2024 FEBRUARY MASS AUTO DEALER

Robert O’Koniewski, Esq. executive Vice President rokoniewski@msada.org

Jean Fabrizio Director of Administration jfabrizio@msada.org

Robert

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Boston, MA 02109 Subscriptions provided annually to Massachusetts member dealers. All address changes should be submitted to MSADA by e-mail: jfabrizio@msada.org

From the President

NADA Show Wins in Las Vegas

TDOY Tom Murphy Honored as National Finalist

By Jeb Balise,

MSADA President

The 2024 NADA Show in Las Vegas was as vibrant and active as ever. Attendance seemed higher than ever, and there was a cautious optimism in the air going into an election year with challenges and opportunities in front of our industry.

More importantly, we had the chance to honor our Massachusetts TIME Dealer of the Year (TDOY), Thomas Murphy of Falmouth Toyota. Tom was named one of the five finalists for the national award, which is quite an honor, especially following Gary Rome as the national award winner in 2023. Ultimately, this year’s award went to Rita Case of Rick Case Automotive Group in Florida.

We had a great turnout at our annual party co-hosted with our accounting partner, Withum (formerly O’Connor and Drew), to honor Tom as our dealer of the year. We were also fortunate to have previous TDOY nominees attend – Joe Shaker (2022), Ernie Boch, Jr. (2007), and Marshall Jespersen (2006). Beyond Tom’s success, his engagement and history of giving back to his community on Cape Cod is inspiring. We could not have asked for a finer individual to stand on the Vegas stage for us this year. Congratulations, Tom!

The national convention had a great mix of fine speakers on the Main Stage and smaller venues around the convention hall as well as vendors pitching their wares in the exhibition hall. However, as we have seen under the last three years of the activist Biden administration, we were briefed on all that the federal government is trying to impose on our industry that is not helpful to the business community, or even for consumers it purports to help.

NADA is challenging the Biden regulatory agenda on several fronts. In response to NADA’s legal challenge to the FTC Vehicle Shopping Rule, the FTC postponed the Rule’s effective date of July 30, 2024, pending judicial review. While the postponement of the effective date was good news, NADA will still need to argue its case in court. Additionally, NADA is pursuing legislative fixes in Congress through restrictions in the appropriations process and passage of the FTC REDO Act to stop the FTC from implementing or enforcing the rule.

NADA also is lobbying Congress to pass legislation that would rein in the EPA’s proposed vehicle rules that essentially creates an EV mandate of 67.5% for new vehicle sales early in the next decade. Further, LIFO relief is on NADA’s agenda while a tax package wends its way through the House and Senate. Finally, with federal right to repair legislation moving out of a House subcommittee to the full House Energy and Commerce Committee, NADA will have its hands full preventing this onerous proposal from becoming law.

Later this year we will be traveling to our nation’s capital for the annual NADA Washington Conference. By then, however, decisions could have already been made affecting these legislative proposals. Lobbying never takes a rest. If you want to get involved in engaging with our Congressional delegation on these issues, always feel free to contact me or our Executive Vice President, Robert O’Koniewski. Many hands can make light work. t

MsAdA BoARd

Barnstable County

Brad tracy, tracy Volkswagen

Berkshire County

Brian Bedard, Bedard Brothers Auto Sales

Bristol County

richard Mastria, Mastria Auto group

Essex County

William Deluca iii,

Bill Deluca family of Dealerships

Paul Bertoli, Priority chryslerJeep Dodge ram

Franklin County [open]

Hampden County

Jeb Balise, Balise Auto group

Hampshire County

Bryan Burke, Burke chevrolet

Middlesex County

frank Hanenberger, MetroWest Subaru

Norfolk County

Jack Madden, Jr., Jack Madden ford

charles tufankjian, toyota Scion of Braintree

Plymouth County

christine Alicandro, Marty’s Buick gMc isuzu

Suffolk County

robert Boch, expressway toyota

Worcester County

Steven Sewell, Westboro chrysler Dodge ram Jeep

Steve Salvadore, Salvadore Auto

Medium/Heavy-Duty Truck Dealer Director-at-Large [open]

Immediate Past President

chris connolly, Jr., Herb connolly chevrolet

NADA Director

Scott Dube, Mcgovern Hyundai rt.93

OFFICERs

President, Jeb Balise

Vice President, Steve Sewell

Treasurer, Jack Madden, Jr. Clerk, c harles tufankjian

ACV Auctions

Steve Sirko (856) 381-3914

ADESA

Jack Neshe (508) 626-7000

Albin, Randall & Bennett

Barton D. Haag (207) 772-1981

Ally Financial

Maryanne Recupero (617) 997-9574

American Fidelity Assurance Co.

Kathleen Weisenbach (402) 523-5945

America’s Auto Auction Boston

Jim Lamb (781) 596-8500

Armatus Dealer Uplift

Joe Jankowski (410) 391-5701

Auto Auction of New England

Steven DeLuca (603) 437-5700

Automotive Search Group

Howard Weisberg (508) 620-6300

Bank of America Merrill Lynch

Dan Duda and Nancy Price (781) 534-8543

BCI Financial Corp.

Timothy Rourke (203) 439-9400

Bellavia Blatt

Leonard Bellavia (516) 873-3000

Broadway Equipment Company

Fred Bauer (860) 798-5869

Brown & Brown Dealer Services

Jason Bayko (508) 624-4344

Burns & Levinson LLP

Paul Marshall Harris (617) 345-3854

Sarah Decatur Judge (617) 345-3211

CDK Global

Rob Steele (508) 564-1346

Chase Auto

Ken Miller (508) 902-8908

Clifton Larson Allen

Rick Parmelee (860) 982-9307

Cooperative Systems

Scott Spatz (860) 250-4965

Cox Automotive

Ernest Lattimer (516) 547-2242

Creative Resources Group

Charlie Rasak (508) 726-7544

CVR

John Alviggi (267) 419-3261

Dave Cantin Group

Woody Woodward (401) 465-7000

DealerSafeGuardSolutions

Doug Fusco (972) 740-8638

DealerShop

Ken Grove (248) 444-6283

Brian Fleischman (716) 864-0379

Associate Members

Downey & Company

Paul McGovern (781) 849-3100

DP Sales Distributors

Andrew Prussack {631) 842-7549

Driving Dealer Performance

Kimberly Guerin (978) 760-0322

Eastern Bank

David Sawyer (617) 620-3484

EasyCare New England

Greg Gomer (617) 967-0303

Electric Supply Center

Jennifer Williams (781) 265-4272

Enterprise Rent-A-Car

Timothy Allard (602) 818-3607

Ethos Group, Inc.

Drew Spring (617) 694-9761

F&I Direct

Sean Wiita (508) 414-0706

Michelle Salas (508) 599-0081

Federated Insurance

Kevin Sundberg (559) 547-9694

Fisher Phillips LLP

Joe Ambash (617) 532-9320

Jeff Fritz (617) 532-9325

Josh Nadreau (617) 532-9323

GW Marketing Services

Gordon Wisbach (857) 404-0226

Hilb Group

James Pietro (508) 791-5566

Huntington National Bank

Michael Ham (740) 815-5085

JM&A Group

Chris “KC” Hwang (954) 415-6961

John W. Furrh Associates Inc.

Pamela Barr (508) 824-4939

Key Bank

Mark Flibotte (617) 385-6232

KPA

Abe Cohen (503) 902-6567

LoJack by Spireon

Ashvir Toor and Robin Dukes (800) 557-1449

LotLinx

Giovanna Scognemiglio (310) 526-1463

M & T Credit Corp.

John Federici (508) 699-3576

Management Developers, Inc.

Dale Boch (617) 312-2100

McWalter Volunteer Benefits Group

Shawn Allen (617) 483-0359

Merchant Advocate, LLC

Dan Giordano (973) 897-2778

Mintz Levin

Kurt Steinkrauss (617) 542-6000

Murtha Cullina

Thomas Vangel (617) 457-4000

Nancy Phillips Associates, Inc.

Nancy Phillips (603) 658-0004

NEAD Insurance Trust

Charles Muise (781) 706-6944

Northeast Dealer Services

Johna Cutlip (401) 243-7331

OCD Tech

Michael Hammond (844) 623-8324

Performance Management Group, Inc.

Dale Ducasse (508) 393-1400

Piper Consulting

Jim Piper (207) 754-0789

Portfolio

J. Gregory Hoffman (800) 761-4546

Pro-Vigil

Sasha Lam-Plattes (408) 569-2385

Pullman & Comley LLC

James F. Martin, Esq. (413) 314-6160

Reynolds & Reynolds

Austin Ziske (802) 505-0016

Rockland Trust Co.

Joseph Herzog (508)-830-3241

Samet & Company

John J. Czyzewski (617) 731-1222

Santander Bank

Richard Anderson (401) 432-0749

Chris Peck (508) 314-1283

Schlossberg, LLC

Michael O’Neil, Esq. (781) 848-5028

Shepherd & Goldstein CPA

Ron Masiello (508) 757-3311

Southern Auto Auction

Joe Derohanian (860) 292-7500

Sprague Energy

Rick Pasquatelli (508) 768-7640

The Towne Law Firm P.C.

James T. Towne, Jr. (518) 452-1800

TrueCar

Pat Watson (803) 360-6094

Truist

Andrew Carmer (401) 409-9467

US Bank

Vincent Gaglia (716) 649-0581

Wells Fargo Dealer Services

Josh Tobin (508) 951-8334

Withum

Kevin Carnes (617) 471-1120

Zurich American Insurance Company

Steven Megee (774) 210-0092

NADA Hits Jackpot with 2024 Show

TDOY Murphy Named National Finalist

By Robert O’Koniewski, Esq. MSADA Executive Vice President

rokoniewski@msada.org

Follow us on X (formerly Twitter) • @MassAutoDealers

Over 20,000 franchised dealers and key staff, state and metro dealer association leadership, vendors, media, and other affiliated members of our industry gathered on February 1-4 in Las Vegas for NADA Show 2024 to celebrate the successes of and discuss the challenges to franchised dealers here and across the world.

During the four-day celebration of free market capitalism, dealers heard from a panoply of firstrate speakers: John Taffer, renowned hospitality industry expert and producer of the TV program “Bar Rescue”; former NASCAR and Indy racer Danica Patrick; and Pro Football Hall of Famer Kurt Warner, who capped the Inspirational Session on Sunday morning.

Attendees also heard from outgoing NADA chair Geoffrey Pohanka, whose Pohanka Auto Group is headquartered in Maryland, and newly crowned chair Gary Gilchrist, of Gilchrist Chevrolet Buick GMC in Tacoma, Washington. The opening night party was held at The Sphere, an awe-inspiring technological marvel that is the newest edition to the Vegas Strip.

Attendees had access to over 500 vendors on the Las Vegas Convention Center’s exhibition floor. Moreover, a major pillar of the convention is education. Registrants had access to over 100 education workshops throughout the four days in several tracks: business essentials, digital and marketing, fixed ops, human capital, leadership, and variable ops.

www.msada.org

Concurrent with the NADA Show, American Truck Dealers (ATD) held their convention at the Wynn Hotel. Plus, instead of an annual meeting, the American International Automotive Dealers Association (AIADA) held a cocktail reception for members at the Encore Hotel.

For me, each year the TIME/Ally award ceremony is one of the highlights of NADA’s annual convention since it spotlights the considerable positives dealers deliver to their communities every day in addition to providing hundreds of thousands of jobs across the country. The ceremony is preceded by a brunch at which this year’s 49 nominees, their families, and their nominating ATAEs enjoy the camaraderie and fellowship the meal is meant to engender and celebrate. This year we heard from Baseball Hall of Famer Cal Ripken.

On Saturday’s Main Stage, TIME and Ally conducted the Dealer of the Year ceremony. As we detailed in our January Auto Dealer, Massachu-

setts was represented by Tom Murphy of Falmouth Toyota in Bourne. Gary Rome’s winning the national title last year in Dallas has set a high bar for our future Massachusetts nominees. Tom Murphy was well positioned to meet the challenge and was one of the five finalists named. Alas, Florida dealer Rita Case received the national title. Tom became our fifth finalist in this event, preceded by Fred Cain (1970), Julian Lucini (1978), Donald Rodman (2004), and Christine Alicandro (2021). A man of substantial character and accomplishments, in Tom we could not have had a better representative for us on the Main Stage this year. That evening, your MSADA held its annual cocktail party, co-hosted with our accounting partner, Withum, to honor Tom and to bring together dealers and affiliated industry folks in a few hours of relaxed revelry. Our congratulations and best wishes go out to Tom and his wife, Janet.

Finally, prior to the NADA convention, the Automotive Trade Association Executives (ATAE) held its winter meeting. ATAE, housed in NADA’s Virginia headquarters, works with NADA on its national dealer organization programming and matters of federal advocacy on dealer issues, including participation in the annual Washington Conference and the ATD Congressional Fly-In. The ATAE network consists of the CEOs of over 100 state and metro new car and truck dealer associations in the United States and Canada, including this writer. I also am serving another two-year term on the ATAE board. This year’s winter meeting included presentations and discussions on a number of legislative and regulatory issues, such as the continued transition to EVs in the marketplace, various assaults on the dealer franchise system, and efforts to enact bills in Congress regarding LIFO relief and to rein in the FTC and its vehicle shopping rule as well as the EPA’s overly aggressive EV mandates.

Be sure to mark your calendar for the 2025 NADA Show, January 23-26 in New Orleans.

Check out our cover story on pages 1822 for all the details for the Vegas Show.

Mass. Legislative Updates

Under the rules of the Massachusetts Legislature, all committees needed to make a report on each piece of legislation within their jurisdiction by the first Wednesday of February in the second year of the session – this year, February 7. Under the so-called “Joint Rule 10 Day” reporting deadline, committees had several options at their disposal: give the bill a Favorable or an Adverse recommendation; discharge the bill to another committee; keep hold of the bill in a committee extension order; or put the bill into a study order (a gentlemanly way to most likely kill a bill but does leave open the remote possibility of action at a later date).

During the 2023-24 session, your Association has an interest in a number of legislative proposals, favorably and in opposition:

Temp Tags. As reported late last year, the Legislature enacted, and the governor signed into law, legislation that fixed several flaws with the temp tags statute that Gov. Charlie Baker signed into law on his last day in office in January 2023. If you are experiencing glitches with the implementation of the law, please let us know. We are working closely with the RMV to ensure proper implementation of the program.

Reform Off-Site Contracting. House 351, filed by Rep. Jack Lewis (D-Framingham), received a favorable report from the Joint Committee on Consumer Protection and subsequently received initial support in the House. The bill is before the House Committee on Bills in the Third Reading, which prepares legislation for final passage in that branch. The bill would reform the three-day cancellation law to clarify that dealership-customer contracts executed via the internet are not to be considered as “off-site” transactions. This became an issue during the pandemic as dealers conducted more on-line transactions. The bills would modernize the on-

line purchase process without hindering current consumer protection laws.

Auto Body Labor Rates. The Joint Committee on Financial Services reported House 4412 favorably, which would create a process to increase the insurance reimbursed labor rate to auto body repairers for insurance-paid work. The bill then was referred to the House Committee on Ways and Means. This legislation has received strong backing in the Senate during the last several years.

Class 1 License Appeals. The Joint Committee on Consumer Protection reported favorably House 270, filed by Committee House Chairman Tackey Chan of Quincy, to create a process to appeal an allegedly improperly issued class 1 license to a party that is not a franchised vehicle dealer. The bill was then sent to the House Ways and Means Committee.

Service Contracts. The Joint Committee on Financial Services reported favorably House 995 (Rep. Dan Donahue, D-Worcester) which would create a statutory framework in MGL Chapter 175 for the sale of vehicle service contracts in the Commonwealth. The bill was then sent to the House Committee on Scheduling and Policy.

Right to Repair. The federal court judge has not yet issued a decision in the litigation filed by the Alliance of Automotive Innovators that challenged the legality and constitutionality of the 2020 amendments to our RTR law passed via initiative petition on the November 2020 ballot. The trial was completed in 2021. Thus, the Joint Committee on Consumer Protection placed into an extension order several RTR-related bills it had to address issues in the 2020 law.

Doc Prep Fee Cap. Your MSADA opposed legislation (House 3348) that would cap the doc prep fee at $400 and prohibit a doc fee in certain transactions. The Joint Committee on Transportation unfortunately reported the bill out favorably, and it was sent to the House Committee on Ways and Means. We testified against the bill at the committee’s public hearing last month.

Massachusetts Information Privacy Act. Your MSADA has lobbied against these bills (Senate 227, Senate 25, and House 60) for several sessions. It is based on the current California law. The Joint Committee on Advanced Information Technology, the Internet and Cybersecurity held a public hearing on October 19, 2023, and still has the bills in committee.

Tesla Stores Exemption. House 354, filed by Rep Linsky (D-Natick), would allow a manufacturer to open a factory-owned store, without a dealer, if there is no same line-make dealer in the state. We opposed this bill. The Joint Committee on Consumer Protection placed it into a study.

We will continue to advocate on these issues, as well as on others as they may arise, and will keep you informed of developments.

Now Open: 2024 NADA/ATD Dealership Workforce Study

Now in its 13th year, the annual NADA Dealership Workforce Study is open for all NADA and ATD members to participate. We encourage you to enroll today to begin the participation process. Your participation is key to the value of the data provided exclusively to NADA and ATD members.

Participants use the data from this study to evaluate their operations with regards to employee turnover and retention, benefits offerings, pay, hiring, and training, including demographic issues facing your dealership.

This study is the only authoritative and comprehensive examination of car and truck dealership employee compensation, benefits, turnover, retention, demographics, hiring trends, hours of operation, and more. This study provides the latest workforce trends nationally and regionally as well as non-luxury vs. luxury brands. In addition, you can also see data across various sales volume ranges from low, medium, and high-volume stores.

There is no cost to participate. Once you enroll you will receive an email with instructions to complete an online benefits questionnaire and complete the payroll file. All responses and data are confidential.

You will need the NADA Member ID number for your single store or Dealer Group to enroll. If you do not have this NADA Member ID number, please contact NADA Customer Service at (800) 557-6232.

Participation is the only way for you to receive:

• Complimentary custom report comparing your dealership against aggregated data from your peers across the nation and region, right down to dealerships selling your brand in your state.

• Complimentary National & Regional Trends in Compensation, Benefits & Retention Report with analysis of workforce data across the nation and by region.

• EXCLUSIVE one year access to the DWS Database Search Tool: An online based customizable search tool with archived tenure and compensation data from all NADA Dealership Workforce Studies for over 60 positions!

Go to www.nadaworkforcestudy.com to enroll today.

New IRS Newsletter Covering EV Tax Credits Program –Subscribe Today

This month the Internal Revenue Service (IRS) issued the first edition of “e-News for Clean Vehicle Industry”, an e-mail newsletter designed to provide EV tax credit updates and tips for using the Energy Credits Online portal. The IRS created the newsletter in response to feedback received from dealers and dealer trade associations, such as your MSADA, during the NADA Show.

The first newsletter includes important reminders about best practices for submitting Time of Sale Reports and for determining Used Vehicle Eligibility. The next edition will cover buyer vs dealer/seller responsibilities regarding modified adjusted gross income (MAGI).

We encourage you to sign up to receive the newsletter. You may sign up for the newsletter at www.irs.gov/newsroom/e-news-subscriptions, scroll down to “e-News for Businesses”, and select e-News for Clean Vehicle Industry.

Mass. DOR Information Letter: Point-of-Sale Cash Reduces Sales Taxable Amount

With the advent of the implementation of the federal and state cash-on-the-hood processes, which enable eligible buyers of qualifying clean energy vehicles under the Massachusetts MOR-EV rebates and the IRS’s tax credits programs to convert those monies to a cash discount at the time of purchase, we requested guidance from the Massachusetts Department of Revenue (DOR) and the Massachusetts Division of Energy Resources (DOER), which oversees the MOR-EV program, regarding the effect of these discounts on the sales taxable price of the vehicle.

In short, state rebates or federal tax credits converted to a cash discount by an eligible buyer for the purchase of a qualifying vehicle at a registered dealership at the time of sale will reduce the sales taxable amount of the vehicle purchase.

DOER has received the following guidance from the DOR regarding rebates converted to cash discounts under the MOREV program:

• Rebates redeemed at participating dealerships at the time of purchase or lease, whether for new or used vehicles, should be treated as a cash discount/trade-in, and the amount of the rebate is to be excluded from the taxable sales price of the vehicle for purposes of calculating the sales tax due. The rules in DOR regulation “Motor Vehicles, 830 CMR 64H.25.1(5)(c)” will generally apply to these sales.

• Rebates sought by a purchaser online post-purchase may not be applied to reduce the sales price of an already purchased vehicle and any previously paid sales tax is not eligible for refund. See 830 CMR 64H.1.4(3).

• Dealers must maintain normal business records showing the date of sale, vehicle(s) purchased, selling price, and the amount of the MOR-EV rebate in a manner sufficient to determine whether the proper amount of tax has been paid. These records must be kept for the amount of time specified in the Record Retention Regulation, 830 CMR

62C.25.1, and must be produced for review by the DOR in the course of an audit of the dealer.

Further, the DOR issued an informational letter this month in response to the question whether the sales price of a motor vehicle is reduced when a taxpayer claims a New Clean Vehicle Credit pursuant to Section 30D of the Internal Revenue Code (“Code”). In its letter, the DOR stated the following:

• Massachusetts law imposes a 6.25% sales tax upon the retail sale or other transfer of a motor vehicle, trailer, or other vehicle in Massachusetts. G.L. c. 64H, § 2; 830 CMR 64H.25.1(3)(a). Generally, the sales tax is collected by the vendor from the purchaser, and the vendor then pays the sales tax to the Department of Revenue. G.L. c. 64H, §§ 2, 3.

• The Code provides a tax credit pursuant to Section 30D, known as the New Clean Vehicle Credit, for the purchase of new clean vehicles. The statute allows a customer purchasing a new clean vehicle to make a transfer election at the time of purchase. A customer making this election transfers the entirety of the allowable credit to a registered dealer in exchange for a reduced final cost from the dealer equal to the amount of the credit. A customer is not obligated to make a transfer election and may instead choose to claim the New Clean Vehicle Credit upon filing his or her income tax return.

• If a customer elects to transfer the credit to a registered dealer at the time of the sale in exchange for a reduced final cost of the vehicle, the reduction in price is treated like a cash discount and excluded from the sales price subject to tax. This reduction in price is similar to a manufacturer’s rebate that reduces the sales price at the time of the sale. See 830 CMR 64H.1.4(3).

• The reduction in price must occur at the time of the sale in order to decrease the sales price subject to tax.

• If the customer receives a reduction after the sale, the sales tax is based on the full purchase price of the vehicle.

• If the customer does not make a transfer election and instead claims the New

Clean Vehicle Credit on his or her own tax return, the sales tax is based on the full purchase price of the vehicle.

NOTE: A DOR “informational letter” is intended to provide general information such as the potential applicability of Department of Revenue public written statements or well-established principles of tax law, but it is not intended to provide authoritative guidance on the application of the tax laws to a specific set of facts. This response is not a “ruling” or “letter ruling” that is legally binding on the Department.

Gov. Healey Announces $50 Million for EV Charging Infrastructure

[The following is a press release the Massachusetts Executive Office of Energy and Environmental Affairs issued on February 7, 2024.]

The Healey-Driscoll Administration today announced an investment of $50 million in initiatives to build out electric vehicle (EV) charging infrastructure across Massachusetts. The American Rescue Plan Act (ARPA) funds will increase access to charging infrastructure for more residents, electrify the state fleet, improve operation of public charging stations, manage the impact of charging infrastructure on the electric grid, and provide charging solutions for difficult to electrify vehicle types.

“State and rideshare vehicles contribute a disproportionate amount of transportation emissions, so by investing in the electrification of these vehicles, we can have a much more cost-effective impact on emissions,” said Governor Maura Healey. “Our administration is committed to leading by example in addressing climate change, and we are pleased that these funds will also allow Massachusetts to more quickly electrify its fleet.”

“Many Massachusetts drivers want to make the switch to electric vehicles, but worry about access to charging,” said Lieutenant Governor Kim Driscoll. “This investment will break down barriers to widespread electric vehicle adoption and help Massachusetts meet its ambitious

greenhouse gas emissions targets.”

The $50 million in ARPA funds will support innovative EV technology programs at the Massachusetts Clean Energy Center (MassCEC), charging infrastructure investments for the state fleet through Division of Capital Asset Management and Maintenance (DCAMM) and the Department of Energy Resources (DOER), testing equipment and staff at the Division of Standards (DOS) to conduct inspections of public charging stations, and future analysis of EV charging needs by the Electric Vehicle Infrastructure Coordinating Council (EVICC).

“Vehicle emissions not only contribute significantly to climate change, but also impact public health, especially in environmental justice communities,” said Secretary for Energy and Environmental Affairs Rebecca Tepper. “With this funding, the Healey-Driscoll Administration is creating more equitable access to clean transportation and ensuring drivers in all communities across Massachusetts have the option to choose an electric vehicle.”

“This funding will help make a bigger impact in the lives of our residents across the state as it relates to the future of transportation,” said Transportation Secretary and CEO Monica Tibbits-Nutt. “Taking the steps to increase measures like fastcharging stations and decarbonization will position us to offer better choices to residents that will be good for the environment and for us as we all work to respond to climate change.”

“Decarbonization and addressing climate change are core priorities of DCAMM’s operations,” said DCAMM Commissioner Adam Baacke. “We are excited to be a part of this important investment in EV charging infrastructure.”

“This significant investment from the Healey-Driscoll Administration will help make the transition to electric vehicles a more accessible and affordable opportunity for the Commonwealth’s residents and business owners,” said MassCEC CEO Dr. Emily Reichert. “These ARPA funds will directly impact our work to increase curbside charging stations, expand mobile

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charging for medium- and heavy-duty vehicles, speed up the electrification of taxi and rideshare fleets, and advance emerging technology that allows EV owners to use their car to power other sources.”

The following initiatives will receive funding:

• Electric Vehicle Curbside Parking for Residents in Multi-Unit Dwellings$12.5 million: MassCEC will work to help municipalities expand access to EV charging for residents with limited access to home charging, particularly in environmental justice and urban communities. Pole-mounted and streetlight chargers represent a promising strategy to use existing assets to expand access to curbside charging, but this potential is limited by barriers such as regulatory hurdles, complex ownership structures and unclear business and financial models. The project aims to increase the number of overnight curbside charging stations, including accessible pole-mounted and streetlamp EV charging solutions. A technical consultant will deploy onstreet charging near multi-unit dwelling neighborhoods and provide guidance to municipalities for future implementation.

• Medium- and Heavy-Duty Electrification Mobile Charging Solutions$9.5 million: Medium and Heavy-Duty (MDHD) vehicles make up 3% of Massachusetts vehicles, yet produce 20% of on-road vehicle emissions, making their electrification critical to reaching the state’s climate goals and to improve air quality in environmental justice communities, especially those near warehouses and ports. One major challenge to achieving electrification in this sector is project delays due to limits in grid infrastructure. Mobile charging represents a promising technology that could help fleet operators avoid delays and resist the urge to overbuild through temporary mobile charging solutions. MassCEC will complete a market characterization study paired with deployment projects to demonstrate mobile charging financial models and use cases.

• Ride-For-Hire Vehicle Electrification

Charging Solutions - $8 million: Uber, Lyft, and taxi drivers drive a lot of miles, spend a lot of money on gasoline, and need a lot of charging. MassCEC will deploy EV charging to support the electrification of taxi and transportation network company (TNC) fleets. Electrification of this sector can help support the deployment of electric vehicles in urban areas and environmental justice communities. For example, studies in California show that while TNC drivers make up less than 3% of electric vehicle (EV) drivers, they account for over 40% of all public fast charger use. This project will fund level 2 and fast charging infrastructure projects with a focus on deploying charging resources in environmental justice communities, where a high percentage of TNC drivers reside.

• Vehicle-To-Everything (V2X) Analysis and Demonstration Projects - $8 million: The widespread deployment of bidirectional technology would allow EV owners to use their car battery as a resource to reduce home energy costs or sell electricity onto the grid. V2X systems both charge and discharge an EV’s battery, enabling EVs to act as a grid resource by sending energy stored in the onboard battery to the local utility grid or to a grid-connected asset such as a building. This would have the potential to transform our relationship with the grid, providing EV drivers with a mobile source of storage and opening up potential revenue streams to support EV adoption for low-income drivers. MassCEC will complete a market characterization analysis and demonstration projects that support vehicle-to-grid and/or vehicle-to-building projects designed to reduce peak demand and provide grid services.

• EV Charging at Priority State Facilities

- $9.5 million: DCAMM will seek to install fleet EV charging infrastructure in 60 or more high priority sites at state facilities. Each site would receive an average of 4 EV ports and 4 make-ready spots, making it easy to double the number of charging stations in the future.

• EV Charging for Other State Vehicles

- $1.5 million: DOER will provide funding to other agencies to install fleet EV charging infrastructure at approximately 60 sites, focusing on those not on the high priority list, non-executive branch fleets, and leased facilities.

• EV Charging Testing Equipment–

$604,000: DOS will purchase EV charging infrastructure testing equipment and hire staff to conduct inspections of public charging stations to ensure that they remain in working order and adhere to a common set of standards.

• EV Charging Needs Analysis-

$396,000: This funding will support the analytical needs of the EVICC through the end of 2026 to help it continue to assess the current state of EV charging infrastructure and future needs of Massachusetts as it promotes the electrification of the transportation sector.

The EVICC was authorized by “An Act Driving Clean Energy and Offshore Wind” in 2022. The Climate Law requires that the EVICC assess and report on strategies and plans necessary to deploy electric vehicle charging infrastructure to establish an equitable, interconnected, accessible and reliable electric vehicle charging network. Since convening in May, the EVICC has held 10 public meetings on state EV infrastructure strategy.

In August 2023, the EVICC submitted an Initial Assessment to the Legislature which found that approximately 10,000 publicly accessible fast charging ports will be necessary to support the light-duty vehicle fleet by 2030, in addition to 35,000 publicly accessible Level 2 stations and more than 700,000 residential and workplace charging stations.

Earlier this year, the Administration expanded the Massachusetts Offers Rebates for Electric Vehicles Program (MOR-EV Program), which provides rebates for the purchase or lease of light-, medium-, and heavy-duty battery electric and fuel cell electric vehicles (EVs). In addition to the existing $3,500 rebates for EVs, the new MOR-EV program includes the rebates at the point-of-sale with participating dealers, a $3,500 rebate for used EVs for in-

come-qualifying residents, a $1,500 rebate adder for income-qualifying residents called MOR-EV+ that is in addition to the standard rebate for new or used electric vehicles; and increased rebates for certain light-duty pickup trucks.

OSHA Injury & Illness

Electronic Reporting Deadline March 2, 2024

Dealerships required to electronically file 2023 employee workplace injury and illness records with the Occupational Safety and Health Administration (OSHA) must do so by March 2, 2024.

OSHA injury and illness reporting requirements depend on the type of dealership and number of employees working at a single “establishment” or rooftop. OSHA defines establishment as “a single location where business is conducted or where services or industrial operations are performed.” The following categories of dealerships must record and report employee workplace injury and illness:

• Commercial truck dealerships with 20 or more employees working at a single establishment must electronically submit OSHA Form 300A- Annual Summary of Work-Related Injuries and Illnesses;

• Commercial truck dealerships with 100 or more employees working at a single establishment, in addition to submitting OSHA Form 300A- Annual Summary of Work-Related Injuries and Illnesses, must electronically submit case-specific information from OSHA Form 300 Log and OSHA Form 301 Incident Report;

• Light-duty dealerships with 250 or more employees at a single establishment must electronically submit OSHA Form 300AAnnual Summary of Work-Related Injuries and Illnesses;

• Light-duty dealerships with fewer than 250 employees at a single establishment must annually record workplace injuries and illnesses but are not required to file electronically with OSHA;

• All dealerships must report worker fatalities within eight hours and worker amputations, eye losses or hospitalizations within 24 hours.

Electronic filing must be done using OSHA’s Injury Tracking Application (ITA). See OSHA’s FAQs on the ITA submission process. A North American Industry Classification System (NAICS) number is required for filing: commercial-truck dealerships are NAICS 42311; light-duty dealerships are NAICS 44111.

Go to www.osha.gov/injuryreporting/ for all pertinent information you will need to stay compliant.

2024 Dues Invoices

In December your Association sent out 2024 dues invoices to all our dealership and associate members. Our members’ dues help fund the Association’s activities on their behalf, including our lobbying on Beacon Hill and in Washington, our member counsel services, and our education and training activities.

Over the last several years we have witnessed quite a bit of economic disruption in our industry, including governmental over-regulation. More than ever, our dealers need a strong MSADA. MSADA will continue to lead on the various issues that threaten the viability of our dealerships. We will strive continuously to keep you informed of developments in our industry and how they will play out in Massachusetts. These efforts also include working closely with NADA to better serve our members.

Our strength lies in our members. With your continued support and membership renewal, we can build on our current foundation and begin to enhance your Association’s core purposes of communication, advocacy, and education.

New Endorsements for Vendor Services

Your Association has engaged several vendors for newly agreed upon endorsed services:

• Merchant Advocate works with retailers to analyze the credit card fees those businesses are charged and assessed in processing transactions. The savings can be considerable, as Merchant Advocate uncovers duplicate or unsubstantiated fees

from the credit card companies. Over the last several years, they have saved retailers across the country over $380 million.

• Plug In America, through its PlugStar program, works with dealerships to train personnel, including salespersons, to be able to best address your customers’ needs and questions regarding electric vehicles. They presently work with dealerships in over 30 states to assist dealerships in the transition to EV sales and servicing.

• ComplyAuto works with dealers’ compliance efforts on privacy and cybersecurity platforms, FTC Safeguards Rule, advertising, AI-powered sales, workplace safety and OSHA-related rules, and HR policies and employee training.

• Sprague Energy works with businesses to analyze their electric and gas charges in an attempt to provide them with reduced charges for such services. Sprague works with a number of Massachusetts dealerships currently in those efforts.

Check out the ads for each of these companies in this month’s Auto Dealer magazine.

Our PACs - NADAPAC & NCDPAC

We appreciate the contributions we receive from our member dealers who answer our calls for donations to our PACs.

Each year MSADA expresses itself politically through NADA’s federal PAC, NADAPAC, and through our state PAC, the New Car Dealers Political Action Committee (NCDPAC).

We depend on contributions from our dealers to keep these PACs strong, as we need to have an active voice in Washington and on Beacon Hill. Contributions to our PACs are an inexpensive insurance policy. Since by law we cannot use our membership dues or other association revenues for political contributions, the PACs help us to remain strong politically as we advocate for our dealers’ interests in the political process.

If you have not yet given to the PACs this year, please contact me at rokoniewski@msada.org and we can make sure your contributions happen. Thank you. t

NADA Starts Off 2024 with

Show Hits the Jackpot on All Accounts

Now in its 108th year of serving franchised dealers, NADA used its annual convention earlier this month in Las Vegas to celebrate the greatest capitalist market in the world and all that it has to offer.

NADA Show 2024 brought together over 20,000 attendees from across the globe –U.S. and international dealers and their key staff, state and metro dealer association leadership, vendors, media, and other key members of our industry – in one of the most “over-the-top” cities in the world, that truly does not sleep.

Over the course of four days, attendees had access to 500-plus

exhibitors, more than 100 workshops and education sessions, dealer franchise meetings, and an impressive list of keynote speakers. With over 3.2 million square feet of state-of-the-art exhibit space, the Las Vegas Convention Center was once again the homebase of NADA Show 2024, taking place Thursday, February 1, through Sunday, February 4. In addition, the truck dealers’ ATD Show 2024 programming took place concurrently at Wynn Las Vegas through February 3.

with a Bang!

NADA leadership kicked off its annual convention on Thursday with its all-day Women Driving Auto Retail event at the Wynn Las Vegas. It featured structured and informal networking, inspiring speakers, and expanded educational sessions. More than 500 attendees heard from renowned speaker and social psychologist Dr. Amy Cuddy and Shelley Zalis, founder and CEO of The Female Quotient. After lunch and networking, attendees headed to the convention center to attend WDAR-focused workshops and

the Super Session, “Unleashing the Combined Power of AI and Human Capital Featuring Female Leaders.” The day’s programming concluded with a special WDAR happy hour. WDAR’s expanded programming was made possible by sponsors Ally, CarGurus/CarOffer, Epsilon Automotive, Group 1 Automotive, RouteOne, and Solera.

Also on Thursday, NADA commenced its vast educational and workshop opportunities for attendees. With more than 100 workshops and education sessions, mini sessions in the Dealer Learning Lab and the EV Solutions Center on the Expo floor, two Super Sessions, and the ever-popular Distinguished Speaker Series, NADA Show attendees had access to every trend, issue, and update affecting dealerships today. These events alone are worth the price of admission.

food and top-shelf beverages while interacting with one-of-a-kind technology created specifically for the Sphere, including AI robots and the world’s largest hologram. The multi-sensory cinematic experience continued with a showing of Academy Award-nominated director, Darren Aronofsky’s “Postcard from Earth” in the venue’s main bowl.

Thursday evening, NADA held its welcome reception at the latest eye-popping venue on the Vegas Strip – The Sphere. At “A Night Under the Sphere”, attendees enjoyed delicious gourmet

On Friday, NADA leadership, including Show 2024 Committee Chairman Bobby Sight from Missouri, conducted the ceremonial unbuckling of the seatbelt outside the Convention Center’s Expo Hall.

“Being honored as representing all Massachusetts dealers, I thank all the dealers in our state for that privilege. I also owe a special thank you to Robert Boch for submitting my name to MSADA for consideration and a very special thank you to Bob O’Koniewski for all the assistance helping me through the whole process. It would have been difficult without him, I share this award with my wife of fifty-seven years, Janet. It never could have happened without her. We truly have been fortunate to have lived the American Dream.”

Day Two’s theme was “motivation,” and renowned hospitality industry expert and “Bar Rescue” producer Jon Taffer opened the Main Stage with an exciting session designed to ignite the fire within while sharing some of his best practices and experiences. “I don’t want to change what you do; I want to change what you think today,” Taffer said.

2023 NADA Chairman Geoffrey Pohanka reflected on his year at the helm, which included an important policy speech at the New York Automotive Forum last April and going to China to attend an event with the China Automobile Dealer Association in November. Pohanka called on auto dealers and NADA to continue efforts to preserve affordable vehicle transportation. “In a very real way, by supporting the freedom of mobility, America’s car dealers support freedom itself,” he said.

The day included a surprise visit from U.S. Energy Secretary Jennifer Granholm during the Live Stage programming.

The convention seeks to build to a crescendo during Day Three’s events on Saturday. Nothing beats the buzz in the convention center than the annual TIME Dealer of the Year ceremony jointly sponsored by Ally. For 13 years, TIME has partnered with NADA and Ally to honor America’s best and brightest car dealers for their tireless efforts to improve their communities and the world around them.

Readers may recall that our very own Gary Rome of Gary Rome

Hyundai in Holyoke won the prestigious national award last year in Dallas. Unfortunately, Gary was unable to attend this year’s event due to a personal family matter, but he did provide a pre-recorded video extolling the highs he experienced during the previous 12 months as the national winner and congratulated all of the nominees for being so honored by their state and metro associations this year. Massachusetts was once again well represented among the 49 nominees by Tom Murphy of Falmouth Toyota in Bourne. And when Tom was named one of the five finalists, there was a murmur amongst Team Massachusetts that maybe lightning would strike twice again. Alas, Rita Case of Rick Case Automotive Group in Florida, a fine nominee in her own right, was named the national 2024 TIME Dealer of the Year, the fifth woman so recognized. Congratulations go out to Tom for this recognition.

Charlie Gilchrist of Washington State was introduced as NADA’s new chairman for 2024. Readers may recall that Gilchrist spoke at our 2023 annual meeting last October. In Vegas, Gilchrist noted in his first speech as chairman, that passion and intention can build a stronger NADA and dealership community. “Here’s what I need from you: I need you to be passionate about the defense of the entire franchise system, and I need you to be intentional every single day to do the things that unite us…protecting the franchise system and the customers we serve,” he said from the Main Stage.

Racing legend and entrepreneur Danica Patrick closed out Saturday’s Main Stage programming and shared her life lessons on and off the track, including her philanthropic efforts, which she said were “rooted in inspiration…authenticity, accountability and fun.” Patrick actively supports many charitable causes and has her own foundation, which focuses on empowering young girls and women.

On Saturday evening, MSADA co-hosted with our accounting partner Withum (formerly O’Connor & Drew) our annual party honoring our TIME Dealer of the Year – Tom Murphy. We had a great crowd of around 200 folks, including four previous TDOY nominees – Joe Shaker (2022), Ernie Boch, Jr. (2007), Marshall Jespersen (2006), and Jeb Balise (2001), current MSADA president. A great time was had by all.

Finally, Day Four of the convention on Sunday is a time for attendees to wind down and get ready to return home with newly learned insights and tools to improve dealership operations. The morning’s inspirational session featured Pro Football Hall of Fame quarterback and philanthropist Kurt Warner on the Main Stage. Warner shared his uplifting life story and how all the obstacles he has faced throughout his professional and personal lives have led him ultimately to unimaginable success and happiness both on and off the field.

“Keep on believing in who you are, and what you’re doing. Push through, take your own journey but always believe in what you can do,” said the father of seven, who went from a college football star to a grocery store stock boy before ultimately becoming a two-time NFL MVP and Super Bowl XXXIV champion. “No matter where you are at, you can find yourself where you want to be.”

The NADA Show educational programming continued all the way up to the end of the last day with workshops and Exchanges, the Dealer Learning Lab and the EV Solutions Center on the Expo floor, Dealer Franchise meetings, and Live Stage sessions.

At the end of the day, Chairman Gilchrist sat down with NADA Senior Vice President of Public Affairs Jonathan Collegio to outline NADA’s priorities for 2024. The two biggest policy priorities, Gilchrist said, will be continuing to push back on the FTC vehicle shopping rule and the EPA’s proposed new emissions standards that would effectively require 67.5% of U.S. vehicle sales to be electric by 2032. Gilchrist also talked about the importance of dealers being engaged with their state automobile associations.

“If we, as dealers, unify on the same message and understand it… we’ll have a better chance of coming together and knocking out… some, but not all” of these government regulations, he said. “We’re better in unity. Strength is better in numbers.”

New ATD Chairman Scott Pearson and ATD President Laura Perrota stepped up to the Live Stage on Sunday to give an outlook on what’s ahead for ATD this year. Some upcoming priorities include battling emission regulations like the EPA’s new nitrous oxide rule and phasethree greenhouse gas rule, opposing the socalled “Right to Repair” rule, and supporting legislation that will benefit America’s truck

dealers, such as bills to repeal the Federal Excise Tax on trucks and legislation to fight rising catalytic converter thefts.

With the completion of Day Four, it was time to cede the limelight to an event nothing can top although many try – the circus of Super Bowl LVIII was coming to town for the following Sunday at Las Vegas’ Allegiant Stadium.

NADA Show 2025 will be in New Orleans January 23-26, 2025 (Thursday-Sunday). It is never too early to circle the dates on your calendar and plan accordingly. If you have not been, there is plenty offered up that can help your dealership in all areas of operation. The learning, networking, and camaraderie cannot be beat. t

(Material for this article provided courtesy of NADA.)

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Hyundai Hope on Wheels

Continues Community Giving in 2024

On January 25, at Gary Rome Hyundai, Hyundai Hope on Wheels donated $10,000 to LukeStronger, Inc. of South Hadley and $10,000 to Each Moment We’re Alive of West Springfield. Then on February 26, at the Westfield Police Department Headquarters, Hyundai Hope on Wheels donated $109,000 to Cops for Kids with Cancer to support their team for the Boston Marathon.

Gary Rome is the Eastern Region board member of Hyundai Hope on Wheels and is honored to represent the organization with presenting the grant funds. “At Gary Rome Hyundai, we believe in leading by example and pride ourselves on doing the next right thing. As a Hyundai Hope on Wheels board member for the Eastern Region, I am committed to making a positive impact by supporting local organizations in their fight against childhood cancer,” said Gary Rome. “We are dedicated to striking out cancer and providing hope to those affected by it.”

Hyundai Hope On Wheels®, a 501(c)(3) nonprofit organization supported by Hyundai Motor America and its more than 820 U.S. dealers, celebrates its 25th anniversary in its long-standing fight against childhood cancer. Launched in 1998, the organization is one of the longest-running corporate social responsibility efforts in the automotive industry. In honor of this milestone, Hyundai Hope On Wheels will award $25 million in research grants this year, its largest donation in a single year, bringing its total giving to $225 million since its inception.

Each Moment We’re Alive was launched by Sheridan Murphy in 2015 after her second bout with breast cancer. She then realized that reaching out, rather than blocking out, was the best chance for survival. Since then, she has helped organize support groups and workshops with a focus on emotional and spiritual health. Sheridan has since expanded her network to help families with all types of cancer, including pediatric cancer.

LukeStronger, Inc. is a local nonprofit 501(c)(3) providing assistance to local families dealing with pediatric cancer so that parents can spend time with their children. LukeStronger originated when Luke Bradley, a then 10-year-old boy from South Hadley, relapsed with acute lymphoblastic leukemia. Local residents rallied to support his family with, among other things, a benefit golf tournament. Complications and another unforeseen relapse kept Luke at Boston Children’s Hospital for 15 months. In December 2017, he underwent a bone marrow transplant and we are pleased

to report that he is doing well!

Knowing firsthand the financial struggle, Luke’s family created a nonprofit to help other families by continuing the golf tournament tradition. Together with friends, in its short history, LukeStronger has helped seven local families fill in the income gap caused by pediatric cancer. All profits go to the family in need. LukeStronger does not expect repayment.

Cops for Kids with Cancer is a 501(c)(3) charitable organization focused on raising funds to provide assistance to families of children fighting cancer, to improve their quality of life since 2002. They have a 20-plus person Board of Directors, comprised of active and retired police officers, and friends of law enforcement. All are volunteers, receiving no salaries. The funds that they raise go to people directly involved in the care of children with cancer, with each family typically receiving $5,000. There are many organizations raising money for important research, but their goal is to help the children and their caregivers through this most difficult crisis.

In recent years, including the hospital donations, they have given to over 762 families in need, totaling more than $4,100,000 in and around New England. Their Boston Marathon team is one of their largest fundraisers.

BOSTON

Annual oEM Awards

The annual OEM awards for 2023 performance have begun.

Mercedes-Benz Financial Services congratulates the following Massachusetts dealerships as 2023 Valued Partner Award recipients:

• Mercedes-Benz of Hanover

• Mercedes-Benz of Springfield

• Mercedes-Benz of Westwood

Acura congratulates its 2023 Precision Team Award winners for performance-based excellence throughout their operations:

• Acura of Peabody, 15-year recipient

LAS VEGAS

Auto dealers donate $50,000 to Junior Achievement Financial Literacy Program

In conjunction with the annual National Automotive Dealers Association Show returning to Las Vegas this year, NADA kicked off a three-year sponsorship with the Junior Achievement of Southern Nevada with a $50,000 donation to the construction of the association’s new Finance Park.

Junior Achievement provides young people the knowledge and skills they need to overcome economic inequity. In the Junior

NEWS from Around the h orn

Achievement of Southern Nevada’s new Finance Park, students will experience an authentic simulation of financial decision-making. Guided by their assigned life situation, students apply knowledge gained in the classroom to make budget decisions and build skills to confidently navigate today’s economic environment.

NADA is the exclusive sponsor of the transportation storefront in Finance Park, where students will learn about the financial decisions and budgeting needed for personal mobility.

“Supporting Junior Achievement of Southern Nevada’s Finance Park was the perfect fit for us,” said Mike Stanton, NADA President and CEO. “Las Vegas is a home away from home for NADA, as we return every other year for our annual Show, and both NADA and our members share Junior Achievement’s mission to prepare the next generation for important financial decisions – like purchasing and maintaining a vehicle.”

The Finance Park is anticipated to open in late spring 2024 and will grow to host 20,000 students each year, which is nearly 85% of the region’s ninth and tenth grade students.

“Decisions around personal transportation play a major role in budgets, work and family, and it is important for young people to learn about how to make thoughtful financial choices,” said Michelle Jackson, Junior Achievement of Southern Nevada president and CEO. “NADA is helping provide all students, no matter their background, the opportunity to develop the skills and motivation to thrive.”

Past NADA Show donations include:

• 2023 (Dallas): NADA donated two undercover vehicles to the to the Dallas Police Department, valued at $50,000;

• 2022 (Las Vegas): NADA donated $25,000 to Three Square Food Bank;

• 2021: NADA donated $25,000 to the Second Harvest Food Bank in New Orleans;

• 2020 (Las Vegas): NADA donated $50,000 to the Nellis Support Team, a nonprofit organization that supports airmen and their families at Nellis Air Force Base, Creech Air Force Base, and Nevada Test and Training Range;

• 2019 (San Francisco): NADA donated $50,000 to the San Francisco-Marin Food Bank to support the purchase of a new refrigerated truck.

MCLEAN, VIRGINIA

NAdA Academy Graduates in 2024

The following Massachusetts dealership employees graduated NADA Academy in January and February this year:

• Rosa Ridley, Lexus of Northborough;

• Matthew Sherman, Silko Volkswagen of Brockton; and

• Mike Tarasuik, Albrecht Buick GMC of Wakefield. Congratulations and good luck with your endeavors in our industry.

DEARBORN, MICHIGAN

How Toby Keith Helped Ford Stay Afloat During 2008 Financial Crisis

The late country music singer agreed to continue his long-running partnership with Ford for a fraction of the pay when it needed to cut costs.

During the Great Recession in 2008, Ford Motor Co. was canceling many of its sponsorships and promotional deals to help avoid going bankrupt. But when the automaker told country music singer Toby Keith it might need to cancel his multimillion-dollar contract, he offered to keep pitching Ford trucks for a fraction of the pay instead.

times. We can square up when the company is healthy again.”

Keith, who picked up an affinity for Ford from his father, started working with the company in 2002, when he used its bright yellow F-350 Tonka concept in the music video for “Who’s Your Daddy?” He helped Ford launch about a half-dozen trucks over the next 15 years, including a redesigned F-150 at the 2008 Detroit auto show with Mark Fields, who was the company’s president of the Americas at the time.

“We were looking for every dollar,” Ford spokesperson Mark Truby said after Keith died of stomach cancer earlier this month. “His attitude was: This is a partnership through good and bad

Investors Flee Tumbling EV Upstarts once Hailed as ‘Next Tesla’

(BloomBerg News)

There was a time when the backing of some of the world’s deepest pockets and the mere ambition to sell electric cars was enough to inspire confidence in the stocks of upstarts Rivian Automotive Inc. and Lucid Group Inc. Now investors have all but thrown in the towel on the shares.

All it took was a fresh dose of reality from the two companies this month around cooling demand for EVs. Rivian, which makes electric pickups, SUVs, and delivery vans and counts Amazon.com Inc. as its top shareholder, said its production will stay flat at last year’s levels. It also announced plans to shrink its workforce again. Lucid, majority-owned by Saudi Arabia’s sovereign wealth fund, projected only a slight increase in output over 2023. Both forecasts fell far short of analysts’ expectations.

For investors, the sense of gloom has been building since October, when Tesla Inc. warned of sagging interest in EVs. Though shares of the EV giant have fared poorly since then, losing around 20% and massively underperforming the broader market, the impact on smaller rivals like Rivian and Lucid has been nothing short of disastrous.

“If you are a hyper-growth company in what is seen as a disruptive industry and you are not growing your topline, you are in trouble,” said David Mazza, chief strategy officer at Roundhill Investments. “Having an anchor investor like Amazon or the Saudis gives them a

“He was never big on dress rehearsals but always brought his A game,” Truby said in an email. “Sometimes we called him with short notice to do an event or TV spot, and he would often drop everything to make it happen.”

Keith’s death February 5 at age 62 came more than two years after he received his cancer diagnosis. Truby said the news prompted members of Ford’s truck team, people at its ad agency and even CEO Jim Farley to call and text one another with memories of working with Keith during their lengthy partnership.

longer runway from a capital perspective, but their growth will still be slower and margins thinner than what was once expected.”

Shares of Irvine, California-based Rivian are down by about 44% since Tesla’s October warning — the first in a series of grim outlooks from global EV-makers and suppliers. Newark, California-based Lucid has dropped some 33% in the same period.

Still, had it not been for their wealthy backers — Amazon has a 17% stake in Rivian, and Saudi Arabia’s Public Investment Fund holds roughly 60% of Lucid, data compiled by Bloomberg show — the stocks could be looking far uglier.

“The presence of these names is a comfort to investors and a cushion to the price,” Mazza said. “If these stocks were just relying on the EV hype, then they will be down much worse.”

Amazon in an emailed statement said that the recent results from Rivian don’t change anything about the e-commerce company’s “existing investment, collaboration, or order size and timing.” Rivian has a deal with Amazon to sell it 100,000 electric delivery vans by 2030.

Overall, the biggest concern is that these cash-burning, unprofitable companies will struggle to sell cars at a time when even industry-leader Tesla — by far the biggest seller in the US market — is cutting prices to boost demand. And while Tesla’s profits and largescale production allow it to compete by lowering prices, Rivian and Lucid have neither of those advantages.

Both Rivian and Lucid are now worth a fraction of the prices they fetched at their public-market debuts in 2021. Rivian’s market value is around $9.6 billion, and Lucid’s is about $6.9 billion. That’s a long way down from their $153 billion and $91 billion valuation peaks, respectively, in 2021.

Buying and Selling a Dealership

By Barton haag

CPA, Albin Randall & Bennett bhaag@arbcpa.com

Although the buy/sell market is starting to show signs of slowing, many dealers are still flush with cash accumulated over the past several years and are still looking to grow by adding additional franchises. Dealer groups, both large and small, are generally in a strong cash position, which can lead to considerable purchase opportunities.

What are some key considerations when a buyer targets a dealership for purchase?

Facilities: Whether or not a dealership’s facilities are factory compliant influences both the attractiveness and the value of the franchise. If a dealership is not factory compliant, then a normalizing adjustment should be made to the earnings. This will reduce the historical earnings of the dealership against which a multiple or return on investment is applied, reducing the goodwill the buyer is willing to pay.

Goodwill/“Blue Sky”: Obvious factors affecting a dealership’s intangible value (goodwill/“blue sky”) are location, market size, competition, and the type of franchises you already own, in addition to understanding the intrinsic value of the specific target franchise. Large discrepancies in valuation multiples exist among different franchises. Whether you are considering a luxury, import, or domestic franchise, each will have a significant range of multiples when considering franchise value. It is also important to understand the current dealership’s reputation within its local market. Service absorption is another important component of a dealer’s profitability, so pay particular attention to an analysis of a dealer’s fixed operations and units

in operation. An under-performing dealer may have more upside and may be worth more to a purchaser than an over-performing dealership in the same market. An add-point may also be worth more to an acquiring dealer than one that is entering a new market.

Inventory Valuation: How to define the value of the inventory you are buying is included in the letter of intent and the buy/sell agreement. New vehicle inventory is purchased at a price net of factory incentives already received by the selling dealer. The purchase price generally does not include holdback, floorplan, or advertising assistance. The seller generally has already collected or will collect these factory incentives, so the buyer would not pay for them again. It is important to understand what factory incentives a manufacturer has and what should be excluded from the purchase price. Used vehicle inventory is usually purchased at a negotiated price adjusted for any modifications made to the vehicle by the selling dealer. The value paid for OEM parts inventory is usually an amount for returnable undamaged parts. The buyer and seller generally negotiate the price paid for non-OEM parts.

Appraisal of Assets: Aside from goodwill and inventory, what other business assets are you acquiring? It is important to take an inventory and value all fixed assets. As a buyer, you should not buy assets at the value on the factory financial statement. Often times the value presented here is due to a previous purchase price allocation. Who knows if the value is accurate and representative of what you are receiving. Sellers should take note of their previous capitalization policies. Did you expense certain items? How did you account for special tools? You should ask these questions prior to putting a value on these assets. While considering the assets you are selling, you should also consider various contracts you want a potential buyer to inherit. Accumulate these contracts and make sure they can be assigned

to another company.

Quality of Management: An often-overlooked aspect of many deals is the importance of assessing a dealership’s existing workforce. If the buyer is a local dealer group, they are more likely to have existing management team personnel and/ or employees they can transfer to the new dealership. However, if the buyer is an outside dealer group expanding into a new market, they are likely to be more reliant on the target dealership’s current employee base, especially its management team. Most buyers believe they can improve on the profitability of the prior dealer. If that is the case, then look carefully at what the current management team is doing or not doing. Are they the cause of poor performance, or are there other factors?

Earnings Capacity: Normalize the target dealership’s earnings by increasing or reducing expenses you expect will not apply to your new company. For example, if rent is not fair market rent, then add-back or subtract an amount that will normalize rent to fair market. If the current dealer employs family members that will not be needed at their current salary, then add-back or subtract an amount that will normalize their salary. If the current dealer packs his or her extended service contracts and pays that money to a management company, add that pack back to net income to determine normalized net income. This type of analysis will help you determine what you think you can do with this opportunity. An underperforming dealer in a high-traffic market may present more of an upside than the same type of dealer in a lower-traffic market.

It is important to work with qualified professionals when analyzing an opportunity. They should assist you with formulating a reasonable projection of earnings when targeting a dealership to acquire. Once you understand your opportunity, you can start putting together your offer.

Please let anyone on our dealership services team know how we can help.

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Maximize Your 2024 Returns ACC ountin

By Ben Deforest CPA, Partner at withum

any cash flow impact at the dealership is negligible. Registering for the advanced payment option will keep your dealership competitive, as many dealers plan to participate in the program.

Qualified Alternative Fuel Vehicle Refueling Property Credit

With so much going on in the dealership world, it is easy for items like filing deadlines and tax credits to fall by the wayside. Keeping these items at the forefront is imperative. They can potentially result in heavy penalties for missed deadlines or lost opportunities for dealers to save money.

As we are still early in the new year, it is the right time for a refresher on several key tax and filing requirements happening in 2024. Here are four that you want to keep in mind:

2024 IRS Energy Credit Online Portal

Beginning January 1, 2024, individuals purchasing a new or used electric vehicle (EV) can transfer the related federal income tax credit, up to $7,500 for a new vehicle or $4,000 for a used vehicle, to the dealership at the point of sale and immediately receive the benefit of that tax credit as part of the deal. Previously, customers purchasing an EV could only apply for the credit on their individual federal income tax return, forcing them to wait up to a year or longer after purchasing the vehicle to realize the tax credit benefit. While claiming the credit on their own tax return is still an option for customers, it is not nearly as beneficial as the new advance payment option.

The IRS requires dealerships to register with their online portal for the advanced payment option and for customers claiming their tax credit. Once registered and approved online, a dealership is reimbursed for any advance payments requested within 72 hours. This quick turnaround ensures

The Inflation Reduction Act of 2022 (IRA) re-established the Alternative Fuel Vehicle Refueling Property Credit under Section 30C of the Internal Revenue Code (IRC) and extended the life of the credit through December 31, 2032. Businesses were eligible for the revamped credit beginning January 1, 2023. The IRA also amended the tax credit limit up to $100,000 per EV charger for installation projects completed after December 31, 2022. The revised credit is now capped at 6% for depreciable property unless certain prevailing wage and apprenticeship requirements are met during the property’s installation. The credit can increase to 30%. To qualify for the credit, the qualifying property must also be installed in a population census tract in a low-income community or non-urban area.

Dealerships also should check with their local electric company, as many offer financial assistance packages for installation as well.

Corporate Transparency Act

The Corporate Transparency Act (CTA) requires certain “reporting companies” to provide information to the Financial Crimes Enforcement Network (FinCEN). The law went into effect as of January 1, 2024, although companies that already existed as of January 1, 2024, have until January 1, 2025, to file their first report. FinCEN projects that this filing requirement will affect over 32 million businesses in the first year. The law was enacted to help prevent lawbreakers from engaging in corruption, money laundering, fraud, drug trafficking, tax evasion, and other criminal activities via anonymous shell companies.

A “reporting company” is defined as a

corporation, LLC, or other entity created by filing a document with a secretary of state or any similar office under the law of a State or Indian tribe. Each reporting company must provide beneficial ownership information, including the name, date of birth, residential address, and driver’s license or passport number (including copies of these documents) of their beneficial owners. Beneficial owners include those who exercise substantial control over the reporting company or those who own or control at least 25% of the reporting company’s ownership interest.

There are 23 exemptions from this law, including large operating companies that employ more than 20 full-time employees in the United States, have an operating presence at a physical office within the United States, and have filed a Federal income tax or information return in the United States for the previous year demonstrating more than $5,000,000 in gross receipts or sales. For auto dealerships, the operating company of the dealership may be exempt from reporting. Still, realty companies or other related LLCs will likely be subject to the reporting requirements of the CTA. Not complying with the CTA could result in daily fines of $500 up to a $10,000 maximum and potential jail time.

8300 Electronic Filings

Form 8300, Report of Cash Payments

Over $10,000 Received in a Trade or Business, is another tool used by FinCEN to deter those who are engaged in nefarious financial activities. As of January 1, 2024, certain businesses that receive payments over $10,000 in cash must electronically file their Form 8300s rather than file it on paper. With Form 8300 filing commonplace at auto dealerships, ensuring your dealership is filing correctly is crucial.

Participating and abiding by these new regulations is critical to remain in good standing with the government while thriving in the competitive business environment that 2024 will surely bring.

FTC Safeguards: Designating a Qualified Individual

By Nick Reed

iT Security Analyst, OCD Tech

The Federal Trade Commission’s (FTC) Safeguards require dealerships to appoint a Qualified Individual (QI) whose duties include overseeing your dealership’s information security and protecting the organization by instituting the Safeguards’ requirements as written. The QI is tasked with the protection of customer information in-line with the Safeguards as well as management of the overall security program. Typical QI duties often include the development and management of risk assessments, security policies, incident response capabilities, and system monitoring. Thus, the QI can be considered roughly analogous to a Chief Information Security Officer (CISO) at other organizations.

At a minimum, the QI should be knowledgeable about the Safeguards, IT security, and a dealership’s security practices. While specific certifications are not mandatory for the position, industry recognized certifications that verify security knowledge (e.g., CISA, CISSP, Security+, and CASP+) are certainly advantageous for a QI to possess. Oversight of the information security program will entail the analysis of regulations to determine the mitigating controls to be established and will often require auditing expertise. QIs must possess strong motivation and resilience as they face the challenging task of persuading dealerships and their employees to embrace best practice security measures.

Unfortunately, these measures and the engagement of security personnel are frequently met with resistance. Although the guidance and criteria for QI selection from the FTC are sparse, it is risky to exploit the flexible nature of the requirement. Considering that security leadership sets the tone for the entire program, only an exceptional individual should be entrusted with this role.

If selecting an internal candidate to fulfill this role seems like a daunting task, it is worthy to note that the QI can be a third-party service provider or an affiliate of the dealer. For dealerships without qualified personnel, this option can deliver immense value and remove some of the burden if the security program is handled in-house. In addition to the functions listed previously, the QI often also has a hand in organizing security awareness training, overseeing vulnerability management, and implementing technical security controls. Trained security professionals with audit experience can provide quality management of the security program and expert insight.

For dealerships that choose to utilize an external QI, a senior member of your staff must be designated to oversee them. This ensures that the QI is always acting under supervision and in alignment with the dealership’s interests. Without direct guidance from the FTC on what oversight by senior staff looks like, it is recommended to hold at least quarterly check-ins with a third party or affiliate QI to discuss projects, compliance objectives, and the overall status of the dealership’s information security program.

Before selecting a QI, organizations should be aware that the QI holds additional responsibilities under other Safeguards requirements. The QI’s role extends beyond mere oversight; QIs hold the authority to formally approve alternative compensating controls in writing. These controls must be reasonably equivalent or even more stringent than the imposed requirement. This ensures compliance with the Safeguards in situations where exact adherence is not feasible for any given reason. Failure to meticulously select and implement sufficient compensating measures to mitigate control risks may lead not only to noncompliance but also to breaches of customer information.

QIs are also assigned the duty of report-

ing (in-writing and at least annually) to the organization’s governing body the status of the dealership’s information security program. The report is its own stand-alone requirement, which likely necessitates its own article. It should be apparent that the effects of an inadequately placed QI can lead to widespread failures in other FTC Safeguards requirements. So, when a QI is selected by an organization, what is truly being determined, is the quality of the information security program, risk mitigation efficiency, and how effective reporting to key stakeholders will be.

The phrase “qualified individual” often instills fear, as there is a misconception that those selected for this role bear responsibility for any wrongdoing or legal repercussions resulting from a dealership’s noncompliance. However, it is important to remember that the QI is not personally liable for breaches of regulatory safeguard requirements. This is why selecting a capable QI is so vitally important; ultimately, the dealership will assume full responsibility for their QI’s actions and inactions.

Equipped with the appropriate criteria for candidate selection and a clear understanding of the QI’s responsibilities, dealerships can make informed decisions in selecting the right individual for the role. It is no coincidence that the designation of a QI holds the top spot in the Safeguards regulation, highlighting its paramount importance.

The QI serves as the cornerstone of the program, capable of either solidifying or undermining compliance efforts. With the right QI, compliance becomes more than just a routine task; it transforms into an ongoing initiative to enhance security and elevate organizational effectiveness. Beyond compliance, at the end of the day, this individual is who you are entrusting with the protection of your assets, from the ever-evolving cybersecurity threat landscape.

What Dealers Need to Know About the Corporate Transparency Act

By Tom Vangel & James Radke Partners at Murtha Cullina LLP, (617) 457-4072

The Corporate Transparency Act (CTA), signed into law on January 1, 2021, took effect January 1, 2024. The CTA is designed to combat money laundering and other financial crime by requiring a broad range of entities to disclose information about their owners and persons who exercise control to the Financial Crimes Enforcement Network (“FinCEN”), a bureau of the US Treasury.

The CTA’s goal is to address illicit activities, like money laundering and tax evasion, by gathering additional information about the ownership of specific entities operating in or engaging with the U.S. market.

Impact of the CTA on Dealers: The CTA establishes tight reporting deadlines on new entities formed after January 1, 2024, and creates new reporting obligations for a wide range of entities formed in the United States, even those formed before January 1, 2024. The CTA forces organizations to disclose information to the US Treasury about their owners and persons who exercise control.

Who Must File? The CTA requires the following business entities (either domestic or foreign) to file a report with FinCEN (unless an exemption applies):

• Limited liability companies (LLCs)

• Corporations

• Limited Liability Partnerships

• Other entities created by the filing of a document with a Secretary of State or similar office.

Each of these entities is referred to as a “reporting entity.” The CTA is a large net

that catches many small family businesses, including LLCs and other entities designed to hold solely real estate, including single-member LLCs disregarded for tax reporting purposes. The law will require reporting from these entities.

Exemptions From Being Considered a “Reporting Entity”: There are 23 exemptions, some of which include public companies; companies in regulated industries, such as financial services, insurance, and certain investment companies; tax exempt entities; and larger companies (with a U.S. physical location, more than 20 employees, and over $5 million on gross sales).

What Information Must Be Reported?

All reporting entities must submit information to FinCEN about the entity and its beneficial owners. A beneficial owner is an individual who exercises substantial control over the company or who owns or has control over at least 25% of its ownership interests. Beneficial owners can include trusts in addition to individuals. There is no set maximum limit on the number of beneficial owners.

Beneficial owners must report their name, date of birth, address, and unique identifier number from a recognized issuing jurisdiction (such as a driver’s license or passport) and a photo of that document. If an individual decides to file their information to FinCEN directly, they may be issued a “FinCEN identifier” which can be provided on a FinCEN report instead of the required information.

Additionally, a reporting entity created on or after January 1, 2024, must provide personal details about the “company applicant.” This refers to the individual who files the document to create a domestic entity or register a foreign entity. If there is an individual mainly responsible for overseeing or controlling that filing, that individual must provide personal details.

When Are Reports Required? A reporting entity created or registered on or after January 1, 2024, and before January 1,

2025, has 90 calendar days after receiving notice of the entity’s creation or registration to file its initial FinCEN report. This 90day deadline starts when the entity receives actual notice that its creation or registration is effective, or after a secretary of state first provides public notice of its creation or registration, whichever is earlier.

Reporting entities created or registered on or after January 1, 2025, have 30 calendar days from actual or public notice that the entity’s creation or registration is effective to file their initial FinCEN reports.

Existing entities (created or registered before January 1, 2024) have until January 1, 2025, to file their FinCEN report.

Updates to FinCEN Reports: Reporting entities must file an updated report within 30 days whenever there is a change in (1) its basic information, (2) beneficial owners, or (3) status as a reporting entity.

Consequences for Non-Compliance: Any person providing false information or failing to comply with reporting requirements is liable for civil penalties of up to $500 for each day the violation continues. Violators are also subject to criminal penalties of imprisonment of up to two years and fines of up to $10,000.

Conclusion

For many new car dealerships in Massachusetts, the operating entity will likely fall within the CTA’s exemption for larger businesses. However, the exemption likely would not apply in most cases to separate entities established to hold title to the dealership real estate or leasing activities (or non-dealership ventures such as rental property or other family businesses), as the revenue and employee thresholds are unlikely to be met. We encourage dealers to determine if they and their related entities meet the definition of a reporting entity and, if so, determine the next steps to comply with the CTA.

How to “Spring Clean” Your Employment Practices

By Jeff Fritz, Esq., and Joshua Nadreau, Esq., Fisher Phillips LLP

As you know, Punxsutawney Phil saw no shadow this year, which means (to a scientific certainty) Spring is just around the corner. No better time than now to review your employment practices and do some Spring cleaning. Here are ten things to think about.

1. Update Your Company Handbook

Yes, it might be painful to delve into your current policies, but the time to update your policies is now. The laws that apply to your operations likely have evolved since your last update. Resolve to review and revise your handbook as necessary this Spring, paying special attention to your policies addressing employee conduct, family and medical leave, harassment and discrimination, social media, benefits, and use of electronic devices.

2. Schedule Training Sessions

Your policies are only as good as those who enforce them. Resolve to schedule training sessions for your managers to remind them of their responsibilities and provide a refresher course on your policies. Also, conduct an all-employee session to introduce any policy revisions and remind your employees of your workplace rules.

3. Distribute Policy Reminders

If your handbook is up to date, you can still reinforce the importance of any of your critical policies (including workplace conduct and harassment) by distributing them to all of your workers and having them sign an acknowledgment of receipt (or demonstrate electronic receipt).

4.

Ensure Signed Copies Are In The Personnel File

Speaking of signed acknowledgement pages, now is a good time to review all employee personnel files to make sure you have a signed copy of each and every necessary document in each and every file. All too often, employers only learn the signature on a key document is missing after trouble arises. Better to ensure you have a 100% signature rate now when things are calm. This

is particularly important for your arbitration agreements and your harassment/discrimination/relation prevention policy.

5. Conduct An I-9 Audit

Another proactive step you can take to avoid trouble is to conduct an I-9 audit. Make sure your I-9 forms are kept in separate binders, one for current employees and one for former employees. Also, make sure they are not mixed in with personnel files. Confirm they are completely filled out and no authorization documents are expired. For new hires, ensure you are using the latest and most-current I-9 form. A full audit of your I-9 compliance might require the assistance of counsel.

6. Ensure Your Managers and Payroll Staff Understand the Importance of Paying On Time

As you know, there has been a significant uptick in litigation in Massachusetts with respect to the timeliness of wage payments, especially with respect to final pay upon termination. Ensure your managers and payroll staff understand that, on an involuntary termination, final pay is due the day of termination and failure to do so can subject your dealership to automatic treble damages. It is a bitter pill, best to be avoided, to terminate an employee for misconduct only to be on-the-hook for triple the amount of his or her final pay.

7.

Review Independent Contractor Status

If your dealership retains any workers as independent contractors, you should review their status to ensure they are truly considered independent contractors under the law. Written agreements are fine, but they are not fool-proof solutions. Whether someone is truly an independent contractor depends on what that person does for you; it is not based on a title. Government agencies and plaintiffs’ attorneys scrutinize these relationships and target possible misclassification situations, which could cause you problems

down the road with both the U.S. Department of Labor and the IRS.

8. Determine Whether Arbitration and Non-Competition Agreements Are Necessary

If you have not required your employees to enter into arbitration agreements in the past, now is the time to consider whether you should implement them. When done right, these agreements can save considerable expense and headaches if things ever go south.

9. Examine Exemption Status

Exemption status is of the utmost importance. For your workers considered exempt from overtime pay requirements under state and federal law, you should carefully review their duties and compensation to ensure they still quality for this status. Make sure you are not basing your conclusions on an outdated analysis when reviewing these important arrangements. Violations of the federal Fair Labor Standards Act and especially Massachusetts wage-and-hour law can become very expensive very quickly.

10. Consider How Union-Proof You Are

Finally, unless you want to be dealing with a union, you should review all your employment policies and practices to make sure your dealership is not susceptible to a union-organizing drive. Communication is often key, as is competitive compensation, perceived fairness of policies, and a positive management style. Making sure your employees feel valued is a good way to make sure they do not turn to a third party for help with their workplace issues.

While this list may appear daunting, Spring presents a great opportunity to tidy up your workplace policies and procedures at your dealership. If you are able to check off all ten boxes of your to-do list, you may be rewarded with fewer employment issues in the future.

Patrick Manzi NADA Senior Economist

New light-vehicle sales cooled at the start of 2024. The January 2024 SAAR of 15.0 million units represents a decline of 5.6% compared with December 2023 and 0.7% compared with January 2023. It is likely that some of January’s sales volume was pulled into December 2023, given the increase in OEM incentive spending seen at the end of 2023. According to J.D. Power, average incentive spending per unit likely totaled $2,346, down $287 compared with December 2023.

In January, sales of alternative fuel vehicles continued to chip away at the market share held by internal combustion engines (ICE). Sales of alternative fuel vehicles represented 18.2% of all new vehicles sold in January 2024. Battery electric vehicles (BEVs) represented 7.4% of all new vehicles sold and BEV sales increased by 9% year-over-year.

New light-vehicle inventory increased at the end of January 2024 to 2.40 million units, an increase of 40.4% compared with January 2023 and 4% compared with December 2023. The inventory mix in January 2024 was somewhat skewed toward more expensive models. But given the affordability constraints of consumers in the current high interest rate environment, we foresee the OEMs increasing builds of more affordable trims and models in 2024.

Looking ahead to the rest of 2024, we expect new light-vehicle production to increase in 2024. And new light-vehicle inventory will rise slowly throughout the year as higher production is somewhat offset by higher demand. Our forecast for new light-vehicle sales for all of 2024 is 15.9 million units. t

AIADA Sees Opportunity Ahead

By Cody Lusk

President & CEO, American international Auto Dealers Association

Earlier this month, I traveled with the AIADA staff to Las Vegas for the 2024 NADA Show. There, we joined board members, dealers, auto executives, and the thousands of other individuals who keep America’s auto retail industry moving forward. That includes Massachusetts TIME Quality Dealer Award winner Thomas Murphy, who deserves a hearty congratulations for his long and exceptional career as a Toyota dealer on Cape Cod and who was named one of five finalists for the national award.

As I expected, the energy in Vegas was high among dealers, who are generally optimistic about the trends they see in their stores and beyond. In my career with AIADA, I have always been blown away by the positive lens through which dealers view their industry. It is the one unifying characteristic I have noticed among dealers of all brands, ages, regions, and philosophies.

Successful dealers see opportunity where others see peril. In Las Vegas, where you might have expected nervous conversations over the economy, the transition to electric vehicles, or even the politically unsettled election year, the dealers I spoke to mostly saw possibilities. That optimism is one of the things I love about this industry, and one of the qualities I have tried to incorporate into AIADA’s own approach to advocacy.

All that is not to say that dealers are not capable of clear-eyed assessment of the challenges they face, only that they know challenges often bring opportunities. In 2024, AIADA will be led by someone who truly embodies that world view.

Chairman Anthony Brownlee, whose dealership group includes Chevrolet, GMC, Toyota, and Honda stores in Wyoming and who is constantly working to grow and expand his footprint, is all-in on automotive retail. While I cannot take all the credit for the timing, I can confidently say that Anthony is the right man at the right time for AIADA.

Beyond being an energetic and proactive force on AIADA’s board, Anthony is also a firm believer in the potential of the American political process. Where it has become common to dismiss our increasingly partisan politics as an embarrassment or even disengage from the system entirely, Anthony is leaning in. He is a believer in debate, compromise, and the middle of the road, moderate policies that most Americans actually want.

Recently, that yearning for sensible, attainable policy has been in the spotlight in Washington, D.C. The house of cards that was the government’s relentless push for more, more, more EV sales finally appears to be collapsing. Lawmakers were prioritizing, and subsidizing, a product that most consumers did not want and could not make fit into their commutes or budgets. What consumers DO want, and what dealers have been asking for all along, are options.

Those options include all-electric vehicles, traditional ICE vehicles, and, more than ever, plug-in hybrids. In general, American drivers support the greening of our national fleet, but they also want to be confident in the value, range, and safety of the car or truck they buy. One thing is certain: the transition to electric vehicles will take time and should not be mandated by any government agency.

At AIADA and among the dealers I speak to daily, we are bullish on the United States of America, and we are bullish on the American auto retail industry. The vehicles you sell today are more technologically advanced, safer, and greener than at any point in history. As a dealer-led trade association, we are also more confident than ever in our ability to make your voice heard in the halls of power. As Anthony frequently reminds me, the auto industry is not blue or red, or Right or Left; it is for all Americans. As dealers, you must work to ensure that it remains that way.

I look forward to working with Anthony and all of you in 2024 to do just that. Through our robust dealer visit program, our lobbying activities, and our communications efforts, we will ensure that the dealer’s perspective is heard and appreciated in Washington, D.C.

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By Scott Pearson

Chairman, American Truck Dealers ATD ChAirmAn SCoTT PeArSon iS owner AnD PreSiDenT of PeTerbilT of ATlAnTA.

ATD Celebrates Successful 2024 Show

Incoming ATD Chairman Challenges Truck Dealers to Get Engaged

American Truck Dealers (ATD) installed Scott Pearson as its new chairman for 2024 at its annual convention this month in Las Vegas.

Pearson’s career in the commercial truck industry began in 1979 working as a materials manager followed by sales manager and eventually Western region parts manager at Cummins Engine Co. in Columbus, Indiana.

Pearson joined Peterbilt Motors Company, division of PACCAR Inc, in 1990, and, following a progression of management roles including rising to Assistant General Manager responsible for Sales and Marketing, became a Peterbilt dealer in 2007 acquiring the Las Vegas franchise; the dealership was renamed Peterbilt of Las Vegas. In late 2010, Peterbilt provided Pearson the opportunity to move to Atlanta to reestablish the Peterbilt brand in north Georgia. The new Peterbilt of Atlanta opened in 2011 and has since expanded to five full service, one parts and service, and two TRP all-makes parts stores.

Pearson and Peterbilt of Atlanta have been honored with multiple national distinctions, including a nomination for ATD’s 2020 Truck Dealer of the Year. Peterbilt Motors Co. has recognized the dealership as: a Best-in-Class Platinum Award winner each year since 2018; the 2021 Parts Dealer of the Year; and the 2022 PACCAR Parts & Peterbilt Service UPTIME Dealer of the Year.

Pearson is a long-time member of the ATD Peterbilt 20 group. He was elected to the ATD board of directors in 2021 by his fellow Peterbilt dealers. In 2023, he was elected to a one-year term as ATD Vice Chairman and became the ATD Chairman at the 2024 ATD Show in Las Vegas.

The following are Pearson’s first comments as ATD Chairman which he delivered on the Main Stage of the 2024 ATD Show in Las Vegas to a full house of truck dealers, their staff, and industry allies.

Fix the problem, not the blame. Noting the regulatory obstacles currently facing the industry, Pearson encouraged his fellow dealers to focus on addressing the problem through engagement and education. For example, due to emission regulation mandates, Cali-

fornia heavy-duty truck dealers’ vehicle allocation is being cut by up to 90% in 2024, which will not only have a huge impact on those dealers’ business but also on the industry and economy. And California is not the only state considering such stringent regulations. “We need to inform legislators how completely unrealistic and overly aggressive the EPA and CARB regulations are,” Pearson said. “And the impact they will have on consumers, your businesses, and our economy.”

Listen generously. Pearson spent three decades working for a supplier and a manufacturer before buying his first dealership. First, he was a materials manager, then parts manager at Cummins. Later, he transitioned to Peterbilt. Throughout this time, he had the opportunity to work with some of the best dealers in the country, listening and learning from them and their businesses. “That listening and learning never stops,” Pearson said. “Today’s truck dealerships are not the same as they were a generation ago, or even a decade ago.”

The ever-changing nature of the industry is one reason why Pearson strongly advocates for engaging the next generation in the business early and often. His son, Brad, graduated from ATD Academy in 2023, and his daughter, Shelley, is enrolling this year. “I’ve told [my kids], and I will tell all of you – Academy is the beginning of your learning,” Pearson said. “It is the place to go to learn how to run a successful dealership, but the education does not end there. Always keep listening.”

Bring the fun. “Sometimes we forget it, but this should be fun!” Pearson said. “Let’s celebrate the wins, and let’s work hard for the future of the entire trucking and transportation industry. Remember – we are the foundation of the American economy.”

Deliver results. Pearson closed his address by outlining the results he strives to deliver to the ATD membership: increased dealership involvement, engage the next generation, and improve workforce development.

Pearson’s efforts will be supported by the ATD Board of Line Representatives, which welcomed two additions for the 2024 term. Korey Neal, CEO of K. Neal Truck and Bus Center, replaces Terry

Minor, President of Cumberland International Trucks, Inc., after his three-year term as the International Line representative. Chris O’Donnell, COO of Valley Truck Centers, will be taking Neal’s place as ATD NextGen Chair.

ATD Outgoing Chairman: Invite Lawmakers to Your Dealerships

In his final remarks as ATD Chairman, Scott McCandless challenged the audience of heavy-duty truck dealers at the 2024 ATD Show to engage and educate their government representatives.

“Invite lawmakers to your dealerships,” McCandless, the president of McCandless Truck Center in Aurora, Colorado, said. “Help them understand our business and the fleets and small businesses we serve. Don’t just tell them; show them.”

Last May, McCandless joined Hank Fracalossi at his dealership, Tri-County International in Dearborn, Michigan, to host a small group of EPA staff members. They used the experience to educate the regulators on the challenges and opportunities when selling and servicing EVs as they develop their Greenhouse Gas (GHG) Phase 3 rule.

“It was clear to me and hopefully to the EPA staff that there was a knowledge gap,” McCandless said. “Our message was focused on the need for zero emission vehicles to be affordable, reliable, and to meet the needs of the customers. The trucks must pencil out for the customer in the long-run or they will not be purchased.”

Part of that knowledge gap was the infrastructure requirements to sell and service zero emission vehicles. For example, because of the battery location of some electric trucks, the vehicles have to be lifted six feet off the ground to be serviced. For many facilities, this requires raising the ceiling height of the service bays, which is a substantial investment.

“We invest in our dealerships every day – in our employees, our equipment, our facilities,” said McCandless. “We are ready to sell whatever power train the manufacturers provide. But the technology has to match the customer’s needs. And, in most cases, the technology isn’t there yet.”

With the current technology and infrastructure, it takes at least two ZEV medium-duty trucks to do the job of one comparable diesel. These are the kind of real-world experiences that McCandless wants dealers to share with legislators and regulators, and there is evidence it is working.

After ongoing input from ATD, NADA, and dealers across the country, the EPA delayed the finalization of the greenhouse gas rule, which was originally supposed to be finalized in December 2023.

This wasn’t the only significant milestone of McCandless’ term, which also saw:

• Record membership levels;

• Record ATD Academy graduates;

• Formalization of an ATD NextGen program for future dealership leaders and the establishment of a NextGen Steering Committee;

• Sold-out 2023 ATD Truck Industry Forum and Legislative Fly-In;

• Development and commencement of a three-year strategic plan;

and • Expansion of the Board of Line Representatives to include four new seats, ensuring that every major line of truck dealer is represented.

“These past two years as your Chairman have been anything but boring,” McCandless said. “Truck dealers have had a lot thrown at us, and instead of getting discouraged or complacent, ATD members are getting more engaged.”

Katie Hopkins of Truck Centers, Inc. Selected as 2024 Truck Dealer of the Year

Katie Hopkins, President and CEO of Truck Centers, Inc. based in Troy, Illinois, was named the 2024 Truck Dealer of the Year at the ATD Show 2024. The national award, sponsored by American Truck Dealers (ATD); Trucks, Parts, Service magazine; and Procede Software, recognizes commercial-truck dealers for business performance, industry leadership, and service to their community.

“The TCI team and this industry are filled with hard-working, talented people who keep America’s supply chain moving,” said Hopkins. “I am honored to be a small part of that. On behalf of everyone at Truck Centers, Inc., thank you for this tremendous honor.”

Hopkins is the third-generation leader of Truck Centers, Inc., which was founded by her grandfather in 1970 and led by her father for 48 years before Hopkins took the reins. She takes pride in her business’ exceptional customer service, executed by a team empowered to go above and beyond, which results from heavy company investment in employee training.

“The foundation of teamwork, customer service, and solution-focused thinking that my dad and his partner, Mike Yates, laid is still strong today,” Hopkins said. “I feel blessed to be entrusted with the opportunity with other leaders of the next generation such as my brother Justin to continue building upon this legacy.”

Hopkins credits taking over a dealership facility on short notice during tough financial times as an event that helped forge her future success. She was thrust into a management role after the departure of another manager and used the opportunity to stabilize and then grow the facility in a fertile business area. That success earned Hopkins more authority, which she then used to continue expanding the dealer operation into new markets.

Hopkins views the Truck Centers, Inc. as responsible stewards and trusted community partners and she is committed to fostering a communal spirit of giving back. As one of the largest privately-held companies in their region, the business has been recognized for their ongoing contributions to the industry and their local communities.

Hopkins was chosen from seven nominated commercial truck dealers, including:

• Paul Burk, Executive Vice President of Doggett Freightliner in San Antonio, Texas;

• K.C. Heidler, President and CEO of Tom’s Truck Center in Santa Ana, California;

• Brian O’Donnell, President of Valley Truck Centers in Cleveland, Ohio;

• Jim Schroeder, President of Peterbilt Pacific in Surrey, British Columbia;

• Dennis Ross, President of Kenworth of Jacksonville in Jacksonville, Florida; and

• Bill Reilley, Jr., CEO and President of Lakeside International/ Badgerland Idealease in Milwaukee, Wisconsin, who was recognized as the award finalist.

The nominees were selected by state, metro, and national dealer association leaders. A panel of judges from Indiana University’s Kelley School of Business evaluated the nominees and selected the winner.

Hopkins succeeds 2022-2023 Truck Dealer of the Year nominee Kari Rihm, president and CEO Rihm Kenworth in St. Paul, Minnesota. Hopkins will have the opportunity to serve as a guest lecturer at Indiana University to share her professional story with students interested in entrepreneurship. She also will serve on the ATD Board of Line Representatives for a one-year term in a non-voting role lending her voice and serving as an advocate for the country’s heavy-duty truck dealerships and educating decisionmakers who impact the future of the industry.

Washington Policy Update from ATD Show

On its Saturday session, ATD convened commercial truck industry legislative and regulatory leaders to offer a glimpse inside the policy landscape in the nation’s capital. ATD Vice President of Legislative Affairs Michael Harrington, NTEA-The Work Truck Association Senior Vice President Mike Kastner, and America Trucking Associations Executive Vice President for Advocacy Bill Sullivan brought their wealth of knowledge and experience to the discussion.

The panel explored the intricacies of policymaking directly affecting the trucking industry. Attendees gained insights into legislative priorities and learned the latest about EPA and CARB regulations as well as the potentially devastating implications for the truck market and small businesses. The discussion also touched upon the influence of elections on shaping future truck policies and what lies ahead for the broader trucking sector.

ATD President Laura Perrotta moderated the panel, translating the complex policy issues facing the trucking industry.

“There is no shortage of policy challenges and opportunities facing the trucking industry today,” said Perrotta. “It is important for the truck dealers across the country to hear about the policy goals industry leaders are pursuing in 2024 and how they will impact trucking infrastructure.”

Bill Sullivan expressed, “Our industry faces both challenges and opportunities in the evolving policy landscape. The pursuit of goals such as FET repeal and promoting fleet turnover will significantly influence the future of trucking, and it’s crucial for stakeholders to understand the impact on infrastructure and operations.”

Deep dives into the policy priorities and challenges facing the trucking industry are crucial. As legislative priorities, regulations, and election outcomes continue to shape the future, the insights shared by industry leaders offer a valuable perspective on what lies ahead for the trucking sector. This panel discussion contributed to a greater understanding of the policy landscape and its implications for businesses operating in the trucking industry.

Upcoming Webinar – ATD Overview of EPA & CARB Electric Vehicle Mandates

On March 5, at 3:00 p.m. ET, join ATD Chairman Scott Pearson, President Laura Perrotta, and members of the Regulatory Affairs team as they provide an overview of the new CARB regulations, the EPA NOx regulation, the pending EPA GHG Phase 3 regulation, and the impact they will have on the truck market. Register at www.nada.org/atd.

ATD Truck Beat: 2023 Commercial Truck Sales Reach Half a Million for First Time Since 2019

By Patrick maNzi, NaDa ecoNomist

Commercial truck sales in 2023 topped half a million units for the first time since 2019. Sales totaled 507,277 in 2023, up 7.6% from 2022. Sales of medium-duty trucks reached 240,525 in 2023, up 10.8% year over year. And heavy-duty truck sales totaled 266,752 in 2023, an increase of 5% from 2022. Sales of heavy-duty trucks slowed this December compared with a year earlier, with Class 8 truck sales dropping by 19.8%.

According to ACT Research, Class 8 orders in December ended the fourth quarter totaling 26,500, a decline of 12.5% year over year. Class 8 orders cooled in December following a solid month for them in November, when they posted their strongest year-overyear gain since October 2022. Despite recent weakness in freight market orders, truck buyers appear to be somewhat confident in the year ahead and continue to replace aging equipment even if those replacement rates will be a bit below 2023’s stellar performance.

Now that new-truck production has recovered, prices for used Class 8 equipment have returned to a more normal level. According to ACT Research, the average retail price of a Class 8 truck sold in November 2023 was $59,292, down 6.2% from October 2023 and off a whopping 27.4% compared with November 2022’s average retail price of $81,657. November’s average sale price was the first average price below $60,000 since April 2021, ACT Research says.

For 2024, we do not expect another year of a half-million-plus commercial truck sales. Headwinds for the industry include high interest rates, declining truckload rates and new regulations in California that will severely limit California truck dealers’ ability to sell new Class 8 trucks. Our forecast is for medium-duty truck sales to increase slightly to some 248,000 units, while Class 8 truck sales will likely decline some 20% to around 213,000 units.

NADA Show 2024 a Rousing Success

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This month, NADA returned to Las Vegas for its 2024 Show event, and from comments I received no one left disappointed.

When it comes to motivation, community, and inspiration, America’s franchised auto and truck dealers are playing their cards right and winning big for their employees, communities, and businesses. And those winning traits were on full display at NADA Show 2024, as more than 23,000 dealers and managers, OEM execs, allied industry, and international guests experienced four days of education, networking, dealer franchise make meetings, and event programming at the Las Vegas Convention Center.

It was also great to see another Massachusetts dealer honored on the Main Stage, as Tom Murphy of Falmouth Toyota, our Massachusetts TIME Dealer of the Year, was named one of the five finalists for the national award. Our MSADA, along with our accounting partner Withum, put on a great party to honor Tom on Saturday night at the Encore Hotel.

Fellow Dealers and ATAEs,

During the course of 2023, while serving as NADA vice chairman, I was very fortunate to have gotten the opportunity to visit many states and have engaged in discussions with many dealers and dealer representatives about both the national and individual state-level issues they were facing.

There is no shortage of obstacles to overcome and winding rivers to navigate, but I am energized, informed, and ready to tackle everything that’s before us head-on.

My priorities as the 2024 NADA chairman are straightforward:

1. Continue to work with the NADA professional staff, dealers, and OEMs to protect and support the franchise system.

2. Enhance dealer engagement and involvement.

3. Further strengthen the working relationship between NADA and ATAE.

4. Defend the auto retail industry against regulatory overreach.

Why are these my priorities? Because dealers, NADA, ATAEs, and the manufacturers are the legs of the stool upon which the entire franchise system sits. And the legs of this stool must be strong and balanced to support the considerable weight the franchise system must endure, especially today.

I look at my job as doing what I can to remind everyone that we will accomplish so much more by working with one another than not.

The last day of the Show took place just one week before Super Bowl LVIII at Las Vegas’ Allegiant Stadium, which managed to be one of the more exciting Super Bowls in recent times, a Kansas City Chiefs’ OT victory. They still have a ways to go before they can top the success the Patriots have experienced this century.

I want to thank all from our Massachusetts dealer and vendor community who attended our 2024 Show.

Finally, it is never too early to plan, so circle January 23-26, 2025, on your calendar for our next Show in New Orleans.

NADA Chairman Gary Gilchrist: I’m Ready to Tackle Our Dealer Issues

New NADA Chairman Garry Gilchrist offered the following comments as he took the helm for the next year at the NADA Show in Las Vegas this month.

Challenges are coming at us from all different directions. In my 47 years in this business, I cannot think of a time dealers have been pulled in so many directions and challenged on so many fronts.

I want you to know our NADA staff and dealers have been continually working on each of these priorities, and many more issues simultaneously. I look at my job as doing what I can to remind everyone that we will accomplish so much more by working with one another than not.

A few issues in particular will be coming to a head before we know it. In March, the Biden administration is set to unveil its long-awaited EV mandate. And while we don’t know what the final mandates will be exactly, we need to be prepared for standards that will remain unrealistic and unachievable.

The facts on the ground do not lie. Electric inventory is climbing, and more than half of the EVs available for sale today do not qualify for the full $7,500 tax credit. The warning signs that these mandates are way ahead of consumer acceptance are everywhere.

At NADA, we will continue to keep the pressure on the administration and implore them – both publicly and through ongoing face-to-face meetings – to take a pause and realize that consumer demand simply isn’t where they need it to be.

We will continue to stress to them the need to look much more closely at hybrids, hydrogen and other ways we can lower emissions responsibly. And will urge them to consider those alternative options just as important, just as rewarded, and just as critical to creating the future we all want for our kids and grandkids.

NADA is also fully engaged in a campaign to stop the FTC’s Vehicle Shopping Rule from being implemented and enforced.

In January, the FTC published the final version – an atrocious rule after a rushed, deeply flawed, and, we believe, illegal process.

The bottom line on this rule? The Vehicle Shopping Rule is simply terrible for consumers. It will add massive amounts of time, complexity, paperwork and cost to car buying and car shopping for tens of millions of Americans every year.

And the FTC failed at every juncture to justify why these wholesale changes to the way Americans shop for and purchase new cars are necessary, or how any of these changes would benefit consumers.

NADA continues to fight back against this rule with every tool in our arsenal. After the rule was published, NADA and the Texas Automobile Dealers Association filed a legal challenge in the U.S. Court of Appeals for the 5th Circuit to Stay the July 30, 2024, effective date of the FTC’s Vehicle Shopping Rule.

And I’m happy to report that just before the 2024 NADA Show in Las Vegas – in direct response to the legal challenge we initiated – the FTC issued a stay of its own rule, postponing the effective date of the rule pending judicial review.

Women Driving Auto Retail Announces Inaugural Awards

This year’s Women Driving Auto Retail event, hosted in conjunction with NADA Show 2024 in Las Vegas, included the announcements of the initiative’s three inaugural awards. NADA’s Women Driving Auto Retail initiative aims to empower women working in the auto retail industry and encourage more women to join the industry by highlighting the many unique career paths of women before them.

The awards, sponsored by RouteOne, were developed to recognize the women and men pushing gender diversity forward. Take a look at the 2024 award winners below.

Rising Star Award: Lilly Jimenez, General Manager of Classic Chevrolet OKC in Oklahoma City

The Rising Star Award recognizes a woman early in her dealership career who is driving her path in auto retail and serving as a role model and champion for her female peers in the industry.

“Our winner today embodies resilience, dedication, and the pursuit of dreams against many odds,” said Amber Haseley, Director of National Business Development at RouteOne, who presented the awards at the event. “Her story is one of extraordinary courage and determination.”

The Vehicle Shopping Rule is simply terrible for consumers.... And the FTC failed at every juncture to justify why these wholesale changes to the way Americans shop for and purchase new cars are necessary.

In addition to our legal challenge, NADA is also pursuing Congressional solutions to either nullify the rule or deny the FTC funding to enforce the Vehicle Shopping Rule. Again, we’re utilizing every tool we have at our disposal on behalf of franchised dealers.

So, as you can see, we’ve got a lot on our plate. Which means YOU have a lot on your plate! So, stay involved, stay educated and stay in touch with your Directors and your ATAEs. And remember that we’re in this together, which means we will be successful.

I hope your 2024 is off to a fantastic start.

Many thanks,

Gary Gilchrist

2024 NADA Chairman

Jimenez came to the United States as a refugee during the Vietnam War. After 10 years, she left her successful career in telecommunications to raise her two daughters. Last summer, she, her husband and their business partner bought a dealership as part of General Motors Minority Dealer Development Program. Jimenez knew her experience in customer service, relationship building, and hard work would translate to a successful career at a dealership – and she was right.

Accelerator Award: Samantha Martin, Assistant Service Director of Pohanka Hyundai of Salisbury

The Accelerator Award recognizes a mid-career level woman who has demonstrated success in improving gender equity in her dealership.

Martin, who has worked at Pohanka of Salisbury for 23 years, oversees the operations at three of the auto group’s dealerships. She has used her position in management to champion initiatives to empower females to thrive within the service departments. Martin has implemented split shifts to enable two women to share their job responsibilities, providing more flexible hours to be with their families. She has

also allowed some team members to work from home as their positions allow.

As a mother, Martin understands how important it is to create opportunities for women to thrive in their dealership careers while balancing family responsibilities.

Ally Award: Karl Schmidt, President of Hello Auto Group in Los Angeles, Calif.

The Ally Award recognizes a person with a career track record in hiring, training, mentoring and championing women in auto retail and enhancing gender diversity in the field.

Schmidt built the foundation for the culture of his automotive group in the early 1990s when he proactively recruited women in the dealership, building a bench for the diverse leadership team he has today. Now 50% of the Hello Auto Group general managers are female, and women also represent 50% of his corporate positions.

One female manager from Hello Auto Group said of Schmidt: “I have been in the auto industry since 2004. I have worked in many different operational roles but never in my wildest dreams would I ever imagine that I would be given the opportunity to be a general manager. Karl saw something in me that I didn’t see in myself. He brings the best out of me and makes me believe I can lead my team effectively. Thanks to his support and motivation I have been successful managing my own store.”

NADA Capitol Insider Report –February 2024

Despite political turmoil and gridlock in Congress, NADA is pressing forward to address important dealer priorities that may be considered in the next few weeks. Congress is still dealing with must-do items held over from 2023, including overdue appropriations legislation to fund the government for the current fiscal year that ends September 30.

Two of the hold-over appropriations bills that may be voted on in early March include dealer-backed policy riders to (1) temporarily stop both the Federal Trade Commission’s (FTC) anti-dealer, anti-consumer Vehicle Shopping Rule and (2) the Environmental Protection Agency’s (EPA) proposed Electric Vehicle Mandates.

Further, after three years of stalled action on a tax bill, the Senate may soon consider a bipartisan, narrow tax package that recently passed the House of Representatives by an overwhelmingly bipartisan vote. This tax package may provide an opportunity for Senators to attach LIFO relief in the next couple of weeks. More details on these issues are below.

If you have a chance to discuss these issues with your Members of Congress, it is important to remind them that action on dealer issues is critical.

Urge Members of Congress to Block FTC Vehicle

Shopping Rule: On January 18, in response to a petition filed by NADA and the Texas Automobile Dealers Association, the FTC postponed the Vehicle Shopping Rule’s (VSR) effective date of July 30, 2024, pending judicial review. While the postponement of the effective date is good news, NADA is continuing its multi-faceted legislative challenges to the VSR since this flawed rule is merely on hold. Those current legislative efforts include:

• A policy “rider” in the House appropriations bill (H.R. 4664) that stops the FTC from implementing or enforcing the rule for the fiscal year. NADA has sent a letter of support to Members of Congress and to appropriators (also signed by the American International Automobile Dealers Association (AIADA), and National Association of Minority Automobile Dealers (NAMAD)) urging Congress to retain the House provision in the final FTC funding bill (the Senate bill is silent on this issue (S. 2309)).

• Congressional oversight, including a House Oversight and Accountability Committee investigation of the VSR and House Small Business Committee questions to Chair Lina Khan.

• The NADA-backed “FTC REDO Act” (H.R. 7101/S. 3014) would stop the VSR permanently and require the FTC to follow certain procedures, which it failed to follow, should the agency choose to redo the rule. H.R. 7101 was recently introduced in the House by Rep. Kelly Armstrong (R-North Dakota) with 5 original cosponsors. Companion legislation in the Senate (S. 3014) was introduced by Sens. Jerry Moran (R-Kansas) and Joe Manchin (D-West Virginia).

Dealers should urge members of Congress to cosponsor the “FTC REDO Act” since the recently finalized VSR will impose massive amounts of time, complexity, paperwork, and costs to the car buying process. For example, under the rule:

• Every time a consumer asks about a specific vehicle or monthly payments, it could involve several new written forms;

• Ambiguous new legal standards such as “express informed consent” are introduced which states that a customer signature by itself will NOT suffice, contrary to many state laws;

• The FTC is empowered to issue $51,744 per violation, imposing massive fines on dealers for unnecessary and vague requirements;

• New recordkeeping burdens are imposed that more closely resemble retention requirements for supervised financial institutions, such as forcing dealers to capture every written communication with a customer, including texts.

Congress Should Support House Efforts to Stop the EPA’s “Too Far, Too Fast” EV Mandate: NADA strongly supports language in the House Interior-Environment appropriations bill (H.R. 4821) that would temporarily pre-

vent the EPA from spending money to finalize its unrealistic regulations for model years 2027-2032. H.R. 4821 passed the House on November 3. A NADA-supported letter led by Rep. Lisa McClain (R-Michigan) and signed by 223 Republicans was sent to Republican leadership in support of blocking this EPA rule until the end of the fiscal year (September 30). NADA supports including the House language in the final Interior-Environment appropriations bill (the language in the Senate bill is silent on this issue).

NADA also supports the “Choice in Automobile Retail Sales (CARS) Act” (S. 3094/H.R. 4468) which permanently prohibits the EPA from finalizing their EV 67.5% mandate. H.R. 4468 passed the House on December 6 by a vote of 221-197, with the support of five House Democrats.

Dealers should continue to talk to their members about their EV investments, provide consumer feedback regarding EVs, and urge Congress to pass legislation stopping the Administration’s “too far, too fast” EV mandate.

Ask Senators to Add LIFO Relief to the Tax Package: The House passed the narrow “Tax Relief for American Families and Workers Act” (H.R. 7024) earlier this month by a vote of 357-70. Senate Republicans are currently deciding whether to consider the bill negotiated by House Ways and Means Chair Jason Smith (R-Missouri) and Senate Finance Chair Ron Wyden (D-Oregon). The House bill combines child tax credit revisions with favorable Tax Cuts and Jobs Act provisions to restore the EBITDA-based business interest limitation, and 100% “bonus” depreciation through the end of 2025 on a retroactive basis.

troversial LIFO fix in the tax package: NADA recently sent a letter to Senate leadership reiterating the importance of the LIFO relief issue to many small, multi-generational dealers. The key points are that the “Supply Chain Disruptions Relief Act” (S. 443) should be added to H.R. 7024, the “Tax Relief for American Families and Workers Act,” when considered by the Senate. S. 443 would simply require the Treasury Department to use its existing authority and allow extra time for dealers who utilize LIFO to replace inventory depleted due to pandemic-related foreign trade interruptions. This is still a time-sensitive issue, and the Treasury Department has indicated it is ready to implement the measure once Congress enacts it into law.

“Right to Repair” Legislation Subject of Controversial House Subcommittee Markup: A fundamentally flawed “right to repair” bill, H.R. 906 – the “REPAIR Act,” passed out of a House subcommittee late last year. NADA submitted comments and a coalition letter in opposition to the bill.

Dealers should continue to talk to their members about their EV investments, provide consumer feedback regarding EVs, and urge Congress to pass legislation stopping the Administration’s “too far, too fast” EV mandate.

During House consideration of the Smith/Wyden tax package, Chairman Smith successfully opposed all amendments to the bill. Several members spoke in favor of passing LIFO relief legislation (H.R. 700, the ”Supply Chain Disruptions Relief Act”) during the Ways and Committee markup, including LIFO sponsor Rep. Jodey Arrington (R-Texas), and cosponsors Reps. Mike Kelly (R-Pennsylvania), Carol Miller (R-West Virginia), Beth Van Duyne (R-Texas), and Brad Wenstrup (R-Ohio).

Some GOP members of the Senate Finance Committee have indicated they will not pass the House tax package without some changes. While sponsors of the package are resistant to amendments, Sen. Tim Scott (R-South Carolina) has been prioritizing the LIFO relief issue in discussions with his Republican colleagues. The legislation would allow dealers to offset tax liability on future returns to claim relief without amending returns.

Urge your Senators to include the bipartisan, noncon-

H.R. 906 is a bad bill because it would force auto and heavy-duty truck manufacturers to give any third-party remote, bidirectional access to sensitive consumer data from vehicles, which raises significant consumer privacy, cybersecurity, and automotive safety concerns. It would also require manufacturers to provide any “aftermarket parts manufacturer” the information necessary “to produce or offer compatible aftermarket parts,” i.e., parts not made by the auto or truck manufacturer. Please remind your lawmakers, especially members on the House Energy and Commerce Committee, that H.R. 906 is a flawed and unnecessary bill that raises serious vehicle privacy, security, and safety issues for consumers.

Dealers Run into the Speaker in the Capitol: A staple of attending NADA Academy is a political and legislative briefing followed by a tour of the U.S. Capitol. During a class tour led by Rep. Kat Cammack (R-Florida), dealers ran into the new Speaker of the House, Rep. Mike Johnson (R-Louisiana). Speaker Johnson spoke briefly with the dealers and posed for photos.

EPA Staff Visit Heavy-Duty Truck Dealership

Korey Neal, ATD NextGen Chair, hosted EPA leadership and staff at the K. Neal Truck & Bus Center in Hyattsville, Md. The EPA site visit included candid conversation regarding the challenges related to the proposed unworkable GHG Phase 3 rule. This rule, expected to be finalized this Spring, would set EV mandates for medium- and heavy-duty trucks.

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