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AUCTION NEWS
INSIDE
04....................................................................Dealer Spotlight 06................................................. NIADA Government Report 08..........................................................Security Starts Within 10.....................................CRM Technology vs. CRM Mindset 12.................................................Bank More on the Back End 14..........................................................Compliance Overdrive
WHAT’S NEW NIADA.tv
NEW CPO CHANNEL AND USED CAR WEEK
NIADA.tv just introduced a new channel devoted to CPOrelated programming, including marketing strategies and value perception of CPO. In addition, the site now offers 19 education and training sessions from the recent Used Car Week Conferences. Check out NIADA.tv for these videos and much more!
ADVERTISER’S INDEX
ABC Baton Rouge................................................................. IBC ADESA .....................................................................................9 AutoZone..................................................................................8 Black Book................................................................................5 LA’s 1st Choice AA................................................................IFC Manheim ..........................................................................10, 11 Manheim Pennsylvania..........................................................13 NADA........................................................................................7 NextGear Capital ...................................................................12 Texas Direct Auto.............................................................15, 17 VAuto....................................................................... Back Cover
OFFICE
For information on how to become a member please contact Dwayne Tambling louisianaiada@gmail.com 877-513-6275.
NIADA HEADQUARTERS
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 The Open Road is published bimonthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the authors and do not necessarily represent the views of the Open Road or NIADA. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright ©2016 by NIADA Services, Inc.
STATE MAGAZINE MGR./SALES
Troy Graff • troy@niada.com EDITORS
Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT & GRAPHIC ARTIST
Christopher Hanley • chris@niada.com
SENIOR ART DIRECTOR / PRODUCTION MANAGER
Christy Haynes • christy@niada.com PRINTING
Nieman Printing
MANHEIM TRIPLES IMAGING OFFERING AVAILABILITY FOR CLIENTS Expansion in Response to
used to take standard condition report photos. Using high-quality, state-of-the-art programmable cameras and software, certified photography staff members shoot the images after vehicles have been reconditioned. They display one car at a time and include a consistent set of views most important to buyers. High-resolution images, available in-lane and via Simulcast and OVE, enable viewers to pan the vehicle and zoom in and out to areas of interest on the vehicle. “Dealer interest in improving online sales and their success stories compelled us to In response to client demand, Manheim broaden our EVI footprint and be an even has nearly tripled the availability of Enhanced better business partner,” Manheim senior Vehicle Imaging, expanding from 25 to 74 vice president of inventory services Grace auction locations throughout North America. Huang said. EVI provides a consistent set of quality The addition of Enhanced Vehicle Imaging high-resolution images that showcase helps consignors move vehicle inventory vehicles in an optimal way. Manheim said more efficiently, reaching up to 80 percent the service leads to a higher conversion rate more online buyers with increased bids per for sellers and increased confidence about sale, Manheim said. Manheim data also purchases for online buyers. showed Simulcast listings with EVI images “The Enhanced Vehicle Imaging service convert 16 percent better than two or three we use from Manheim Milwaukee has proven low-resolution photos, and 50 percent to be a big boost to our bottom line and has better than no photos. grown our online attendance,” Napleton Dealers using EVI sell 27 percent more Automotive Group remarketing manager vehicles online than those who use two or Jeff Ricchio said. “And we love the positive three low-resolution images. EVI supports feedback we get from buyers about the dealer efforts to sell less desirable, aged photos.” vehicles online – vehicles with expected low Manheim’s EVI produces photos superior AutoGrade scores, high mileage or lower to those traditionally available via the device prices.!
Client Demand
BOARD MEMBERS PRESIDENT Kevin Reeves Dixieland Autoplex 15600 Florida Blvd. Baton Rouge, LA 70819 kevin@dixielandautoplex.com 225-248-6519
BOARD MEMBERS Scott Ledet Ledet’s Auto Sales P O Box 1505 Gonzales, LA 70737 scottledet@ledetsautos.com 225-644-2886
VICE PRESIDENT Robert Perry Doug Perry Wholesale Cars 311 N. 4th Street Monroe, LA robertperry2010@yahoo.com 318-343-8611
Jacob Warren Louisiana’s 1st Choice Auto Auction 18310 Woodscale Rd. Hammond, LA 70401 jacob@lafcaa.com 985-345-3302
EXECUTIVE DIRECTOR Dwayne Tambling Dwayne Tambling Auto Brokers 46001 Hwy # 22 St. Amant, LA 70774 225-675-3675 SECRETARY Rudy Martinez Ponce Imports, Inc. 6060 Florida Blvd. Baton Rouge LA 70806 rudymp@cox.net 225-927-4346 TREASURER Chuck Hill Oakview Auto Auction 13451 Florida Blvd. Baton Rouge, LA 70815 chuckhill69@yahoo.com 225-272-5139
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Donald Mendoza Don’s Wholesale 6902 Johnston St. Lafayette, LA 70503 mendozadonald@yahoo.com 337-210-5000 David Albritton Redline Motorcars, LLC 605 Cypress Street West Monroe, LA 71291 dcalbritton@gmail.com 318-605-3655 Daniel Guinn Guinn Auction Company, Inc. 1635 Thibodeaux Rd. Jennings, LA 70546 daniel@guinnauctions.com 337-368-7713
Jeff Hernandez Airline Automart Inc. 4520 Airline Hwy Baton Rouge LA 70805 airlineautomart@yahoo.com 225-357-1597 Scott Rabeaux Rabeaux Auto Sales 6882 Johnson St. Lafayette, LA 70593 srabeaux@yahoo.com 337-991-9100 Matt Pedersen Lake Charles Auto Auction 2435 E. Broad St. Lake Charles LA 70601 matt@lcautoauction.com 337-433-8664 Eric Stroderd (Past President) My Dealer Supply 850 Kaliste Saloom Rd. Lafayette, LA 70508 877-427-1238 Ricky Donnell Best Stop Auto Sales 4238 Front St. Winnsboro, LA 71295 bsas03@yahoo.com 318-435-6565
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DEALER SPOTLIGHT
DON’S WHOLESALE Prominent Dealership Making Waves
Don’s Automotive Group, better known to its loyal fan base as “Don’s Wholesale,” is making a name for itself as one of the prominent independent automotive dealer groups in Louisiana, if not the United States. This fast growing used car dealership group is making major waves among the industry elites with its unique approach and fresh perspective to the automotive business. Don’s Wholesale, LLC began as a wholesale operation over 12 years ago and is currently one of the largest automotive B2B operations in the region, selling over 5,000 vehicles annually. As the wholesale operation grew, the retail business quickly developed and the first Don’s Wholesale retail location opened up seven years ago off Johnston St., a few miles south of the Acadiana mall. The retail business or “Truck Super Stores” specialize in selling preowned customized trucks along with unique and sporty inventory. Today, Don’s Automotive Group offers three retail facilities in Lafayette, Broussard, and Lake Charles and plans for additional locations in the future. In 2015 Don’s Automotive Group opened their headquarter location, which offers customers a full service facility equipped with 15 service bays capable of working on all makes and models, including diesel, imports and performance. This location also offers a spacious 5,000 square foot accessories showroom that showcases all aftermarket items for any vehicle. Whether you’re looking for window tint, tires, rims, bed liner or anything in between, DW Accessories is your local facility that’s ready to serve. In their quest to continue to expand their operations, Don’s Automotive Group acquired a locally owned rental and leasing company named Auto Rental Etc. The business has been a staple in the Lafayette market for over 40 years, offering its customers daily rental vehicles as well as short and long term leasing options. Since acquisition in 2015, DW has expanded its fleet and now has multiple locations in the Lafayette and Lake Charles market. Auto Rental Etc. is poised to be in a great position in years to come as the rental business expands. A spin off of Auto Rental Etc., DW Leasing caters to locally owned companies looking to lease vehicles for their businesses or individuals specifically looking to lease any type of brand new vehicle. DW has just unveiled Lafayette’s first women-focused dealership called POSH Preowned at the corner of Ambassador and Ridge Road. POSH offers a car
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buying experience with a no hassle, no negotiation and no pressure car buying environment. The dealership offers a unique inventory of low mileage, certified, affordable luxury vehicles. Danielle Mendoza leads the team at POSH
with heart, desire, passion and experience. Her deepest desire is to serve and allow women to feel empowered and be a part of something so much bigger. POSH Preowned is her opportunity to give back to the community what has so graciously been given to her.
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WASHINGTON UPDATE
NIADA GOVERNMENT REPORT
Latest Governmental Issues and Activity Here’s a rundown of some of the latest governmental issues and activity affecting the used car industry from NIADA senior vice president of legal and government affairs Shaun Petersen and NIADA lobbyist Sante Esposito of Key Advocates.
REGULATORY REPORT By Shaun Petersen
FEDERAL TRADE COMMISSION A federal court judge approved the FTC’s $10 billion settlement agreement with Volkswagen over the company’s deliberate cheating on government emissions tests. The approval formally starts the process for owners of certain Volkswagen and Audi 2.0 liter diesel vehicles – including independent dealers with those vehicles in their inventory – to get compensation. In most cases, the owners of VW and Audi diesel cars fitted with the emissions defeat devices will receive between $12,500 and $44,000 each, depending on the model, year, mileage and trim of the car, as well as where the owner lives. A post on the FTC’s consumer blog, www.consumer.ftc.gov/blog/vwbuybacks-and-lease-terminationsbegin, provides additional background information on the settlement order, along with detailed instructions for affected owners about how and where to file a claim and the claim-processing timetable. It also tells consumers how and where they can pick up buyback checks and noting those funds do not have to be used to buy a new Volkswagen.
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CONSUMER FINANCIAL PROTECTION BUREAU Supervisory highlights: The CFPB released its latest supervisory highlights report, which showed recent supervisory actions returned more than $11 million to more than 225,000 harmed consumers. The report outlined violations found in auto loan origination and servicing, including a claim that servicers refused to return personal belongings from a borrower’s repossessed car until the borrower paid a storage fee. If borrowers did not pay the fee in the allotted time, usually 30-45 days, depending on the state, the companies would dispose of the property instead of returning it to the borrower. The CFPB said it is an illegal and unfair practice to refuse to return a consumer’s personal property until a fee is paid. Service providers bulletin: The CFPB reissued its compliance bulletin on service providers, saying the amendment was needed to clarify that entities have flexibility, allowing for appropriate risk management of service providers. The new bulletin includes the same list of expectations for managing service provider relationships, such as verifying that service providers understand and are capable of complying with federal laws; requesting and reviewing service providers’ policies, procedures and training materials; and including in contracts clear expectations about compliance. The revised bulletin gives entities some flexibility and discretion when determining the level of oversight needed, based on the circumstances of the relationship and the particular activities of the service provider, as well as the potential for harm to consumers. Comments on payday lending rule: NIADA joined with NADA and the RV Dealers Association to submit comments to the CFPB regarding its proposed payday lending rule. Our comments raised concerns that the CFPB’s proposed rule needs greater clarity to ensure retail installment contracts for the purchase of personal property, such as automobiles, are not covered by the proposal. We also told the bureau the purchase money exemption must include all components of the transaction, including the purchase of voluntary protection products such as GAP, as well as negative equity.
LEGISLATIVE REPORT By Sante Esposito
S.2663, REFORMING CFPB INDIRECT AUTO FINANCING GUIDANCE ACT Advocacy efforts heading into the lame duck session, which begins in midNovember, have been focused on urging Sens. Joe Donnelly (D-Ind.) and Heidi Heitkamp (D-N.D.) to cosponsor the bill, which rescinds the controversial auto
financing guidance action taken by the CFPB in March 2013 and provides for a more transparent and accountable process for addressing the issue of indirect auto lending. The effort is the result of a recent meeting with Sen. Richard Shelby (R-Ala.), chairman of the Senate Banking Committee, which has jurisdiction over the bill. In that meeting, Shelby committed to marking up the bill in committee during the lame duck session if two Democrats would cosponsor it. Donnelly is a small business advocate who was a featured speaker at NIADA’s 2016 National Leadership Conference and Legislative Summit. NIADA will also keep pushing its request for the Senate to convene a series of meetings with the CFPB and stakeholders to explore the possibility of an administrative solution to the issue. The CFPB’s guidance claimed dealer discretion on interest rates in indirect auto financing creates a “significant risk” of unintentional disparate impact discrimination. S.2609, MARKETPLACE AND INTERNET TAX FAIRNESS ACT This bill would allow states to charge sales tax on so-called “remote transactions,” such as Internet sales, but thanks to NIADA’s efforts it now specifically exempts vehicles, aircraft, vessels and business purchases – all cases in which states currently collect a use tax either when the vehicle is registered or because businesses pay their use tax. A summary of the text refers to the exemption as preventing “double taxation.” The Senate Judiciary Committee has received comments back from a wide range of stakeholders and is still deciding its legislative strategy. Rep. Bob Goodlatte (R-Va.), chairman of the House Judiciary Committee, and Rep. Anna Eshoo (D-Calif.) have developed a discussion draft bill on the remote sales tax issue. H.R. 6094, THE REGULATORY RELIEF FOR SMALL BUSINESSES, SCHOOLS, AND NONPROFITS ACT The bill, introduced on Sept. 21 by Rep. Tim Walberg (R-Mich.) with 76 cosponsors, would postpone the effective date of the Department of Labor’s rule revising income thresholds for determining overtime pay for executive, administrative, professional, outside sales and computer employees exempt from regular minimum wage and overtime pay requirements from Dec. 1 until June 1. The bill passed the House on Sept. 28 by a vote of 246-177. Seven Democrats, including National Leadership Conference speaker Rep. Henry Cuellar (D-Texas), voted in favor.
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TECHNICALLY SPEAKING BY DAN DOMAN
SECURITY STARTS WITHIN Six Steps to Protect Your Dealership’s Data
According to data security firm Virtru, even as hackers become more and more sophisticated, much of the threat to your business actually comes from inside. The company notes that up to 28 percent of enterprise data security incidents come from inside an organization. They’re not saying any of your employees has malicious intent – though that is possible. What they are saying is your staff could be inadequately trained or your data security policies might be incomplete or not enforced. So here are six training and enforcement policies to help protect your dealership from possible threats: Strong passwords: While you’ve heard it before and it might seem obvious, enforcing strict password requirements – such as requiring a minimum of eight alphanumeric characters with symbols – and prompting users to change their passwords regularly are easy ways to protect against unauthorized access. A 2015 survey by TeleSign found 47 percent of people use passwords that are at least
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five years old. Don’t let your dealership’s employees be among them. Authentication: Require multi-factor authentication on every device that accesses your dealership’s data. The process requires users to register their devices to a particular user ID and password. Registering a device requires employees to select and answer a series of “security” questions not easily guessed by anyone but the employee. In the event a user name and password was compromised, a hacker would still be unable to access your dealership’s systems unless that device was authenticated to those credentials, adding another layer of security.
IP blocking: Use IP blocking to limit user access from only dealership-approved IP addresses. That helps prevent unauthorized access from remote or mobile locations. Implementing IP blocking is a great opportunity to review and audit your dealership’s policies regarding remote access to integrated dealer systems and appropriate purposes and use. Now that you have secured the devices that are coming into your system, focus on your dealership’s employees’ day-to-day use. Check your user permissions: Not every employee needs access to all of your dealership’s data. Assign employee permissions and access to specific dealership systems that suit your business processes and
the employees’ respective responsibilities. That will help control their ability to access personal and confidential customer data. Use your systems’ notification or activity alert tools: They can be configured to alert you of potentially suspicious employee activity, such as changes to a user’s “setup” or “preferences.” Run a report: Regularly run a user report to ensure all who have access truly need it. The reports should provide detailed information on users including dealer ID and dealer name (for dealer groups), user name, last successful login date, no user activity for more than 60 days, and admin. It is a sound security practice to check your user reports against your active employee list. You should never have an ex-employee authorized to access your systems. Secure dealerships are successful dealerships, and maintaining a secure dealership begins with fundamental security practices. By implementing the six practices explained here, your dealership will be well on its way to helping ensure the security of your customers’ information – and a successful future. Dan Doman is chief legal and privacy officer of RouteOne LLC (www.routeone.com), a joint venture created by Ally Financial, Ford Motor Credit Company, TD Auto Finance and Toyota Financial Services. He is responsible for managing the legal, governmental, privacy, and security affairs of RouteOne LLC.
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MANAGEMENT MATTERS BY SCOTT BERGERON
CRM TECHNOLOGY VS. CRM MINDSET It's a Tool, Not a Crutch
Have you ever wondered how dealerships sold in volume before CRMs, before the Internet, before websites and Internet leads? I consider myself an old-school car guy who
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knows how to use technology. I still believe there’s a place in this business for pen, paper and all the high-tech programs that make our lives easier. I started my career in the ‘80s and was lucky enough to work for a top 100 nationally-ranked dealership. We sold 500 vehicles, both new and used, per month. We did it directing our focus on advertising, ordering correctly, training, and a CRM mindset. In other words, we wanted all the information and we collected as much as we could. It wasn’t efficient compared to the tools we have now, but it worked because everyone was on the same playing field. Technology today works like a champ, when
it’s used as a tool and not a crutch. There are more ways than ever for potential customers to connect with a dealership. Online shopping is, by all estimations, the starting line for over 80 percent of all transactions. In the dealership, the CRM software is used to track, assess, notify and persuade consumers. It also lets you track the steps of the sale as well as who’s performing on your sales floor, and who needs help. We’ve all heard the phrase “garbage in, garbage out.” Technology is only as good as the information that goes in, and the process to get the information back out to reconnect with is where most dealerships lose deals. I’ve been in dealerships where their CRM reported a 100 percent closing ratio. They must have some pretty great salespeople, or they’re only entering their sales into their CRM, and forgetting about the other 80 percent of unsold prospects. And even if the leads automatically populate into the CRM, it doesn’t do any good unless someone is following up. CRM technology is limited without a common sense process within the dealership to make sure everyone gets touched, whether they’re Internet leads or face-to-face prospects. One thousand online leads and 300 visits in a month should show as 1,300 prospects, less the conversions to sales, which likely won’t show a 100 percent closing ratio. I’ll take bad news that’s accurate any day over grossly inflated closing ratios. An article on Adexchanger.com elaborates on the importance of dealership CRM as an all-encompassing relationship tool, not just technology, concept. Headlined “CRM: A Philosophy That Goes Beyond Data, Technology and Channel,” the article by digital specialist Mayur Gupta notes, “CRM software is not enough… Establishing a lifelong customer relationship and loyalty is not just a technology problem. Marketers need to bring the strategy, data and technology together to establish and operationalize a CRM capability. To do this, they must establish a customer relationship and experience strategy.” In the dealership, it’s as simple as asking, “What’s happening to my customers? Is my CRM helping me make more deals, or is our process breaking down?” So how does a dealer combine technology with a selling mindset that provides customers your undivided attention and connection before they say yes?
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How much tech is too much tech? How do you feel when someone is talking to you, but texting? How would you feel in a selling environment if your salesperson was entering data into their phone while they were showing you a vehicle? Probably not very good. But it’s reality in many dealerships that have invested fortunes in high tech, thinking it will “revolutionize their sales process.” Most customers aren’t buying it. No matter what a salesperson is doing on their phone, a vast majority of customers think they’re being ignored. In my opinion, when a salesperson is in front of a customer, their eyes need to be up and directed toward their customer. Look down at your phone and you’re likely to lose a deal. So the challenge really is how much technology do we need, and when is it best to use good old-fashioned rapport building and eyeball-to-eyeball selling? Old school or new school – It’s all good, if it’s done right. Once the sales force has learned (or relearned) the more traditional side of relationship-building and management, it’s time to show how mindset and technology together can forge a highly successful sales program. Technology can be a catalyst to help build traditional relationships to reach more people in more ways. When done right, it results in more deals. Used properly, tools such as Internet Lead Modules and CRMs can prime the pump efficiently. Using prospect and customer information, a smart CRM can store critical information about a prospect’s wants and needs, as well as timeline and budget. Technology does the heavy lifting, while customer engagement closes the deal. High Tech & High Touch High tech allows your sales team to be efficient. High touch, or client engagement, is what’s required to be effective. In other words, it doesn’t matter how efficient I am at auto responding to prospects if they don’t show up and buy. Most of us still want to do business with people we like, respect and trust – and that requires one-on-one interaction. For the best and most effective results, brainstorm about how best to use/blend the two – high tech and high touch. Then, test it in your next sales training session. Here’s one scenario using email as the springboard: Do what the others don’t. Instead of
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canned auto-responders for inbound leads, try a catchy, clever and, most importantly, personalized email that will spur a visit or at least put you higher up on the radar than the other guys. Try a subject line like, “Scott, I’ve been waiting for you to email me!” Most prospects shop online because they fear entering a dealership. They don’t want some pushy salesman. But, knowing you were low-key and fun to work with could help start a dialogue. Today’s customers don’t want the old sales gimmicks, but they also don’t want to be ignored, or feel like they’re going through a line at Walmart to buy
a car. This is a huge buying decision. They deserve your attention, your personality and the best experience you can provide. Remember, they can go anywhere in the world to buy their vehicle. Give them every reason to buy from you. Ultimately, it’s CRM technology and a selling mindset together that make customer relationship management work effectively in today’s auto sales world. Former dealer executive Scott Bergeron is the founder and principal at Daily Gameplan. com - a sales team performance company. Scott can be reached at 303.918.3169 or scott@dailygameplan.com.
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ACCELERATE
BY GWC WARRANTY
BANK MORE ON THE BACK END The Ultimate Customer Satisfaction Experience
So much of what you do on a day-to-day basis is to preserve your front-end gross. You act with discipline when acquiring inventory, you carefully manage reconditioning costs, you price your cars based on demand and market and you work to sell them in a timely fashion. But what are you doing to make more profit on the back end of your deals? Statistics show very few dealers offer service contracts on every sale. But why? Beyond the fact you can better protect your customers after the sale, there are countless benefits that put more profit in your pockets. Think about the extra commas in your bottom line if you apply the same effort to your back-end profits as you do to protecting your front-end gross. Nice mental image, isn’t it? It starts with having a process: Think 300 percent. That means you offer 100 percent of your service contract menu to 100 percent of your customers 100 percent of the time. That doesn’t mean you’ll end up getting every single customer to purchase a service contract. But if you can bump your penetration from 25 percent to 50 percent, you’ve just doubled your profits from the back end of deals. Not to mention the more service contracts you sell, the more you stand to get back in return. You get out what you put in: A portion of every service contract you sell is set aside in the event a claim is paid on that particular vehicle. Check with your service contract provider to see what portion of that reserve, if any, you can get back when the contract expires.
GWC Warranty dealers who qualify for our Elite Dealer Program begin earning a portion of those reserves back when they reach certain service contract volume milestones. Create enough service contract volume and WealthBuilder dealers can qualify for up to 100 percent of their underwriting profits. Service contract volume isn’t the only driver of that profit center. Selling quality vehicles and focusing on reconditioning will help keep reserve accounts full, as fewer claims are paid from them. Up your game with upsells: When it comes to immediate profits, upsells to richer coverage levels with longer terms will help build up reserve account balances. If you’ve followed the first two steps of this process and you work in upsell opportunities, you’ll be offering better contracts more often, making more underwriting profits available and, perhaps most important, improving post-sale satisfaction, setting you up for long-term profitable benefits as well. Repeat, refer, rejoice: Where you stand to benefit the most from a standardized back-end profit approach is when it comes back to you on the front end. How does that work? Imagine the customer you protected for a longer term with richer component coverage. Now think about how he’ll feel when two, three, four or even five years down the road, the service contract you sold is still saving him money on unexpected repairs. It’s the ultimate customer satisfaction experience, and one customers will tell family and friends about. So when their cousin, friend or colleague needs a quality vehicle, where will they go? You guessed it – they’re coming to you. And when they’re in the market for another vehicle, you can be sure they’ll start their search where their last one ended – on your doorstep.
SAFETY WATCH
BMW RECALLS MORE THAN 100,000 VEHICLES Fuel Pumps May Have Loose Wires
BMW of North America, LLC (BMW) is recalling 136,188 model year 2007-11 BMW X5 3.0si, X5 4.8i, X5 M, X5 xDrive30i, X5 xDrive35i, X5 xDrive48i and X5 xDrive50i, 2008-11 X6 x Drive35i, X6 xDrive50i and X6 M; 2010-11 X6 ActiveHybrid, 535i xDrive Gran
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Turismo, 535i Gran Turismo, 550i xDrive Gran Turismo and 550i Gran Turismo, 20112012 528i, 535i, 535i xDrive, 550i and 550i xDrive and 2012 535i ActiveHybrid, 640i Convertible, 650i Convertible, 650i xDrive Convertible, 650i Coupe and 650i Coupe xDrive vehicles. The affected vehicles have in-tank fuel pumps that may have insufficiently crimped wire contacts. The loose wires may cause the connector to melt, resulting in a fuel leak. Additionally, the fuel pump may stop working, possibly causing an engine stall and increase the risk of a crash. BMW will notify owners, and dealers will replace the fuel pump module, free of charge. The recall is expected to begin Dec. 5.
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COMPLIANCE OVERDRIVE BY CHIP ZYVOLOSKI
AVOID THE “ONE SIZE FITS ALL” RETAIL SALES CONTRACT MINDSET Address Your Specific Terms Avoid compliance violations and potential fines by setting aside time to review your retail sales contracts. Wait, aren’t all forms “one size fits all?” Your credit documents need to address the specific terms of credit you offer – matched with state and federal disclosures and provisions. Mismatching your credit terms and contract provisions could cost you thousands of dollars in fines, damages and legal fees as well as harm your business reputation. Here are a few features you should review to make sure your retail sales contracts match the credit terms you offer. Type of Property Sold Motorcycles, autocycles, off-road vehicles, RV’s and other motorized vehicles may not be “motor vehicles” under your state’s retail sales laws. Required contract and disclosure terms can vary depending on whether you are selling a “motor vehicle” as defined in your state’s retail sales laws. With the variety of motorized vehicle types available, make sure the contract you are using is designed for the type of personal property you sell. The same is true of your license to sell motor vehicles. Make sure your dealer’s license covers the property you sell. Cash Down Payments Usually, the cash down payment is received at closing, but dealers sometimes allow buyers to make one or more down payments after closing. Under the Truthin-Lending Act and Regulation Z of the act, these “deferred down payments” or “pickup payments” must be made no later than the due date of the second regularly scheduled payment. They also cannot be subject to a finance charge. It’s helpful to have a contract provision with buyer’s promise to make deferred down payments. It must also be a line item in the Itemization of Amount Financed, which treats it as a credit even though it hasn’t been received yet. Although it’s not required, dealers should include the date and amount of a deferred down payment in the Fed Box Payment Schedule. If you allow deferred down payments, be sure your contracts support them or are flexible enough to handle them. Note: some states do not allow deferred down payments or require them to be paid sooner than under Reg. Z.
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Negative Equity Trade-Ins Under Reg. Z, a down payment in the itemization can never be less than zero. As a result, negative equity trade-ins require special handling. Reg. Z allows two methods of calculating the down payment. One way is to net all the cash and other credits against the negative equity in the trade-in (“netting”). Another way is to add all credits but not subtract any negative equity in the trade-in (“nonnetting”). The method used will affect the calculated down payment and the amount of a separate line financing the balance owed on the negative equity trade-in. You may not have much choice in selecting a contract with your preferred netting or non-netting method, but it’s important to understand which method your contract uses so you can explain it to buyers. Equal Installments. Balloon Payments. Equal monthly payments are a common payment frequency. Changing to more or less frequent equal payments can sometimes require changes to contract terminology and disclosures. Be sure to review your documentation and completion tools carefully if you require equal periodic payments other than monthly. Balloon payments are generally structured as a final payment that is more than twice as large as the average periodic payment. A balloon payment schedule can lower periodic payments, but the buyer might have problems paying the balloon. Dealers and lenders sometimes provide options for buyers who can’t pay the balloon amount. Those options may be included in the contract, especially if they are required by law. For example, one option is to allow a buyer to pay the balloon amount plus interest in installments, usually in an amount no greater than the prior installments. States sometimes require additional disclosures to warn the consumer of the final payment amount. Be sure to review your documentation if you offer balloon payment features. Arbitration Not all contracts include an arbitration provision. You should review your contract to confirm it has one if you want it. The CFPB has proposed a regulation that would preserve the buyer’s ability to join a class action lawsuit even if the dealer/ creditor has a contract right to require arbitration. If the CFPB’s proposal becomes final, you will want to review your decision to include an arbitration provision and either update or remove it. Conditional Delivery – Spot Delivery Is your retail sales contract conditioned on your ability to sell the completed contract to an assignee? If so, your retail sales contract should include a provision telling the buyer about it. If you do conditional deliveries, it can be risky to use a retail contract that doesn’t include a spot delivery provision
or specifically cross-reference a separate spot delivery agreement. In that case, someone reading the retail contract alone will not know it’s subject to another agreement. (The same concept also applies to arbitration provisions.) If spot delivery is an important element of your credit programs, make sure your contract addresses it in some way. Note: some states do not allow conditional delivery provisions. Fees and Charges Your retail sales contract probably has blank lines in the itemization and in other places. That does not mean you can put anything you want in the blank lines, especially fees. In many states, only specific fees with specific names are allowed. You should review your retail contracts to determine if they have any required disclosures or contract provisions for the specific fees you charge. What if there isn’t a contract provision or disclosure for your fee and it only appears on a blank line in the itemization? That may be okay for some fees in some states. The point is that you should research your state to determine what fee information is required and to confirm your retail contract has it. Like the seasons, your credit programs and terms can change over time. Now is a good time to review your credit documentation to make sure it is up to date. Chip Zyvoloski is a senior attorney for Indirect Lending at Wolters Kluwer. For more information, please visit www. wolterskluwerfs.com/indirect.
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AUCTION NEWS
BY AUTO REMARKETING STAFF
SERVNET ADDS LOUISIANA AUCTION TO MEMBERSHIP Louisiana’s 1st Choice Auto Auction
ServNet has a new member. Joining the independent auction group is Louisiana’s 1st Choice Auto Auction, which opened back in 2002. “We welcome Louisiana’s 1st Choice Auto Auction as the newest member of the ServNet Auction group,” ServNet president Kevin Brown said. “The auction is highly regarded in the industry, and has long been recognized for innovation, creativity and dedication to customer satisfaction.” “LFCAA’s efforts produce excellent results for their customers, and we’re pleased that the auction will carry the ServNet brand in their region,” he said. “ServNet’s auction owners and executive team look forward to a rewarding collaboration with John Poteet and his auction team.” LFCAA managing partner John Poteet said,
LIADA AUCTION MEMBERS
“We have long admired ServNet for its professionalism and comprehensive approach to the marketplace. “As a ServNet auction, we join ranks with the most successful, innovative and service-centered independent auctions in the country, and we look forward to working with them in sharing ideas, refining best business practices and contributing to a cohesive strategy to best serve both our commercial and dealer customers.” LFCAA holds a six-lane sale every Tuesday, including consignment from ARI, Consumer Portfolio Services, Credit Acceptance/ VRS, Emkay, Hancock Bank, National Auto Acceptance, Santander Consumer USA and dealers. The auction completed a $3 million expansion project last year that included 4.5 acres of parking, two additional auction lanes and an operations center. The latter features a photo booth, detail/mechanic shop and a vehicle registration building.
ABC Baton Rouge
3960 Blount Road Baton Rouge, La 70807 225 778 3737 www.auctionbroadcasting.com Sale Thursday
ADESA Shreveport
7666 Greenwood Road Shreveport, LA 71119 318-938-4400 Phone 318-938-7623 Fax www.adesa.com Sale Wednesday at 9 a.m.
Alexandria Auto Auction 515 N 3rd Street Alexandria, LA 71301 318-484-9672 Phone 318-484-9699 Fax www.alexandriaauction.com Sale Tuesday at 5:30 p.m.
America’s Auto Auction Houston 1826 Almeda Genoa Rd. Houston, TX 77047 281-819-3600
Brown’s Auction Co.
6249 Hwy 190 Eunice, La 70535 Phone: 337-457-4919 www.brownsauction.com Sale is quarterly (call for more information).
Copart
21595 Greenwell Springs Rd. Greenwell Springs, LA 70739 225-261-0102
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Open Road / December 2016
LFCAA earned ARI’s Auction of the Year Award in 2011 and 2014. This year, it earned the inaugural Southern Chapter Auction of the Year Award from the National Auto Auction Association and was one of Auto Remarketing’s Best Auctions to Work For. LFCAA was the only auction to earn both awards. “We like to say that superior service is our auction’s signature ‘lagniappe’ – a Louisiana tradition that means a little something ‘extra’ that is not expected or demanded,” Poteet said. “Our affiliation with ServNet is sure to enhance that lagniappe as we expand the scope of our service to the industry.”
Greater Shreveport-Bossier
Manheim New Orleans
Insurance Auto Auction
Mid-South Auction
Louisiana’s 1st Choice Auction
Mike McTurner Dealers
18310 Woodscale Road Hammond, LA 70401 985-345-3302 Phone 985-343-5735 Fax www.lafcaa.com Sale Tuesday at 9 a.m.
136 Gregory Drive Monroe, LA 71202 318-343-8200 Phone 318-343-8259 Fax www.dealersautoauction monroe.com Sale Tuesday at 10 a.m.
Long Beach Auto Auction
Lake Charles Auto Auction
1315 Grimmett Drive Shreveport, LA 71107 318-221-3362 Phone 318-221-3372 Fax www.gsbautoauction.com Sale Wednesday at 1 p.m. 29000 Frost Road Livingston, LA 70754 225-686-9197 Phone 225-686-8197 Fax www.iaai.com Sale Monday at 9 a.m.
8494 County Farm Road Long Beach, MS 39560 228-452-2030 Phone 228-452-9588 Fax www.lbautoauction.com Sale Wednesday at 1:30 p.m.
Manheim Lafayette
1611 St. Mary Street Scott, LA 70583 1-337-237-5620 Phone Sale Thursday at 10:00 a.m.
Manheim Mississippi 7510 U S Highway 49 Hattiesburg, MS 39402 601-268-7550 Phone 601-579-7202 Fax www.manheim.com Sale Thursday at 9 a.m.
61077 St. Tammany Slidell, LA 70460 985-643-2061 Phone 985-643-2122 Fax www.manheim.com Sale Wednesday at 9 a.m. 1657 Old Whitfield Road Jackson/Pearl, MS 39208 601-956-2700 Phone 601-956-5603 Fax www.midsouthaa.com Sale Tuesday at 9 a.m.
2435 E Broad Street Lake Charles, LA 70601 337-433-8664 Phone 337-436-7197 Fax www.pedersenandpedersen.com Sale Wednesday at 5:30 p.m.
Oak View Auto Auction
13451 Florida Blvd Baton Rouge, LA 70815 225-272-5139 Phone 225-272-5314 Fax www.oakviewautoauction.com Sale Friday at 10 a.m.
Z66 Auto Auction
66 N Mingo Tulsa, OK 74116 Phone: 918-794-0660 www.a66aa.com Sale Friday’s at 11:30 a.m.
www.louisianaiada.com
LIADA DEALER SERVICE PROVIDERS Frazer Computing Inc. ADVERTISING help@frazer.com Auto Sweet P.O. Box 569 Christopher Lentz Canton, NY 13617 lenny@autosweet.com Phone: 1-888-963-5369 3240 W. Henderson Rd. Fax: 1-888-963-3366 Columbus OH 43220 Phone: 614-448-9089 DEALER SUPPLIES / FORMS My Dealer Supply Company ATTORNEY Eric Stroderd McGlynn Glisson Mouton ericstroderd@mydealersupply.com Attorney at Law 311 A West University Christopher D. Glisson Lafayette, LA 70506 chris@mcglynnglisson.com Phone: 877-427-1238 340 Florida St. Romano Promotions LLC Baton Rouge, LA 7080 Megan Romano Phone: 225-344-3555 megan@romanopromo.com Tureau & Tureau, APLC 42062 Gardens Blvd Ralph Tureau & Steven Tureau Hammond, LA 70403 steven@tureaulawfirm.com Phone: 985-634-8274 12320 Hwy 44 Suite 3C DETAILING Gonzales, LA 70737 Phone: 225-647-8529 Jose Upholstery Fax: 225 647-8530 Jose Delgado 4776 Fairfields Ave. AUTO PARTS Baton Rouge, La 70802 ABC Auto Parts Phone:225-316-4575 Larry Pyle M M Topshelf Detailing & Recon dereck@abcauto.com Lonnie McCauley P.O. Box 3627 lmccauley@eatel.net Longview, TX 75606 4452 Jeffery Dr. Phone: 903-232-3060 Baton Rouge, LA 70816 AutoZone Phone: 225-603-4600 Derlyn Odom Fax: 225-622-5994s deryln.odom@autozone.com 6517 airline why FINANCES Metairie LA, 70003 American Credit Acceptance 228-990-5669 Rachel Swain Email: callie.kwiatt@acacceptance.com Pull A Part Phone: 864-308-4380 Toby Thompson 961 E. Main St. Baton Rouge, LA 70814 Spartanburg, SC 29302 Phone: 225-247-9160 AppOne BODY SHOP Penny Bearb Custom Colors 6815 Saukview Dr. Pete McKnight--Billy Rapp St. Cloud, MN 56303 customautocolors@gmail.com pbearb@appone.net 11550 Cloverland Ave. www.appone.net Baton Rouge, LA 70809 Phone: 877-277-6631 x1228109 Phone: 225-752-5947 Automotive Finance Company Fax: 225-752-5940 11221 Cedar Park Ave. BUSINESS SERVICES Baton Rouge, LA 70809 Davenport Business Services LLC Julie@teamhonda.com www.automotivefinancecompany.com David Davenport david@davenportbusinessservices.com Phone: 225-293-6488 14 Concord Place Center Street Finance, LP Gulfport, MS 39507 200 N. Mesquite, Suite 202 Phone: 228-547-9219 Arlington, TX 76011 Phone: 682-777-2002 CONSULTING Fax: 817-887-4976 DealerDynamix Central Credit Inc. Joseph Ventura Charles E. Spedale jventura@dealer-dynamix.com skebdees@yahoo.com 6671 W Indiantown Rd. 4303 Plank Rd. Jupiter, FL. 33458 Baton Rouge, LA 70805 Phone: 866-970-8929 Phone: 225-356-4656 CREDIT CARD SERVICES Fax: 225-356-4656 Applied Merchant First Consumers Financial, LLC Jeff Gallo Bob Chedville jgallo@appliedmerchant.com bob@fcfcarloan.com 26775 Malibu Hills Rd. 14580 Florida Blvd. Calabasas, CA 91301 Baton Rouge, LA 70819 Phone: 800-236-2179 Phone: 225-272-9009 DEALERSHIP MAINTENANCE Nationwide Acceptance Martin Less Integrity Audio Visual LLC mless@nac-loans.com Steve Clay 3435 N Cicero Ave. steve@integrity-av.com Chicago IL 60641 39089 South Angelle Court Phone: 800-622-7605 Gonzales, LA 70737 Phone: 225-235-1528 Preferred Loans LLC Shana Quick DEALER MANAGEMENT SYSTEMS preferloans@eatel.net Dealer Market Exchange 12241 Roddy Rd. Holly Jonsson Gonzales, LA 70737 holly@dmx.io Phone: 225-644-0304 B5 Calle Tabonuco Fax: 225-644-6862 Guaynabo PR 968 Phone: 970-749-0851
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Open Road / December 2016
Westlake Financial Services Rob Wilson 4751 Wilshire Blvd, Suite 100 Los Angeles, CA 90010 dealers@westlakefinancial.com www.westlakefinancial.com Phone: 888-8YES-YES FLOOR PLAN
AFC Tim Ormiston 1610 A St. Mary St. Scott, La. 70583 timothy.ormiston@autofinance.com www.Afcdealer.com Phone: 337-593-8992 AFC Michael Meyers Michael.Meyers@autofinance.com 18310 Woodscale Rd. Hammond La. 70401 Phone: 877-739-0218 CarBucks Floor Plan Brandon Ziebarth www.usecarbucks.com 381 Halton Road Greenville, SC 29607 Phone: 225-819-6747 NextGear Capital Stuart LaBauve slabauve@discoverdcs.com Phone: 225-620-1660 Fax: 866-550-8694
Safe Lily Insurance Agency Laquica Fisher lfisher@safelilyins.com 720 Burnside Ave. Gonzales, LA 70737 Phone: 225-450-2009 US Agencies Low Cost Insurance Sharon Miller Sharon.Miller@confiegroup.com 440 Third St. Baton Rouge, LA 70802 Phone: 225-615-0957 Fax: 225-987-5144 US Agencies Low Cost Insurance Kenneth Champagne kchampagne@usagencies.com 440 Third St. Baton Rouge, LA 70802 Phone: 225-408-8492 Fax: 225-987-5144 MARKETING
GLASS/WINDSHIELD
Cars.com 75 W. Jackson Blvd. Suite 800 Chicago, IL 60604 Phone: 312-601-5188 Interactive Financial Marketing Group Travis Weisleder dealerinfo@interactivefmg.com 1509 West Main St. Richmond, VA 23220 Phone: 804-225-1880 Showroom Logic 47013 N. Morrison Blvd. Hammond LA 70401
GPS
MasterMatch Eddie Krueger eddielsufan@yahoo.com 1104 Pine St. Suite A Monroe LA 71207 Phone: 318-322-2886
Babin’s Auto Glass Inc. Brent Babin babinsautoglass@eatel.net 13283 Airline Hwy. Gonzales, La 70737 Phone: 225-647-1369
PAINT TOUCHUP & INTERIOR REPAIR
Position Plus GPS SECURITY SYSTEMS Andy Seckinger Integrity Audio Visual LLC andy@positionplusgps.com Steve Clay 950 Market St. Steve@Integrity-av.com Shreveport, LA 71107 39089 South Angel Court Phone: 318-286-6297 Gonzales, LA 70737 SVR Tracking 225-235-1528 Zanita Phillips Zphillips1225@gmail.com RENTAL CAR 950 N. Market St. Enterprise Rental Car Shreveport, LA 71107 3545 N 1-10 Service Rd., Ste. 101 Phone: 318-286-6297 Metairie, LA 70002 Phone: 504-454-1717 INSURANCE & BONDS
LeBlanc Auto Title Company 1116 E. Cornerview St. Gonzales, LA 70737 Phone: 225-644-4591 Fax: 225-644-8207 hopeleblanc@eatel.net TOWING & RECOVERY
Smart Tow Kevin Rembert 3045 Rosenwald Rd. Baton Rouge, LA 70807 kevinpremert@yahoo.com Phone: 225-356-3002 Fax: 225-356-3222 TRANSPORTATION
Masney Auto Transport Inc. Greg Hedges page@masney.com 831 Maguire Rd. Ocoee FL 34761 Phone: 407-877-8882 VEHICLE HISTORY
Carfax Kathy Collins kathycollins@carfax.com Phone: 703-934-2664 5860 Trinity Pkwy Centreville, VA 20120 WARRANTY
AUL Corp Shelton Green shelton@sadrinc.com 1250 Main St. Suite 300 Napa, CA 94559 Phone: 504-722-8123 Centurion Automotive Consultants Danny Delich centurionautomotiveproducts@gmail.com Atlanta, GA Phone: 470-955-9757 CTR Warranty, LLC Ken Rugg 319 North 3rd St. Monroe, LA 71201 Phone: 318-323-6385
Ferrell Dealer Services 18016 Shadow Creek Ave. Baton Rouge, LA 70816 Phone: 225-978-5111 fspruell@gmail.com GWC Warranty James W. Hester Affordable Insurance Solutions RENT TO OWN jhester@gwcwarranty.com Janis Fallaw Seadra Inc. 40 Coal St. agentj0912@aol.com John Garner Wilkes-Barre, PA 18702 751 Hwy 51 john@seadraonline.com Phone: 225-771-9766 Madison, MS 39110 10555 Lake Forrest Blvd. Phone: 601-856-9447 GCWS, LLC New Orleans LA 70127 GWC Phone: 504-241-0211 Carmouche Insurance Inc. Rock Brunet 516 N. Burnside Ave rockbrunet@gmail.com TIRES Gonzales, LA. Cooper Tire and Rubber Company 101 Shumard Dr. Phone: 225-647-8552 Lafayette LA 70508 Michael Wertz Charles Carmouche Phone: 337-258-2998 charles@carmoucheinsurance.com mtwertz@coopertire.com 820 Rivers CreekLn. Protective Solution LLC Crossland Insurance Agency Little Elm, TX 75068 Rick Cole Andrew Arceri Phone: 567-525-2765 rcmarketingllc@me.com andrew@crosslandins.com 4211 Sterlington Rd. 1101 Hwy 90 E. TITLE – NOTARY Monroe, LA 71203 New Iberia, LA 70560 Dealertrack Registration Phone: 877-697-2533 Phone: 337-367-6035 and Titling Services PWI Processed by Auto Title Express Dwight W. Andrus Insurance Sharon Coleman Amy Casey Bonnie Dozier sharon@warrantys.com 3445 Causeway Blvd Suite 103 bbd@andrus.com PO Box 278 Metairie, LA 70002 P.O. Box 60970 Orwigsburg, PA 17961 7 locations throughout Louisiana! Lafayette, LA 70598 Phone: 800-548-1121 Go.dealertrack.com/LA Phone: 337-981-7300 Contact Sales: 888.346.3087 Insurance & Bonds, LLC Express OMV John Sonnier Brooke Barnett 9131 Interline Ave. #10-B Phone: 225-243-6925 Baton Rouge, LA 70809 485 Florida Blvd. Jsonnier60@gmail.com Denham Springs LA 70726 Phone: 225-922-3700 S. Brown Associates 150 River Rd. M3 Montville, NJ Phone: 973-270-2270 www.louisianaiada.com
NEW FRANCHISES Team Honda and Team Toyota Moss Motors Giles Automotive Group Ray Brandt Auto Group Salisbury Dodge
Hood Automotive Group Richards Honda Duplessis Buick / GMC Tiger Honda of Gonzales Patty Peck Honda
Sango Buick C-D-J Jeff Wilson C-D-J Paul Barnett Nissan Honda of Covington Bergeron Chrysler
USED CAR DEALERS Brewer Wholesale Joel’s Auto Sales Ledet’s Auto Sales Auto King of Baton Rouge D. Moore Auctioneers McCray’s Auto Sales Harvest Motors
Gumridge Auto Cars IV R L Sawyer
WE DON’T DO BALLPARKS The vAuto way is simple: Every used car decision is made with data-driven precision. This year, the 7,500+ Provision® dealers who rely on our industry-leading insights and exclusive Live Market View will continue to soar above the national averages in inventory turns and profitability. Thriving despite ever-thinner margins and more cars on the market. Starting with your pricing, you’ll see how precision pulls shoppers into your inventory, moves it faster and makes more total gross. You’ll see how precision results in better decisions, less guesswork and fewer aged cars. And you’ll see why Provision has proven time and again to be the only way the best dealers want to work.
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