Texas Dealer, October 2014

In This Issue: – New Advertising Rules Now Effective – The Moneyball Phenomenon – Michael W. Dunagan on Disclosure of Prior Damage and Cooling-Off Periods – It’s Beginning to Look a Lot like Christmas

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Volume XIV

2015 TIADA Board of Directors

chairman of the board Michael Thomasson/Mike Carlson Motor Company 264 Exchange St. Burleson, TX 76028 Office: 817.366.9578 Email: mthomasson@mcmcauto.com

Secretary Kathrine Tolsch/CICO Auto Sales 11050 Harry Hines Blvd.

Dallas, TX 75229 Office: 214.352.9282 Email: cicoauto@verizon.net Treasurer Greg Zak/Dixon Motors 7902 North Freeway Houston, TX 77037 Office: 281.931.1300 Email: gzak@windstream.net Vice President, West Texas (Region 1) James Hobson/H-Town Motors 3714 Dyer Street El Paso TX 79930 Office: 915.564.9797 Email: htownmotors@sbcglobal.net Vice President, Fort Worth (Region 2) Tommy Gregory/Abilene Used Cars Sales Inc. 497 E.S. 11th Abilene, TX 79602 Office: 325.676.8000 Email: aucsinc@sbcglobal.net Vice President, Dallas (Region 3) Kevin Mims/VP Auto Sales 2921 S. Garland Ave. Garland, TX 75041 Office: 972.864.1300 Email: kevinm@vpautosales.com Vice President, Houston (Region 4) Juan Sabillon/Mi Tierra Auto Sales 7935 Gulf Freeway Houston, TX 77017 Office: 713.644.2446 Email: brentfordct@yahoo.com Vice President, Central Texas (Region 5) Robert Beck/Stop N’Drive Motors 711 N. General McMullen Dr. San Antonio, TX 78228 Office: 210.432.1101 Email: stopdrive@texas.net Vice President, South Texas (Region 6) Dan Keetch/Keetch Motors 1010 S. Staples Corpus Christi, TX 78404 Office: 361.882.3541 Email: dankeetch51@yahoo.com Vice President At Large Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 Office: 713.641.0980 Email: ryan.winkelmann@sbcglobal.net Vice President At Large Trey Crouch/Trey Crouch’s Wheels On Credit 636 E. Business 83 McAllen TX 78501 Office: 956.972.0700 Email: trey@wheelsoncredit.com TIADA Executive Director Jeff Martin 9951 Anderson Mill Rd., Suite 101 Austin, TX 78750 Office Hours M-F 8:30am - 4:30pm 800.442.5944 • Fax 512.244.6218 jeff.martin@txiada.com

I s s u e 10

/

O c t o b e r 2 014

texasDealer

President Brent Rhodes/Fiesta Motors 5150 Industrial Way Drive Buda, TX 78610 Office: 512.312.2201 Email: brent@fiestamotors.net

President Elect HL Hensley/Automax of Lubbock 1908 Avenue J Lubbock, Texas 79411 Office: 806.744.3533 Email: hl@gospac.com

/

5 Officers’ Message

contents

by Brent Rhodes, TIADA President

9 Legal Corner: Dealer Questions About Disclosure of Prior Damage and Cooling-Off Periods Addressed

by Michael W. Dunagan

10 Upcoming Events 12 News & Notes 14 House of Delegates Meeting Minutes 16 Local Chapters 16 2014 Auto Auction Directory & Resource Guide 19 New Advertising Rules Now Effective

by Bill Harbeson

21 It’s Beginning to Look a Lot like Christmas: Getting creative during the upcoming holiday season

by Brent Carmichael

25 On The Cover: Dealers & Customers: The Rest of the Story

by Danny Langfield

35

The Moneyball Phenomenon

by Joe Lescota

40 Regulation Matters: Titling a Vehicle in the Name of an Entity

by Danny Langfield

42 New Members 45 Behind the Wheel

by Jeff Martin

What’s happening at w w w . t x i a d a . c o m ?

DID YOU KNOW... Members can access free legal consultation at any time? Just

go to Legal Resources/Legal Consultation Service, enter your question and submit the form. A TIADA staff member or attorney will respond to you directly, usually within one business day.

The Editor of the Texas Dealer magazine is Jenny Kroening, Special Projects Director of TIADA. To change your address for subscription and/or for other TIADA products, call the TIADA state office at 800.442.5944, 512.244.6060 or fax 512.244.6218. E-mail: info@txiada.com. New Membership/Subscriptions: If you are a member of TIADA, you may receive this magazine free of charge. Membership year runs from Jan 1 to Dec 31. Back issues are available for $20 each subject to availability. Send a check or money order, along with your name and mailing address to TEXAS DEALER, Attn: Back Issues, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750. Sorry, no billing. Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the membership. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured.

officers’ message Planning for the Unexpected

I

remember attending a basketball camp with my kids where a guy was brought in to show off his crazy ball-handling skills. At one point in the presentation, he proceeded to strap on sharp pointed sticks to his knees, feet and even on his head. He got a ball spinning and then placed it on one of the sticks and did the same thing with seven more basketballs.

When he was done, he had all eight basketballs spinning at the same time! As an owner/operator, there are many days at my dealership when I feel just like this guy, trying to keep all of the different parts of the dealership spinning — sales, collections, service, customer problems, and bank issues. The list can keep on going sometimes. Do you ever feel like this? Have you thought about who would handle these issues in your absence?

At my recent twenty group meeting, we were informed about a dealer in another twenty group who suddenly passed away. This tragic event led to a lengthy discussion on succession planning and preparing for tragedies such as this. I hope that all of you have your personal affairs in order with a will and life insurance, etc., to provide for your immediate family. (If you don’t, stop reading this article and attend to this matter immediately!) But how many of you have seriously thought about and have a detailed, written succession plan that is to be followed in your absence?

I’ll list some of the issues we discussed in our twenty group meeting here. My hope is that you have already planned for many of them. If you haven’t, now is the time.

Who would step in and run the dealership if you had to take an unexpected, extended or even permanent leave? Do you have someone in place to make competent decisions

by Brent

Rhodes

Fiesta Motors (Buda) TIADA president

about your business? Many of you might be like me and have a spouse who is not actively involved in the dealership.

Do you have someone whom you and your spouse can trust to make the decisions that you want for your business?

What would happen to the dealership if you were no longer there? Would the dealership continue to operate or begin the process of liquidating its assets? This involves selling off inventory as well as selling off your portfolio of notes if you are a buy-here pay-here dealer. Selling off inventory seems to be the easier of the two since they could all be taken to auction. If you want to liquidate your portfolio, have you obtained a list of companies that buy notes in order to get bids when the time comes? If you want to continue to collect your notes until they mature, do you have someone to manage these collections?

What will happen to the real estate of the dealership?

There are different discussions to have depending upon if you lease or if you own the real estate. What will happen to all of the furniture and fixtures?

As you can see, deciding the future of your business without you as the owner requires planning. The good news is that with all of the work spent on an emergency succession plan, you will have a head start when you are ready to voluntarily “ride off into the sunset” and retire.

Do not neglect succession planning because it looks too far ahead to the future. Developing a written, formal plan that outlines the ownership transition once you are no longer involved day-to-day is a critical undertaking that must be done before the plan is ever needed.

Do not neglect succession planning because it looks too far ahead to the future.

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5

TIADA DeAler AcADemy 2014

Keeping Your Dealership Legal and Compliant a seminar with Michael W. Dunagan, TIADA General Counsel Author of the standard-setting books, “Dealer Financing of Used Car sales” and “Texas Automobile repossession: A Lien Holder’s Legal Guide.”

This class is the 2014 version of attorney Michael W. Dunagan’s ongoing quarterly compliance seminar. Featuring updates on both federal and state compliance issues, this session focuses on advanced dealership financing issues. This is the practical side of compliance from the association that understands you have a business to run — and you want to run it right.

The seminar will focus on advanced financing concepts, with special emphasis on in-house financing, repossession & bankruptcy issues, OCCC compliance and federal regulations. u u u u u u u u u u

u u

Customer ID requirements – what is acceptable?

Privacy Notice requirements – do we need a new, custom form? risk-based Pricing – what does the rule require?

Credit Card Convenience Fees – what is allowable?

Adverse Action rule – who is affected?

Consumer Financial Protection bureau (CFPb) – what can dealers expect? bankruptcy – when do we have to give the vehicle back? repossessions – When does the 60% rule apply? Is repo notice required?

Do we have to return custom wheels? Do we have to disclose a GPs unit?

OCCC Audits – what are the most common mistakes dealers make?

TxDMV enforcement – advertising violations, title management issues & more

PLUS: Texas Legislative session – an update on bills that will affect the industry Q & A – don’t leave until you get all your questions answered by the top industry expert in Texas, Michael W. Dunagan

Monday, October 27, 2014 Houston, Texas

seminar will be held from 9:00am - 3:30pm DoubleTree by Hilton Houston Hobby Airport 8181 Airport blvd. | Houston, TX 77061 713.645.3000

sponsored by: Collateral Protection Insurance www.cpiai.com

Discount Pricing for Multiple Attendees!

MeMbers – First registrant $149, each additional $99 (Must be from same dealership)

NON-MeMbers – $299

www.autozoom.com

register online at w w w . t x i a d a . c o m or by phone at 800.442.5944.

Texas Independent Automobile Dealers Association

www.passtimeusa.com

legal corner

Dealer Questions About Disclosure of Prior Damage and Cooling-Off Periods Addressed Dealer Question: Is there a law

that makes it illegal to sell a car that had prior body or frame damage without disclosing the fact?

Answer: If the information about prior damage is “material” information, then there is potential liability for non-disclosure under the Texas Deceptive Trade Practices Act (DTPA). You won’t find a law that specifically refers to legal requirements regarding disclosure of prior damage to a motor vehicle.

However, the DTPA creates a cause of action for seller misrepresentation of any product sold — whether a manufacturing defect on a toaster or frame damage to a motor vehicle.

I

n addition to addressing affirmative misrepresentations of material fact (such as saying that a vehicle is a 2005 model year when in fact it is a 2004), there is a DTPA action for failure to disclose a known material fact. The fact that a vehicle has repaired frame damage will probably be found to be a material fact by a jury. While a slight bump to a fender or a ding on a door probably doesn’t constitute material damage, more serious collision damage, especially involving straightening or welding a frame, probably does. The final determination of whether the prior damage is material — that is, whether the average reasonable person would find that the information would have an effect on the buying decision — is to be made by a judge or a jury (if either party has demanded a jury trial).

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An actual reported court case in Houston demonstrates how this works. A woman purchased a used Lincoln Continental from a dealer. The vehicle had come from a rental car company which had expended over $3600 in repairs after a rear-end collision. This fact was never disclosed to the retail purchaser.

After she found out about the previous damage, the woman sued the dealer claiming fraud and misrepresentation under the DTPA. A jury found that the dealer had committed fraud and had misrepresented the vehicle and assessed damages. The Court of Appeals agreed with the trial court that the buyer’s testimony — that she had relied upon the misrepresentation of the dealer and would not have entered into the purchase but for the seller’s misrepresentations — was sufficient to establish that the misrepresentations were the producing cause of the purchaser’s damages.

Each purchaser, including a dealer, has a similar cause of action against its seller. If, for instance, a dealer purchases a vehicle from another dealer, and subsequently finds out that there had been undisclosed material damage (such as frame damage), the purchasing dealer has a potential DTPA cause of action against the selling dealer. The same

by Michael

W. Dunagan

TIADA general counsel

would apply to a vehicle taken in trade from a consumer.

DTPA damages for misrepresentation are not covered by a dealer’s bond (unless there is a failure of title). Thus, a dealer who has been

...the DTPA creates a cause of action for seller misrepresentation of any product sold — whether a manufacturing defect on a toaster or frame damage to a motor vehicle. damaged by a prior owner’s misrepresentations about the condition of a vehicle due to prior undisclosed frame damage has to worry about whether he’d be able to collect damages from the seller even if he obtained a judgment.

The universal rule here is that the dealer who buys inventory only from dealers who are honest and solvent and take care of their 9

Upcoming Events TIADA Dealer Academy October 2014 27 Keeping Your Dealership

Legal & Compliant DoubleTree by Hilton Houston Hobby Airport 8181 Airport Blvd. / Houston, TX 77061 713.645.3000 Online registration available at www.txiada.com

November 2014 10 Dealer 101: Nobody Told Me That!

Crowne Plaza Austin 6121 North IH-35 / Austin, TX 78752 512.323.5466 Online registration available at www.txiada.com

19 Better BHPH Financials: How to

Get Organized for Growth DoubleTree by Hilton Hotel Dallas Market Center 2015 Market Center Blvd.

Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com

20 Better BHPH Financials: How to Get Organized for Growth Hilton San Antonio Airport Hotel 611 N.W. Loop 410 San Antonio, TX 78216 210.377.4601 Online registration available at www.txiada.com

10

December 2014 8 Keeping Your Dealership Legal & Compliant DoubleTree by Hilton Hotel Dallas Market Center 2015 Market Center Blvd.

Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com

Other TIADA Events

October 2014 6 TIADA Board of Directors

Meeting Austin, Texas

problems has little to worry about.

On the other hand, when vehicles are purchased from individuals and dealers who don’t have the inclination or financial ability to protect their buyers from losses, the dealer is on his own.

The second rule is that a selling dealer should always disclose in writing, even to another dealer, any known fact about a vehicle that might affect its value. If the disclosure is made orally, there is a risk that the buyer will “forget” about the disclosure (or claim that any disclosure was inadequate) when the time comes to sue. The dealer in the chain of title who disclosed the defect in writing to his buyer will probably not have any liability when someone down the line who wasn’t given notice decides to file suit.

Dealer Question: I just got a let-

ter from an attorney telling me that his client (my customer) is exercising his right to cancel our contract within three days of the sale. Does my customer have such a right?

Answer: If the sale took place at your dealership, there is no such right. Rumors about a 72-hour “cooling-off period” go back to a couple of sources.

First, the Federal Truth-InLending Act in 1968 established a three-day right of rescission for any consumer entering into a contract that created a lien on the consumer’s principal dwelling. The right to unilaterally cancel the contract was effective until midnight of the third day following the signing of the contract. This provision was intended to give some relief to consumers who may have been unduly coerced into signing home improvement contracts (usually for aluminum siding or storm windows) that imposed second liens on the homestead. Congress was reacting to media reports about senior citizens who lost their homes to foreclosure of liens by a holder in due course T e x a s

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October 2014

that had purchased the note and security interest from a contractor.

In some cases the contract called for payments that exceeded the social security income of the home owner or was for a price that far exceeded the value of the work to be done. In some cases the work had either not been done or performed poorly. Congress concluded that the homeowners needed the time to have someone else scrutinize the contract, to be able to think about it outside the presence of a fasttalking, high-pressure salesman, or to just look at the agreement in the light of day. Obviously, car sales did not fit into this three-day coolingoff period.

The next occurrence that furthered false rumors was the proposal by the Federal Trade Commission in 1976 that its proposed Used Car Trade Regulation Rule contain a three-day cooling off period for car sales. The provision was dropped from the final version of the

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proposed rule amidst heavy industry lobbying. When the rule finally went into effect in 1985, there was no three-day cooling-off period.

However, there is a provision of the Texas Finance Code that does create a 72-hour right of rescission in certain circumstances. This section governs “home solicitation sales.” The broad definition of a home solicitation sale goes beyond the traditional door-to-door sale and should be considered any time any part of a sales transaction takes place away from the seller’s place of business. For instance, if a personal solicitation of the sale takes place at a location other than the merchant’s place of business, and the consumer’s agreement is signed at a place other than the merchant’s place of business, then the sale is a home solicitation sale. This means that an agreement to sell a car to a consumer made at a restaurant is probably subject to the three-day right of rescission.

In addition to creating a 72-hour right of rescission, this statute also requires the seller in a “home solicitation sale” to give written notice to the consumer of the consumer’s rights to cancel within 72 hours.

Since most motor vehicle sales documents don’t contain such a notice, the transaction that meets the definition of a “home solicitation sale” would also likely violate the notice requirement.

Bottom line: Closing a vehicle sale away from the dealership, even as an accommodation to the consumer, can have severe unintended consequences and should be avoided.

Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for over 35 years. He has written a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions.

11

news & notes

Happenings in the Industry‌

compiled by Texas Dealer staff

21st Annual BHPH World Convention Headed to New Orleans

T

he Leedom Group has announced that the 21st Annual BHPH World Convention will be held at the Hyatt Regency New Orleans, April 12–14, 2015. The event will offer over 40 workshops and presentations as well as an expo hall with over 100 booths. Chris Leedom, the convention founder, will offer the keynote address.

Sponsorships and exhibit space are now being reserved and early registration is available by visiting www.bhphworld.com or calling 1-855-627-0809.

12

HIADA to Host Golf Tournament

T

he Houston Independent Automobile Dealers Association will host a golf tournament Monday, October 20 at Southwyck Golf Club in Pearland, Texas. Registration is $125 for a single player or $400 for a team. Prizes will be awarded for the longest drive and tee shot closest to the pin. Details about the event, including sponsorship opportunities, can be found by visiting www.houstoniada.com/golf_tournament.php.

Registration can be secured by calling (832) 604-4355 or emailing houstoniada@gmail.com.

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house of delegates meeting minutes July 27, 2014 | Lost Pines, TX Hyatt Lost Pines Resort & Spa

compiled by Texas Dealer staff

At its meeting on Tuesday, July 29, 2014, TIADA took the following actions: President Michael Thomasson called the meeting to order at 4:15 p.m.

Winkelmann; Vice President at Large; Trey Crouch.

Moved by Scott Allen, seconded by Keith Hagler — Passed.

2015 Officer Elections

No recommended changes were presented by the Bylaws or Legislative Committees.

With no contested races, Byron Riley asked for a motion directing the Secretary to submit a single ballot for the following candidates: President: Brent Rhodes; Chairman of the Board: Michael Thomasson; President Elect: HL Hensley; Secretary: Kathrine Tolsch; Treasurer: Greg Zak; Vice President Region 1: James Hobson; Vice President Region 2: Tommy Gregory; Vice President Region 3: Kevin Mims; Vice President Region 4: Juan Sabillon; Vice President Region 5: Robert Beck; Vice President Region 6: Dan Keetch; Vice President at Large; Ryan

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Bylaws and Legislative Committees

Meeting adjourned at 4:43 p.m.

Moved by Ryan Winkelmann, seconded by Greg Zak — Passed.

Respectfully submitted, HL Hensley, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request.

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S I N C E 1972.

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2 014 tiada a u t o a u c t i o n

Local Chapters Victoria Dennis Schroller Victoria Autos Direct 361.578.0530 Dennis@victoriaautosdirect.com Meeting – 1st Monday (Monthly) Fort Worth Jerry Smith HJ Smith Automobiles 817.282.0102 hjsmithauto@yahoo.com Meeting – 4th Thursday (Monthly) Dallas County Kevin Mims VP Auto Sales 972.864.1300 kevinm@vpautosales.com Meetings as needed/TBD Houston Michael Zak Dixon Motors 281.931.1300 houstoniada@gmail.com Meeting – 2nd Monday (Monthly) Waco-Heart of Texas Bill Miller Bill Miller Used Cars Meeting – 2nd Monday (Monthly) For more information contact Eddie Massey, Massey Motors 254.753.6661 San Antonio Robert Beck Stop N’ Drive Motors 210.432.1101 stopdrive@texas.net Meetings quarterly (dates announced at www.txiada.com) El Paso Ricardo Gardea Cars Plus 915.778.8285 cars_plus@att.net Meeting – 3rd Friday (Monthly) 16

ABILENE * Alliance Auto Auction of Abilene 6657 US Hwy 80 West / 79605 325.698.4391 / 866.310.3555 www.allianceautoauction.com Jimmy Compton, Auction Manager Danielle Staples, Office Manager Friday: 10 AM * CM Company Auctions 2258 S. Treadaway / 79602 325.677.3555 / 866.310.3555 www.cmauctions.com Gregory Chittum, Owner Thursday: 10 AM

AUSTIN * America’s Auto Auction Austin / San Antonio 16611 S. IH-35 / Buda / 78610 512.268.6600 www.americasautoauction.com John Swofford, General Manager Tuesday: 1:30 PM

BEAUMONT Gulf Coast Auto Auction 4450 South 11th Street / 77701 409.840.6000 www.gulfcoastautoauction.com Roger Rashall, General Manager Rocky Rashall Blake Rashall Thursday: 7 PM

CARROLLTON * Texas Lone Star Auto Auction 2205 Country Club Drive / 75006 214.483.3597 www.TLSAA.com Jeff Dunning, Jr., General Manager Tim Clement, Assistant GM Michelle Elrod, Office Manager Tuesday: 1 PM / Thursday: 2 PM

DALLAS / FT. WORTH METROPLEX * ADESA Dallas 3501 N. Lancaster-Hutchins Rd / Hutchins / 75141 972.225.6000 Ken Osborn, GM Wednesday: 3 PM – New Car Trade Thursday: 9:30 AM – Consignment/ Fleet/Lease * Use your TIADA VIP Auction card at these participating auctions and get a FREE buy/sell fee (up to $200).

* Alliance Auto Auction of Dallas 9426 Lakefield Blvd. / Dallas / 75220 www.allianceautoauction.com Christopher Dean, General Manager Wednesday: 1 PM * America’s Auto Auction – Dallas 219 N. Loop 12 / Irving / 75061 / 972.445.1044 www.americasautoauction.com Robert Hammonds, GM Ruben Figueroa, Assistant GM. Tuesday: 2 PM / Thursday: 2 PM

EL PASO * El Paso Independent Auto Auction 7930 Artcraft Road / 79932 / 915.587.6700 www.epiaa.com Lori Pidgeon, GM Luke Pidgeon, AGM Wednesday: 10 AM – Fleet/Lease & Dealer Consignment Wednesday: 1 PM as scheduled – GSA Public Auction

HARLINGEN / McALLEN * Big Valley Auto Auction 4315 N. Hutto Rd. / Donna / 78537 956.461.9000 www.bigvalleyaa.com Bernard Watson, GM Lisa Harms, alternate contact Thursdays: 10 AM

HOUSTON * America’s Auto Auction – N. Houston 1440 FM 3083 / Conroe / 77301 / 936.441.2882 www.americasautoauction.com Buddy Cheney, GM Ben Nash, Sales Manager Mondays: 6:30 pm

longview * Alliance Auto Auction, LLC 6000 SE Loop 281 / 75602 903.212.2955 www.allianceautoauction.com Jeff Loftin, Auction Manager Brenda Hunt, Office Manager Friday: 10 AM

LUBBOCK Lone Star Auto Auction 2706 Slaton Hwy / 79404 806.745.6606 (local) / 888.299.6606 (toll-free) www.lsaalubbock.com Jim McNulty, Owner Dale Martin, General Manager Wednesday: 10 AM T e x a s

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d i r e c t o r y & r e s o u r c e g u i d e LUFKIN * Lufkin Dealers Auto Auction 2109 N. John Redditt Drive / 75904 936.632.4299 Wayne Cook Thursday: 6 PM

ROCKWALL Lakeside Auto Auction 1810 East I-30 / 75087 972.771.9919 www.lakesideaa.com Pete Conley, Owner Tuesday: 7 PM

TYLER * Greater Tyler Auto Auction 11654 State Highway 64 W / 75704 903.597.2800 Tuesday: 5 PM – Repo Lane Tuesday: 6 PM – Consignment

WACO * Heart of Texas Auto Auction (Waco’s oldest auto auction- Proudly serving dealers for 20 years!)

2508 HWY 6 / 76705 254.755.7713 www.heartoftexasautoauction.com Allan Wichkoski, Owner Kenny Reigert, General Manager Shirley McMillan, Office Manager Thursday: 7 PM * Alliance Auto Auction 15735 N. Interstate Hwy 35 / Elm Mott, TX / 76640 254.829.0123 / 254.829.1298 (fax) www.allianceautoauction.com Darren Darnell, GM darren.darnell@allianceautoauction.com Carmen Klaus, Office Manager Every Friday: 10 AM

oKLAHOMA CITY, OK * Dealers Auto Auction of OKC 1028 S. Portland / Oklahoma City, OK / 73108 405.947.2886 /405.943.8370 (fax) www.daaokc.com Gary Smith, Owner/President/GM John Reininger, Asst. GM Mike Egdahl, F/L Manager Thursdays: 8:30 AM – Consignment Sale INOP Sale held weekly GSA sale held monthly (open to public) Call for info on sale dates and times Every other Tuesday: 10 AM – GM Sponsored Factory Sale October 2014

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The TIADA Website:

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

Texas Department of Motor Vehicles 888.368.4689 www.txdmv.gov Office of Consumer Credit Commissioner 800.538.1579 www.occc.state.tx.us Texas Comptroller 800.252.1382 www.window.state.tx.us NIADA 800.682.3837 www.niada.com

Repossessions

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

Forms

Burrell Printing 800.252.9154 www.burrellprinting.com

17

feature New Advertising Rules Now Effective

by Bill Harbeson

Enforcement Division Director, TxDMV

A

t its May meeting, The TxDMV Board approved several changes amending existing advertising rules and creating new rules. The action to amend the rules was initiated by the Texas Automobile Dealers’ Association (TADA) that worked together with the department’s staff to draft the changes. These changes became effective Jun 6, 2014, after being published in the Texas Register.

43 TEX. ADMIN. CODE §215.244 was amended to include “representations” in the definition of “advertisement.” Expanding the definition clarified that any type of representation, as opposed to just a “statement”, used to solicit business is considered an advertisement and subject to the rules in the subchapter. A graphic or pictorial “representation” could include photographs, charts, graphs, and other depictions. The amendment to 215.244 also clarified that direct communications, including in-person, telephonic and e-mail communications, between a dealer or the dealer’s representative with a prospective purchaser does not constitute advertising. The prior definition did not exclude direct communication by the actual dealer with a prospective customer from being considered an advertisement.

43 TEX. ADMIN. CODE §245, which deals with the availability of vehicles, was amended to include the requirement that when a dealer does not actually have a vehicle in its inventory when an advertisement is published, that the advertisement must clearly and conspicuously advise the reader that the vehicle is not in the dealer’ inventory.

43 TEX. ADMIN. CODE §246 was amended

to clarify that both statements and representations in an advertisement shall be accurate, clear, and conspicuous, and shall not be false, deceptive, or misleading. The amendment was considered necessary to address situations where photographs or other depictions are used in advertisements and the vehicle is not in the inventory of the advertising dealer, but is actually in the inventory of another dealer. Such advertisements are considered to not be accurate depictions of the advertising dealer’s inventory, are false in representing that the advertised vehicle is in the inventory of the advertising dealer, and deceive and mislead consumers. The amendment was also necessary to address advertisements where the October 2014

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advertising dealer makes statements or representations that misrepresent its affiliation with another dealer or line-make.

43 TEX. ADMIN §215.250, which deals with

dealer price advertising, was amended to specifically address the use of terms such as “internet price” or “eprice.” The new section specifically prohibits using these terms or any other terms that may lead a reader to believe that there is a different or unique sales price for an on-line or Internet consumer.

Please contact the Enforcement Division of the Texas Department of Motor Vehicles should you have any questions about these or any other laws concerning motor vehicle dealer advertising.

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feature It’s Beginning to Look a Lot like Christmas:

Getting creative during the upcoming holiday season

by Brent Carmichael

Executive Conference Moderator, NCM Associates

There were some who thought with the current state of the economy that it might not happen, but I have it on good authority that Christmas is indeed on.

I

t might only be October, but from the looks of everything from big box stores to department stores, it appears that Christmas is on again for this year. There were some who thought with the current state of the economy that it might not happen, but I have it on good authority that Christmas is indeed on.

For those of us in the BHPH industry this is definitely good news. Yes, I said good news. This gives a golden opportunity to finish the year strong from both the sales and collections sides of the business.

I know what you’re thinking. Obviously this guy travels so much that he finally missed his flight back to reality. When I first got into this industry I was told there were only two absolutes in the BHPH world: You can’t sell cars or collect money in December. It’s a month where you just hang on and wait for tax season. And I bought into that philosophy for my first couple of years.

What changed my philosophy you ask? Call it ego. Call it ignorance.

But more than anything else, you can call it greed. I wanted the twelfth month to be just as profitable as the other eleven.

In looking ahead and preparing for December, the first thing

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you have to do to make it just as successful as the other months is to get your mind right. Without accomplishing this first step, nothing else will matter. Believing it is a “hold on” month will always make it one. You know what they say: “Whether you think you can or can’t, you’re right.”

Now that you have the “I can” mentality, what comes next? We all know this is a collections business. But if we don’t sell some vehicles, there won’t be a whole lot to collect. So let’s start with sales.

The biggest obstacle to selling a vehicle in our industry is not the sale price. It’s not the features and benefits, or lack thereof, of the vehicles we are selling. It’s the down payment. And of course this is the time of year customers have the least amount available for a down payment. To make December a successful month we have to be prepared to overcome that obstacle.

Now, don’t think I’m saying this is the time to offer zero downs. What I’m saying is this is the time of year

to get creative in regards to downs. We all know that the amount of down payment received has no bearing on how the customer will perform. If that were the case, the best paper we put on the books would be from February deals. Sorry to say, those deals have worse performance than any other month from a static pooling standpoint.

By getting creative, I mean focusing on customer trade-ins — and not just vehicles. I work with quite a few successful dealers who will trade for anything. TV’s, jewelry, video games, you name it.

Anything of value. They assign the “trade” a dollar value and apply it toward the down payment.

(Editor’s note: Only a vehicle taken in on trade will reduce the taxable value of the purchase. Other items taken in on trade can be applied toward the down payment, but will not lessen the taxable value of the vehicle.)

Another avenue to overcome the down payment obstacle would be to offer to defer a portion of the down payment until the customer receives their tax

Believing it is a “hold on” month will always make it one. You know what they say: “Whether you think you can or can’t, you’re right.”

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return.* There are aggressive dealers out there who not only do that in December, but they do it as far back as late October and early November. There are tax services available that can estimate a prospective customer’s return based on their most recent paystub.

And of course, you can always offer giveaway promotions.* Since the money you want for a down payment would be the money the customer would use for gifts, offering TV’s, video games, and gift cards could be a way of freeing up those down dollars.

Everything I’ve said so far about sales can be said for trying to keep our customers in good standing from the payment standpoint. You have to have the right mindset and be creative.

Giveaways can work here as well. Typically I see gift cards, TV’s, and video games given away on an arbitrary basis or after some sort of registration process. It gives the customer something to give as a gift while still being able to make their payment. Gift cards seem to work best for this type of promotion as the customer can spend it however they see fit.

Deferral of payments during the holidays is something that many of the major finance companies have offered to their good-paying customers for years as a way of helping them out. A word of caution here, though. This will definitely establish goodwill with your customers, but it can be detrimental from a cash flow standpoint.

The point to all of this is that there is no reason for the holiday season to be a time of just hanging on. It should be no different than the other months of the year. The key is to make this time of year a priority from both a sales and collections standpoint.

There are customers in the market that need transportation and the financing to obtain it. Of those customers, there are those who have the money available to not only purchase a vehicle, but to continue to pay for it.

The question is, are you willing to be creative enough to capture and collect from those customers, or are you just willing to hang on?

The key is to make this time of year a priority from both a sales and collections standpoint.

SAVE

*May be subject to legal limitations. Contact TIADA for additional information.

THE

DATE

2015 TIADA Annual Conference and Expo

August 9–12, 2015 JW Marriott Hill Country Resort & Spa, San Antonio, TX

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on the cover

by Danny Langfield

TIADA Deputy Director

“U

sed Car Dealer Rips Off Consumer!” screams the headline… “Dealer Fraud Alleged in Scam!” howls the auto blog… “How one customer got taken for a ride — details at 10!” promises the local news.

In a world where negative news dominates the media, car dealers have always been attractive targets. But the explosion of the internet over the last 15 years and the rise of the 24 hour news

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outlet have created a media machine that must be constantly fed.

From the absurd to the obscene, stories about abusive dealer practices inflame public passion, even if the truth in many of these stories ends up being sacrificed on the altar of the almighty advertising dollar and the all-important Nielson ratings.

Are there unscrupulous operators out there, ripping off customers and damaging the reputation

of the industry? No doubt there are. But as many TIADA members know first-hand, there is another side to the story, a side that won’t sell nearly as many newspapers or spike the viewer ratings like the horror stories will.

Reflected in the real-life letters from customers pictured here, this side of the story is about the honest, hard-working dealers out there who take great pride in taking care of their customers.

25

Those dealers are rewarded with repeat and referral business, a sterling reputation in their community and company longevity sometimes stretching over multiple generations.

“In my experience, used car dealers are some of the most compassionate people around,” said Dan Keetch of Keetch Motors in Corpus Christi, a BHPH operator specializing in no-frills, workingfamily vehicles. “I try to sit on their side of table,” Keetch continued, “In our echelon of clientele, it doesn’t take much to knock ‘em off center. They don’t come here because they have a whole lot of money. We need them to keep the car payment a priority, but things happen to these folks sometimes. We understand that, so we listen to them, and we work with them.”

According to figures obtained from the Texas Department of Motor Vehicles, the agency opened 6,058 complaints in fiscal year 2014. This may seem like a significant number until one contemplates the volume of sales in Texas that generated these complaints: 5,359,066 vehicles sold over that same time period. And that number includes not only dealer transactions, but also private party sales.

That translates into about 1/10th of 1% of vehicle sales in Texas resulting in customer complaints to

Amazon Auto Sales in Houston received this letter from a customer, happy with the service and “diplomacy” provided during the sales process.

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Many customers now share their thanks on social media sites like Facebook, as was the case with this customer of Auto Land Auto Sales in Haltom City.

This customer of Red Carpet Auto Sales in Seguin provides a positive report after a 17,000 mile road trip.

the agency — a number that does no favors to the faction looking to paint all dealers as con artists and fraudsters.

Kim Coutee, owner of Lumberton Auto Sales, a higher-end retail store in Lumberton, talked about her company’s approach to customer care: “Well, on the front end, one thing we always do is really encourage our potential customers to take the vehicle to their own mechanic before they buy, and let them tell us if they think there is anything wrong with the vehicle,” Coutee said. “And we are very honest if there are any defects — we are going to tell the customer everything we know about any given vehicle. The other thing is, no

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TxDMV Enforcement Division Director Bill Harbeson had this to say about customer complaints and the auto industry:

W

hen looking at the complaint-to-sales ratio, one needs to realize that not every complaint filed with the department results in a finding of a violation. In FY 2014, of the 6,058 complaints filed with the department, violations of the laws we enforce were only found in 2,676 cases. Many of these cases were closed with warning letters or orders with no civil penalties because of the minor nature of the violation or the fact that it was the first violation by our licensee.

When I am asked my opinion of the industry, the person making the request is usually expecting a reply consistent with the stereotype. “Car dealers? They are all crooks wearing bad polyester suits.” People are surprised when I answer giving them the numbers discussed above. I will reply, “Really, when looking at the vast majority of our dealers, they do a really good job taking care of their customers. If they don’t, they do not survive.”

Yes, we have some ‘bad actors.’ But every industry does. This is where we try to channel our resources- to focus on the ‘bad actors.’ Most of our dealers want to do the right thing the right way because they are good businessmen. Doing the right thing the right way is just good business.

high-pressure sales. I told our team, we are just not gonna be that way. And we’ve been blessed — we’ve only been open a little over a year and we have already gotten a ton of referral business.

That makes me proud of what we are doing here.”

“You know, we will spend a little extra to take care of a problem, even though we don’t have to,” said Greg Chaney of Chacon Autos. “We have found that taking care of our customers is a win/win. When they feel like you are looking out for them, it makes 99% of everything else better.”

Chacon has 11 locations, inluding stores in Dallas/Ft. Worth, Austin, San Antonio and Houston.

Chaney says that keeping customers happy is the key to their success. “Our bedrock philosophy is simple: What’s good for the customer is good for us. Making them happy will benefit us in the long run.”

“Customer service is the most important aspect of the business, especially in a smaller market,” says John Miller Jr. of National Car Sales in Kerrville. “In an area this size, a new customer is not going to come along every day.

We are especially reliant on repeat and referral business.”

Miller’s Kerrville operation does a combination of BHPH and retail business. According to Miller, the company’s goal is to have customers so loyal that they come back for their second and third vehicle purchases — and beyond.

“We may have a customer start off in-house, then if they do well on that car, we try to get them bank financing on the next one,” he said. “I think a dealer has an obligation to help their customer get the best, most optimal financing terms they can get. And if the bank or credit union will give them a better rate, we make sure to help them get it.”

This heartfelt thank-you card was sent to Chacon Autos, the 2013 Texas Quality Dealer of the Year.

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“Whether it’s in-house or third party, our number one thing is to sell a good product that will keep performing,” Miller added. “We make sure a vehicle is really right before it leaves here; if it leaves here in great shape, we will have a much happier customer.”

Dan Keetch says he thinks this business is a lot more personal than people give it credit for. “This is a people business, and that’s what makes it so interesting.”

He laughed as he recalled an expression his dad used to share with the customers he was trying to work with on a late payment: “Dad used to tell them, ‘Look, you can’t tell me a new story, ‘cause I’ve heard ‘em all — but I do need a story.’”

Rhodes Auto Sales in Houston received this enthusiastic thank you letter from a customer whose daughter was given a chance to improve her credit.

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29

TIADA Membership Application

2014

Business Name: ____________________________________________ Select one:

Dealer Member

Associate Member

Contact Person: ____________________________________________ Address: __________________________________________________

2014 TIADA Membership Dues:

City: _________________________________________ State: _______

Join Date:

Dues:

Zip: __________________ County: _____________________________

Jan. / Feb. / Mar.

$425

Apr. / May / Jun.

$320

Jul. / Aug. / Sep.

$215

Oct. / Nov. / Dec.

$425

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

(includes all of 2015) (all dues include NIADA membership)

PLEASE INDICATE PAYMENT METHOD: Check or Money Order payable to TIADA Check # __________ Credit Card Card Number: __________________________________________________ Expiration Date: ____________ Monthly Payments - $100 initial payment & $29.50 per month Via Credit Card (Please enter card information above. Authorization Agreement required - contact state office) Via Bank Draft (Authorization Agreement & voided check required - contact state office)

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

www.txiada.com

512.244.6060

800.442.5944

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

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October 2014

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D e a l e r Tr a i n i n g C e n t e r Texas I n d epen d ent A utomob i l e D ea l ers A ssociation

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Dealers will be able to take a course without traveling, without missing a day at the dealership and without having to plan ahead.

See a sneak preview of our first course, “An Introduction to Transferring Titles” by going to YouTube and searching for “TIADA Online Education Module.”

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feature The Moneyball Phenomenon

The Analytical and Statistical Approach That Has Taken Over Baseball Can Help Raise Your Dealership’s Batting Average

by Joe Lescota

Director of Dealer Development, NIADA

T

he more I work with dealers the more enthused I get about the Brad Pitt movie, Moneyball.

It’s the story of Oakland A’s general manager, Billy Beane, as he challenges the system and defies baseball’s conventional wisdom when he is forced to rebuild his small-market team on a limited budget. He ends up doing it with the help of a Yale-educated economist who happens to be a whiz at crunching numbers (data).

S TAT I S T I C S

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In today’s efficient marketplace it takes approximately three selling opportunities to sell one vehicle.

That means you have to get people to come through the door of your dealership.

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That new number crunching system changes forever the way baseball is played and teams are put together.

I recently read an article about how NBA teams are also embracing the Moneyball phenomenon by hiring statistical analysts. The article explained how important it was for players to understand the smallest nuances of their playing abilities by scouring metrics and game films.

In other words, while scoring baskets is obviously important, it’s even more important to understand details like how many times an individual player actually dribbles a ball before being able to successfully make a shot.

In essence, the statisticians are quantifying every aspect of the game.

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So how does this tie in to selling more vehicles? Well, you decide if it does or does not.

For more than 30 years, I have successfully captured enough data from within automotive retail dealerships to make the following assumptions: In today’s efficient marketplace it takes approximately three selling opportunities to sell one vehicle. That means you have to get people to come through the door of your dealership.

For every three visitors who come into a dealership, at least two of them must be given the opportunity to test drive a vehicle on your lot.

Both of the two potential customers who did take a test drive must be given the opportunity to purchase a vehicle from you. That is done by making a formal written presentation (offer to buy) to the two potential customers.

Of the two potential customers who were presented a written offer to buy, both should make the purchase and one should actually end up being delivered (based on credit approval ratios).

Does that type of analytical approach really apply to a typical independent dealer? You only have to read about the nation’s top used vehicle seller, CarMax, to see just how effective an analytical, number-crunching approach to running a car dealership can be.

Remember, there is an actual hard cost associated with attaining each potential buyer.

Wouldn’t you want to know if your marketing efforts are effective or being supported by your sales staff?

Small dealerships can benefit greatly from such an approach.

Why would you want to know how many guests it takes to sell a retail unit in your dealership? Because you want to discover just how effective or ineffective you are when it comes to working with each of your guests.

Remember, there is an actual hard cost associated with attaining each potential buyer. Wouldn’t you want

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to know if your marketing efforts are effective or being supported by your sales staff? Wouldn’t you want to have a strategy in place to compensate for the lack of traffic in your dealership if you should discover you only had two guests in a day when you know that in your dealership it might take three guests to sell one car?

If you only see two guests, you know statistically you need one more “swing of the bat” to improve your odds of making a sale. Where is that additional guest going to come from?

You have to look at it this way: If in your dealership it does indeed take three guests to sell one vehicle and you only saw two guests today, you would have to see four guests tomorrow to make up for today’s lack of a sale.

The effort to sell increases exponentially.

Here’s the crazy part about all of this. It’s frequently the dealer who begins to defend his staff by saying something like, “You know, I try to get my people to keep track of traffic, but I don’t know of any dealer who is able to get his salespeople to write down everyone who comes into the dealership.”

I hear you, but I respectfully and emphatically disagree with any dealer who makes such a broad statement. I meet dealers throughout North America, and let me tell you effective dealers not only know the importance of tracking the number of guests who walk into their dealership, call their dealership and search their virtual dealership, but also understand that knowing that is not an option.

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It’s not about what the salesperson wants, thinks or assumes.

It’s about giving and presenting value in order to maximize gross profit opportunity.

What I’ve learned from successful dealers is this: If it’s important, you get it done.

I’ve heard it and you’ve heard it — the importance of not only keeping track of guests who walk into the dealership but even more important, keeping track of what happens to them once they arrive. I’m not sure I ever really get this message across enough, but this industry is no longer fighting a price-competitive battle. That battle is over because the Internet says so.

We are in an efficient marketplace. That said, dealers had better find another way to sell used vehicles, and one of the best and most effective ways I know is to sell value.

All too frequently I still see salespeople meeting and greeting guests either on the showroom floor or on the

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blacktop, and within minutes the salesperson and the guest are sitting at a desk and proceeding to discuss pricing without ever having sold the first ounce of value through a value selling presentation or an emotional and exciting demonstration drive.

When I ask those salespeople why they didn’t take their guests on a test drive, they’ll say something like, “Oh, that’s one of my customers. He and I have got a good relationship. He’ll drive it later if he likes the price.”

Seriously?

It’s not about what the salesperson wants, thinks or assumes. It’s about giving and presenting value in order to maximize gross profit opportunity. People spend more money on products they are emotionally involved with. The demo drive evokes emotion.

What about this one — the potential customer who comes into your dealership after spending approximately 18 hours of online research, takes a test drive of the vehicle she came in to see, then leaves the dealership without ever being given the opportunity to purchase it.

Surely you can’t tell me you’re not the least bit curious to find out why a guest who actually took a test drive of one of your vehicles was not given or presented with an official written offer to make a purchase or might not have wanted to be given the opportunity to make a purchase.

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Perhaps the guest didn’t want to discuss price because a salesperson never gave the guest the opportunity to make a purchase, or perhaps something happened or was discovered during the test drive that dissuaded the guest from taking the transaction any further.

A Moneyball approach to managing your dealership’s daily sales activities is not meant to overwhelm you with data but rather to give you a better handle on what’s actually occurring during your attempted selling process.

Here is where reality replaces assumptions. Don’t assume you know what’s going on because you’re a small dealership and you’ve convinced yourself you know what’s going on because you know your people.

Prior to writing this article I spent four days with three dealerships. In each of those dealerships I found some pretty awesome people working pretty hard. But being nice and working hard is no assurance of success.

Many car dealerships, both independent and franchised, have gone out of business by attempting to work harder than they’ve ever worked before only to find out they were working hard at the wrong thing.

As a matter of fact, they probably weren’t sure what they were really working hard at. A Moneyball approach is a matter of removing some of the guesswork (notice I said some of the guesswork, because, trust me, there’s always some guesswork involved) out of running a sports team, a multimillion dollar business or just an ordinary — or extraordinary — independent dealership in order to make the best, most educated business decisions possible.

Businesses aren’t necessarily successful because of extraordinary employees. Rather, they become successful by average employees achieving extraordinary things.

A reasonable person would ask, “Who has the time to keep up with this sort of statistical analysis when I need to focus on selling something today?”

The answer is simple. You do, because you cannot afford to not know how effective your selling process is — or is not. Today’s dealer needs accurate information to make the best decisions possible in order to maximize selling and profit results.

Wouldn’t you play harder to win if you knew the odds of winning were in your favor? So keep track of the stats and you learn to pick the odds.

Another way of improving your winning odds is by learning more about how you can become an NIADA Certified Master Dealer or by becoming a member of an NIADA Dealer 20 Group. Visit www.niada.com and click on the “Training” tab for more information about these programs designed to help you analyze your business and find ways to make it more efficient and profitable.

Joe Lescota, a veteran of more than 25 years in the automotive industry, is NIADA’s director of dealer development and instructor for NIADA’s Certified Master Dealer program. He can be reached at joe@niada.com.

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Ignorance is no defense.

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October 2014

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regulation matters Titling a Vehicle in the Name of an Entity

by Danny

T

he relentless summer heat has slowly conceded ground to the crisp autumn air, football season has returned, and the Austin City Limits Music Festival is right around the corner — it must be fall in Texas.

A lovely sentiment, but what’s that got to do with vehicle titling? You may well ask. Well, work with me here... this season of change brings with it… another change to the titling process! (OK, a bit of a stretch, but let’s go with it...)

As discussed in this column back in May, TxDMV has been working on a way to adjust the ID process so that an EIN/FEIN could be entered instead of an individual’s ID information when a vehicle is titled in the name of a business, government entity or organization. The good news is that this can now be done; the not-as-good news is that this will require another document to be added to the deal jacket.

Completing the 130-U

When a vehicle is to be titled in the name of an entity, the buyer may now choose what ID information will be included on the 130-U title application form.

The buyer may select either their own personal ID information, or they may select the EIN/FEIN of the business. One or the other must be entered on the 130-U. It is our understanding that an updated form 130-U that includes the EIN/FEIN option will soon be available at www.txdmv.gov/forms-tac. If you (or your DMS) are using the current version of the form, the EIN/FEIN may be entered in box 14a as shown on the sample form on the next page.

Dealer Procedure

As is currently the case, in order to apply for title in the name of an entity, you will need the following two items from your customer to meet the ID requirements: 1. P hoto ID — this is the personal ID (such as driver’s license) of the person who is making the purchase on behalf of the entity.

40

Langfield

TIADA deputy director

2. A uthorization to Sign — this is an item that ties the person in the photo ID to the entity. This item may be a printed business card; an authorization letter on letterhead; or an employee ID. If the buyer has chosen to have his or her own personal ID information captured on the 130-U, then no other steps are necessary.

However, if the buyer has instead chosen to have the EIN/FEIN captured on the 130-U, then a third item will be required of the buyer: 3. A document associating the EIN/FEIN with the entity — TxDMV has noted that examples of acceptable documents could include a business tax filing or documents from the Comptroller of Public Accounts, Secretary of State, or Internal Revenue Service (IRS). The agency has indicated that these examples are not all-encompassing nor is there a specified list of acceptable documents.

It is our understanding from TxDMV enforcement that a copy of each of the items above should be retained in the deal jacket.

What Goes to the Tax Office

The agency has made clear via rule and communications to the counties that none of the documents above are required to be submitted to the tax office for a dealer transaction. If you have any issues at your county, you may be able to refer them to Registration & Title Bulletin #017–14 which addresses this matter in detail.

Just like the seasons, the changes keep coming. And we will continue to keep track of them and keep you up-to-date so you can keep your focus on the important stuff — like selling more vehicles.

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Please Welcome Our Newest TIADA Members

Dealer Members

A Motor Sales & Finance

Ahmad Elashqa 2534 Babcock Rd San Antonio, TX 78227 Americar Finance

Hoss Gharatappeh 3611 Broadway Houston, TX 77017

Armadillo Auto Restorations, L.C.

Kenny Hague P.O. Box 592 Hamilton, TX 76531

Austin Century Auto Sales

Reza Amirnejab 16417 FM 1325 Austin, TX 78756 Auto Advantage

Henry Rangel 2904 Culebra Rd. San Antonio, TX 78228 Auto Genius, Inc.

Oluwakemi Kawonise 10541 Harry Hines Blvd.

Dallas, TX 75220 Balbisi Auto Sales

Laura Balbisi 6852 Ingram Rd. San Antonio, TX 78238 C R Car Company

Kenneth Westra 5306 Wildwood Creek Way Spring, TX 77379 Capital Fleet

Farid Atiqi 10010 Heron Meadows Dr Houston, TX 77095 Car Mart

Max Namazi 6529 W. Sam Houston N Houston, TX 77041 CARZ Ready

Joe Logue Auto Sales

South Texas American Auto

Easy American Auto Sales

Kars Kingdom LLC

Tande’s Auto Sales

Easy Imports Auto Sales

Knodel Motors

Susana Blanchard 4509 Credo Lane Austin, TX 78725 Gabriel Garcia 10255 O’Connor #7 San Antonio, TX 78233 Sergio Sepulveda 10255 O’Connor Rd. San Antonio, TX 78233 Easy Trucks LLC

Luis Bragagnini 10255 O’Connor San Antonio, TX 78233 G & R Auto Sales

Richard Roman 5170 Randolph Blvd San Antonio, TX 78233 Genesis Auto Sales

Daniel Garcia 5020 E. 7th Street Austin, TX 78702 God Trucks & Cars

April Garcia 405 Gladstone San Antonio, TX 78214 Gross Auto Sales LLC

Richard Gross 33125D IH-10 W Boerne, TX 78006

GS Texas Automotive

Rene Trevino 1220 Lumpkin Rd Houston, TX 77043

Gulf Coast Used Cars

Mark Rodriguez 5021 Harrisburg Houston, TX 77011 H & H Auto Sales

Samuel Engler 2107 Capitol San Antonio, TX 78201

Ed Hernandez 4022 Blanco Road San Antonio, TX 78212

Curtis Whittaker 7415 Airport Blvd.

Houston, TX 77061

Sammy Koopaei P.O. Box 1972 Alief, TX 77411

Sandra Daniels-Cushingberry 6903 Cullen Houston, TX 77033

Spencer Scott 5445 FM 389 Rd Brenham, TX 77833

Andrew Christie 4203 Roundtree Lane Missouri City, TX 77459

Mohammad Hashmi 12114 Essenbruk Dr Houston, TX 77066

Curtis & Company

Hou-Tex Finance

Joseph Logue 5673 Randolph Blvd.

San Antonio, TX 78233

Kyle Tomaszewski 5450 FM 78 San Antonio, TX 78219

Faisal Aziz 8235 Jones Rd Houston, TX 77065

Neyla Funez 828 Prairie Trail Austin, TX 78758 TH Motors LLC

Darrel Knodel 2411 Austin Hwy San Antonio, TX 78218

Taissir Haek 1503 White Willow Lane Arlington, TX 76002

Kool Kars

The Majestic Star Group

Mike Collins PO Box 968 Nederland, TX 77627

Olivia Ortega 10134 White Oak Trail Ln Houston, TX 77064

Lamb Ventures Auto Sales

Top Notch Used Cars

Jim Ramsey 2100 Kramer Lane #150 Austin, TX 78758

Russell Moore 900 East Davis Conroe, TX 77301

Lone Star Auto Plex

Tri County Auto Group

Moses Bhatti 2602 Culebra Rd San Antonio, TX 78228 Meridian Auto Sales LLC

Cheryl Kloss PO Box 310945 New Braunfels, TX 78130

National Cars USA

Courtney Sikes 6726 Burnet Rd Austin, TX 78757

Nest Auto Sales

Wael Elhaj 3535 Hwy 6 S Houston, TX 77082

Power Stroke Magic Sales

Adam Adam 11031 Bissonnet St Houston, TX 77099

Truman Motors

Jorge Asencio 4004 San Pedro Ave San Antonio, TX 78212 Ali Gardezi 13476 Bellaire Blvd Houston, TX 77083

Universal Credit

Nestor Ramirez 9610 FM 812 Lot A Austin, TX 78745

Universal Motors

Sarah Johnson 8211 Fairbanks White Oak Rd. Houston, TX 77040 PrilPaul Motors

Paul Mbachy 7620 N Lamar Blvd Austin, TX 78752 Quality Preowned Auto

Fadi Saad 8133 Jackrabbit Rd Houston, TX 77095

VSA Motorcars

Veronica Aranda 12212 Cypress N Houston Rd #1 Cypress, TX 77429 Wild West Used Cars

Sabih Siddiqui 1640 Gessner Dr Houston, TX 77080

Associate members Equifax Automotive

Cushingberry’s Car Tyme

In & Out Auto

Red Stars Auto Sales

DNA Motors

International Used Auto

Rivercity Auto Sales

Drive ASAP Auto Sales, LLC

J. B. Motor Company

S A Auto Sales

Gomez Law, PLC

Drive Automotive

JD Byrider/CNAC

Slap Sale Motors

PositionPlus GPS

Todd Regan 10 N Caddo St. #166 Cleburne, TX 76031

Ata A 3138 Culebra Rd. San Antonio, TX 78228 42

Dune Autos

Joe Bettis 10512 Mykawa Rd Houston, TX 77048

Lucy Alvarez 4241 Woodcock Drive, Ste A-204 San Antonio, TX 78228

Sam Safa 110 West Pflugerville Pkwy Pflugerville, TX 78660 Mahmoud Miri 1131 Basse Rd San Antonio, TX 78212 Sammy Soto PO Box 358 Castroville, TX 78009 Greg Shattuck 54 Chicon St Austin, TX 78702

Jennifer Reid 1525 Windward Concourse Alpharetta, GA 30005 FEX DMS a Finance Express company

Greg Levi 30071 Tomas, Suite 250 Rancho Santa Margarita, CA 92688

Sandra Gomez 13831 Northwest Fwy, Suite 100 Houston, TX 77040 Kyle Fjelstad 27 Spectrum Pointe Dr, 311-312 Lake Forest, CA 92630 T e x a s

D e a l e r

October 2014

TIADA DeAler AcADemy 2014

Dealer 101: Nobody Told Me That!

This class is designed for those dealers new to the business, those considering opening their own dealership, new employees, family members or anyone else needing a refresher on the basics. We’ll cover everything you need to know to run a clean, compliant used car dealership in Texas. Topics include: n n n n n n

n

8:30am - 5:30pm $149 Per Registrant

n n

n

Transferring Titles Customer ID Requirements Odometer Disclosures Title & Registration Fees Acquiring Inventory Temp Tags & Metal Dealer Plates Requirements for Maintaining Dealer License The Buyer’s Guide - As Is Inspections, Emissions, Green Slip Power of Attorney

n n n

n n n n n n n n

SOLD! The Deal Jacket Record Keeping Garage Liability & Dealer Bond Motor Vehicle Sales Tax Vehicle Inventory Tax Online Sales Out of State / Out of Country OCCC: the MVSF License Advertising Rules Federal Requirements Forms Review

We will build a deal jacket from scratch... we will role-play an actual of transfer of title at the tax office... we will do a simulation of VIT calculation, with real numbers over multiple years... and much more. TIADA teaches you the business from an experienced, practical point of view.

Presenters will include: Dorothy Starr, Motor Vehicle Manager, Tarrant County Tax Assessor-Collector Danny Langfield, Deputy Director, TIADA Michael W. Dunagan, attorney, Jameson & Dunagan, TIADA General Counsel

Monday, November 10, 2014

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Texas Independent Automobile Dealers Association

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behind the wheel The Best Offense is a Good Defense “Here is a partial list of legislation passed, defeated and/or amended through the efforts of TIADA members from all across the state…

TIADA supported HB 1017 — This bill

would require the notation of the odometer reading on the certificate of title at the time of sale.

TIADA supported HB 1025 — This bill

amended the description of abandoned vehicle to include motor boats, outboard boats and vessels and expanded some jurisdiction to include the Texas Parks and Wildlife Commission.

TIADA opposed HB 978 — This bill would have established a “mandatory” warranty for a 14-day period following the sale tied to a safety inspection.

TIADA opposed HB 1081 — This bill would have abolished the state automobile safety inspection program.”

You might think the legislative report above comes from a recent TIADA legislative meeting or even the last Texas Legislative Session. These are certainly

by Jeff

Martin

tiada executive director

issues the association would be in the middle of during any legislative session. It might surprise you a little to know that this language comes from the “Legal Ledger” of the TIADA Dealer News published in 1983, over 30 years ago. I love reading any TIADA historical documents and I came across this gem as I perused some of our archived material here in the TIADA office. With the 84th Legislative Session just three months away this report jumped off the page at me. While the full piece reported on 15 different bills and amendments that the association was involved in, you and I both know there were many more issues the members of the association worked on during that session.

The most enlightening part of this report is the number of bills the association opposed. Many times when a bill is introduced that has a negative unintended consequence, the author of the bill has no idea how it might affect a specific industry and it’s the job of the trade association to work with the legislator to try and find a resolution or try to stop the bill. The problem is that the session is only six months long and bills and amendments can move fast, particularly toward the end of the session. We can and should learn a lot from the legislative wrap-up some 30 years ago and every legislative wrap-up since. While we don’t know of them yet, there will be a number of bills and

The best way for you to stay abreast of up-to-the-minute information is the Advocacy section of the TIADA website.

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amendments introduced this coming session that will not be advantageous to our industry and will demand our attention. It takes a significant amount of time to work with the interested parties to find some resolution. When we can’t, we oppose the bill. As a grassroots organization, our strength comes from you, the member’s voice, and that takes even more resources and focus.

Sometimes our members seem a little startled when I tell them that a big part of our legislative strategy is

defense. It always leads to the obvious question — are there some bad bills out there? The answer to the question is — not yet but there will be. The best way for you to stay abreast of up-to-the-minute information is the Advocacy section of the TIADA website. As always, we welcome the input of our members regarding legislative matters. TIADA’s legislative team will work diligently to keep you apprised of the issues and call on you to act when needed. Sometimes our greatest legislative victory is not passing legislation at all.

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