that even if your borrower agreed to not file for bankruptcy, if they do, you must comply with all bankruptcy regulations? • Do you know that if you violate the bankruptcy rules, your borrower can sue you for thousands of dollars?

How comfortable are you with the bankruptcy process, and are you really making sure your rights are protected? As the bankruptcy process moves forward, deadlines come and go. As a creditor, your options become more limited if you are not actively involved in the case. The bankruptcy process makes it harder for you to get your money and forbids you from going out and picking up the car – even if the borrower has stopped paying! Atlas Acquisitions purchases auto notes in bankruptcy. Why bother with the hassles of compliance and the delayed payments when you can eliminate those risks and get paid today? This is a specialized industry. We understand the complexities of the bankruptcy laws. It doesn’t cost you anything to get a bid. Atlas is looking to partner with dealers to provide cash on hand allowing you to focus what you do best... SELLING CARS. To learn more about selling your bankrupt auto notes, please go to or call Leah Bar at 888-762-9889 ext.103.

26*5$)"4*/( :063$6450.&34'03.0/&: (FUUIFNQBZJOHUIFMPBOXJUI1BZUFDL


Innovation Headquarters 800.880.3081 t

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Joffa LaRoe – Inventory Director, Gateway Buick GMC Jennifer Friday – Senior Sales Manager, Ally SmartAuction

Some lenders might go the extra mile. We went the extra 3.1.

Joffa LaRoe was blown away by the extraordinary dedication Jennifer Friday showed helping her implement Ally SmartAuction®. So much so, she asked if Jennifer would like to continue her support by joining her in a 5K charity race. Jennifer — despite not being an avid jogger — was all in. Because at Ally, when it comes to proving our dedication to our dealers, we don’t just talk the talk, or even walk the walk — we run the run. ©2015 Ally Financial. All rights reserved. Driven by what we love is a service mark of Ally Financial. SmartAuction is a registered service mark of Ally Financial.

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10/22/15 11:49 AM

WORK YOUR DIGITAL STRATEGY LIKE A MASTER. Build your brand, boost your inventory exposure and convert online shoppers to in-store traffic.

Get to know the new Autotrader at


©2015, Inc. All Rights Reserved. Autotrader is a registered trademark of TPI Holdings, Inc. used under exclusive license.

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Used Car News 11/2/15  
Used Car News 11/2/15