HawaiiDealer

The Official Publication of the Hawaii Automobile Dealers Association

2017 Summer Edition

Magical Maui M E, O C

LEARN WH AT ’S

UP T

D! A O HE R

RECORD ATTENDANCE ANTICIPATED AT THE 58TH HADA CONVENTION OCT. 5-8, 2017, ON MAUI (see story page 8)

THE ROAD TO THE SUMMIT OF HALEAKALA IS THE SHORTEST DISTANCE BY ROAD IN THE WORLD FROM SEA LEVEL TO 10,000 FEET. Also in this Edition...

1st Half of 2017

up 5.1.% Eric Chester—who is on the national speakers’ registry—will provide the keynote for Friday’s General Meeting.

Page 12

New car and truck registrations for 2017 are following the projection for the year made seven years ago.

Page 23

Mark Wong, the City’s Director of Information Technology will present details on the new online registration system at the Friday, General Meeting.

See page 12

POW ERFUL .

E L E G A N T. DAR ING.

Camry’s powerful design and aggressive exterior styling announce your arrival —with authority. A look that’s all at once tempting and tantalizing. Throw in a 3.5-liter V-6 engine with an output of up to 301 horsepower, the 2018 Camry will give you an exhilarating performance that will leave you speechless.

T HE A L L-NE W 2 018

W H AT M O R E C O U L D Y O U A S K F O R ?

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The Official Publication of the Hawaii Automobile Dealers Association

2016 Summer Edition

Sponsors of the

Q: Will dealers operating in the blind bring down State Tax Revenues?

A: Yes

HawaiiDealer help HADA dealers fulfill the association’s mission.

See Story Page 8.

Registered vehicle data, which has not been available for 10 months is now slowly starting to flow.

See Hawaii Auto Outlook pages 20, 21, 22, and 23.

Also in this Edition...

HADA provides featured presentation for visiting Japan Auto Dealers Association page 14

HADA board discusses convention plans and other agenda items. See story on long lines at DMVs. page 27

Come to Kauai. Learn what’s ahead for the auto industry at the HADA 57th Convention Oct. 13-16 page 12

The Official Publication of the Hawaii Automobile Dealers Association

2016 Convention Edition

At the 57th HADA Convention October 13-16, 2016 Grand Hyatt Kauai

THE HADA Mission: "To help auto dealers comply with the laws, to make car buying (and servicing) by the general public, trouble free.”

KAUAI 2016

At the 2016 HADA convention you’ll be provided insights on the No. 1 word on top-selling dealer websites, p. 8 See President Bill van den Hurk’s comments, p. 4 See Hawaii Auto Outlook pages 20, 21, 22, and 23.

Also in this Edition...

Communications are key. Mahalo to all of the 25 sponsors of the official publication of the Hawaii Automobile Dealers Association.

Here’s to a great 2017!

Providing a Solution: Hawaii dealers met with Senator Brian Schatz to discuss S. 2663 — a solution to CFPB’s flawed guidance. page 11

Sponsors provide record $100,000-level of support for the HADA convention. page 4

Hawaii Forecast …remains positive.

The Hawaii Auto Outlook provides numbers useful for planning. page 20

The Official Publication of the Hawaii Automobile Dealers Association

2016 4th Quarter Edition

Advertise In The Jim Falk is Hawaii’s 2017 Dealer of the Year

HawaiiDealer

Jim Falk’s Maui dealerships provide 400 to 500 bicycles and helmets to kids at Christmastime. See story page 14

Also in this Edition...

Established under HADA president Charlie King in 2002, the HawaiiDealer is a quarterly magazine that provides information on the activities of HADA members to a wide audience, including the membership of the Association, key employees at the dealerships, legislators, city council members, Hawaii media, the Congressional Delegation, and many Hawaii sister organizations.

HADA appreciates the “sponsorship” of the official publication through the provision of sixth, third, half, and full-page color messages.

Mahalo!

Pete Luke and Byron Hansen emceed the Awards Night at the HADA convention on Kauai which drew a record 262 attendees.

See page 10

New vehicle registrations leveling off — see Hawaii Auto Outlook.

Page 26

The “Bloody Thorn” — a story shared at the annual meeting of the association. See page 11

The Official Publication of the Hawaii Automobile Dealers Association

2017 1st Quarter Edition

START THE

EXCITEMENT! AT THE TAKING THE SHOW TO A WHOLE NEW LEVEL...

More supercars than ever A hot concept car that was one of the stars of the SEMA show

For more information, Contact Custom Publishing Design Group, Inc. Tel 860-513-1213

Fax 860-513-1216

sara@MyCompanyMagazine.com

Lots of brawny trucks Sculpted-body sportscars Wall-to-wall displays

MARCH 24–26 See President's remarks page 4

Also in this Edition...

Also see the HADA website at www.hawaiiautodealer.com Dealer Day at the Capitol See pictorial, pages 14–17

See how online vehicle registration will speed up commerce.

Page 8

HADA Convention room reservations are open.

See page 30

Hawaii Automobile Dealers Association 1100 Alakea Street, Suite 2601 Honolulu, HI 96813

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2012-2013 2017-2018 HADA HADA O FFICERS & DIRECTORS OFFICERS & DIRECTORS PRESIDENT Mike Niethammer Brian Kitagawa PRESIDENT-ELECT Bill vanUekawa den Hurk John VICE ICE P PRESIDENT RESIDENT V (ULF )XNXQDJD Eric Fukunaga SECRETARY ECRETARY S Joe Nicolai Wayne De Luz TREASURER TREASURER Kenny Ching John Uekawa NADA DIRECTOR NADA DIRECTOR Stan JoeMasamitsu Hanley HAWAII DIRECTOR HAWAII DIRECTOR Jackie De Luz Watanabe Wayne De Luz MAUI DIRECTOR MAUI DIRECTOR Jim Falk 'DPLHQ )DULDV KAUAI DIRECTOR O AHU DIRECTOR Mike Niethammer Stan Masamitsu OAHU DIRECTOR OAHUMasamitsu DIRECTOR Stan Morrie Stoebner OAHU DIRECTOR Michael OAHU DStoebner IRECTOR Jack Jackson OAHU DIRECTOR NickDCutter OAHU IRECTOR Keppel ODan AHU D IRECTOR Brad Nicolai KAUAI DIRECTOR AT-L ARGE DIRECTOR Dan Mackey Marc Cutter AT LARGE DIRECTOR ATKeoni -LARGEHansen DIRECTOR Keoni Hansen IMMEDIATE PAST PRESIDENT IMMEDIATE PAST PRESIDENT Nick Cutter Bill van den Hurk

Maui lassoed the sun and made it stop for for awhile.

When it’s time to take a break, Maui’s a good place.

In ancient lore, from the top of Haleakala, Maui lassoed the sun and made it stop for awhile.

This year’s HADA convention, our 58th in the long line of conventions usually held on a neighbor island, is shaping up to be something special.

HADA members have booked more than 540 room nights at the Fairmont Kea Lani during and surrounding the convention period, October 5-8, 2017—a record number of rooms.

A special set of speakers has been lined up for the breakfast and General Meeting of the Association, 8 a.m.-11:30 a.m. Friday, October 6.

Byron Hansen, a longtime HADA member, now retired, has again agreed to chair the golf tournaments along with Pete Luke. Byron and Pete appeared on the stage last year, outďŹ tted head-to-toe in classic, historical golf togs for the Awards Banquet. Bob Gardner again hosts the tennis tournament for the third year. Bill van den Hurk is again chairing the event.

Much thanks to all our generous associate member sponsors who are making this event possible. It’s all shaping up to be more than 260 attendees.

See you on Maui!

Brian Kitagawa 2017, 2018 HADA president

HADA STAFF HADA STAFF ([HFXWLYH 'LUHFWRU Dave D Rolf EXECUTIVE IRECTOR Dave Rolf 'HDOHU 6HUYLFHV 0DQDJHU *HRUJH &RFKDUG

HawaiiDealer is designed & published by Custom Publishing Design Group, Inc.Ž ‡ ZZZ 0\&RPSDQ\0DJD]LQH FRP 7R DGYHUWLVH LQ DQ XSFRPLQJ LVVXH FRQWDFW 6DUD 5XVVHOO H[W RU H PDLO VDUD#P\FRPSDQ\PDJD]LQH FRP

HawaiiDealer is published quarterly by the Hawaii Automobile Dealers Association, 1100 Alakea Street, Suite 2601, Honolulu, HI 96813 Phone: 808 593-0031 Fax: 808 593-0569 Email: drolf@hawaiidealer.com

4

FH B.C O M

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Convention offers a view of what's up the road ahead

T

he summit road to top of Haleakala on Maui is known as the shortest land distance in the world, from sea level to 10,000 feet.

The view above the clouds, when the sun comes up, is magnificent.

This year’s HADA convention on Maui will offer a magnificant view of the road ahead for the auto industry. The hundreds of thousands of gasoline-powered vehicles in Hawaii are being joined by growing numbers of electric vehicles, hydrogen fuel cell vehicles and the new highly autonomous vehicles.

The net result will be that the goal for the Hawaii Clean Energy Initiative, which was drafted in 2008, and which set a goal of 70% reduction in fossil fuel by 2030, likely could be achieved by the year 2045.

To hit the current HCEI’s goal of 400,000 EVs by 2030, some 30,000 out of the 50,000 new vehicles sold each year on average, would need to be EVs in each of the next 13 years. Currently EVs account for 2% of new vehicles sold. About 1,000 a year. Hitting the current HCEI goal for 2030, means that 60% of all vehicles sold each year between now and then would need to be EVs.

A technology sunrise seems to be casting a bright light on the auto industry.

Some officials are now using the HADA projected year-to-year new vehicle registration rates to see and understand the future of Hawaii. Transportation, island energy use, even housing development and state tax revenues can be factored from the new vehicle numbers.

The automobile should be considered in the context of the whole of Hawaii’s economy.

HADA estimates that more than 80 percent of all commute trips in Hawaii will continue to be be made in an automobile through 2045. There will be more pooling of commuters, as the digital-pairing trend continues in a process known as Transportation as a Service (TaaS), and many cars will start to take on Highly Automated Vehicle (HAV) capabilities.

that proposes that Hawaii set a goal to be fossil-fuel-free by 2045 in the ground transportation sector. While the goal is laudable, it is likely that highly efficient gasoline-powered vehicles will still continue to play a large role in transportation and electric vehicles, including hydrogen fuel cell electric vehicles will play an ever increasing role.

8

Hawaii, with its early adoption of hydrogen fuel cell electric vehicles and high adoption rate of battery electric vehicles and plug-in hybrid electric vehicles, and the possible adoption of highly automated vehicles (starting in 2020), is at the tip of the spear when it comes to change in the industry.

The HADA-produced Rosetta Stone graphic will be explained more fully at the HADA convention. he automobile, along with its high-tech powertrain and guidance options, will play a large role in Hawaii’s future, and Hawaii’s future workforce.

Many feel it will indeed be a pure joy for the auto industry to play a key role in shaping Hawaii’s future, by providing high tech transportation and well-paying jobs.

Here’s to seeing you on Maui!

Laudable but not likely.

300 Highrise Buildings

EV/AV Adoption Bridge Education/University Educ Edu Ed d cation/ Engineers

70,000

5G LTE

Transportation + Construction

60,000

50,000

40,000

30,000

20,000

10,000

0

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 All Vehicles

A HADA graphic has been produced for testimony on HB1580, to serve as a talking document on the bill

So what is a likely adoption rate for all the new technology?

E Vehicles

HAVS Highly Autonomous Vehicles

New Ca Car & Truck Projections Thru 2045

iπ Tourism/Conventions + Military

+1=0

Source: Hawaii S H ii A Automobile bil Dealers D l Association. Note: Hydrogen fuel cell electric Vehicles are included in EV numbers.

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The HADA convention will focus on workforce development for the coming high-tech auto age Speaker #1 “No one knows the emerging workforce better than Eric Chester. He offers advice that is both practical and solid,” according to reviews of the highly-regarded convention speaker scheduled as the keynote for the 8 a.m. Friday, October 6, 2017, General Meeting of the Association, at the Fairmont Kea Lani on Maui during the HADA convention.

Speaker #2 There a plans being put in place for an auto industry “JOBS” exhibit will be part of the 2018 First Hawaiian International Auto Show. A firm which assists dealerships in hiring auto technicians and other key employees has been asked by HADA to review dealership websites and provide insights into ways the websites can attract high-talent job seekers for the auto industry in Hawaii.

A confidential review of each HADA dealership’s website will be provided at the back of the room following the General Meeting.

HADA has asked Hireology to provide assistance in attracting the needed high level of talent for the industry’s high-tech future.

The firm will help provide staff for the JOBS exhibit at the show, and will provide remarks at the convention about what’s needed in dealerships right now to build a high-tech workforce.

Speaker #3 Mark D. Wong, the City and County of Honolulu Director of Information Technology, has worked, along with DMV officials, HADA dealer and associate members, and those from his own IT department to create a state-of-the-art online electronic vehicle registration system for Hawaii. Director Wong will give attendees at the HADA convention a first look at the coming new system which will streamline the registration and title transfer of both new and, now, many used vehicles.

12

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Easy online registration go to ..... www.HawaiiAutoDealer.com

Easy!

Online HADA Convention Registration For Sponsorship, Convention, Hotel & Golf Visit www.HawaiiAutoDealer.com V

Mauino ka oi!

The 58th HADA Convention October 5-8, 2017 Fairmont Kea Lani Wailea, Maui

www.HawaiiAutoDealer.com

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16

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A16AD87 (0617)

HADA dealers discuss the message we’re carrying to D.C. to present to Hawaii’s Congressional Delegation

The HADA executive committee/legislative committee was joined by Brad Nicolai (shown far right, 3 o'clock position) during a recent meeting which included discussions on the message being carried by HADA to the Hill during the NADA Washington Conference, Sept. 12 and 13. Shown L-R counter clockwise after Brad Nicolai, are NADA director Stan Masamitsu, Treasurer Kenny Ching, President Brian Kitagawa, Immediate Past President Bill van den Hurk, and Vice president, Eric Fukunaga.

C

ongress is considering a bill to advance self-driving cars or Highly Automated Vehicles (HAV) which would preempt certain state franchise laws. The HAV preemption language, however, is much broader than necessary. All fifty states have enacted vehicle franchise and licensing laws to provide consumer protections and regulate vehicle commerce. The pending bill previously had provisions, now clarified on the House side, that would have preempted these state laws. HADA will ask our

18

members of Congress to ensure that laws applied to self-driving vehicles preserve state vehicle licensing and franchise laws. Additionally, HADA has concerns about S.900/H.R.1181, a bill that would have prohibited dealers from selling or wholesaling a used vehicle under open recall, even though the vast majority of vehicle recalls do not require the drastic step of grounding. Lowering trade-in values would hurt car buyers by reducing the down payment a consumer could use to buy a newer vehicle.

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Servco Breaks Ground On Oahu’s First Publicly Accessible Hydrogen Station

The ground-breaking ceremony for Servco’s new hydrogen fueling station at their Mapunapuna location was held August 2, 2017. Shown l-r are: Kahu Kordell Kekoa; Project Manager Pete Pugnale, Fastech; Vice Chair Eric Fukunaga, Servco Pacific Inc.; Managing Director Roy Amemiya, City & County of Honolulu; Chairman & CEO Mark Fukunaga, Servco Pacific Inc.; Governor David Ige, State of Hawaii; President & COO Rick Ching, Servco Pacific Inc.; SVP Projects & New Initiatives Thor Toma, Servco Pacific Inc.; Principal Dennis Enomoto, Palekana Permits HONOLULU–Servco Pacific Inc. (Servco) broke ground on Oahu’s first publicly accessible hydrogen station, August 2, 2017, marking the company’s commitment to the future of mobility through alternative energy vehicles in Hawaii. The station, which is fully funded by Servco,will be located at Servco’s corporate offices in Mapunapuna, and is expected to be completed and opened in early 2018. “Our construction of Oahu’s first publicly accessible hydrogen station demonstrates our belief in the potential for fuel cell vehicles in Hawaii,” said Mark Fukunaga, chairman and CEO of Servco Pacific Inc. “The future of transportation uses the latest technology to minimize environmental impact while

maintaining convenience and comfort.

Hydrogen vehicles offer zero carbon emissions and zero compromise on fast refueling and driving range.”The hydrogen station will be able to produce up to 20 kg of hydrogen daily –enough for four fuel cell vehicle fill-ups. The station will create hydrogen on-site by electrolyzing water. With the station’s highpressure dispenser,a hydrogen fill-up will take approximately five minutes, which is comparable to refueling a car with gas. To fill up, the driver connects the dispenser to the car’s receptacle and engages the nozzle lock to form sealed connection with the vehicle. The station and vehicle’s onboard computers perform a system check and then begin the flow of

hydrogen gas. When the tank is full, the dispenser stops, and the driver unlocks the nozzle and places it back on the pump. Servco anticipates that the hydrogen station will be used by future owners of fuel cell vehicles such as the Toyota Mirai, the company’s first full-production fuel cell vehicle.

The Toyota Mirai has a total EPA estimated range of 312 miles on a full tank of hydrogen, with a combined city/highway fuel economy rating of 66 mpge, making the Mirai the most fuel-efficient hydrogen fuel cell vehicle rated by the EPA, and one with the largest range. Servco brought the first Mirai production vehicles to Hawaii in 2016. Hawaii was the second state in the U.S. to receive the Mirai, after California.

21

Is an electric vehicle fast charger in your business future?

Attract more customers, please your employees, help our environment This is a great time to consider adding a DC Fast Charger for electric vehicles to your business. The Hawaiian Electric Companies’ program to encourage plug-in EV ownership has been extended. With nearly 6,000 plug-in EVs on our roads, Hawai‘i is among the national leaders in EVs per capita. More EV models with moderate pricing and greater range are on sale here now or soon will be.

Consider whether a fast charger on your premises can be an asset for your business or building. Call us at 808543-GOEV (4638) and we’ll tell you about choices: own and operate an on-site fast charger yourself or, better yet, let Hawaiian Electric do it for you. t 5IF )BXBJJBO &MFDUSJD $PNQBOJFT DBO PXO operate up to 25 publicly accessible DC fast chargers across O‘ahu, Maui County and Hawai‘i Island. Nearly a dozen are already in place and more sites are needed. You provide the space and minimal support, Hawaiian Electric operates, and maintains the charger.

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Covering Data thru June 2017

Volume 16, Number 3

™

Hawaii Auto Outlook

Sponsored by: Hawaii Automobile Dealers Association FORECAST

State New Vehicle Market Improved in First Half of 2017 New vehicle sales predicted to remain strong in 2017 Below is a list of 10 key trends and developments in the Hawaii new vehicle market:

8. Brands with the largest percentage increases in registrations during the first six months of this year (among top 25 brands): Buick, Tesla, Infiniti, Chrysler, and GMC.

1. State new retail registrations increased by 5.1% in the first half of this year versus a year earlier, compared to the 0.6% drop in the Nation.

9. State market share leaders in the first half of 2017 were Toyota, Honda, Nissan, Ford, and Chevrolet.

2. The market has come a long way from the low point in 2010.

Registrations in the first half of this year were 29,816 units, up by more than 14,000 compared to the first six months of 2010.

10. Top ten selling vehicles in state market: Toyota Tacoma, Toyota 4Runner, Honda CR-V, Honda Civic, Ford F-Series, Toyota RAV4, Toyota Corolla, Honda HR-V, Nissan Rogue, and Toyota Camry.

3. Auto Outlook’s annual forecast for 2017 new retail light vehicle registrations: 59,750 units, up slightly from 2016.

4. Light truck market share increased from 59.7% during the first six months of 2016 to 63.4% this year.

General Market Outlook for next two years: New vehicle sales likely to drift lower; but should remain at healthy levels After fully recovering from the low point in sales that occurred in 2010, the state new vehicle market is likely to soften during the next few years. But the healthy job market, strong consumer affordability, and significant advances in new vehicle technology and safety features should keep sales strong.

5. Registrations for Detroit Three brands were up 8.3% so far this year, higher than the 5.1% increase in the industry.

6. Alternative powertrain (hybrid and electric) market share was 5.9% thru June of this year, up from last year.

7. Three biggest segments in the state are Compact Car, Compact SUV, and Compact/Mid Size Pickup.

Annual Trend in State Market

Market Summary

New light vehicle registrations

70,000 60,000 50,000

54039

59750 57094 58485

48705

40,000 42463 30,000 32878 32649

35576

20,000 10,000 0

TOTAL

YTD '16 thru June 28,373

YTD '17 % Chg. thru June '16 to '17 29,816 5.1%

Mkt. Share 2017

Car Light Truck

11,433 16,940

10,911 18,905

-4.6% 11.6%

36.6% 63.4%

Domestic European Japanese Korean

5,941 2,647 17,905 1,880

6,432 2,741 18,708 1,935

8.3% 3.6% 4.5% 2.9%

21.6% 9.2% 62.7% 6.5%

2009 2010 2011 2012 2013 2014 2015 2016 2017 Forecast Historical Data Source: IHS Markit.

Source: IHS Markit.

The graph above shows annual new retail light vehicle registrations in the state from 2009 thru 2016 and Auto Outlook’s projection for 2017.

Domestic brands consists of vehicles sold by GM, Ford, FCA (excluding FIAT and Alfa Romeo), and Tesla.

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+, -# (&&-'#,0 3 ('(%-%- #* ) *,& ', 3 - # (. *'& ', 3 3 %(" #1 3 #! +% ' 3 / ## 3 / ## ' % 3 / ## "((%+ 3 *% / ## - # (&&-'#,0 3 -# 3 '#. *+#,0 ( / ## 3 / ## ',* % 3 +, "- (&&-'#,0 3 / ## , , 3 -# (-',0 3 %% 0 +% (&&-'#,0 3 ('(%-%-

24

Hawaii Auto Outlook

Page 2

MARKET TRACKER - SEGMENTS

State Market Up in 4Q ‘16 Change in Segment Market Share

Small SUV

YTD 2017 thru June vs.

YTD 2016

Mid Size and Large SUV Luxury Mid Size and Large SUV

Hawaii and U.S. Markets

Luxury Small SUV Pickup

Typical models in segments:

Luxury and Sports Car

Small Car: Hyundai Elantra Mid Size & Large Car: Toyota Camry Luxury & Sports Car: BMW 3-Series Pickup: Ford F-Series Van: Honda Odyssey Small SUV: Jeep Cherokee Mid Size and Large SUV: Kia Sorento Luxury Small SUV: Audi Q5 Luxury Mid Size and Large SUV: Lexus RX

Van Hawaii Mid Size and Large Car

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

Change in market share Source: IHS Markit.

Hawaii Auto Outlook

Hawaii Market Out-Performs U.S. Hawaii Market

U.S. Market

5.1%

-0.6%

Passenger car market share YTD '17 thru June

36.6%

36.3%

Domestic brand market share YTD '17 thru June

21.6%

41.7%

Top 10 brands and market share YTD '17 thru June First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth

US

Small Car

MARKET TRACKER: STATE MARKET VERSUS U.S.

Percent change in registrations YTD '17 thru June vs. YTD '16

Small SUV market share was up sharply in both the state and U.S. markets. Small Cars had the biggest decline.

Toyota Honda Nissan Ford Chevrolet Kia Subaru Mazda Hyundai Jeep

26.3% 15.8% 10.2% 7.4% 5.4% 3.9% 2.8% 2.7% 2.6% 2.5%

Toyota Ford Chevrolet Honda Nissan Jeep Subaru Hyundai Kia GMC

Covering data thru June 2017 Published for: Hawaii Automobile Dealers Association 1100 Alakea Street, Suite 2601 Honolulu, HI 96813 Phone: 808-593-0031

13.1% 12.2% 11.2% 10.2% 7.3% 5.4% 4.2% 3.8% 3.5% 3.2%

Published by: Auto Outlook, Inc. PO Box 390 Exton, PA 19341 Phone: 800-206-0102 EMail: jfoltz@autooutlook.com Editor: Jeffrey A. Foltz Reproduction, including photocopying of this publication in whole or in part, is prohibited without the express permission of Auto Outlook, Inc. Any material quoted must be attributed to Hawaii Auto Outlook, published by Auto Outlook, Inc. on behalf of the Hawaii Automobile Dealers Association, and must also include the statement: “Data Source: IHS Markit.” Unforeseen events may affect the forecast projections. Consequently, Auto Outlook is not responsible for management decisions based on the content of Hawaii Auto Outlook.

Copyright Auto Outlook, Inc., August 2017

Source: IHS Markit

25

Hawaii Auto Outlook

Page 3

MARKET TRACKER: HYBRID AND ELECTRIC VEHICLES

Hybrid/Electric Vehicle Share is 5.9% in 2Q 2017

State Hybrid and Electric Vehicle New Retail Registrations 2011 thru 2016, 2017 YTD thru June Year Hybrids Electrics Total 2011 1299 338 1637 2012 2403 340 2743 2013 2551 774 3325 2014 2782 870 3652 2015 2171 748 2919 2016 1952 913 2865 17 ytd (June) 1044 734 1778

Quarterly Alternative Powertrain Market Share (includes hybrid and electric vehicles) 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0%

Trendli Trendline Alternative powertrain market share has trended slightly lower over the past three years, but was close to 6% in 2Q ‘17.

0.0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '13 '13 '14 '14 '14 '14 '15 '15 '15 '15 '16 '16 '16 '16 '17 '17

New registrations of hybrid and electric vehicles were 1,778 units during the first six months of 2017.

Source: IHS Markit.

COUNTY SCOREBOARD

Kauai New Vehicle Registrations Increase More Than 20% Oahu market was up 6% The table on the right provides a summary of each of Hawaii’s four retail light vehicle markets. The table is divided into four sections.

Market Summary shows total new retail light vehicle registrations during the first six months of 2016 and 2017 and the percent change. The second and third sections show Light Truck and Detroit Three market share. The fourth section shows market share figures for the top 10 selling light vehicle brands in the state. The top rated county in each category is shaded.

Kauai had the largest percentage increase, up 22.9%. Detroit Three market share was highest in Kauai (25.2%) and lowest on the Big Island (19%).

26

New Vehicle Markets Summary Hawaii Kauai Market Summary YTD '16 thru June 3433 YTD '17 thru June 3443 Percent change 0.3% Light Truck Market Share YTD '16 thru June 66.0% YTD '17 thru June 69.5% Change (share points) 3.5 Detroit Three Market Share YTD '16 thru June 19.3% YTD '17 thru June 19.0% Change (share points) -0.3 Market Share for Top 10 Selling Brands in State - YTD '17 thru June Toyota 28.2% Honda 19.0% Nissan 13.2% Ford 7.3% Chevrolet 2.8% Kia 7.1% Subaru 5.3% Mazda 1.2% Hyundai 2.1% Jeep 3.0%

Maui

Oahu

1154 1418 22.9%

3646 3607 -1.1%

20140 21348 6.0%

74.2% 72.5% -1.7

65.2% 68.8% 3.6

56.8% 60.9% 4.1

27.2% 25.2% -2.0

24.6% 23.3% -1.3

20.2% 21.4% 1.3

31.4% 17.3% 9.9% 11.8% 4.7% 7.3% 3.0% 1.5% 2.3% 3.1%

25.7% 19.9% 10.2% 7.4% 5.7% 4.4% 3.4% 1.0% 1.8% 2.1%

25.8% 14.5% 9.8% 7.1% 5.7% 3.0% 2.3% 3.3% 2.8% 2.5%

LAW £ Hawaii F&I Library

Reynolds Document Services has developed a library of standard F&I documents designed to streamline processes, reduce potential liability, and provide common defenses for Hawaii dealers.

LAW£ — The Brand Hawaii Dealers Can Trust For more information, contact your Document Services Consultant Kyle Madison at 619.577.0527 or Kyle_Madison@reyrey.com.

800.344.0996 | LAW@reyrey.com

© 2016 The Reynolds and Reynolds Company. All rights reserved. Confidential and Proprietary Information. 9/16

27

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28

Hawaii Auto Outlook

Page 4

Hawaii New Retail Car and Light Truck Registrations Second Quarter

TOTAL

Registrations 2Q '16 2Q '17 14,692 14,678

% change -0.1

YTD thru June

Market Share (%) 2Q '16 2Q '17

Change

Registrations YTD '16 YTD '17 28,373 29,816

% change 5.1

Market Share (%) YTD '16 YTD '17 Change

Cars Light Trucks

5,811 8,881

5,283 9,395

-9.1 5.8

39.6 60.4

36.0 64.0

-3.6 3.6

11,433 16,940

10,911 18,905

-4.6 11.6

40.3 59.7

36.6 63.4

-3.7 3.7

Domestic Brands European Brands Japanese Brands Korean Brands

3,143 1,362 9,222 965

3,084 1,315 9,317 962

-1.9 -3.5 1.0 -0.3

21.4 9.3 62.8 6.6

21.0 9.0 63.5 6.6

-0.4 -0.3 0.7 0.0

5,941 2,647 17,905 1,880

6,432 2,741 18,708 1,935

8.3 3.6 4.5 2.9

20.9 9.3 63.1 6.6

21.6 9.2 62.7 6.5

0.7 -0.1 -0.4 -0.1

Acura Audi BMW Buick Cadillac Chevrolet C/D/J/R Total Chrysler Dodge Jeep Ram FIAT Ford GMC Honda Hyundai Infiniti Jaguar Kia Land Rover Lexus Lincoln Mazda Mercedes MINI Mitsubishi Nissan Other Porsche Subaru Tesla Toyota Volkswagen Volvo

201 156 368 40 30 709 882 65 266 362 189 19 1,232 165 2,158 383 64 15 582 38 418 11 421 344 128 29 1,448 25 51 390 72 4,092 187 34

219 123 371 90 47 756 892 77 209 405 201 28 1,008 179 2,380 407 93 31 551 38 414 9 375 335 89 35 1,471 40 57 410 97 3,920 183 30

9.0 -21.2 0.8 125.0 56.7 6.6 1.1 18.5 -21.4 11.9 6.3 47.4 -18.2 8.5 10.3 6.3 45.3 106.7 -5.3 0.0 -1.0 -18.2 -10.9 -2.6 -30.5 20.7 1.6 60.0 11.8 5.1 34.7 -4.2 -2.1 -11.8

1.4 1.1 2.5 0.3 0.2 4.8 6.0 0.4 1.8 2.5 1.3 0.1 8.4 1.1 14.7 2.6 0.4 0.1 4.0 0.3 2.8 0.1 2.9 2.3 0.9 0.2 9.9 0.2 0.3 2.7 0.5 27.9 1.3 0.2

1.5 0.8 2.5 0.6 0.3 5.2 6.1 0.5 1.4 2.8 1.4 0.2 6.9 1.2 16.2 2.8 0.6 0.2 3.8 0.3 2.8 0.1 2.6 2.3 0.6 0.2 10.0 0.3 0.4 2.8 0.7 26.7 1.2 0.2

0.1 -0.3 0.0 0.3 0.1 0.4 0.1 0.1 -0.4 0.3 0.1 0.1 -1.5 0.1 1.5 0.2 0.2 0.1 -0.2 0.0 0.0 0.0 -0.3 0.0 -0.3 0.0 0.1 0.1 0.1 0.1 0.2 -1.2 -0.1 0.0

370 275 704 88 56 1,362 1,701 113 524 693 371 55 2,302 293 4,078 740 127 22 1,140 92 821 23 763 650 244 62 2,911 48 111 821 114 7,951 368 81

443 278 736 164 90 1,597 1,761 157 454 751 399 58 2,206 392 4,720 766 197 68 1,156 90 725 13 809 692 175 69 3,049 85 124 841 200 7,855 402 55

19.7 1.1 4.5 86.4 60.7 17.3 3.5 38.9 -13.4 8.4 7.5 5.5 -4.2 33.8 15.7 3.5 55.1 209.1 1.4 -2.2 -11.7 -43.5 6.0 6.5 -28.3 11.3 4.7 77.1 11.7 2.4 75.4 -1.2 9.2 -32.1

1.3 1.0 2.5 0.3 0.2 4.8 6.0 0.4 1.8 2.4 1.3 0.2 8.1 1.0 14.4 2.6 0.4 0.1 4.0 0.3 2.9 0.1 2.7 2.3 0.9 0.2 10.3 0.2 0.4 2.9 0.4 28.0 1.3 0.3

1.5 0.9 2.5 0.6 0.3 5.4 5.9 0.5 1.5 2.5 1.3 0.2 7.4 1.3 15.8 2.6 0.7 0.2 3.9 0.3 2.4 0.0 2.7 2.3 0.6 0.2 10.2 0.3 0.4 2.8 0.7 26.3 1.3 0.2

0.2 -0.1 0.0 0.3 0.1 0.6 -0.1 0.1 -0.3 0.1 0.0 0.0 -0.7 0.3 1.4 0.0 0.3 0.1 -0.1 0.0 -0.5 -0.1 0.0 0.0 -0.3 0.0 -0.1 0.1 0.0 -0.1 0.3 -1.7 0.0 -0.1

29

Reservations for rooms are no longer taken online. The block has been expanded but you may contact the The Fairmont Kea Lani Maui reservation number at

1-800-659-4100.

Mention the HADA room block and the dates.

Then, for registration for the convention itself, go to the HADA website at

www.hawaiiautodealer.com Sponsorships also can be booked and paid for online at the HADA website at

www.hawaiiautodealer.com

Commercial & Personal Insurance Serving & Supporting Hawaii’s Auto Dealers Since 1976

Need Answers? www.HawaiiAutoDealer.com

YOUR HADA INFO RESOURCE

Cavanah Associates, Inc. An Independent Insurance Agency Specializing in:

A U T O M

O

B

H

A

E IL

30

www.cavanah.com

II

N

hada IO

E

Phone: (808)537-1970

Vehicle Service Contracts GAP Protection Programs Homeowners Insurance Personal Auto Insurance Dealer Enhancements Group Life and More!

A

D

Full Dealer Package Garage Liability Property Insurance Physical Damage Workers Compensation Employment Practices Liability

W

A

L

E

R

I A A S S O C

T

From Ship to Showroom Pasha Hawaii offers Hawaii auto dealers and rental car companies versatile ocean transportation services between Hawaii and the Mainland, with fully enclosed decks on our roll-on/roll-off vessels for maximum protection of all vehicles.

Direct Ro/Ro service available from Los Angeles and San Diego, CA to Hilo, Kahului, and Honolulu, HI.

In a word, we’re driven.

For decades, Matson has supported Hawaii’s auto dealers as both a friend and partner. We have more sailings, more often, to and from Hawaii than any other carrier. The Hawaii Auto Dealers Association can rely on Matson to continue its proud tradition of providing regular, reliable delivery of automobiles and outstanding service, including up-to-date technology for vehicle status reporting and tracking. And after 130 years of service to the islands, members can continue to count on Matson to deliver.

For more information, call our Customer Support Center at (800) 4-MATSON or visit matson.com.