March 2016 FINAl Mag MAR16_MidAtlanticDealerNews 2 23 2016

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TWENTY GROUP PARTICIPATION TO GROW YOUR BUSINESS – PAGE 21

MidAtlantic

DealerNews

MARCH 2016

AFFILIATED WITH NIADA | PUBLISHED BY PA-MD-DE IADA

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1501 North Front Street

Harrisburg, PA 17102

PA STATE OF THE BUDGET

ADDRESS MEANS

CONTINUING BATTLE

OVER INCREASING TAXES

STATE OF THE STATE ADDRESS IN

MARYLAND CUTTING TAXES AND FEES

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PIADA MEETING WITH LEGISLATORS,

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MidAtlantic

DealerNews

Affiliated with National Independent Auto Dealers Association

DEPARTMENTS & ARTICLES

Presidents’ Message to MidAtlantic Dealers By John DeFilippo ..........6

Executive Directors’ Message By Paula Frendel, Reg Evans .............8

Budget Battles Mean Industry Needs to Watch Out By Reg Evans .......10

PIADA Dinner Event With PA State Senator and House Majority Whip .....11

Defending Against Arbitrary Changes to Interest Rates By Reg Evans. . . . . 11

Can Elevated, Rotating Cars Generate Higher Margin Sales? By Chris Purtee . 12

CFPB Enforces Against Colorado BHPH Dealer By Peter Salinas .........14

Pennsylvania Auto Show 2016 – For Car Enthusiasts and the Family .....18

What Is At Stake in Pennsylvania for the 2016 Elections? By Bob Keaton ..20

How Low Can Prices Go? Ask Motor City! .........................20

NIADA Acquires Twenty Groups Education for Dealer Members

Nationwide By Peter Salinas ................................21

Are You Committing Sales Malpractice? By Al Mosher ................22

Dealership Employees Win $1,000,000 Powerball By Peter Salinas ......22

Legal Corner By Tom Hudson, Esq. and Nicole Munro, Esq. ............26

Electronic Odometer Disclosure Edges Toward Reality

By Anthony Bush, Esq. and Grace Strom Power, Esq. ...............28

NJ Legislation Anticipated for NJ MVC Alleged Fraud and Misconduct

By Anthony Bush, Esq. and Grace Strom Power, Esq. ...............28

Kontos Kommentary By Tom Kontos, Adesa Auctions ................30

PIADA, NJIADA/NYIADA, MIADA/DIADA

PROGRAMS, OFFERS & EVENTS

PIADA ANNUAL GOLD AND BRONZE SPONSORS ................. 6, 27

5th Annual MARIADA Dates/Locations Set ....................... 6, 8

FREE WEBINAR FOR MEMBERS MARCH 30 HOSTED BY WAYNE HERRING . 11

MARCH MADNESS! 11 FREE WEBINARS FOR IADA MEMBERS! ........13

PIADA Issuing Agent Training Courses ...........................23

AUCTION DIRECTORY - EXPANDED FOR OUR STATES ...............24

Pennsylvania Forms Dealers Can Order ..........................25

Maryland Forms Dealers Can Order .............................25

IADAs Membership Information ................................27

ADVERTISERS

✷ ABC Lancaster ..............31

✷ Adesa PA/Adesa Pittsburgh ......7

✷ America’s Auto Auction Harrisburg. 2

AutoTrader ....................6

Auto Use .....................9

✷ Auto Zone ..................6

✷ Bel Air Auto Auction ..........23

✷ Central Pennsylvania Auto Auction. 32

✷ Corry ADE ....................9

✷ Counselor Library ............27

4 | MARCH 2016 MIDATLANTIC DEALER NEWS

MARCH 2016

✷ Dealer Goodies ..............29

✷ Greater Erie Auto Auction ......25

✷ GWC Warranty. ...............3

✷ Kramer Insurance Center ......25

Manheim New York. . . . . . . . . . . . .15

✷ Manheim Pennsylvania ..... 16,17

MyDealerOnline .................6

NextGear Capital ................6

✷ North East PA Auto Auction .....19

✷ ProGuard Warranty Inc. .......5,6

✷ ADVERTISER ALSO PARTICIPATING IN THE 2016 DISCOUNT BOOK FOR PIADA-MDIADA-DEIADA FOR ALL FIVE MIDATLANTIC STATES.

EXPANDED DISTRIBUTION OF THIS RENAMED MAGAZINE (FORMERLY PA DEALER NEWS) NOW INCLUDES DEALERS IN THE FIVE STATES OF

PENNSYLVANIA, NEW JERSEY, NEW YORK, MARYLAND, DELAWARE: (1) VIA EMAIL TO ALL DEALER MEMBERS AND TO ALL NON-MEMBERS THAT

PROVIDE US WITH THEIR EMAIL ADDRESSES: (2) PAPER COPIES ARE MAILED TO PIADA MEMBERS IN PA AND TO MEMBERS OF NJIADA, NYIADA,

MIADA/DIADA: (3) PAPER COPIES FOR MEMBERS AND NON-MEMBERS IN ALL FIVE STATES MAY BE OBTAINED FOR FREE AT PARTICIPATING

AUCTIONS ON AUCTION SALE DAY. MIDATLANTIC DEALER NEWS SENDS FREE COPIES FOR DISTRIBUTION TO DEALERS AT AN ANTICIPATED

APPROXIMATELY: 19 WHOLESALE VEHICLE AUCTIONS IN PENNSYLVANIA, 11 IN NEW YORK, 2 IN NEW JERSEY, 2 IN MARYLAND.

WOULD YOU LIKE TO RECEIVE A DIGITAL VERSION OF THE MIDATLANTIC DEALER

NEWS MAGAZINE EARLY EACH MONTH? Email Shannon at Shannon@piada.org.

PA-MD-DE IADA'S 2015-2016

OFFICERS AND DIRECTORS

John DeFilippo, President

DeFilippo Bros. Motorcars (PA)...........610.532.8771

Tad Swift, Chairman

Corry Auto Dealers Exchange (PA)......814.664.7721

Tom Brandis, Treasurer

Advantage Auto Sales & Credit (PA)....215.805.2034

Clint Weaver, Secretary

America's Auto Auction Harrisburg (PA)..717.697.2222

Michael Brill, Vice President

B & B Automotive (PA).......................215.781.1818

Tom Hodges, Vice President

Tom Hodges Auto Sales (MD).............301.373.2277

Michael Mansour, Vice President

Car Connection, Inc. (PA)...................724.658.1212

Beth Melamed, Vice President

Ticket to Ride Auto (PA).....................717.393.9133

Fran Morelli, Vice President

Fran Morelli Sales & Service (PA).......814.265.1330

Lisa Cohowicz, Director

North East Pennsylvania Auto Auction (PA)..570.207.2277

James Cuce, Director

Manheim Philadelphia Auto Auction (PA)..215.962.6742

Jeff Dreier, Director

Dreier Auto Sales (PA).......................570.675.5696

Joe Eikenberg, Jr., Director

Aero Motors, Inc. (MD)......................410.686.3444

Gus Kurtz, Director

Sports and Imports, Inc. (MD)............410.360.8600

Dan Limongelli, Director

Jo-Dan Motors (PA)............................570.829.4043

Kevin Luring, Director

Garden Spot Auto Auction (PA)...........717.738.7900

Noah Melamed, Director

Ticket to Ride Auto (PA).....................717.393.9113

Kevin Novitsky, Director

Village Auto Sales (PA)......................570.254.6463

Chris Smiley, Director

Mountville Motor Sales (PA)...............717.681.9610

George Smouse, Director

Smouse Trucks & Vans (PA)...............724.887.7777

Steve Worley, Director

Worley Motors (PA)............................717.732.2051

Jay Zimmerman, Director

Zimmerman’s Auto Sales (PA)............717.766.7656

STAFF

Reg Evans, Executive Director

reg@piada.org............................. 717.238.9002 x28

Arie Garcia, Director of Operations

arie@piada.org.............................717.238.9002 x13

Shannon Becker, Membership Director

shannon@piada.org......................717.238.9002 x18

Ping Goslawski, Finance Department

ping@piada.org............................717.238.9002 x12

Nicole Autry, Dealer Development

nicole@piada.org......................... 717.238.9002 x26

Gigi Kode, Messenger/Title Call Center..717.635.2595

Peter Salinas, Special Contributing Writer

Jerry Trone, Media Photographer

To keep the MidAtlantic Dealer News on schedule, certain deadlines

must be observed. All information is due at the Pennsylvania-

Maryland-Delaware Independent Automobile Dealers Association

(“IADA”) office in Harrisburg thirty days prior to the publication date

of each issue.

The MidAtlantic Dealer News is a publication of the IADA, 1501

North Front Street, Harrisburg, PA 17102, in cooperation with our

partners the NJIADA and NYIADA. Advertising rates available on

request. If you have any questions please call the IADA office at

717.238.9002.

IADA was established in 1955, and chartered in 1959 under

the Non-Profit Corporation Laws of the Commonwealth of

Pennsylvania as PIADA and merged with Maryland and Delaware

trade association in 2015.

The statements and opinions expressed herein are those of the

individual authors and do not necessarily represent the views of

the MidAtlantic Dealer News, IADA, NJIADA, or NYIADA. Likewise,

the appearance of advertisers, or their identification as members

of IADA, NJIADA, or NYIADA, does not constitute an endorsement of

the products or services featured.

Editorial and advertising requests should be directed to the

Editor: MidAtlantic Dealer News, IADA, 1501 North Front

Street, Harrisburg, PA 17102. Telephone 717.238.9002, FAX

717.238.3870 or e-mailed to Shannon@piada.org.

Logos are respective trademarks of the IADA, NJIADA, NYIADA.

Copyright © 2015-2016 by IADA. All Rights Reserved.

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FROM THE PRESIDENT TO MIDATLANTIC DEALERS

THE VALUE OF WORKING “ON” YOUR BUSINESS

By John DeFilippo

Any dealer who has spent time with me might have heard me say the following phrase:

If you are only working in your business and not on your

business then you are going to be out of business.

JOHN DEFILIPPO

DeFilippo Bros. Motorcars

2240 East Lincoln Hwy.

Coatesville, PA 19320

610.532.8771

www.ujobucredit.com

Now why would I say such a harsh

thing and actually mean it? Because

I believe it to be true. Here is why

and what you can do about it.

There are fundamental things in our

business that stay the same. We

sell vehicles, people buy them and

need financing, we employ or are

employed, we can always be better at what we do. That last

item is at the heart of what I am talking about here.

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We can always be better

at what we do. A little

better or a whole lot

better, depending on

where we are in our

business and what the

market is doing at any

given moment.

The Twenty Group

program is all about

dealers meeting with

dealers from outside

of your geographic

zone, so there is no

competitive concern,

to hear about trends

and best practices, to

discuss problems and

hear solutions that work

for other dealers, to

learn about how to make

money not only now but

going forward based

on trends identified by

the moderator other

industry experts.

In the article on page 21, you can read quotes that are

testimonials to the value that dealers like me feel from

attending and participating in Twenty Group meetings.

Everyone there is seeking the same things: from how to

improve our respective dealerships to provide the best

possible customer service, to how to market better, improve

sales techniques, generate good income from retail financing,

upselling techniques for warranties and other products, how

to motivate staff, leadership skills, financial and tax planning,

and more. I know dealers who have literally upended or at

least significantly adjusted their business models and made

more money just by attending their first meeting.

You start with colleagues and end up with them becoming your

friends. Having dealership friends all over the country is a very

good thing. You can call them for advice just like they will call

you to bounce ideas around or deal with a specific problem.

These business and social relationships have tremendous

value because people who understand your business and are

not competing with you locally can comfortably share their

business insights and experiences to help you help yourself

and your dealership to be successful.

Being successful is an ongoing process that involves being

willing to invest time in yourself and to adapt to changing

market conditions and technologies. Twenty Groups can

help dealers to be more significantly more successful than

without them.

The Twenty Group dealerships success program is now owned

by NIADA which recently purchased this fine dealership training

program from Leedom and Associates. If you want to do more

than work in your business, if you want to actually learn more

ways to take it to the next level(s) and then some, contact

the NIADA directly. At least inquire. Give it a shot. You will

be glad you did.

John

6 | MARCH 2016 MIDATLANTIC DEALER NEWS


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EXECUTIVE DIRECTORS' MESSAGE

REG EVANS

Executive Director

PIADA, MDIADA, DEIADA

www.piada.org,

www.mdiada.org,

www.deiada.org

WHEN $2 BILLION IS SOUGHT

BY STATE GOVERNMENT. Pennsylvania

Governor Tom Wolf

provided his State of the State

Budget Address on February

9, 2016. State Government in

Pennsylvania is looking to raise

$2 billion. If you had a State

Government looking for $2 billion

it did not have, would you be

concerned about taxes or fees

going up? Your Pennsylvania

chapter is watching out for this

since the State’s budget for 2016 - 2017 is an unresolved

item. See page 10.

TAXING TRADE-IN VEHICLES IN PENNSYLVANIA. This

proposal is something the PIADA Pennsylvania chapter

strongly opposed when it was proposed in December 2015. It

would be unfair to tax consumers twice for buying and selling

a vehicle on trade-in. Since the State is looking for money,

we are continuing to inform legislators of our concerns with

any such proposal to impose taxes on vehicle trade-ins or to

raise taxes on retail vehicle purchases.

MARYLAND STATE OF THE STATE ADDRESS. Maryland

Governor Larry Hogan presented his State of the State

Address on February 3, 2016. Governor Hogan said in his

2015 address, “Every decision I make as governor will be

put to a simple test. Will this law or

action make it easier for families and

small businesses to stay in Maryland?

And – will it make more families and small

businesses want to come to Maryland?”

In his 2016 address, he said, “We have

already reduced or eliminated 100

fees all across state

government, saving

Maryland Governor

Larry Hogan

taxpayers $51 million.

Now, we ask you to

join our efforts by

reducing or eliminating another dozen

fees that are set in statute, to save

hardworking Marylanders another $71

million.” Some Maryland MVA fees that

affect dealers were in fact reduced in

2015. In the meantime, Mayor of Baltimore

Stephanie Rawlings-Blake and County

STATE OF THE STATES AFFECTING

DEALERSHIP INDUSTRY

By Paula Frendel and Reg Evans

Mayor of Baltimore

Stephanie

Rawlings-Blake

Executives were asking for money to fund key roads to support

job growth, among other items. Maryland IADA was there and

met with legislators to promote

the interests of independent

dealerships across the State.

MARYLAND MVA REMINDER

BULLETIN ON LOCATING

VEHICLES. At the request of

the Maryland State Highway

Administration, the Maryland

MVA issued a bulletin requesting

that all dealers make sure they

are safely displaying their vehicles

and they are not on State Highway

PAULA FRENDEL

Executive Director

NYIADA and NJIADA

www.newyorkiada.org

www.newjerseyiada.org

property or right of way. Failure to do so may result in citations.

INSTALLMENT LOAN INTEREST RATES BILL IN NEW JERSEY.

There is a legislative bill in New Jersey directed only at

dealerships that provide financing to retail customers. This

bill would limit the interest rate charged if a dealer installs

a GPS device in a financed vehicle. But the GPS device

helps credit-challenged customers to improve their credit by

not being automatically repossessed when their loans are

delinquent. Our Director Michael Brill provided testimony

to the New Jersey legislative committee on this issue. See

page 11 for details.

NY LEGISLATION TO ALLOW DEALERS TO COVER COSTS.

New York State Assembly Bill 02251 would increase the allowable

fees in aiding a customer with the registration of a

vehicle from $75 to $100. NYIADA supports this bill.

NJ MVC TROUBLES CONTINUE. See the article on page 28

for an update on pending regulatory agency changes due to

results of a fraud investigation by New Jersey State officials.

ELECTRONIC ODOMETER DISCLOSURES APPROVED BY

NEW FEDERAL LAW. See the article on page 28 for this new

federal authority that awaits implementation by the States.

NEW BENEFIT FOR MEMBERS – FINANCE RESOURCES. If

you are a dealer in Pennsylvania, Maryland, or Delaware and

are seeking retail finance sources for indirect lending or direct

lending for your retail customers, PIADA-MDIADA-DEIADA has

a new resource available for our Members. Please contact

us when you are looking for retail finance source information.

MARCH MADNESS – ANNOUNCING DEALER EDUCATION

SCHEDULE PIADA-MDIADA-DEIADA. Dealer Education Online

Webinar Classes for Members are being held in March 2016.

See pages 11 and 13 for details.

Have a Great Sales Month!

8 | MARCH 2016 MIDATLANTIC DEALER NEWS


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MIDATLANTIC DEALER NEWS MARCH 2016 | 9


BUDGET BATTLES MEAN

INDUSTRY NEEDS TO WATCH OUT

By Reg Evans

It is annual State Budget address

season across America. We address

two recent budget addresses

from our MidAtlantic region which

demonstrate the range of budget

problems and dangers that small

business and the general public face

from potential new taxes and fees

to fund perceived or actual budget

deficits.

PENNSYLVANIA BUDGET ADDRESS

Pennsylvania Governor Tom

Wolf (Democrat) provided his Budget Address to the

General Assembly (Republican majority in both Senate and

House) on February 9, 2016. Governor Wolf stated that

“Pennsylvania now faces a $2 billion budget deficit.” He

added, “Today, because of years of budgetary irresponsibility,

the Commonwealth of Pennsylvania is considered to be among

the least creditworthy states in America. This is embarrassing.

But embarrassment isn’t the point. You see, because our

credit has been downgraded so much, we are forced to pay

a higher rate of interest on our $17 billion in debt. That will

eventually cost us an extra $139 million a year.” The Governor

cited budget deals with Republican legislators that were not

completed and was booed when he said they should get other

jobs if they do not pass a responsible budget. You get the

point. And so did the Republican legislators who in press

conferences after the Governor’s speech indicated that the

Executive and Legislative branches are farther apart after the

Governor’s budget address than before it.

WHAT DOES THIS PENNSYLVANIA BUDGET BATTLE HAVE

TO DO WITH OUR INDUSTRY? PLENTY.

Remember in December 2015 when there was a proposal

to tax trade-in vehicles and the PIADA branch had to spring

into action against it. That is an example of a reasonable

tax exemption that would hurt our customers and therefore

also hurt our businesses if people had to pay a tax on the

value of a vehicle when trading it

in for another vehicle. That would

amount to paying tax twice on the

same vehicle, once to pay sales tax

when buying it and then again paying

sales tax when selling it.

Pennsylvania dealers already took

a hit with the PA Transportation

Funding bill that became law as

Act 89 of 2013 which increased

dealer-related fees. In this state of

seemingly never-ending incomplete

State budget negotiations, trade

associations for industries across Pennsylvania, including the

PIADA branch, are poised to say enough is enough already,

stop trying to tax us with new taxes and fees.

MARYLAND STATE OF THE STATE ADDRESS

Meanwhile, in his State of the State address on February

3, 3016 regarding budget and other priorities, Maryland

Governor Larry Hogan (Republican) encouraged State

legislators (Democratic majority in both Senate and House) to

pursue less spending and lower fees. This follows his stated

test for spending measures being whether it will hurt small

business or drive jobs away from the State. “Marylanders

are demanding relief from years of crippling tax and fee hikes.

We are already delivering $600 million back into the pockets

of Maryland’s taxpayers. This year, let’s work together to help

even more struggling Marylanders throughout our state.”

SIMILAR PROBLEMS, DIFFERENT SOLUTIONS

There are Budget problems in both States and different

approaches to solving them. That is the laboratory of the

States. Between Pennsylvania and Maryland, it is the

Pennsylvania dealers and general public that presently are

facing more potential government extraction of money from

their wallets and pocketbooks. Remain aware and we will

keep you apprised because as the saying goes, “It ain’t over

‘til it’s over.” 3

Speaker of the House Mike Turzai and House Republicans

Senator Joseph Scarnati (above) President Pro Tempore of the Senate

Top: Gov. Tom Wolf (center) with Speaker Turzai (l) and Lt. Gov. Mike Stack

10 | MARCH 2016 MIDATLANTIC DEALER NEWS


PIADA DINNER EVENT WITH

PA STATE SENATOR AND HOUSE MAJORITY WHIP

By Reg Evans

Dealership Members in the Lancaster

area convened a PIADA Chapter dinner

event attended by our invited guests

of honor, Pennsylvania State Senator

Ryan Aument and State Representative

Bryan Cutler who serves in leadership

as House Majority Whip. A wide range

of issues was discussed including the

Rep. Bryan Cutler

State Budget negotiations, taxes, small

business, fees on dealerships and auctions, safety recalls,

and other issues. Meetings like this one are important

to establishing and growing relationships with key people

who understand the concerns of businesspeople in the

Commonwealth.

We thank Senator Aument and

Representative Cutler for meeting with

us to discuss issues of importance to

our industry. Special Thanks to Director

Chris Smiley and Lobbyist Bob Keaton

who arranged this event. We also thank

our tri-State Board of Directors for making

Sen, Ryan Aument

this event possible.

Finally and most importantly, we thank our Members who

took time from their busy schedules to attend this event to

promote our industry to people of legislative influence at the

Pennsylvania State Capitol. 3

DEFENDING AGAINST ARBITRARY CHANGES TO

INTEREST RATES

By Reg Evans

In early February 2016, PIADA-MDIADA-DEIADA Director

and Vice President Michael Brill provided a New Jersey

legislative committee with informative testimony regarding

the positive use of GPS devices in vehicles financed by

dealerships. The reason for the testimony is a New Jersey

bill that would discount permissible interest rates when a

GPS device is installed in a vehicle for retail finance collateral

recovery purposes. NJIADA’s Executive Director Paula

Frendel has been monitoring this bill and advocating against

it for the industry in New Jersey.

“It is essential to most if not all dealerships in the buyhere-pay-here

industry to be able to locate a vehicle in the

event that the customer is past due on a vehicle loan and

is not returning phone calls,” said Michael Brill. This device

gives the customer a better chance of being reminded to pay

on time so that the customer can improve his or her credit

score and retain use of the vehicle. The device plays a crucial

role in providing some flexibility from otherwise immediately

repossessing the vehicle. GPS devices are as important to

customers as to the dealers who sell and finance the vehicle

purchase. Vehicles as collateral are not like house collateral

since vehicle collateral moves and could be anyplace. And

arbitrarily singling out one group of lenders for interest rate

reduction could be a slippery slope toward future legislation

inconsistently affecting multiple lenders in different fact

scenarios.

It remains important to let legislators know the industry

view and background on an issue. Developing understanding

can make a difference. MidAtlantic Dealer News and our

associations thank Michael Brill for his time and effort

preparing and testifying on behalf of our industry twice before

this New Jersey legislative committee in recent months. 3

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MIDATLANTIC DEALER NEWS MARCH 2016 | 11


CAN ELEVATED, ROTATING CARS GENERATE

HIGHER MARGIN SALES?

Five critical criteria to determine if elevated,

spinning car displays might work for your dealership

By Chris Purtee, 360 Auto Display USA

Every dealer looking to increase monthly sales volumes

knows that you can’t make sales if you don’t have customers

walking onto the lot. While outgoing telephone calls and the

increasing reliance on internet departments can bring in some

solid leads and sales, the higher margins come from passing

motorists that are drawn to pull into the dealership and

ideally purchase from

your stock.

Now, the age-old

question of how to

get these potential

customers to drop in is

being addressed through

a new breed of auto

display that elevates a

vehicle on a revolving

pedestal that sits ten

feet high in the air,

rotating 24 hours a day.

What sets the latest

rotating car displays

apart from their massive

erector-set ancestors is

the ease-of-use, small

footprint, fast vehicle

change-out, and eyecatching

features such

as automatic lights that

illuminate the vehicles at

night. Sweetening the deal are new low

cost monthly lease options with turnkey

service, which means the lift display is delivered to the lot

and maintained by the provider for as long as the dealership

wants it.

1. THE ULTIMATE TEST: WILL IT INCREASE SALES?

For the forward thinking dealerships who have already

tested this concept, there is deliverable proof of its ability to

increase walk-in traffic and significantly boost sales.

“We get good traffic anyway, but our elevated, rotating car

display probably increased our numbers by 20-30% over the

six months we’ve had it,” says Danny Nolan, Sales Manager

at Arriba Motors, with stores in Conroe and Porter, Texas, that

sell used trucks and SUVs of all makes.

While dealerships are spending a growing percentage of

their advertising budgets on the internet, those leads tend to

deliver low margin sales. According to the dealers who have

embraced this new forms of dealership advertising, these

displays not only delivers increased numbers, but they deliver

the higher margin sales needed to increase the bottom line.

2. IS THE DEALERSHIP IN A HIGH TRAFFIC/

HIGH VISIBILITY AREA?

As with real estate, location is everything, and the prime

dealership spots are along heavily trafficked highways or roads

with potentially millions of customers driving by each year.

The issue then becomes attracting the attention of a driver

who may be distracted,

deep in thought, or in a

conversation.

The answer –

supported by research

in the field of advertising

– is to attract attention

through motion. As

Shrimp and Andrews

point out in their book

Advertising, Promotion,

and other aspects of

Integrated Marketing

Communications,

advertisements that

involve motion increased

sales by 51% more than

a similar static display.

It is this theory that

drives such advertising

as corner sign holders

that spin and flip their

signs, dancing men in

gorilla suits, and even the “inflatable

dancing man” that gyrates spastically.

Even balloons, banners, and flags waving in the wind work

under the same principle.

According to John Johnson, General Manager Bates Nissan

Killeen, Texas, the first vehicle he placed on the spinner was

a Nissan Juke.

“I thought because the car looks ‘unique’ it would catch

someone’s attention and it did,” says Johnson. “A lady was

driving by, noticed the Juke, and stopped in. She said she

had never seen one of them before, thought it was cute, and

bought it on the spot. Had the car been sitting in line with

the rest of the inventory, she may have just passed us by.”

“I can’t tell you how many times someone says, ‘I want a

car like the one on the spinner,’ adds Larry Crawford, Sales

Manager AutoNation Mazda Fort Worth, Texas.

3. A “NO FUSS” PROMOTION

A typical sales team has too many non-sales tasks to deal

with each day—such as putting cars out front, sticking the

Mulroney’s back on the windows, or taking online courses

12 | MARCH 2016 MIDATLANTIC DEALER NEWS


from the manufacturer—to spend an hour putting a car in

the air. Here’s where the improved designs of modern risers

come into play.

Newly designed auto displays can have a car in the air

quickly; only 15 minutes in some cases. Such expediency

encourages swapping out the vehicle on display on an almost

daily basis, adding variety to the attention-getting mix.

4. MORE UPSCALE PRESENTATION

Although advertising balloon products have their place and

are widely used throughout the industry to capture people’s

attention, some luxury brand vehicle dealerships may want

to a more sophisticated presentation.

Placing a vehicle itself on display may be more appealing

and in line with certain branding images. Dealers like Nolan

agree that putting a fully-optioned, top-of-the-line model on a

raised, rotating display for all to see sends a message that

this dealership offers excellence, luxury, and class.

In addition, some municipalities have regulations against

gaudy or oversized signage. In such cases a 360-degree

spinning auto display of adequate height is permissible within

a large majority of these regulations.

5. THE SWEET SPOT IN ADVERTISING BUDGETS

As with any advertising, the question is the cost versus

effectiveness. Now, with new short term leases, dealers can

test out the return on investment without major commitments.

According to Nolan, although he had the option to purchase

the unit outright he preferred a monthly lease. The short

term leases offered by some manufacturers, for durations

as low as six-months, allow dealers to test drive the product

and monitor the impact on sales without a major impact on

the advertising budget.

“We are leasing our auto spinner and found it to be very

affordable,” notes Nolan. “We didn’t have to lay out a ton of

money.” 3

For more information, contact 360 Auto Display USA in Houston, 702 Spring Cypress Road, Suite H; Spring, TX 77373;

888-360-3477; chris@360autodisplayusa.com or visit www.360autodisplayusa.com.

(The display Nolan selected was 360 Auto Display USA of Houston, Texas, a company that manufactures an elevated,

rotating vehicle display. The entire system fits in a single parking spot and is designed for quick and easy changing

of vehicles in 10-15 minutes. The system operates 24/7 and runs off a common 20 amp, 110 volt grounded circuit.)

MARCH MADNESS!

11 FREE WEBINARS IN MARCH FOR IADA MEMBERS

1. Tuesday, March 1, 3pm: Federal Regulatory Agencies-Structure Intro, “D#fence”, and Tips – FTC, CFPB,

DOJ, IRS, FINCEN, for PA, MD, and DE Dealers.

2. Wednesday, March 2, 3pm: Pennsylvania Regulatory Compliance – Intro to Agencies Structure, Audit Prep,

and Tips, for PA Dealers.

3. Thursday, March 3, 3pm: Maryland Regulatory Compliance – Intro to Agencies Structure, Audit Prep, and

Tips – for MD Dealers.

4. Thursday, March 10, 3pm: Pennsylvania Secure Power of Attorney Form, for PA Dealers.

5. Tuesday, March 15, 3pm: How to Handle Consumer Complaints, for PA, MD, and DE Dealers.

6. Wednesday, March 16, 3pm: Maryland Spot Delivery New Authority and Compliance Tips, for MD Dealers. .

7. Thursday, March 17 at 3pm: Pennsylvania MV 27A and B Vehicle Purchase Reporting Form, for PA Dealers.

8. Tuesday, March 22, 3pm: Intro to Pennsylvania Retail Installment Finance Compliance and Guidance

Information, for PA Dealers.

9. Thursday March 24, 3pm: Advertising Guidance for Federal and State Compliance, for PA, MD, and DE Dealers.

10. Tuesday, March 29, 3pm: Repossessing Vehicles in Pennsylvania, for PA Dealers.

11. Thursday, March 31, 3pm: New 5 Year Agent Contract Requirements, for PA Dealers.

SPEAKER ARIE GARCIA: SESSIONS 4, 7, 11. SPEAKER REG EVANS: SESSIONS 1, 2, 3, 5, 6, 8, 9, 10

ADDITIONAL CLASSES WILL BE SCHEDULED DURING 2016.

MIDATLANTIC DEALER NEWS MARCH 2016 | 13


CFPB ENFORCES AGAINST COLORADO BHPH DEALER

FOR ALLEGED UNLAWFUL LENDING PRACTICES

By Peter Salinas

The Consumer Financial Protection Bureau (CFPB), has

dunned a Greeley, Colorado buy-here, pay-here dealership with

a huge penalty —$700,000 — as a result of an investigation

into the store’s business practices.

Y King S Corp., which does business as Herbies Auto

Sales in Greeley, Colorado, was ordered to pay $700,000

in restitution to harmed consumers, and a civil penalty of

$100,000, which is suspended based on the dealer’s inability

to pay.

The move comes on the heels a November 2015, $6.4

million fine against CarHop, a Minnesota-based buy-here, payhere

operation, and its affiliated financing company, Universal

Acceptance Corp., for allegedly inaccurately reporting credit

information for more than 84,000 consumer accounts.

While CarHop, operates 50 retail locations in 15 states,

Herbies operates one location in northern Colorado. The

move by the CFPB may signal increased attention on the buyhere,

pay-here business model, which predominantly involves

smaller operations as opposed to the large chains, such as

CarHop and DriveTime.

CarHop agreed to pay the

fine, but did not admit any

wrong-doing.

“We have agreed to this

settlement, under which we

have not admitted to the

CFPB’s allegations, to move

beyond the distraction of the

investigation started in May of

2012,” CarHop said in a public

statement in December 2015

“Although the CFPB has

made a number of allegations, it did not find that any

consumer is entitled to any damages.

Arizona-based DriveTime was fined $8 million by the CFPB in

late 2014 for allegedly using unfair debt collection practices.

DriveTime was ordered to pay to fix its credit reporting

practices, and arrange for harmed consumers to obtain free

credit reports. The company operates 117 dealerships in 20

states and, as of the end of 2013, held more than 150,000

outstanding auto installment contracts.

The CFPB imposed the fine on Herbies for:

• failing to accurately disclose the finance charge and

annual percentage rate for financing agreements;

• failing to disclose the cost of the repair warranty as a

finance charge;

• failing to disclose the cost of the GPS payment reminder

device as a finance charge;

• failing to disclose the discount provided to cash

customers as a finance charge; and

• advertising a false annual percentage rate.

According to published reports, Lee Yoder, owner of Herbies

Auto, said in a prepared statement that, “It was certainly

never our intention to deceive our customers. Nevertheless,

the CFPB insisted that we sign a consent order or face a law

enforcement action.”

The CFPB made special mention of Herbies charging less

for vehicles paid for with “cash” transactions than it did for

“credit” transactions — by as much as $1,000. The CFPB

said Herbies “took unreasonable advantage of (consumers)

by exploiting its customers’ misunderstanding of the credit

and sales terms for its own financial benefit.”

Herbies, which now leases vehicles to consumers, offered

auto financing to consumers for used car purchases from

January 2012 through May 2014. Herbies assigned the

vast majority of these contracts to YKS Acceptance, Inc., an

affiliated financing business that has the same corporate

officers as Herbies and only takes assignment of Herbies’

installment contracts.

Yoder, in his statement, explained that any additional charges

were for the consumers’

protection, and consumers

were fully aware of them.

He said in the letter that if

buyers experienced mechanical

problems with their cars, they

could end up defaulting on

their loans, so Herbies created

a warranty program, “for an

additional cost, to cover many

mechanical problems, protect

the customer and reduce

purchaser defaults.

The CFPB stated the company charged $1,650 for the

“required repair warranty.”

The CFPB charged that Herbies advertised a “misleadingly

low 9.99 percent annual percentage rate (APR), without

disclosing a required warranty, a payment reminder device

and other credit costs as finance charges. This ruse helped

Herbies convince consumers that they would get the 9.99

percent APR instead of the much higher rate actually charged.

Also, Herbies engaged in abusive practices.”

As a result of the agreed to “consent order” from the

CFPB the company must: provide $700,000 in restitution for

consumers who financed cars with Herbies after January 1,

2012, except those whose accounts were charged off due

to default. Herbies must submit a timeline to the CFPB for

making restitution to consumers. The company is also subject

to a civil penalty of $100,000, which is suspended as long

as redress is paid.

Yoder said in his statement that Herbies was not given any

warning that the protection agency believed the car dealership

was violating the law, or given “any chance to remedy their

concerns.” 3

14 | MARCH 2016 MIDATLANTIC DEALER NEWS


SHORT DRIVE

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PENNSYLVANIA AUTO SHOW 2016

FOR CAR ENTHUSIASTS AND THE FAMILY

By Reg Evans

The Pennsylvania Auto Show, formally known as the

2016 Motor Trend International Auto Show, was held at the

Pennsylvania Farm Show Complex & Expo Center in Harrisburg,

PA on January 28 – 31, 2016.

The latest cars, trucks, and crossover vehicles were on

display from 32 manufacturers. Used vehicles were on display

and up for sale on a rolling inventory basis during this four day

event. The Luxury Hall was where the Rolls Royce and other

high-end vehicles, ranging from new to antique, were to be

seen. Boats were on display as well. Test rides in Ford and

Toyota sedans were taken by many of the attendees.

This was a family-friendly event that included an indoor

zipline near the Motor Trend car and truck of the year, a

moonbounce, an inflatable slide, and mini-electric vehicles

that the kids were allowed to drive around.

Enjoy the photos from this annual excellent event. 3

18 | MARCH 2016 MIDATLANTIC DEALER NEWS


ROBERT C. KEATON

Bob is a Senior Associate

at Bigley and Blikle,

LLC. Bob has worked in

government affairs as a

corporate lobbyist with

Sunoco, Inc. and as a

Policy Director for former

Governor Tom Ridge. Most

recently, he worked as the

Legislative Director for

NFIB.

WHAT IS AT STAKE IN PENNSYLVANIA

FOR THE 2016 ELECTIONS?

By Robert C. Keaton, Senior Associate, Bigley and Blikle, LLC

We are rapidly approaching the April 1 primary in Pennsylvania, for 2016. This year, as in the

past, we hear from the political pundits that this one matters more to our commonwealth and

country than the last.

In presidential elections, the Commonwealth has not been a factor since the presidential

primary of 1976, and the state moved up the primary in April rather than the usual May. Although,

this is the case Pennsylvania is still considered a battleground state with its 20 electoral votes.

Many observers now believe the Keystone State’s days as a battleground state are over. The

election often comes down to three states - Florida, Ohio and Pennsylvania. Win two of the three

and you won the presidency.

So, while Pennsylvania probably will not matter at all in the spring presidential primary, it often

matters in the fall general election. Democrats have carried the state in the last six presidential

elections. Not since George H. W Bush’s victory over Michael Dukakis in 1988 has a Republican

carried the state in a presidential contest.

Regional trends have also helped Democrats in recent years. The eastern part of Pennsylvania

has been growing with more Democrats while most western Pennsylvania counties have been

losing population. The dramatic migration of the formerly solid Republican Philadelphia suburbs

to the Democrats in presidential elections shows why the trend favors the Democratic Party.

Are Pennsylvania’s days as a battleground state over? Other than Obama’s 10-point win in

2008, presidential elections in the state have been close. In the past, Democratic winners have

never received more than 52 percent of the popular vote.

Also, State Democrats have potential problems in 2016. They have to defend two important

state offices up for election: state treasurer and attorney general – both shrouded in controversy.

The state treasurer resigned while facing criminal charges and the current attorney general’s

short tenure has been marred by huge controversies.

Moreover, holding the governorship has not been helpful, historically. The state has a long

history of voting for presidents from a party different than the incumbent governor.

Yes, Pennsylvania will matter in 2016 and can be competitive. National Democrats holding

their party convention in Philadelphia have more than acknowledged this very fact. The remaining

question is what the GOP will do about it?

If the current political climate is a foreshadowing of what we can expect throughout 2016,

then this will be a very challenging political environment. 3

HOW LOW CAN PRICES GO? ASK MOTOR CITY!

By Reg Evans

One of our dealers sent us photos from near the General Motors office towers in downtown Detroit, Michigan. At the time of

this early February 2016 photo, gas prices in Pennsylvania were 50 cents higher than in Detroit.

20 | MARCH 2016 MIDATLANTIC DEALER NEWS


NIADA ACQUIRES TWENTY GROUPS EDUCATION

FOR DEALER MEMBERS NATIONWIDE

By Peter Salinas

Late last year the National Independent Automobile Dealers

Association acquired the assets and operations of Leedom

and Associates LLC, including its highly regarded dealer

Twenty Group Program. The program, designed to improve

dealer profitability through education and idea sharing with

non-competitive colleagues, will now fall under the NIADA

Banner.

Longtime Leedom Twenty Group Moderator Chuck Bonanno,

who left the firm in 2014 after 16 years, has returned as

NIADA’s National Director of Twenty Group Operations. Already

the veteran moderator has led four meetings in 2016, and

along with moderator David Brotherton will manage 16 Twenty

Groups with 235 members, from 200 unique dealerships.

Bonanno said that there is not a better, more cost-effective

education and training program for automobile dealers in the

country. “We predominantly have Twenty Groups for buy herepay

here dealers, though that will change quickly,” Bonanno

said. “We have groups for members who are in the start up

phases, to those with active portfolios of $50 million and

more.” He said over the 16 years the program has been

in place, there have been some excellent success stories,

with turnarounds that have taken

dealerships from near bankruptcy

to profitability in very short periods.

“What this program does is create

a board of directors for your

dealership,” he said. “These

colleagues help you strategize,

organize, and examine your business model and staff and

then hold you accountable for your business decisions and

their implementation. We will actively pursue new members for

retail and special finance independent dealers.” Bonanno said

the goal is to ratchet up membership with the considerable

wherewithal of the NIADA in terms of industry relationships

and marketing and advertising activities.

NIADA CEO Steve Jordan said creating awareness of

the new program has already begun, and the national

association will utilize its relationships with the state IADAs

business publications, marketing activities and conventions

to disseminate information about the proven program. “One

thing for dealers to consider is the monthly fees paid to be

a part of the program now go to the NIADA — an association

with a team that awakens everyday with the goal of improving

the marketplace for its members.” Jordan noted that it

has relationships with industry-related partners, vendors,

lobbyists, and many others serving the used vehicle industry.

These relationships will assist in providing timely, useful

knowledge to the Twenty Group members and help them

develop a winning playbook for their businesses.

The format of the program has remained consistent since

its outset on the franchise dealer side of the business, since

shortly after World War II. Dealers meet three times a year in a

location of the members’ choice. Each meeting is moderated

and has a specific agenda. Importantly, all business data and

analytics are compiled into a user-friendly format to compare

financial results — not only among members, but also among

dealers nationally.

“Dealers will not share their business financials with direct

competitors, but as long as the data is kept confidential,

they will share with dealers who have similar business

models, but do not compete in the same markets,” Bonanno

said. “What you end up with is powerful financial data with

industry benchmarks. Using these benchmarks helps with

decision making in every aspect of your business.” Without

this financial data dealers are often left wondering if their

operation is operating effectively. “Dealers know if they are

making or losing money, but they have nothing to compare

the results to see if their return on investment is on par with

others,” Bonanno said. “Not using these benchmarks would

be like building a ship and heading for an island in the middle

of the ocean without a map.”

John DeFilippo, president of the tri-state Delaware,

Maryland and Pennsylvania IADA, has been a Twenty

Group member for more than 15 years. “What you end up

with is a group of friends who share much in common in

terms of their business,” DeFilippo said. “I increased my

profitability almost immediately upon joining. The program

has made me a better dealer, and more importantly a better

individual. The camaraderie is

amazing,” DeFilippo added. “The

other dealers in my group have

gone beyond colleagues, even

beyond friends, they are more like

family members who have a vested

interest in helping you succeed.

You can call a vendor and they may or may not get back with

you in a few days. If you call or email a fellow Twenty Group

member you get a response, from someone who cares,

immediately.”

Tom Brandis, Treasurer of the Delaware, Maryland and

Pennsylvania IADA, has been a Twenty Group member for

nearly 20 years, and has been in a Bonanno-led group nearly

the entire time. “You hear from dealers all the time who say

they don’t have the time to join a Twenty Group or can’t afford

to leave their dealership for two or three days three times a

year,” Brandis said. “That usually comes from dealers who

think they know everything. “What I tell dealers who ask

about the program is that joining a group has been the most

important business decision I have ever made,” Brandis said.

“I can tell you this, I improved my profitability by more than

six figures in the first year. If you don’t have time to work on

your business, you are not working smart.”

Bonanno said there is testimonial after testimonial from

Twenty Group dealers who have seen huge increases in

profitability, and have made their businesses run more

efficiently — and more enjoyably as well. “If you go into work

every day facing heat, have employees who you cannot depend

on and have no one you can go to help you make important

decisions, it’s not an activity you enjoy,” Bonanno said. “Our

program can make your business pleasantly profitable.”

He and Jordan both indicated that growth of the program

is a priority and moves are already underway to increase

membership.

CONTINUED ON PAGE 23

MIDATLANTIC DEALER NEWS MARCH 2016 | 21


Alan Mosher is a car

guy. His first job ever

was detailing cars at a

dealership when he was

in high school. He began

selling cars in 1975,

and has been in the car

business in one form or

another for most of the

40 years since. Half of

that time he has been

in the BHPH business.

He has operated BHPH

dealerships for 8 years

and been a trainer and

consultant in the business

for 11. He can be

reached via email at al@

alanmosher.com.

ARE YOU COMMITTING SALES MALPRACTICE?

By Al Mosher

There is a saying in the medical field, “Prescription before examination is malpractice.”

If you were a doctor examining a new patient who complained that pains in their abdomen

had become intolerable, you would not simply prescribe a painkiller and send the patient

home. You would perform a careful diagnosis that included blood work and tests, as well as

a thorough physical examination.

A doctor must find out if the patient has an upset stomach, appendicitis or colon cancer

before offering a prescription. The same rule applies when you are trying to sell a car.

I have been in the car business for close to 30 years, and I’ve probably seen at least that

many versions of the proper steps to completing a sale. I’ve seen 7-step versions, 10-step

versions, 12-step versions and probably a few more I can’t remember. What I have never

seen is a sales process that puts the prescription — showing them a vehicle — before the

examination, doing an analysis of their needs and desires. Unfortunately, however, I have

seen it happen much too often in real life. Oh, the salesman will tell you that he qualified the

customer, and he probably did ask them a couple of basic questions, however, what he did

would fall far short of the “examination” he should have done. This is particularly true at a

BHPH dealership where you need to assess their financial health as well as their vehicle needs.

Think of our earlier scenario with the doctor and the patient. Then, imagine the doctor

writing his prescription after taking the patient’s temperature and finding out how much he

weighed. The doctor could claim to have done an examination but I don’t think any of us

would have found that to be sufficient.

It certainly is no sudden bolt of revelation for me to tell you that salespeople tend to rush

the sales process. In some cases, that might be an understatement. They try to shortcut

the process to get through it quicker and then justify that by claiming the customer didn’t

want to spend that much time.

Well, ask anybody that knows me. I hate spending time in the doctor’s office. In spite of

this, I would be highly upset if that doctor tried to shortcut the examination process and just

prescribed a few pills and sent me home. In fact, it is because I hate going to the doctor

that I want him to do a complete and full exam and solve any problems right the first time,

so I don’t have to go back anytime soon.

Most car shoppers are like that, too. They really don’t like the processes involved in buying

a car. Many dealers have modified their processes to try to make the whole process more

customer-friendly and that has helped. Most customers, however, are still apprehensive and

have some misgivings about the process. And, when they buy a car, they are “stuck” with

the results of that purchase, typically for several years.

That is why you need to do a complete and comprehensive examination of each and

every prospective buyer. Only then will you be able to help them identify all of their issues.

A thorough examination is the only way to make sure that you help them purchase the right

car, at the right price, with the right payment. By being a professional salesperson you help

them to be an informed purchaser. There is a reward for being meticulous, as well. If you do

the examination well and your prescription is the right one, your patient will return to see you

when they again have transportation ‘pain’.

The proper examination, diagnosis and prescription are just as important for the car buyer

and their salesperson as it is for the patient and their doctor. Only by conducting a thorough

examination can you avoid committing sales malpractice. 3

DEALERSHIP EMPLOYEES WIN $1,000,000

By Peter Salinas

A lucky group of parts and service department employees at

Union Park Honda in Wilmington, Delaware, didn’t hit the $1.6

billion jackpot in January’s Powerball lottery, but the crew did

match five numbers without the Powerball and won $1 million.

Eighteen employees each put up $10 and purchased 90

tickets — 30 each from Delaware, Pennsylvania and New

Jersey. A Pennsylvania Lottery official confirmed the ticket

worth $1 million was sold at the Landhope Farms convenience

store in Kennett Square.

The Jan. 13, 2016, jackpot had winning numbers of 04-08-

19-27-34 and Powerball 10 — was the largest in American

history.

22 | MARCH 2016 MIDATLANTIC DEALER NEWS

Lee Davis, a shop foreman at the Wilmington dealership,

said, “My wife was sleeping. I ran up and woke her up. She

was like, ‘What’d you get, like $50?’ And I was like, ‘No we

won a million!”

Each employee in the group will get about $41,000 after

taxes. Not enough to retire, but could easily put a down

payment on a house, help put a child through college or —

buy a nice used vehicle, with some money to spare for fun!

Congratulations!


C

M

Y

CM

MY

CY

CMY

K

NIADA ACQUIRES TWENTY GROUPS

CONTINUED FROM PAGE 21

“We plan to expand our program and increase the number

of retail dealers among our membership,” Bonanno said. “Our

plan is to double our current membership to more than 500

unique dealerships in the next few years. Our NIADA Board

of Directors has made this a priority for me and our team,

and if there is one thing we know about, it’s goal-setting and

accountability.”

Brandis said the success of the Twenty Group program is

important to the strength of the independent automotive retail

industry. “Dealers need the most up-to-date and accurate

information available,” Brandis said. “Our moderators will find

the answers to our questions, if a dealer in the group doesn’t

already have the answer.”

It really is a family, Brandis and DeFilippo both noted.

Two years ago a relatively young buy-here, pay-here dealer

unexpectedly died, leaving his family with many business

questions and no small amount of financial instability.

Members of the group knew about his death before the

day was over,” Brandis said. “They all offered their support

and expertise to make sure the business was secure and a

managed transition took place. I know for a fact, that if one

of my fellow Twenty Group members were to die unexpectedly,

there is an envelope that will get opened, and my name and

number is included inside and I can expect a call and I will

be prepared to do whatever needs to be done to assist the

business and help his family. You can’t buy that.” 3

BelAir_4.22x5.65_ad.pdf 1 12/11/13 10:51 AM

2016 PIADA ISSUING AGENT

TRAINING COURSES

Due to previous lack of attendance in Basic Training Classes

PIADA has only scheduled Advanced Training for 2016.

However, if you are interested in a Basic Class please contact

PIADA at 717.238.9002. Classes subject to cancellation/

change at the sole discretion of PIADA.

PIADA Members: $50.00 per person

Non-Members: $125.00 per person

PREPAYMENT REQUIRED. NO WALK-INS.

PRE-REGISTERED ATTENDEES ONLY.

Registration: 8-8:30am • Courses begin at 8:30am

ADVANCED TRAINING CLASS DATES

March 21........................ America’s Auto Auction Harrisburg

Sponsored by Annual Gold Sponsor ProGuard Warranty &

Annual Bronze Sponsor NextGear Capital & Autotrader

April 11................................................. ADESA Pittsburgh

Sponsored by Annual Gold Sponsor ProGuard Warranty

May 16... Northeast Pennsylvania (Arcaro & Genell’s Restaurant)

Sponsored by Annual Gold Sponsor ProGuard Warranty

June 20........................................... Manheim Philadelphia

Sponsored by Annual Gold Sponsor ProGuard Warranty &

Annual Bronze Sponsor NextGear Capital & Autotrader

August 8........................ Central Pennsylvania Auto Auction

Sponsored by Annual Gold Sponsor ProGuard Warranty &

Annual Bronze Sponsor MyDealerOnline

September 12................................................ Garden Spot

Sponsored by Annual Gold Sponsor ProGuard Warranty &

Annual Bronze Sponsor MyDealerOnline

September 26....................................................Corry ADE

Sponsored by Annual Gold Sponsor ProGuard Warranty &

Annual Bronze Sponsor NextGear Capital & Autotrader

October 24................................................. ADESA Mercer

Sponsored by Annual Gold Sponsor ProGuard Warranty

COURSE REGISTRATION

Company_____________________________________________________

Contact______________________________________________________

PIADA Member? Yes No DIN # ______________________________

E-mail Address ________________________________________________

Business Address_______________________________________________

City_______________________________ State_______Zip Code________

Phone (____) ___________________Fax (____)______________________

Number Attending ______

NAMES OF ATTENDEES:

___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

Card Type: VISA MasterCard Discover American Express

Name on Card:_________________________________________________

Card Number __________________________________________________

Security Code ___________ Exp. Date______________________________

Signature______________________________________________________

Fax (We’d prefer fax) to 717.238.3870

Or Mail to: PIADA, 1501 North Front Street, Harrisburg, PA 17102

ON-SITE CLASSES AT YOUR DEALERSHIP CAN

BE REQUESTED!!! CALL PIADA FOR DETAILS.

MIDATLANTIC DEALER NEWS MARCH 2016 | 23


AUCTIONDIRECTORY

PENNSYLVANIA

ABC - LANCASTER AA

1040 Commercial Ave., P.O. Box 406

East Petersburg, PA 17520

Phone: 717.569.5220 / Fax: 717.569.3109

Greg Gehman, Owner/Operator; Ed Fazio, GM

Weekly Sales Wed. 9:00 A.M.

Office: M-F 8:30-5:00

www.abclancaster.net

ADESA MERCER

758 Franklin Road, Mercer, PA 16137

Phone: 724.662.4500 / Fax: 724.662.2840

Barry Fabricant, GM; Sharon White, Fleet Manager

Friday 9:00 A.M.

Office: M-F 8-5:00

www.adesa.com

ADESA PA

I-83 Ex. 28 (Old Ex. 12),

30 Industrial Rd., York, PA 17406

Phone: 717.266.6611 / Fax: 717.266.7650

George Johnson, GM

Angel Alicea, Fleet Manager

Igor Skinder, Sales Manager

Wednesday 8:20 A.M.

Powersports Sale, 4th Wed. of every month

www.adesa.com

ADESA PITTSBURGH

378 Hunker Waltz Mill Rd., New Stanton, PA 15672

Phone: 724.925.4700 / Fax: 724.925.4701

Bernie Nemec, Dealer Contact

Tuesday 9:00 A.M.

www.pittautoauction.com

AMERICA'S AA - HARRISBURG

1100 S. York St., Mechanicsburg, PA 17055

Phone: 717.697.2222 / Fax: 717.697.2234

Lynn Weaver, GM; Clint Weaver, AGM; John

Congdon, Operations Manager; Sharon Guise,

Office Manager; Tom Wesner, Dealer Sales; Tammy

Leppo, Dealer Sales; Randy Donovan, Dealer

Sales; Glenn Gochenaur, National Accounts

Every Thursday 8:45 A.M.

www.harrisburgautoauction.com

AMERICA’S AA - PITTSBURGH

55 E. Buffalo Church Rd.

Washington, PA 15301

Phone: 724.225.1777 / Fax: 724.225.7223

Lou Craig - GM; Skip Thomas - GM

Thursday 12:30 P.M.

www.americasautoauction.com

BLOOMSBURG AUTO AUCTION

25 Ridge Road, Bloomsburg, PA 17815

Phone: 570.784.2306

Wednesday 1:00 P.M.

John and Heather Vance, Owner/Operators

www.bloomaa.com

CENTRAL PENNSYLVANIA AA

Exit 178 of I-80, Lock Haven, PA 17745

Phone: 800.248.8026 / Fax: 570.726.7841

Grant Miller, Owner; Doug Miller, V.P./COO

Tim Keohane, GM

Thursday 10:00 A.M.

Office: MTF 8-5:30 W-Th 8-6:00

www.cpaautoauction.com

CORRY AUTO DEALERS EXCHANGE

P.O. Box 317, Route 6, Corry, PA 16407

Phone: 814.664.7721 / Fax: 814.664.7724

Tad Swift, Auction Manager

Jeri Elmquist, Dealer Contact

Thursday 10:00 A.M.

www.corryade.com

GARDEN SPOT AUTO AUCTION

Robert Rd. & Apple St., Ephrata, PA 17522

Phone: 717.738.7900 / Fax: 717.738.7930

Kevin Luring, Marketing Manager; Kristi Kohl, GM

Omar Landis, Owner

Tuesday 10:00 A.M.

www.gardenspotautoauction.com

GREATER ERIE AUTO AUCTION

7700 Avonia Road, (Exit 16 of I-90 & PA Route 98)

Fairview, PA 16415-0916

Phone: 814.474.3900 / 877.474.GEAA

Fax: 814.474.4969

Todd Briggs, Co-Owner/GM; Chuck Williams,

Dealer Contact/Sales Manager; Todd Briggs, Fleet

Lease Repo Contact; Scott Porter, Transportation

Re-Con Manager; Chrissy Briggs, Marketing Manager

Tuesday 2:30 P.M.

www.greater-erie.com

MANHEIM KEYSTONE PENNSYLVANIA

488 Firehouse Road, Grantville PA 17028

Phone: 717.469.7900 / Fax: 717.469.2842

Sal Cuomo, Manager

Tamra Habbershon, Dealer Services Manager

Shirley Kennedy, Office Manager

Every Monday 11:00 A.M.

www.manheim.com

MANHEIM PENNSYLVANIA

1190 Lancaster Rd., Manheim, PA 17545

Phone: 717.665.3571 / Fax: 717.665.9265

Julie Picard, VPGM; Tim Doyle, AGM; Kevin Gantz,

AGM; Amy Taitano, AGM; Sal Cuomo, AGM; Randy

Derr, AGM; Darren Teague, Auction Manager

Exotic Highline Sales every other Thurs.- 9:00 A.M.

Every Friday Sale 8:30 A.M.

www.manheim.com

MANHEIM PHILADELPHIA AA

2280 Bethlehem Pike, Hatfield, PA 19440

Phone: 215.822.1935 / Fax: 215.822.8140

Charles Pollina, GM; Scott Mulligan, AGM

Gregg Pachik, Dealer Services Manager

Troy Moyer, Commercial Accounts Manager

Tuesday 9:30 A.M.

TRA Sale - Tuesday 1:00 P.M.

Office: M-Th 8:30-5 F 8:30-3

www.manheim.com / www.traauctions.com

MANHEIM PITTSBURGH AA

21095 Route 19, Cranberry Twp., PA 16066

Phone: 724.452.5555 / Fax: 724.452.1310

Tom McDonald, GM; Chris O’Donnell, AGM

Shawn Byers, Commercial Accounts Manager

Craig Hartle, Dealer Services Manager

Wednesday, 9:00 A.M.

www.manheim.com

NORTH EAST PENNSYLVANIA AA

860 N. Keyser Ave., Scranton, PA 18504

Phone: 570.207.CARS / Fax: 570.207.1860

James Gaughan, Owner; Joseph Gaughan, Dealer

Contact; Lisa Cohowicz, Dealer Contact

Kevin Jennings, Dealer Cnt/F-L

Tuesday 10:00 A.M.

www.nepautoauction.com

ORANGEVILLE AUTO AUCTION

2040 St., Rt. 487, Orangeville, PA 17859

Phone: 570.683.4006 / Fax: 570.683.4018

Brenda Hartzel, Dealer Contact

Angela Dawson, Dealer Contact

Wednesday 10:00 A.M.

www.orangevilleautoauction.com

24 | MARCH 2016 MIDATLANTIC DEALER NEWS

PERRYOPOLIS AUTO AUCTION

Route 51 S. Perryopolis, PA 15473

Phone: 724.736.4445 / Fax: 724.736.0466

Renee Smith, Director of Operations

Friday 9:45 A.M.

www.perryautoauction.com

Spend $399 - Get $20,000 in Discounts

on Auction and Industry Products &

Services. Join PIADA-MDIADA-DEIADA,

NJIADA, NYIADA Today!

MARYLAND

BSC AMERICA/BEL AIR AUTO AUCTION

803 Bel Air Rd., Bel Air, MD 21014

Phone: 410.879.7950 / Fax: 410.893.1515

R. Charles Nichols, President;

Michelle Nichols-Neff, Vice President;

Cindy Mitchell, VP of Fleet Operations;

Mike Corrado, Dealer Sales; Chuck Wenzel,

Dealer Sales; John Bellus, Dealer Sales;

Christina Thorneycroft, Dealer Sales

Thursday 8:30 A.M.

www.bscamerica.com

MANHEIM BALTIMORE-WASHINGTON

7120 Dorsey Run Rd., Elkridge, MD 21075

Phone: 410.796.8899 / Fax: 410.799.0512

Toll Free: 800.533.2923

Steve Sirianni, GM; Rich Pomplun, AGM

Sherry Houghtling, Dealer Sales Mgr.

Jeffrey Judkins, OVE Rep.

Tuesday Sale starting @ 9:30 A.M.

TRA Salvage Sale @ 1 P.M.

www.manheim.com

NEW JERSEY

ADESA AUCTION OF NEW JERSEY

200 N. Main, Manville, NJ 08835

Phone: 908.725.2200 / Fax: 908.725.3446

Craig Estep, GM

Consignment Sale Thursdays 8:45 A.M.

Topline Sale 9 A.M. monthly Thursdays

GM Factory Sale Bi-weekly Tuesdays 10 A.M.

www.adesa.com

MANHEIM NEW JERSEY AA

730 Rte. 68, P.O. Box 188, Bordentown, NJ 08505

Phone: 609.298.3400 / Fax: 609.298.4489

Pete Sauber, GM; Greg Conover, AGM

Wednesday 9 A.M.

www.manheim.com

NEW YORK

ADESA BUFFALO

12200 Main St., Akron, NY 14001

Phone: 716.542.3300 / Fax: 716.542.3547

Warren Clauss, GM, Mike Phillips, Assistant GM

Consignment Sale Tuesday 9 A.M.

Boat & RV Sale 2nd Tuesday Monthly 11 A.M.

Ford Factory Tuesday Monthly 9 A.M.

Office: M-Tu: 8-5, W: 8-4, Th: 9-4, F: 9-3

www.ADESA.com/Buffalo

ADESA LONG ISLAND

425 Patchogue Yaphank Rd., Yaphank, NY 11980

Noel Nixon, GM

631.205.5000

www.adesa.com/LongIsland

ADESA SYRACUSE

5930 State Rte. 31, Cicero, NY 13039

David Taylor, GM

315.699.2792

www.adesa.com/Syracuse

SWADE SCRANTON/WILKES-BARRE ADE

11 R. South Keyser Ave., Taylor, PA 18517

Phone: 570.961.3800 (Scranton)

Phone: 570.823.2800 (Wilkes-Barre)

Fax: 570.562.1344

Justin Priblo, Dealer Contact

Dottie Arnone, Office Manager

Gene Scagliotti, Owner

Monday 6:00 P.M.

www.swadeaa.com

BUFFALO AUTO AUCTION

8418 Southwestern Blvd., Angola, NY 14006

716.549.4800

Sally Schueckler, GM

sschueckler@buffaloautoauction.biz

MANHEIM ALBANY

459 Route 146, Clifton Park, NY 12065-0440

518.371.7500

Jay Waterman, GM

jay.waterman@manheim.com

MANHEIM NEW YORK AA

2000 Dealer Drive, Newburgh, NY 12550

Phone: 845.567.8400 / Fax: 845.567.8410

Mark Pester, GM / Darryl Vrooman, AGM

Sale Day Wednesdays 9 A.M.

Monthly Tuesday Ford Factory Sales 10 A.M.

3rd Tuesday of the Month Specialty Sales 10 A.M.

1st Wednesday of the Month Heavy Truck &

Equipment Sales 10 A.M.

Office: M,T, Th 9-5, W 7-6, F 9-1

www.manheim.com

ROCHESTER’S CENTRAL AUTO AUCTION

20 Cairn Street, Rochester, NY 14611

Julie Quinn, GM

585.328.2277

Info@rochesterautoauction.com

ROCHESTER- SYRACUSE AUTO AUCTION

1826 State Route 414, P.O. Box 129

Waterloo, NY 13165

315.539.5006

Scott Prankie, GM

sprankie@rsautoauction.com

STATE LINE AUTO AUCTION

830 Talmadge Hill Rd. S., Waverly, NY 14892

Phone: 607.565.8151 / Fax: 607.565.8659

Jeff Barber, Owner; Jim Terwilliger, Sales Manager

Neal McEwen, Fleet/Lease Manager

GM Closed Factory Sale Alternate

Thursdays @ 10:00 A.M. Sharp

Dealer Consignment Sale

EVERY Friday @ 9:20 A.M.

www.statelineauto.com

ADDITIONAL STATES

MOUNTAIN STATE AUTO AUCTION

Route 2, Box 835, Shinnston, WV 26431

Phone: 304.592.5300 / Fax: 304.592.3510

Chad Garrison, GM; Joe Pyle, Owner

Monday 10:30 A.M.

Office: 9-5:00

www.mtstateaa.com

WINCHESTER AUTO AUCTION

12828 Winchester Ave., Bunker Hill, WV 25413

Phone: 304.229.4400 / Fax: 304.229.9067

David Angelicchio, Chairman & CEO; Dennis

Angelicchio, President; Bryan Dougherty, GM

Friday 10:00 AM

www.WinchesterAA.com

YORKMONT AUTO AUCTION

799 South Main Street, Fair Haven, VT 05743

Phone: 802.278.8057 / Fax: 802.457.7110

Shawn@camaraslate.com


EXIT 16

I-90 & RT. 98

FAIRVIEW, PA

“WE ARE THE DEALER’S AUTO AUCTION”

GROWING

COMMERICAL

CONSIGNMENT!

◊ Garage and Automobile Liability

◊ Dealer Physical Damage

◊ Tow Truck on the Same Policy

◊ Quick Quote Turnaround

◊ Low Monthly Payments

607 Corporate Drive, West

Langhorne, PA 19047

215-860-6510 Tel.

www.KramerInsuranceCenter.com

400+ DEALER

CONSIGNED

UNITS WEEKLEY!

NEXTGEAR AFC AUTO USE FLOORPLAN EXPRESS

AN ADDITIONAL 15-20 BANKS –

CREDIT UNIONS – LEASE COMPANIES

500+/– TOTAL UNITS

EVERY TUESDAY - 2:30

814-474-3900 • (877) 474-GEAA • Fax (814) 474-4969

www.greater-erie.com

“GOTTA GET TO ERIE”

MARYLAND FORMS DEALERS CAN ORDER

To Order Maryland Non-Secure forms (Cash Sales Contracts; Odometer Mileage

Statement; FTC Buyers Guide (As Is or Implied); Restricted Power of Attorney)

or Secured Forms (Secured POA or Dealer Reassignments), please contact

PIADA-MDIADA-DEIADA at 717.238.9002.

PENNSYLVANIA FORMS DEALERS CAN ORDER

DESCRIPTION QUANTITY $

MEMBER NON- $ MEMBER MEMBER EXT NON-M EXT

“As is” Supplemental Statement _____ $

24. 00 $

48. 00 $

_______

$

_______

Buyers Guide Plastic Holders (50) _____ $

40. 00 $

80. 00 $

_______

$

_______

Buyers Guide Window Form _____ $

18. 00 $

36. 00 $

_______

$

_______

Buyers Guide Window Form (Spanish) _____ $

18. 00 $

36. 00 $

_______

$

_______

Consignment & Sales Agreement Form _____ $

18. 00 $

36. 00 $

_______

$

_______

Deal Jackets _____ $

24. 00 $

48. 00 $

_______

$

_______

Fees Chart (wall mount) _____ $

14. 00 $

28. 00 $

_______

$

_______

Installment Sales Contract (100) _____ $

75. 00 $

150. 00 $

_______

$

_______

Key Tags (250) _____ $

32. 00 $

64. 00 $

_______

$

_______

Lease Agreements _____ $

53. 00 $

106. 00 $

_______

$

_______

Limited Warranty _____ $

26. 00 $

52. 00 $

_______

$

_______

No Purchase Required Disclosure _____ $

24. 00 $

48. 00 $

_______

$

_______

Notary Receipt Pad _____ $

15. 00 $

30. 00 $

_______

$

_______

Notary Register _____ $

15. 00 $

30. 00 $

_______

$

_______

Odometer Mileage Statement _____ $

18. 00 $

36. 00 $

_______

$

_______

Power of Attorney Disclosure Forms _____ $

18. 00 $

36. 00 $

_______

$

_______

Rental Agreements _____ $

32. 00 $

64. 00 $

_______

$

_______

Retail Buyer Order Form _____ $

32. 00 $

64. 00 $

_______

$

_______

Secure Power of Attorney _____ $

55. 00 $

55. 00 $

_______

$

_______

Secure Power of Attorney Log Book _____ $

15. 00 $

30. 00 $

_______

$

_______

Temp Tag Log Book _____ $

15. 00 $

30. 00 $

_______

$

_______

Title Release Authorization _____ $

15. 00 $

30. 00 $

_______

$

_______

Used Vehicle Record _____ $

15. 00 $

30. 00 $

_______

$

_______

ADP FORMS

Customer Delivery Check List _____ $

28. 00 $

56. 00 $

_______

$

_______

Customer Proposal _____ $

28. 00 $

56. 00 $

_______

$

_______

Damage Disclosure _____ $

28. 00 $

56. 00 $

_______

$

_______

Delivery Confirmation _____ $

28. 00 $

56. 00 $

_______

$

_______

Goodwill Repair Acknowledgement _____ $

28. 00 $

56. 00 $

_______

$

_______

Insurance Coverage Acknowledgement _____ $

28. 00 $

56. 00 $

_______

$

_______

Interpreter Confirmation of Translation _____ $

28. 00 $

56. 00 $

_______

$

_______

Lease Spot Delivery Agreement _____ $

28. 00 $

56. 00 $

_______

$

_______

Notice to Co-Signer _____ $

28. 00 $

56. 00 $

_______

$

_______

Test Drive Agreement _____ $

28. 00 $

56. 00 $

_______

$

_______

Trade-In Appraisal _____ $

28. 00 $

56. 00 $

_______

$

_______

Subtotal $ _______

$

_______

PA Sales Tax $ _______

$

_______

Shipping $ per pound + Special Shipping $ at cost. Total w/o shipping $_________

Please make checks payable to PIADA, 1501 North Front St., Harrisburg, PA 17102

(call in to receive shipping cost to include in payment) or you may fax orders to

717.238.3870 with credit card information. *All orders MUST be accompanied by a

method of payment. *Must provide DIN if applicable.

Dealership_________________________________________________________________________

Contact_______________________________________________Date_________________

Address___________________________________________________________________________

City_______________________________________________State ______Zip__________

Phone _____________________Fax ____________________*DIN____________________

Card Type: VISA MasterCard AMEX

Name on Card____________________________________________________ Exp. Date________

Card Number _____________________________________ Security Code________

MIDATLANTIC DEALER NEWS MARCH 2016 | 25


LEGAL CORNER

Tom (thudson@hudco.com)

and Nikki (nmunro@hudco.

com) are partners in the

law firm of Hudson Cook,

LLP. Tom is the author of

a book, CARLAW®, and is

the Editor/author of the

CARLAW® F&I Legal Desk

Book. The books are

available at www.counselor

library.com. Tom is also

the publisher of Spot

Delivery®, a monthly

legal newsletter for auto

dealers, and the Editor

in Chief of CARLAW®, a

monthly report of legal

developments in all states

for the auto finance and

leasing industry (not to be

confused with the book).

Nikki is a contributing

author to the F&I Legal

Desk Book and frequently

writes for Spot Delivery®.

Spot Delivery®, CARLAW®

and the books are produced

by CounselorLibrary.com

LLC. For information, call

410.865.5411 or visit

www.counselorlibrary.com.

Copyright CounselorLibrary.

com 2015, all rights

reserved. Single publication

rights only, to the

Association.

HC# 4848-8454-3277

2/16)

THE CARLAWYER ©

By Thomas B. Hudson and Nicole Frush Munro

As winter gets serious, we hunker down and peruse developments in the auto sales,

finance and lease world. This month, we feature developments from the Consumer Financial

Protection Bureau and the Federal Trade Commission we thought might interest folks during

the winter doldrums. We also recap some of the auto sale and financing lawsuits we follow

each month. Remember – we aren’t reporting every recent legal development, only those we

think might be particularly important or interesting to industry.

Why do we include items from other states? We want to show you new legal developments

and trends. Also, another state’s laws might be a lot like your state’s laws. If attorneys

general or plaintiffs’ lawyers are pursuing particular types of claims in other states, those

claims might soon appear in your state.

Note that this column does not offer legal advice. Always check with your own lawyer to

learn how what we report might apply to you, or if you have questions.

THIS MONTH’S CARLAWYER© COMPLIANCE TIP

Offering cars that are “certified pre-owned,” “inspected” or “guaranteed”? If some of those

cars you are offering are subject to open recalls, you urgently need to review your advertising

in light of the recent FTC action described below.

FEDERAL DEVELOPMENTS

Spanish, Anyone? On January 22, the FTC issued its newest Spanish-language fotonovela in

an effort to educate Spanish-speaking consumers about the car buying process and increase

awareness of possible scams.

CPO, Warranted and Guaranteed Cars With Open Recalls. On January 28, the FTC announced

proposed consent orders with General Motors Company, Jim Koons Management and Lithia

Motors Inc. under which the companies have agreed to settle separate FTC administrative

complaint allegations that each touted how rigorously they inspect their cars, yet failed to

disclose that some of the cars they were selling were subject to unrepaired safety recalls. The

FTC’s complaint against GM cited the company’s representations for “Certified Pre-Owned Vehicles,”

while the complaint against Koons dealt with that company’s purported “guarantee,”

and the Lithia complaint involved the company’s “warranty.” For each company, the charge

was similar – in describing the program and touting the inspection of the vehicles, the companies

failed to disclose that some of the vehicles were subject to open (unrepaired) recalls.

The proposed consent orders remain in effect for 20 years, and prohibit the companies from

claiming their used vehicles are safe or have been subject to a rigorous inspection unless

they are free of unrepaired safety recalls, or unless the companies clearly disclose the recalls

in close proximity to the inspection claims. The proposed orders also would prohibit the

companies from misrepresenting material facts about the safety of used cars they advertise.

LITIGATION

GAP Insurance Provider Did Not Misrepresent that Insurance Would Fully Pay Off Debt When

Payment Was Actually Limited to 25% of Vehicle Value: A consumer bought a GAP insurance

policy. After she suffered a total loss of one of her covered vehicles, she sued the insurer for

fraud, misrepresentation, and deceptive practices, claiming that it misrepresented that her

policy would pay off her indebtedness in full in the event of a total loss, when her recovery

was actually limited to 25% of the actual cash value of the vehicle. The insurer moved to dismiss

the complaint, and the federal trial court granted the motion. First, the insured argued

that the title of the GAP insurance option on the insurer's website - Loan/Lease Payoff - is

misleading because the insurance does not necessarily provide for a complete payoff. The

court disagreed, noting that the heading, alone, is insufficient to mislead and that the website

includes a full explanation of the 25% limitation language behind a link directly next to

where the insured clicked to receive the insurance. Next, the insured argued that the insurer

amended its rules-and-rate filing to omit the 25% limitation language, and this amendment

misrepresented the benefits of the policy. The court disagreed, finding that a rules-and-rate

filing is not required to contain policy language, so removal of that language could not be

misleading. Moreover, the court noted that the insured did not know of the rules-and-rate

filing at the time she bought her insurance, so she could not have relied on the filing in deciding

to buy the insurance. Finally, the insured argued that a claims adjuster misrepresented

to her when she totaled her car that the entire debt would be covered by the insurance. The

court found that she could not have relied on this misrepresentation in connection with her

insurance purchase because it took place after she bought the insurance. See Lacy v. Progressive

Direct Insurance Co., 2016 U.S. Dist. LEXIS 24 (N.D. Ill. January 4, 2016).

So there’s this month’s roundup! Stay legal, and we’ll see you next month. 3

26 | MARCH 2016 MIDATLANTIC DEALER NEWS


Pennsylvania | Maryland| Delaware

PIADA ANNUAL

GOLD SPONSOR

PIADA ANNUAL

BRONZE SPONSORS

FOR INFORMATION

ON MEMBERSHIP...

PIADA – MDIADA – DEIADA

Contact Shannon at 717.238.9002 x 18

Shannon@piada.org

www.piada.org

www.mdiada.org

www.deiada.org

NYIADA & NJIADA

Contact Paula at 855.694.2324

nyiada.pfrendel@gmail.com

www.newyorkiada.org

www.newjerseyiada.org

I. A. D. A.

United We Stand

MIDATLANTIC DEALER NEWS MARCH 2016 | 27


ELECTRONIC ODOMETER DISCLOSURE

EDGES TOWARD REALITY

By Anthony Bush, Esq. and Grace Strom Power, Esq., Eckert Seamans Cherin & Mellott

Anthony Bush is a Member

in Eckert Seamans’

Princeton Office with over

two decades of experience

with automotive issues. He

counsels a wide spectrum

of clients including

automobile dealerships,

operators of wholesale

motor vehicle auctions,

auto parts distributors,

finance companies, and

auto body repair facilities.

Tony and Eckert Seamans

have expertise representing

dealers in consumer and

corporate litigation, land

use matters, business

counseling, employment

matters, franchise

disputes, before the New

Jersey Motor Vehicle

Commission and New

Jersey Department of Law

and Public Safety, Division

of Consumer Affairs, and in

legislative and regulatory

issues affecting the

automotive industry.

Grace Strom Power is an

Associate in the Princeton

Office and has over 10

years of government

affairs experience in both

the public and private

sectors, advising and

representing clients before

the New Jersey State

Legislature, Office of the

Governor, state and local

agencies, commissions and

regulatory authorities.

The federal government has granted States the authority to allow Electronic Signatures

(‘E-Signatures”) on Odometer disclosures, paving the way for paperless document processing. In

December 2015, President Obama signed the Fixing America’s Surface Transportation (“FAST”)

Act. Under the new law, each state can decide whether to allow electronic signature on odometer

forms, which could speed up the finance and insurance process and reduce errors and fraud. The

Odometer form was the last document for which the federal government still required an actual

or wet signature from the consumer in the car buying

process. It is now up to the States to implement

this law in coordination with federal transportation

officials.

This new law only gives States the authority to

create their own electronic odometer disclosure

programs, but each state must pass its own law.

To date, no legislation to allow for such changes

has been introduced in the MidAtlantic States. The

law mandates that states can use digital methods

for odometer readings and notices; however, the

processes must set forth security measures to

ensure accurate authentication. If implemented

properly and with foresight, enacting a new law has the potential to not only allow for completely

paperless odometer readings, but a completely paperless process when it comes to vehicle

documentation including sales, registration, and titling. Again, the MidAtlantic States have yet to

act on their new found authority. 3

NJ LEGISLATION ANTICIPATED FOR NJ MVC

ALLEGED FRAUD AND MISCONDUCT

By Anthony Bush, Esq. and Grace Strom Power, Esq., Eckert Seamans Cherin & Mellott

In December 2015, the New Jersey State Commission of Investigation (“SCI”) issued a scathing

report with serious accusations against New Jersey Motor Vehicle Commission (“MVC”) officials:

“Gaming the System | Abuse and Influence Peddling in New Jersey’s Used-Car Industry.” The SCI

alleged some officials have enabled used-car auto malls or “multi-dealer locations” to circumvent

regulations and enforcement, allegedly resulting in fraud, unpaid taxes and “suspicious” financial

transactions. Importantly, the report contains many recommendations that would significantly change

oversight of the entire industry not just for dealers at multi-dealer locations. We now anticipate

that the Legislature will take up many of these reforms, with legislation expected to be introduced

within weeks; however, we do not yet have any information on the specifics of the bill or bills.

As reported previously, the SCI recommended reforms included: (1) removing licensing and

oversight authority from the MVC’s jurisdiction and giving it to the NJ Department of Law and Public

Safety, Office of the Attorney General, Division of Consumer Affairs; (2) creating a wholesale-only

license and exempting wholesale dealers from many of the requirements that strictly pertain

to retail transactions (the MVC has discussed creation of such a license category for years);

(3) requiring more financial disclosures as a condition of licensure; (4) expanding the basis for

denying licenses for certain crimes; (5) adoption of a used car dealer bill of rights; (6) an end to

“AS IS” sales; (7) a cooling off period with financial penalties for the purchase of used cars for

less than $40,000.00; (8) strengthening of NJ’s lobbying disclosure requirements; (9) requiring

licensees be in state residents. The scope of the expected legislation is not limited or bound

by the SCI’s proposals.

As we have previously noted, dealers should expect that for now the MVC will vigilantly enforce

existing regulations and statutes. This is a good time to ensure your business practices are

compliant with all regulatory requirements. 3

28 | MARCH 2016 MIDATLANTIC DEALER NEWS


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KONTOS KOMMENTARY

CURRENT USED VEHICLE MARKET CONDITIONS

SUMMARY

Though seasonally up from December, wholesale price trends in January were bifurcated, as

truck prices showed year-over-year price increases, while car and crossover prices fell on a

year-over-year basis. With gasoline approaching the dollar-per-gallon range in some parts

of the country, this should come as no major surprise. But, with the exception of pickups and

SUVs, dealers are increasingly reporting adequate used vehicle inventories, so additional

wholesale supply is being met with dampening demand and therefore generally softer prices.

Tom Kontos is Executive

Vice-President, Customer

Strategies and Analytics.

In this position, Mr. Kontos

interfaces with members

of the media, Wall Street

and automotive analysts,

dealers, and key ADESA

clients to provide

information and insight

on economic trends in the

vehicle remarketing

industry, of which ADESA

is a major player. Mr.

Kontos also provides

analytical services to

internal and external

ADESA audiences in the

form of annual market

reports, periodic reports

on used vehicle price

trends, web-based

information products,

dealer surveys, and other

strategic studies. He

supplies monthly used

vehicle price data to the

U.S. Bureau of Economic

Analysis (BEA) as part

of the BEA’s effort to

estimate various

components of Gross

Domestic Product.

ADESA Auctions

13085 Hamilton Crossing

Blvd., Suite 500

Carmel, IN 46032

317.249.4235

tkontos@adesa.com

DETAILS

According to ADESA Analytical Services’ monthly analysis of Wholesale Used Vehicle Prices

by Vehicle Model Class 1 , wholesale used vehicle prices in January averaged $10,263 – up

4.9% compared to December and up 0.6% relative to January 2015. However, the modest

year-over-year rise in average prices was only made possible by the 10.5% rise in truck

prices, as car prices fell 6.3% and crossover prices fell 1.6%. Moreover, every car and

crossover segment saw year-over-year average price declines, while every truck segment

except minivans saw year-over-year price increases.

Average wholesale prices for used vehicles remarketed by manufacturers were down 1.6%

month-over-month but up 6.6% year-over-year, as OEMs sold considerably fewer units than

a year ago, when accumulated units recalled in 2014 were released for sale. Conversely,

prices for fleet/lease consignors were up 4.9% sequentially but down 0.8% annually, as fleet/

lease sales volumes rose significantly versus prior year. Dealer consignors saw a 5.5% price

increase versus December and a 2.7% increase relative to January 2015.

Data from NADA showed a 9.9% year-over-year increase in retail used vehicle sales by

franchised dealers and a 10.5% increase for independent dealers in January, but both were

down by over 30% on a month-over-month basis. January CPO sales were down 2.1%

month-over-month and 15.9% year-over-year, according to figures from Autodata.

WHOLESALE USED VEHICLE PRICE TRENDS

Average Prices ($/Unit)

Latest Month Versus:

Jan-16 Dec-15 Jan-15 Prior Month Prior Year

Total All Vehicles $10,263 $9,782 $10,204 4.9% 0.6%

Total Cars $8,540 $8,139 $9,119 4.9% -6.3%

Compact Car $6,656 $6,398 $7,392 4.0% -10.0%

Midsize Car $7,820 $7,356 $7,977 6.3% -2.0%

Fullsize Car $6,767 $6,522 $8,529 3.7% -20.7%

Luxury Car $12,387 $11,801 $12,576 5.0% -1.5%

Sporty Car $12,382 $12,056 $13,023 2.7% -4.9%

Total Trucks $12,160 $11,645 $11,005 4.4% 10.5%

Mini Van $7,185 $7,620 $7,648 -5.7% -6.0%

Fullsize Van $12,123 $10,989 $11,316 10.3% 7.1%

Mini SUV $13,951 $13,556 $12,988 2.9% 7.4%

Midsize SUV $9,332 $8,494 $8,229 9.9% 13.4%

Fullsize SUV $11,974 $11,893 $10,876 0.7% 10.1%

Luxury SUV $18,577 $18,294 $18,278 1.5% 1.6%

Compact Pickup $8,277 $8,037 $7,550 3.0% 9.6%

Fullsize Pickup $15,253 $14,556 $13,534 4.8% 12.7%

Total Crossovers $12,012 $11,346 $12,212 5.9% -1.6%

Compact CUV $10,631 $10,026 $10,944 6.0% -2.9%

Mid/Fullsize CUV $13,016 $12,292 $13,134 5.9% -0.9%

Source: ADESA Analytical Services. December data revised.

1

The analysis is based on over seven million annual sales transactions from over 150 of the largest U.S. wholesale auto auctions, including those of

ADESA as well as other auction companies. ADESA Analytical Services segregates these transactions to study trends by vehicle model class, sale

type, model year, etc.

The views and analysis provided herein relate to the vehicle remarketing industry as a whole and may not relate directly to KAR Auction Services, Inc. The

views and analysis are not the views of KAR Auction Services, its management or its subsidiaries; and their accuracy is not warranted. The statements

contained in this report and statements that the company may make orally in connection with this report that are not historical facts are forward-looking

statements. Words such as “should,” “may,” “will,” “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “bode”, “promises”, “likely

to” and similar expressions identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual

results to differ materially from the results projected, expressed or implied by the forward-looking statements. Factors that could cause or contribute to

such differences include those matters disclosed in the company’s Securities and Exchange Commission filings. The company does not undertake any

obligation to update any forward-looking statements.

30 | MARCH 2016 MIDATLANTIC DEALER NEWS

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