5 tips for buying affordable car insurance for teenagers

Purchasing auto insurance for teenagers can be expensive. The following tips can help lower insurance premiums. Below are the 5 tips for buying affordable car insurance for teenagers which every parents & teenagers would love it.

Get Good Student Discounts

Some insurance companies offer discounts to students for their academic performance. Insurance companies often give full time students additional discounts because statistics show they are better drivers, i.e. a lower risk.
Good Student Discounts vary from company to company. However, most companies allow one to qualify for the good student discount if one is a full-time student, between the ages of 16-25 years, and maintain at least a B average.

Enroll your teen in driver education

If your state does not require it, taking an education or driver safety course can earn you discounts through your car insurance company.  After driver education you can enroll your teen in an additional driver training course to lower your premium.  Most insurance companies offer discounts to those who take these courses.

Monitor your teen’s driving

It is a good idea to ride with your teenager a few times a month to observe their driving habits.  Educate them about how a driving violation can be costly and may even prevent them from getting their permanent license. Make sure to emphasize the dangers of distracted driving, especially texting and driving.

Buy a sensible car

Expensive and sporty cars will most likely have a higher insurance premium. Try buying a used car first before purchasing a new car. Also, the car you buy for your teenager should have high safety rating or have additional safety features installed. Safety features and high safety ratings will lead to lower insurance rates.

Add your teen to your policy

Another way to lower the insurance cost is to add your teenager to your insurance policy.  Research the price of how much it will cost to add your teenager to your policy vs the cost of a standalone policy. Generally, if you can bundle it with your insurance, it will be less expensive.

Misc. Ideas

• A good driving record will keep your rates low and affordable.
• Vehicle safety features will lower your premiums.
• Bundling your policies can save money, such as pairing them with homeowners insurance
• Ask your insurance agent about any other discounts that your teenager may be eligible for, you may be surprised at some discounts you qualify for!

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If you're looking for the reliable new & used car financing in Kansas City then you should visit Northtowne Mazda. For more detail visit KcMazda.com.

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Most Common Startup Mistakes for Auto Dealers

BY: Todd Bryant

Ask any startup founder and you’ll get the same answer: There is hardly anything more exciting in the business field than starting your own company.

And this holds true for auto dealers, too.

But how to start a non-franchised, used-car car dealership and succeed can be tough for many.

While the enthusiasm and energy are abundant in the first months of setting up a new business, the challenges are plentiful too. From financial difficulties to lack of business focus, there are many potential pitfalls on the path of the dealership startup.

What better way to avoid mistakes but to get to know the most common ones that fresh auto dealers make?

Let’s go through the usual pitfalls together, so that your startup dealership is bulletproof.

No Business Plan

Any successful entrepreneur will tell you a solid business plan is a recipe for a well-functioning business. It’s the bible of your company and will evolve with every step you take. Not having a business plan is a recipe for disaster.

The plan gives you the stimulus and opportunity to define your business goals and create a trajectory to follow. It has to contain your mission and vision, which give the overarching structure of your business. Without such an overview, you’ll find yourself at a dead end.

As a critical part of your business plan, don’t forget to research your competitors. That allows you to know “your enemies” and claim your rightful spot in the market. This means you can differentiate your products and services and find the target audience that will best match your company.

Finally, think about your business location. For auto dealers, this is crucial, as convenient and visible locations simply work better for your clients. This step also is a part of setting the stage for the development of your business.

No Sound Financial Plan

Needless to say, adequate financial planning goes hand in hand with the business plan. Having a good overview of your budget, savings and financing options is essential, as it gives you the basis for your operation. The usual tip here is not to overextend yourself financially, as you can easily make a wrong turn in the beginning.

Getting down to specific numbers, the estimated investment for a dealership startup is about $100,000. This, indeed, is a big figure, so it’s essential to know how you’re going to distribute the sum among your different priorities such as facilities, land, inventory and working capital. It’s a good idea to get advice from an accountant, as well as continuing help with your monthly financials.

Having a well-tracked budget also means being careful with hiring staff. Not too early and not too late may sound like a paradox, but that’s the rule of thumb. Furthermore, keep in mind that having excellent mechanics will bring you a lot of business, so make sure to invest in hiring good ones.

No Clear Business Focus

When you start small, it’s important to have a clear focus on a service or product. In this way, you can specialize and capitalize on your expertise, while also saving on big investments that a wide portfolio requires. If you scatter your efforts in buying, say, all kinds of cars, you can easily lose your way in overspending.

For example, one option would be to start with selling European cars. You can get them either by directly approaching people selling their cars or at auctions. You can start with a modest inventory of about 10 cars and whenever they’re out, use the turnover to make the next purchases. It’s a wise step to keep the working capital at the level of two months’ inventory. While scaling in this manner can take a while, it keeps you on the safe side financially.

Such a focused approach also gives you the opportunity to make a name in a certain domain of car sales. You can learn the ins and outs of this trade, thus developing a clear specialty. Once you have this stable ground, it’s much easier to widen your focus and add new types of vehicles and extra services with full-blown power.

Forgetting About Branding and Marketing

Once you delve into the startup universe, you will quickly learn the mantra of any new business in this age: Market your brand. While many car dealers still think this is not relevant for their business, reality shows the opposite. If you’re just taking your first steps as a car dealer, don’t get caught in this common opinion trap.

If you really want to make a difference on the market, you should create a brand for your dealership and put real effort into creating a consistent image of it. The brand transcends the idea of a company that only makes profit. It turns your dealership into a renowned name that has an attractive force beyond its good prices or great customer service. And this is precisely what you should be aiming for.

That’s why not having a marketing budget is a big mistake. Even if your financing is tight, invest in at least a basic marketing service. You won’t believe how many business leads will come from there, especially if you focus on exploring the power of online marketing.

Moreover, returning happy customers often are a bigger and more stable source of revenue than finding new ones constantly. Having a strong brand, along with great service, will help you build those lasting relationships.

Losing Track of Your Credit History

This last point is connected with the first one – namely, having a good business and financial plan for your startup. Many new (and even experienced) dealers make a grave mistake in this respect, as they don’t track their finances and allow their businesses to get into serious debt.

Staying in shape financially is important, because once you owe large sums, it’s difficult to think about solid profit. This means your business should be really flexible and you should adapt to new circumstances as they come.

Maintaining a good credit score is essential for keeping your dealership license too. If your business is located in, say, Texas, every time you need to renew the license, you will have to renew your Texas auto dealer bond. The catch here is that if your credit score falls, the price of your dealer bond will increase.

Instead of paying between 1%-4% of the bond as a premium, you can end up paying 15%. This means that if you need a $25,000 bond, with good credit you will have to pay between $250 and $1,000, while the price for high-risk cases can be up to $3,750. A bad credit record even can get your dealer bond application declined, which is a death sentence for your startup.

Getting to know these common startup mistakes will help you avoid them in your own dealership business. Don’t forget that while there are many potential pitfalls, it’s all about having the right information in advance and being prepared.

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Most Common Startup Mistakes for Auto Dealers
Most Common Startup Mistakes for Auto Dealers

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5 Best Used Vehicles for Teenagers

Choosing the right car for a teenager can be a difficult task.  Most parents try to stay within a budget without compromising vehicle safety. The five used cars below are reliable cars that your teen will like and will not break your bank.

2008 Chevy Malibu  

The Chevy Malibu is a great sedan that is a good and reliable car for teenagers. This car has a 169 horsepower, 2.4 liter four-cylinder with four-speed automatic transmission. The Malibu has smooth, excellent driving dynamics. It is also affordable. The price of the 2008 Chevy Malibu can range from $5,237 to $10,850, depending on mileeage and condition of the vehicle.

2009 Mazda 6
If your teenager is looking for a sporty vehicle, look no further. The 2009 Mazda 6 has smooth transmissions and a roomy cabin. The sports car has a 3.7-liter V6 engine with 272 horsepower at 6250 rpm. Consumer Report has given excellent ratings to this vehicle for reliability and government crash tests.  The price of a 2009 Mazda 6 is anywhere from $5,000 to $12,400.

2009 Ford Focus
The Ford Focus gets 24 mpg in the city and 35 mpg on the highway. The 2009 Ford Focus scored above average on safety.

Some of its safety features are:

• Driver, passenger, side, side head air bags
• 4-wheel automatic braking system
• Electronic stability control
• Traction control

A 2009 Ford Focus that has around 72,000 miles, with overall good condition, is available, on average, for $7,000.

2010 Toyota Corolla
This vehicle is fuel efficient and would be a great fit for any teenager.  It gets an estimated 27 mpg in the city and 35 mpg on the highway and has a 1.8 liter 1-4 cylinder engine. The Corolla is safe and affordable for any teenager. Other reasons the Corolla is good choice for teens is that it is inexpensive to buy, inexpensive to insure, and inexpensive to drive. 2010 Toyota Corolla can be purchased for $5,100-$12,000, depending on mileage and overall vehicle condition.

2004 Ford Ranger
The Ford Ranger is a single-cab truck. Since only one other passenger can fit in the vehicle, your teenager will be less distracted.  The body of the truck is very durable and it has four-wheel drive, which makes it a reliable vehicle in winter weather.  The pickup truck is also helpful for the move to college.  The 2004 Ranger is valued under $10,000, which is a very affordable price.

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Resource:

If you're looking for the reliable used car dealership in Kansas City then you should visit Northtowne Autogroup. For more detail visit Northtowneautogroup.com.

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Legal Expert Rings in the Holidays With ‘12 Days of Dealership Compliance’

FORT WORTH, Texas — Based on recent developments, it’s obvious government regulators are active this holiday season. So to help ring in this season of regulatory compliance, AutoStar Solutions’ Chief Legal Officer Steve Levine offers his "12 Days of Dealership Compliance."

"The government crosshairs on auto dealers is not going away. In fact, it’s only intensifying," Levine said. "For dealers big and small, the threat is real, and so is the learning curve. This 12-step checklist will give dealers the starting points they need to keep the big government Grinch at bay."

DAY 1: Document the pertinent facts. Protect your dealership from the start, when facts are fresh on your mind and you don’t have to rely on memory. Keep detailed notes about the transaction, negotiation process and customer. They may come in handy later.

DAY 2: Keep a centralized compliance manual. Type out all your processes, procedures and other compliance-related documentation, then compile them in a large three-ring binder. If a regulator pays your store a visit, this book should be one of the first things you show him or her. It’s a clear sign that you understand the importance of compliance, and you’ll get big points for effort.

DAY 3: Get to know your regulators. If you develop a positive relationship with your assigned regulators, you may be surprised at the courtesies they pay you — such as a heads-up phone call when they receive a complaint.

DAY 4: Hire a specialized attorney. Just because you share a long history with your current attorney doesn’t mean he or she is the right person for automotive regulatory issues. Are car dealers his or her specialty, or just one of the many types of clients in his or her practice? Regulatory compliance is a highly detailed, ever-changing area of the auto industry. As a result, some lawyers who don’t fully understand the car business have unknowingly implicated their clients. Is that a risk you want to take? If you decide to switch, consider an attorney who is an active member of the National Association of Dealer Counsel.

DAY 5: Reframe your view of complaints. In reality, complaints can be a gift. They may feel annoying, but many of the people who come to you first will complain to a regulator or lawyer if the matter isn’t resolved. In fact, 90 percent of state attorney general investigations originate from complaints. So consider them a golden opportunity to fix the problem and prevent a regulator from ever hearing about it.

DAY 6: Audit your deal jackets before turning them over. If you receive an auditor letter asking for a certain number of deal jackets in various categories, by all means, ask your attorney to hand-pick the ones without compliance issues. And only turn over what’s legally required. Miscellaneous handwritten notes or other extraneous documents can implicate you and cause further action unnecessarily.

DAY 7: Implement progressive discipline for rogue employees. Never turn a blind eye to employees who break compliance rules. If you don’t discipline and document violations of your dealership’s compliance policies, you can bet regulatory agencies will hold you accountable for your employees’ mistakes.

DAY 8: Proactively right your wrongs. This is not the time to shove problems under the rug and hope no one notices. The minute you find a compliance issue, fix it immediately. Then keep records of any refunds, and tell regulators if they come knocking.

DAY 9: Get your advertising house in order. Noncompliant ads and direct mail pieces give regulators a foot in your door, after which they may start poking around in other areas. It’s best to read up on advertising compliance and consult an auto dealer attorney to avoid further trouble.

DAY 10: Pass on your knowledge. All the understanding in the world about compliance issues means nothing if your staff doesn’t share that knowledge. Regulators will investigate whether you train your team to comply, or set policies just for show.

DAY 11: Assume your regulator has little to no experience with dealerships. State attorneys general, for example, oversee so many industries that most of their lawyers possess only a basic understanding of the auto world. It’s your job to help them understand how things work, and why.

DAY 12: Be as nice as humanly possible. Some dealers take a confrontational approach with regulators. It simply doesn’t work. The government possesses all authority and leverage in this situation. But they are people too, so behaving as kindly as you can muster will go a long way.

To learn more about AutoStar Solutions, a provider of web-based software for independent dealerships and finance companies, visit www.autostarsolutions.com.

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Resource: 
Legal Expert Rings in the Holidays With ‘12 Days of Dealership Compliance’
Legal Expert Rings in the Holidays With ‘12 Days of Dealership Compliance’

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5 Tips for Finding a Good Financing Rate for a Used Car

Obtain your credit score

The first thing to do when trying to get the best interest rate to purchase a used car is to obtain your credit score. You can get your credit score from Experian or Equifax. These companies are the most trusted credit-reporting agencies in the nation.  Once per year you can get a free credit report, but if you need it more than once per year you can request it at a small fee. Your credit score determines the interest rate you may qualify for. Banks and credit unions also use the same score to determine your credit worthiness.

Try a lender network company

Companies such as E-loan and Lending Tree make it easy for you to compare interest rates to other institutions.  Submit a request for a car loan to E-loan and they will give you the options of the best rates from different financial organizations.

Using a network of lenders saves you the time of doing the research yourself and gives you a great place to start when finalizing the source you will use for your car loan.

Ask your current bank or credit union about their rates

It is a good idea to compare the interest rates offer by the network of lenders and what your current bank or credit union may offer.  You can take the best offers you already received from a lender and ask your bank if they can match or beat the deal. Your bank may offer you a better deal as they can not only review your credit score but also your bank transactions.

Ask your dealer about their financing options

Your last stop while shopping for a best possible interest rate should be the car dealership. Many car dealers provide a wide selection a financing options. Even if your credit score isn’t above average, car dealerships can offer good deals on interest rates, after all they also want to sell you the car.

Be sure to bring all your pre-approved rates with you to the dealership. Having preapproved loans will indicate to the dealer that you are creditworthy and capable of paying off your loan, which may get you a better deal.

Pay attention to loan’s total cost

When shopping at different places for the best rate, keep in mind that no matter how low the rate, if the loan is extended over a longer period of time, you will be paying more in the long run.  The best way to make sure you are still getting a reasonable price on the loan is to focus on the total cost of the loan. A higher interest rate for a shorter period of time may be cheaper than having a lower interest rate for a longer period of time. If you choose to have a lower interest rate for a long period of time, be sure that you avoid an upside-down loan, which means you owe more than the car is worth.  You can avoid an upside-down load by making a larger down payment.

Car Financing in Kansas City If you are looking to find a loan within the Kansas City area, Northtowne can assist you with any of your financial needs. We want the rate that’s best for you when buying a used car so we’ll help you find financing outside of our dealership as well as inform you of our financing options.

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Resource:

If you're looking for the reliable new & used car auto financing in KC then you should visit Northtowne Mazda. For more detail visit KcMazda.com.

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5 Things Smart Shoppers Look For Before Buying a Used Car

Here is the list of five important things you, the car buyer, should pay attention to when on the dealership lot or when checking out the same vehicle online.

1.    Interior Condition of the Vehicle
There are many things to check in detail when inspecting the interior of a vehicle:

• Check the interior upholstery carefully for any tears or stains.
• Check if the air-conditioning and heating system exhausts are blowing air properly.
• Check the odometer for car mileage.
• Check different lights that are inside the vehicle, like hand brake indicator, ability to change the intensity of dash board display, dome light, radio, CD player, etc.
• Make sure Check Engine light is off, if the indicator is on, avoid that car.

2.    Exterior Condition of the Vehicle
Check the exterior condition of the vehicle in general, including:

• The paint job of the vehicle, check for any rust spots, dents or scratches.
• Inspect for signs of rust or water entry due to cracks or holes
• Be sure tires are worn evenly and are the same kind. Don’t forget to check the spare tire as well.
• Make sure headlights and brake lights are working properly.

3.    Online Reviews of the Vehicle
Read online reviews about the make and model of the used car you want to purchase.  The review contains all the advantages and disadvantages of the vehicle. You should also search for customer reviews before making the decision to purchase the used car.

4.    Price of the Vehicle
It is important to research the price of the used car to ensure you are paying the right price.  Use several different sources such as Kelly Blue Book and Edmunds to compare prices for the same year, make, and model.  While the final price of the vehicle will depend on the vehicle’s mileage and its condition, but researching the price will give you a good idea on the possible price range.

5.    History of the Vehicle
Determine if the vehicle has been any accidents or has had any major repairs. Obtain the vehicle’s VIN number or ask the salesperson about the vehicle history report. Most dealership these days offer free CarFax or AutoCheck reports on their website. If needed, you can obtain the vehicle’s VIN number from the dashboard on the driver’s side of the vehicle.  The vehicle history report can help you make a more confident decision when buying a used car.
The history report may contain all or most of the following:

• If the vehicle has been in a major accident
• How many owners the vehicle’s has had
• The odometer history of the vehicle
• If the vehicle was ever a lemon
• If the vehicle has any flood damage

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Resource:
If you are searching for a used vehicle in the Kansas City area, there are many places online to compare models and prices to ensure you are getting the best deal. Visit our website, at northtowneautogroup.com to compare used cars for the best deals.

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Volvo to Focus on Selling Cars Online

GOTHENBURG, Sweden — On Dec. 15, Volvo Car Group announced a new global marketing strategy, the first leg of which will focus on selling vehicles online. The automaker said the digital push will complement its existing dealer network.

“Volvo Cars will start to sell online gradually across the globe,” the company said in a press release. “But rather than a replacement of our dealership network, online sales will complement our dealerships. Volvo Cars has worked closely with its dealer network in developing the tool in order to retain the personal touch that is so important in buying, delivering and servicing cars.”

The company took its first step toward online sales in September, when it sold 1,927 Special Editions Volvo XC90 cars exclusively online. Part of Volvo’s strategy involves the launch of a new website that will allow customers to select fully-specified cars and adjust them based on personal taste and budget rather than from scratch.

The automaker has also started to implement initiatives to upgrade existing dealerships in a similar way to “display the Scandinavian roots of the Volvo brand.” New dealerships will have a globally uniform layout.

In addition, all Volvo dealer staff will go through a training program on the automaker’s new customer service process. The process, called Volvo Personal Service, will provide every Volvo customer with a Personal Service Technician.

“At the delivery of his or her new car, the customer will be introduced to the Personal Service Technician who will take care of the customer and car throughout the ownership,” according to the release. “This programme obviously requires an extensive training and development programme, which is already underway. A number of countries have already adopted the Personal Service Technician concept as a pilot programme and customer satisfaction in these markets has increased significantly.”

The program is expected to be fully implemented in all Volvo dealerships by 2018.

In addition, the automaker plans to reduce its activities at motor shows — eventually only appearing at one motor show per region per year —and instead holding its own events.

“The car industry is one of the most conservative, least evolutionary marketing clusters in global business,” said Alain Visser, senior vice president Marketing, Sales and Customer Service at Volvo Cars. “For decades, car marketing has been following a certain pattern which is followed by the entire car industry. Now, Volvo Cars chooses to defy that logic and implement a strategy that is geared towards its own needs."

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Volvo to Focus on Selling Cars Online
Volvo to Focus on Selling Cars Online

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Auto Dealers Adjust to Click and Drive Trend

By staff reporters Zhu Shiyun and Nan Hao

Online retail websites in China are paving a wider sales path for new vehicles by catering to increasing numbers of "click-and-drive" car buyers.

Tmall, the retail division of e-commerce giant Alibaba, reported explosive growth for new-vehicle orders on the Chinese shopping-holiday Single's Day, November 11. Some 50,700 shoppers clicked a booking through its website, representing an estimated 500 percent increase from online demand on the same day in 2013.

Other retail websites reported similar spikes. A website that sells cars called Bitauto.com registered bookings for some 530,000 vehicles November 11, compared to around 90,000 cars on the same day 2013.

One auto industry analyst who asked not to be named said more Chinese consumers are switching from browsing inside dealer showrooms to browsing the web before clicking on a car of their choice. Many have found online shopping more efficient and effective than traveling from showroom to showroom in search of a new set of wheels.

Auto dealers and automakers have switched to web sales as well, the analyst said. In some cases, the competitive atmosphere has forced them to accept lower profits after cutting prices to drive sales. In the long run, though, dealers and automakers hope to make money on after-sales services.

Car dealers that operate some 8,000 showrooms across the country and sell more than 30 brands including BMW, Toyota and Volkswagen cars were in the forefront of Single's Day discounts on Tmall. At a Beijing dealer that sells Dongfeng Nissan cars, sales representatives worked until late on November 11 processing orders booked on the website.

Speedier Shopping

Before the online retail era, according to a sales manager at a Volkswagen dealership who asked not to be named, a typical auto shopper might visit a dealer showroom six times before finally making a purchase. Multiple visits were needed to test a car's performance, study its advantages and disadvantages, compare it with other vehicles, and haggle over price with a salesman, the manager said.

Today, the manager said, a shopper may visit a dealer showroom only three times before making a purchase. Speeding the process is the fact that shoppers can learn a lot about cars – features, performance levels and pricing – online. They can also read comments from other consumers who've bought or have experience with certain models. After researching online, the manager said, a car buyer usually "knows what (he or she) wants. They come just to test drive the car and talk about the price."

Online shoppers are also helped by Tmall, which provides special sales data to dealers. The data helps them stock their dealerships with the most marketable vehicles. The manager said some of this data tells dealers which models are in demand in specific geographical areas, thus helping them know what to stock and where in order to control distribution costs.

Negative Impact

Shopping may be convenient and sales easier, but car dealers are not necessarily celebrating the shift to online auto buying.

Because consumers can examine auto prices online, they often find it easier to bargain inside a showroom until a salesman caves in and accepts a lower price. Consumers can also surf the Internet for special promotions and discounts.

As a result, online retailing is cutting into dealer profits in China, a country where car sales rose around 14 percent between 2012 and 2013, and are likely to end 2014 with a 10 percent increase, according to China Association of Automobile Manufacturers. Dealers in recent years have also been hurt by car-ownership limits imposed by some cities in China seeking to control traffic congestion and pollution, said auto industry analysts.

Some dealers have even cut prices to below-wholesale levels in order to attract buyers, said the China Auto Dealer Chamber of Commerce. The chamber has urged dealers to end this practice, spelling out its plea in an open letter to the entire industry distributed November 17.

Losses were posted by some 38 percent of all auto dealers in China in 2012 and 30 percent in 2013, according to the industry consultancy J.D. Power.

A lot of dealerships are pinched because of their fixed costs for labor, real estate and financing, said Wu Yingqiu, founder of the car-selling website 5dcar.com. Dealers also spend a lot of money on marketing.

As a result, according to 5dcar.com, a dealer's fixed and marketing costs can eat up 30,000 yuan for every car sold for 100,000 yuan. Wu said his website's strives to help dealers cut costs by delivering cars to buyers' homes within seven days of an online booking.

Dealers have also tried to improve the bottom line by offering more after-sales services. Servicing vehicles equipped with on-board, smart-driving systems, for example, should provide a tidy revenue source for dealers. The goal is to transform every showroom facility into a complete vehicle shop and servicing center.

The Henan Province dealership China Harmony Auto Holding Ltd., which became the province's first BMW franchise in 2005, underwent a service-oriented makeover in 2013. It's now a company devoted to maintaining all kinds of cars.

Dealers are also selling their services along with cars through online retailers. For example, BMW and General Motors dealers offered service packages at discount prices November 11 on the Tmall website. Shortly after the sales began, these packages sold out.

The click-and-drive phenomenon has turned some automakers more responsive to dealers and consumers, too. Dongfeng Nissan, for example, launched a new business unit to manage e-commerce business. The unit is designed to improve communication with buyers of its vehicles, while cutting costs and improving marketing for dealers.

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Auto Dealers Adjust to Click and Drive Trend
Auto Dealers Adjust to Click and Drive Trend

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Dealers Sentenced to 3 Years for Sales Tax Evasion

LOS ANGELES — Brothers Dagoberto Dueñas, 59, of Rosemead, and Mario Ernesto Gonzalez, 53, of Los Angeles, pleaded no contest to one count of sales tax evasion on Dec. 2, according to Board of Equalization (BOE) Chairman Jerome E. Horton.

Each was sentenced to three years in state prison, to be served in county jail. Deputy District Attorney James Belna of the Los Angeles County District Attorney’s Major Fraud Division prosecuted the case.

“Tax evasion is a serious crime and it is gratifying that these men will be held to account for depriving our state’s honest taxpayers of more than $1.5 million in services,” said Chairman Horton.

Dueñas and Gonzalez owned and operated Space Auto Sales and Spin Auto Sales, respectively, used car dealerships in Los Angeles. The businesses sold used cars from approximately 2007 to 2009.

The BOE’s investigation against Dueñas and Gonzalez began in 2008 when it was discovered that they had failed to report a large amount of sales. The investigation revealed that Dueñas failed to report at least $12.3 million in taxable sales resulting in approximately $1,043,939 in unreported sales tax from 2007 through 2009. Gonzalez was held responsible for failing to report almost $500,000 of sales tax under Spin Auto Sales.

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Dealers Sentenced to 3 Years for Sales Tax Evasion
Dealers Sentenced to 3 Years for Sales Tax Evasion

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Buy/Sell Activity Up 89% Year-Over-Year

BY: Admin

U.S. dealership buy/sell activity reached a new high in the first three quarters of 2014, soaring to an 89% year-over-year increase, according to the Kerrigan Quarterly Blue Sky Report for third quarter 2014.

According to the report, which covers activity through Oct. 1, 2014, the entry into the market of new players has driven price expectations to record peaks, most notably influenced by Berkshire Hathaway’s acquisition of Van Tuyl, the largest acquisition in the auto industry’s history. The report also noted that the completion of Lithia’s acquisition of DCH has had a significant impact on blue sky valuations.

“These two mega deals have motivated a new wave of sellers to consider entering the market, while also pushing pricing expectations to peak — and likely unsustainable — levels,” said Erin Kerrigan, founder and managing director of Kerrigan Advisors. “In addition, they are inspiring a new class of capital — private equity and family offices — to acquire dealerships.”

In addition to the continued rise in transaction activity — 148 dealership transactions in the first three quarters of 2014, versus 78 in the same period in 2013 — key findings this quarter include the dramatic increase in private capital seeking to enter the industry, and the projection that 2014 will prove to be the most active buy/sell year in over a decade, with over 200 transactions completed by year’s end.

Furthermore, according to the report, because the capital markets are increasingly facilitating ever larger transactions, the number of multi-dealership acquisitions more than doubled in the first nine months of 2014 versus the same period 2013, and that the financing available for large acquisitions has contributed to the rise in blue sky values.

In conjunction with the release of the report, Kerrigan Advisors also announced that it has launched a new private equity and family office advisory practice to be led by Ryan Kerrigan, who has worked in the private equity sector for over 13 years, including leading transaction origination for a middle-market private equity firm.

“It is not surprising that private capital is seeking financial exposure to auto retail. These investors see a profitable, fragmented industry with tremendous consolidation opportunities,” said Ryan Kerrigan. “They also see attractive exit opportunities in the public markets through a future IPO. Private investors also see opportunity in a changing industry in which online sales, no-haggle pricing, and new forms of car ownership create attractive new business models that are less reliant on expensive human capital.”

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Buy/Sell Activity Up 89% Year-Over-Year
Buy/Sell Activity Up 89% Year-Over-Year

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White Remains Top Car Color, PPG Industries Reports

TROY, Mich. — White continues to be the most popular car color globally, according to PPG Industries annual automotive color popularity data.

According to PPG’s global data, white ranked first (up 3% from last year to 28%), followed by black (18%), and silver and gray tied for third (13% each). Silver’s popularity continues to decrease across the globe, dropping seven percent over the last two years.

“Car manufacturers across the world are continually seeking new ways to create a unique appearance for models and vehicle brands. As color selection takes place two or three years in advance of a model year, it is important for auto makers to combine color popularity with global consumer trends,” said Jane E. Harrington, PPG manager, color styling, automotive OEM coatings. “Today, automotive manufacturers can choose from a broad array of colors as well as a wide assortment of variations of conservative hues such as white, silver, black and gray, and distinct effects such as micas, glass flakes, fine bright aluminum and hue-shifting pigments.”

The 2014 data also highlighted regional trends. In North America, white remains most popular (23%), followed by black (18%), gray (16%) and silver (15%). In South America, silver and white lead in popularity (32% each), followed by black (13%), gray (11%), red (8%) and blue (2%).

Additionally, in Europe, white remains most popular (25%), followed by black (15%) and gray (14%), and natural shades such as golds, beiges, yellows, oranges and browns continue to grow in popularity (12%). In Asia Pacific markets, white remains most popular (31%), followed by black (20%) and silver (12%).

Across North American vehicle types manufactured in 2014, PPG found that 10% of automobiles were coated in natural hues such as golds, beiges, yellows, oranges and browns. Browns in particular are growing in popularity in midsize and sport utility vehicle (SUV) models.

Sports models continue to be the most likely to feature red, blue or green shades. All three colors overtook gray and silver as more popular colors for sports models. Luxury vehicles, 24% of which were white in 2014, are most likely to feature effect finishes such as metallic or pearl tri-coat.

Looking to 2015 models, Harrington said PPG believes drivers will continue to see an increase in natural tones such as coppers, oranges and browns. New models also may be influenced by metal tones such as bronze, pewter and rose gold, which have had a significant influence across fashion, jewelry, furniture and industrial design in recent years.

In addition, consumers will have access to the same high-definition experience they now readily consume across entertainment platforms, with access to “high-depth” color — a deeper, richer version of color — especially in 2015 models that offer blues, reds and yellows.

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Resource: 
White Remains Top Car Color, PPG Industries Reports
White Remains Top Car Color, PPG Industries Reports

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November a Turnaround Month for Independents, CNW Reports

By: AutoDealer Monthly
BANDON, Ore. — November was a turnaround month for independent dealerships, which realized a slight uptick in used-vehicle sales from a year ago, CNW Research reported last week. The firm also noted an increase in transaction prices from a year ago.

Versus a year ago, actual transaction prices for independent operations rose 2.8% in November, while sales inched up 0.3% from the same period one year ago.

“Independent dealers have been taking it on the chin for the past few months, seeing volumes decline versus 2013 on a regular basis — often double-digit declines,” CNW’s Art Spinella wrote in the firm’s monthly newsletter. “November, however, was a turnaround month for indies …”

Private sales, or what the firm refers to as “casual sales,” were down 2.3% on a year-over-year basis, cutting the segment’s full-year sales increase to less than 3%. The story was different for new-car dealers in November, Spinella noted.

“[Used-car operations at new-car dealerships] were on the positive side of sales and should see a near 2% increase for the full month to 1.226 million units,” Spinella wrote. “Prices also were up slightly versus a year ago by 1.2%.”

For the entire industry, floor traffic continued to slide in the first two 10-day periods of November. “… But it continued to hover in the 100 range,” Spinella noted. “The opening days of the third 10-day period, however, showed an improvement.”

Spinella also reported that days’ supply slipped by about 5.6%, which he attributed to dealers tightening up their inventories.

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November a Turnaround Month for Independents, CNW Reports
November a Turnaround Month for Independents, CNW Reports

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Experian Automotive: Delinquency Rates Rising

SCHAUMBURG, Ill. — In the third quarter of 2014, 30- and 60-day automotive-loan delinquencies grew 3.7% and 8.6%, respectively, from the previous year. This is according to Experian Automotive’s latest State of the Automotive Finance Market report.

“While we have observed a rise in delinquencies over the past few quarters, it was to be expected due to the growth in subprime loans. We have to keep in mind that a majority of the market is still in the prime risk category,” said Melinda Zabritski, Experian’s senior director of automotive credit. “As long as consumers continue to do a good job of making their auto-loan payments on time and lenders keep a close eye on how rates fluctuate year over year, the industry should remain relatively stable.

“Understanding the shifts in payment behavior and the industry’s risk tolerance are important for the market because these insights can trigger actions that affect vehicle prices, loan terms or interest rates,” she added.

Further findings from the report showed that, at a state level, states in the South accounted for four of the top five highest delinquency rates in both the 30- and 60-day category. On the flip side, the states with the lowest delinquency rates in both categories primarily resided in the Midwest and Northwest regions.

The report also found that total balances for all open automotive loans grew to $870 billion, up from $784 billion a year ago and finance companies saw the highest percentage increase in total dollar volume, jumping 19.6% to $134 billion.

Meanwhile, super-prime loans accounted for 20.6% of total loans in the third quarter of 2014, up from 20.26% the prior year. At the opposite end of the spectrum, deep subprime grew from 3.57% to 3.84%.

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Experian Automotive: Delinquency Rates Rising
Experian Automotive: Delinquency Rates Rising

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Loan Amounts Reach Record Highs in Q3

SCHAUMBURG, Ill. —The average dollar amount for both new and used vehicle loans reached all-time highs in the third quarter of 2014, according to Experian Automotive’s latest State of the Automotive Finance Market report. The average loan amount for a new vehicle was $27,799 in the third quarter of 2014, up $1,080 from the previous year. Used vehicle loans increased $676, reaching $18,576 over the same time period.

 

With the continued growth in loan amounts, the quarterly findings also showed consumers leasing at a higher rate, as well as taking out longer loans. The report found that leasing accounted for 29.1% of all new vehicle financing in third quarter 2014, up 7.1% from a year ago. New vehicle loans in the 73- to 84-month range grew by 23.7% in third quarter 2014 compared with the previous year, while used loans in the same range grew by 18% from a year ago.

 

“Car buyers tend to shop with a monthly payment in mind. As a result, we are continuing to see them turn to leasing and longer loan lengths as strategies to keep payments down and make vehicles more affordable,” said Melinda Zabritski, senior director of automotive finance for Experian. “As car values continue to reach new heights, these insights will help dealers, lenders and consumers become more aware of the options available to them to keep people buying cars, all while staying within their budgets.”

 

Furthermore, the report found that the average monthly payment for new and used vehicle loans increased from the previous year. The monthly payment for a new loan reached $470, up $12 from a year ago, while the monthly payment for a used loan reached an all-time high of $358, an increase of $8 over the same time period.

 

Additional findings from the report showed that interest rates for new vehicle loans increased slightly in the third quarter, climbing 4.7% from a year ago. However, despite the growth, these rates have decreased each quarter in 2014. Interest rates for used vehicle loans decreased to 8.5% in the quarter.

 

“As consumers explore the different options available to them to keep their monthly payments low, they have to remember interest rates often can play a factor. Making timely payments and becoming a low credit risk are the easiest ways to ensure a low interest rate,” continued Zabritski. “For example, the average interest rate for super-prime consumers on a new loan was 2.6%, compared with 12.7% for deep-subprime consumers. Understanding how on-time payments influence credit scores, can help consumers improve their financing experience.”

 

The report also noted that the average credit score for a new vehicle loan was 713 in the third quarter of 2014, down 3 points from a year ago, while the average credit score for a used vehicle loan rose 2 points to 650.

 

Captives were the only lender type to see an increase in market share year over year, up 28.9%. Meanwhile, a record-high 54.1% of all used vehicle transactions were financed, up from 52.6% in third quarter 2014. For new vehicles, 84.8% of all transactions were financed in third quarter 2014, which was unchanged from the previous year.

 

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Resource: 
Loan Amounts Reach Record Highs in Q3
Loan Amounts Reach Record Highs in Q3

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J.D. Power: New-Car Sales Reaching Record Levels

LOS ANGELES — J.D. Power’s John Humphrey gave the U.S. auto industry a clean bill of health this week at the NADA/J.D. Power Western Automotive Conference at The LA Downtown Hotel.

New-vehicle sales in the U.S. are steadily approaching the record of 17.3 million set in 2000, but are doing so with more discipline in pricing and the use of incentives, according to Humphrey, senior vice president of the global automotive practice at J.D. Power.

“The industry is in a very healthy state,” Humphrey told the audience from more than 250 automotive industry representatives. “[Sale] growth has continued to be impressive with this year up roughly 6%. We are approaching the record, which was arguably somewhat artificially inflated given less industry discipline and heavy reliance of subvention to move product back then.”

J.D. Power and LMC Automotive are projecting retail new vehicles sales to reach 13.6 million in 2014 with total new-vehicle sales to hit 16.4 million. The sales growth in 2015 is projected to be more moderate at 2% growth to 13.8 million retail sales and 16.7 million total sales.

Humphrey noted that average retail transaction price is $30,026 in 2014, up from $29,298 in 2013, and overall consumer expenditures on light vehicles are expected to reach a record $407 billion in 2014.

Despite the positive outlook for the auto industry, Humphrey cautions that there is some risk in the market.

“The first major issue to watch is the impact the inevitable increase in interest rates will do to demand,” Humphrey said. “We have enjoyed a prolonged period of very cheap money that is coming to an end, and this will clearly affect demand.”

Humphrey anticipates an aggregated rise of 100 basis points would likely increase demand by 300,000 units.

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Resource: 
J.D. Power: New-Car Sales Reaching Record Levels
J.D. Power: New-Car Sales Reaching Record Levels

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More Auto Dealers Join Black Friday fray with sales incentives

By Dan Gearino

Auto dealers have emerged as contenders for the attention and dollars of Black Friday shoppers.

The promotions were enough to lure customers to car lots on a day when people traditionally shop for electronics, apparel and toys.

“It used to be that automotive (dealers) would throw in the towel and sit on the sidelines while every other retailer had their best day of the year,” said Chris Haydocy, co-owner of Haydocy Buick GMC on the West Side.

That has changed. Yesterday, most brands had some sort of marketing push and special discounts aimed at boosting traffic for the day, and many of the deals continue through the weekend.

At Germain Nissan on the Northeast Side, customers were offered incentives such as a limited supply of televisions, tablets and tickets to today’s Ohio State football game against Michigan.

“The last few years, we’ve thought maybe we should get in on that action,” said Paul Germain, one of the top managers of the company that owns the store.

Inside the showroom, giant bows adorned the vehicles.

Jim Merriman, 51, of Johnstown, was shopping for a car for his daughter, and the Nissan store was one of his first stops.

“It’s Black Friday, and I’m off work,” he said.

And that fact — that many customers have the day off — is one of the main reasons that dealers and automakers see an underused opportunity to attract customers.

Another factor this weekend is the OSU-Michigan game. Several dealers said they expect a lull in business during the game today, and they expected those in the market for a car to shift their shopping to yesterday or Sunday.

Dealers across the country are trying to boost sales on Black Friday and this weekend.

“Black Friday represents one of the hottest shopping days in America, and new-car shopping is no exception; there are amazing deals on new cars right now as the calendar year comes to a close,” Jack Nerad, executive market analyst for Kelley Blue Book, said in a statement.

“This month’s deals include some 2015 models and some outgoing 2014s, compact sedans, midsize sedans and even a sporty three-row SUV.”

Some of the promotions:

• Chevrolet is offering $1,000 cash back plus zero percent financing on some models, including the 2014 Silverado pickup and 2015 Malibu sedan.
• Buick and GMC are offering a 20 percent discount on some models, including most in the 2014 model year. The selection of eligible vehicles varies depending on the store.
• BMW is offering up to $3,500 off the price of some models, plus other incentives.
• For many brands, the holiday weekend is the start of campaigns that will run through December. The year’s final month is one of the busiest for the auto industry, and it’s the busiest for certain brands.

“They’re pushing for a strong finish,” said Mike Dunlap, BMW new-car sales manager at Midwestern Auto Group in Dublin.

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Resource: 
More auto dealers join Black Friday fray with sales incentives
More auto dealers join Black Friday fray with sales incentives

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Benefits of Buying a New Car from an Auto Dealer

The Dealership is your Playground
Visiting an auto dealership in pursuit of purchasing a brand new car is comparable to taking a child to a candy shop; (Except the merchandise is much more expensive.) At an auto dealership, there is a wide variety of inventory and you can choose from.  You can choose the vehicle make, model, size, color and other features all based upon your budget.

Brand New Features
As technology advances, the features in new cars also continue to advance; state of the art features such as lane change assist, which is a warning system that alerts a driver when his or her car is unintentionally drifting from a lane of travel. Another example is autonomous parking, which allows a vehicle to essentially park itself by using cameras and sensors. Drivers only need to operate the foot pedals and listen to directions.

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Ford to keep base price stable on Explorer, but raises top trim level

BY: Bradford Wernle

Ford has held the line on prices for the refreshed 2016 Explorer crossover, but a new top-of-the-line Platinum trim raises the ceiling on what a customer can spend for the hot-selling full-size crossover to well above $50,000.

Today Ford Motor Co. announced prices for a base 2016 Explorer will start at $31,595, the same as for a base 2015 Explorer. The loaded Platinum Explorer, new to the lineup for 2016, will start at $53,495.

The priciest version of the current 2015 Explorer is the Sport model, which starts at $43,995. All prices in this story include shipping.

The 2016 Explorer, introduced last week at the Los Angeles auto show, will go on sale next summer. Other trim levels include the XLT, starting at $34,295; the Limited, starting at $42,195 and the Sport, starting at $44,195.

The Platinum will join the Sport as the only Explorer models offered with Ford’s 3.5-liter EcoBoost V-6 engine, which offers turbocharging and direct injection of gasoline.

The Platinum trim level will come standard with such features as enhanced active park assist adding perpendicular, or angle, parking, a lane-keeping system and rain-sensing wipers.

The 2016 Platinum Explorer will have its own LED headlamps and signature lighting, Ford says. Also standard will be a dual-panel moonroof, premium silver-painted front and rear skid plate elements, and 20-inch wheels.

Inside, the Platinum vehicle gets its own brushed aluminum version of the Ford oval in the middle of the steering wheel.

The 2016 Explorer will come with a new version of Ford’s 2.3-liter EcoBoost four-cylinder engine. The 2.3 liter will replace the 2.0-liter EcoBoost four-cylinder currently offered.

More content

Jim Farley, Ford executive vice president of global marketing, sales and service, said during the Los Angeles show that high demand for the Explorer Sport showed support for a model with even more content.

“One thing we learned is we didn’t have enough upscale products,” he said.

The current-generation Explorer was introduced in late 2010 as a 2011 model and is built on a modified version of Ford’s D4 platform, which originated with Volvo.

SUV sales in the United States have increased 90 percent since 2008, and growth has been particularly strong at the upper end of the market, Farley said.

“You can see an explosion of sport versions,” Farley said.

Tough competition

Ford expects the Explorer to compete with the likes of the Jeep Grand Cherokee and GMC Acadia, which have top prices of more than $50,000.

Farley said the Explorer remains a crucial vehicle for Ford, which is bullish on the global growth of SUV sales.

“We’re on pace to sell more than 180,000 [Explorer] units in the U.S.,” said Farley, who takes a new job as president of Ford’s Europe, Middle East and Africa business on Jan. 1. In 2013, Ford sold 192,397 Explorers in the U.S. Ford sells the Explorer in more than 100 countries. It is assembled at Ford’s Chicago Assembly Plant.

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Ford to keep base price stable on Explorer, but raises top trim level
Ford to keep base price stable on Explorer, but raises top trim level

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NADA sees 2015 U.S. sales nearing 17 million vehicles

Continued economic improvement, low interest rates and cheap gasoline will help new-vehicle sales rise more than 3 percent to nearly 17 million units next year, the most since 2005, according to forecasts from the National Automobile Dealers Association.

NADA sees U.S. new vehicle sales growing to 16.94 million units in 2015 from a projected 16.4 million this year, as U.S. gross domestic product grows 3.1 percent, compared with an estimated 2.1 percent this year.

Through October, the industry sold 13.7 million vehicles in the U.S., up 6 percent over the same period of 2013.

But sales will begin to plateau or even decline after 2015 as the growing number car buyers with five- to seven-year financing deals delay their next purchase to pay down those long-term loans, NADA’s chief economist says.

The monthly U.S. adjusted sales rate has topped 16 million vehicles for eight months in a row, and in August surpassed the 17.5 million mark, according to the Automotive News Data Center. The October rate was 16.5 million.

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NADA sees 2015 U.S. sales nearing 17 million vehicles
NADA sees 2015 U.S. sales nearing 17 million vehicles

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NADA tells Nissan to butt out of dealer surveys

BY: Lindsay Chappell

The National Automobile Dealers Association has rapped Nissan's knuckles for "actions by some Nissan representatives" to boost scores in a survey of dealer attitudes toward automakers.

In a July 24 letter to Nissan dealers, NADA said that over the summer it became alarmed that some Nissan field reps may have pressured dealers to give favorable responses on the NADA Dealer Attitude Survey.

"We want you to know that NADA considers any attempt to coerce you into giving responses that you don't believe in is unacceptable," the letter said. It said NADA can drop responses from areas where it determines that the survey has been "subverted."

A statement issued Friday, Sept. 26, by Nissan North America acknowledged NADA's concerns.

"We have cooperated fully with NADA during the survey process, and we understand that the organization will exclude any questionable surveys to ensure that the highest levels of integrity are maintained," the Nissan statement said. "Nissan does not condone manipulation of the NADA Survey, and we will take appropriate action against any party that is found to be interfering with this process."

NADA surveys dealers in winter and summer. The attitude survey is intended to be a confidential report card on dealer-factory relationships. NADA privately presents the survey results to automakers and dealers.

Nissan received low marks in the winter 2014 attitude survey, which signaled a decrease in the number of dealers who believed the value of the franchise would rise.

Nissan's top U.S. management has responded to retailers' gripes by declaring a mission of "making our dealers happier and more profitable" in the words of Jose Munoz, Nissan's North American chairman. Last year, Munoz launched a newly designed sales-incentive approach that addressed dealer complaints that Nissan's previous stair-step program was too unpredictable.

Munoz is determined to raise the value of Nissan dealerships and improve the general perception of Nissan among retailers.

Munoz has said that by making Nissan stores more profitable, multifranchise dealers will give Nissan their top business priority.

NADA did not specify what transpired in the field to raise its concern. The association told dealers that it uses "a number of confidential methods to ensure that any questionable data or conduct comes to light."

According to comments from one Nissan dealer who asked to remain anonymous, his regional office did not overtly ask dealers to provide the survey with positive ratings. Rather, it reminded dealers how improved Nissan's performance has been in the past few years and urged dealers to take time to answer the NADA survey to have a chance of increasing the values of their dealerships.

A copy of a June 24 letter that went out to Nissan field personnel in the Northeast region from Gary Frigo, the regional vice president, obtained by Automotive News, told factory personnel that the summer survey results "will truly be a 'report card' for all of us."

"I hope you also feel as embarrassed over our Winter results as I did," the letter said.

"Let's be 100% clear," the letter goes on, "you are responsible for the scores for your current Area & District."

An NADA spokesman said Friday that the summer survey has not been completed.

"When we were informed of the situation in the region we took action and advised Nissan dealers accordingly," said a statement released by NADA Friday. "NADA has since implemented steps to preserve the integrity of the survey."

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Resource: 
NADA tells Nissan to butt out of dealer surveys
NADA tells Nissan to butt out of dealer surveys

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To Be or Not to Be On-Camera

Are you ready — and qualified — to become the face and voice of your dealership? Marketing expert asks the tough questions.
Auto Dealer Monthly - Feature by Jim Raposa
Broadcast advertising has helped a good many business owners take on an air of celebrity and authority. Former Men’s Warehouse owner George Zimmer’s distinctive voice was the trademark of that company’s TV and radio commercials for nearly 30 years. Sy Sperling launched the Hair Club for Men with a commercial in which he famously told viewers he was not only the company’s president, he was also a client. Zimmer and Sperling leveraged the proper use of on-camera skills to help build their businesses, and they were preceded and followed by countless auto dealers. But the term “proper use” is key, because not every owner is willing or able to represent their own brand.

After a career in radio broadcasting that was followed by ad agency ownership, commercial production and marketing, I have seen the good, the bad and the ugly among dealers who decided to go on the air. In my own market, there is one independent dealer who is clearly trying too hard. He is at least 50 years old, but he shoots commercials in which he talks like a rapper and dances around his lot like it’s the set of a music video. I doubt younger viewers are impressed. This dealer appears to be living out a showbiz fantasy at the risk of blowing media dollars — along with his bottom line.

To be sure, there are many owners and dealer principals I have worked with over the years who decided to take the leap and really nailed it. They understood that no one else was going to convey the passion they had for their business quite the same way they would. John L. Sullivan, owner of a Chevrolet store in the Sacramento, Calif., market comes to mind. He is the type of spokesman who can build trust in the first few seconds of a spot. Another is Bill Cole, who runs the Bill Cole Automalls in Kentucky and in West Virginia, where he also serves as a state senator. He is able to effectively communicate on-camera, and he makes it look easy.

A Star Is Born
Is it time for you to step in front of the camera or behind the microphone? Can you be the face and voice of your dealership? The answer depends on an underlying question that many dealers, ad execs and commercial producers are afraid to ask: Are you really the right person for the job? Talk about the elephant in the room!

For a business owner, there’s a certain level of self-esteem that comes from being recognized as that famous man or woman on TV. And once that vestige of celebrity has been introduced, it can be difficult — if not impossible — to ask the genie to get back in the bottle if it’s not working out. Pity the soul charged with that task.

Before the commercial copy is written and the camera starts to roll, it’s best to take stock of your situation and reverse-engineer your marketing approach. Start by asking yourself and your team what the real goal is, and be specific. If you specialize in safe, secure family transportation, for example, the best spokesperson might be a young parent. Do you look and sound like the clients you wish to attract?

Corey Dissin is vice president and general manager of Propulsion Media Labs in Philadelphia. He connects advertisers with voiceover and on-camera talent and produces radio and TV spots for clients in the U.S. and Canada. “When we consult an ad agency that works with a dealer or directly with a dealer principal, we first want to know if that person is known in the community,” he says. “Are they already a local celebrity? We also want to know if that person’s name is on the signage. Is it John Doe Ford or City Ford? Finally, we want to know if that dealer is glib — are they affable or charismatic?”

Dissin recognizes that not every dealer principal will shine under the lights, despite the fact that they have already succeeded in one challenging field. “I bet if you polled 100 automobile dealer principles, you’d find a high percentage, if not all of them, are excellent salespeople. But that doesn’t always translate to being persuasive on video.”

Caveat Emptor
While the lure of becoming a local celebrity can be enticing, it all comes back to knowing where you want the marketing to take your business. If going on-camera seems like an approach you’d like to take, try shooting a low- or no-cost test video. If you need pointers or ideas, check out some of the countless examples on YouTube. Remember, you might not be perfect your first time out. Be patient. Once you get a take you like, show the video to your agency or someone you trust to give you an informed, honest critique.

“We never want to presume the dealer principal can act when we take on a project,” Dissin says. “We’re always careful to make sure the spot never becomes a farce. We want the client to look good and we want viewers to see the spot and think, ‘What a cool place to buy a car!’ not ‘Oh, God, what a cheesy commercial!’”

Bottom line: If you’re not persuasive on-camera, it’s a waste of your time and ad circulation, and that’s never good. If you must, hire on-camera talent who will deliver the goods — and a healthy ROI — for your dealership. Don Foss, founder of Credit Acceptance and one of the best-known dealers in Detroit, was played by the same actor for years. Foss is a successful businessman with plenty of personality, but he elected to leave the TV work to a professional.

If you have the chops, get started and track the leads coming in the door from your on-camera spots. If not, pick the right person for the job and get back to building your business.

Jim Raposa is president of Raposa Media and has expertise in copywriting and commercial production. JRaposa@AutoDealerMonthly.com

By: Automotive Dealer Monthly

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Resource: 
To Be or Not to Be On-Camera
To Be or Not to Be On-Camera

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NADA Issues Dealer Data Guidance

By Brittany-Marie Swanson

The National Automobile Dealers Association (NADA)’s department of legal and regulatory affairs issued guidance on data protection last week. Officials said the 14-page memo, issued to members on Aug. 28, is part of an ongoing effort to promote compliance by the association, but it comes at a time when industry marketers are turning to transaction data to fuel vehicle sales.

Obtained by F&I and Showroom magazine, the memo acknowledged there are a “number of entities who wish to gain access” to transaction data stored in dealer management systems (DMS), and warned dealers that the “FTC [Federal Trade Commission] may consider any third-party ‘access’ to NPPI (non-public personal information) to be ‘sharing,’” even if the dealer’s vendor never actually accessed the data.

Nine days before it was distributed, the FTC delivered its own warning to big data collectors that it will use all tools at its disposal to protect consumer privacy. The FTC has partnered with the NADA in the past on the topic of data protection, but recent efforts are not related, officials said.

Speaking at the 2013 Aspen Forum on Aug. 19, FTC Chairwoman Edith Ramirez acknowledged the importance of “big data,” even noting that it’s the “FTC’s job to get out of the way of innovation.” But she also said it’s the FTC’s job to make sure consumer privacy is respected.

“Like a vigilant lifeguard, the FTC’s job is not to spoil anyone’s fun but to make sure that no one gets hurt,” she said. “Addressing the privacy challenges of ‘big data’ is first and foremost the responsibility of those collecting and using consumer information. … It is the FTC’s responsibility to make sure that companies live up to their commitments.”

‘Big data’ is a term used to describe the massive amount of information created every day that can be analyzed by firms to deliver targeted marketing, among other things. According to Stamford, Conn.-based Gartner, spending on business-intelligence software is expected to reach $13.8 billion this year. The technology research and advisory firm predicted that spending will reach $17.1 billion by 2016.

In recent months, F&I and Showroom contributor Jim Ziegler has raised concerns about the DMS access some vendors — particularly vehicle information and listing sites — require of dealers, which he believes leaves them vulnerable and their information unprotected. The NADA’s President Peter Welch says he is aware of Ziegler’s crusade, but stressed that “our review of these things has been ongoing.”

“We've had frustrated calls from dealers, ranging from ‘Jeez, various factories are jamming clauses in there, take it or leave it,’ or click through agreements, and there seems to be somewhat of a feeling that they are losing the control of their own intellectual property,” Welch  told F&I and Showroom.

The NADA’s memo included a checklist dealers can use to police vendors’ access to their data. It also warned members that they could run afoul of the Gramm-Leach-Bliley (GLB) Act’s Safeguards Rule and Privacy Rule if they provide NPPI to DMS providers, third-party vendors and even manufacturers without taking certain precautions. Such precautions include providing a Privacy Notice to customers and establishing contractual protections.

“This means that unless their Privacy Notices state otherwise, dealers may not provide access to NPPI to anyone, including their manufacturer,” the memo stated.

In June 2012, the FTC took its first action against an auto dealer for GLBA violations, charging Statesboro, Ga.-based Franklin’s Budget Car Sales Inc. with exposing the information of 95,000 customers after an employee downloaded consumer data files onto a flash drive and loaded them onto his home computer, which contained peer-to-peer file-sharing software. The FTC also charged the dealership with violating the FTC Act’s ban on deceptive acts and practices for failing to maintain adequate safeguards as promised in its Privacy Notice.

As part of its settlement with the agency, Franklin’s was required to establish and maintain a comprehensive information security program and undergo data security audits by independent auditors every other year for 20 years.

“The primary issue under these federal regulations generally arises because of a disconnect between the duties dealers have and the promises they may have made to their customers …,” stated the NADA’s memo.

Last month, a senior team from the NADA met with General Motors Co.’s board of directors in Detroit. Among the topics discussed were intellectual property and data security, something Welch said the association will soon discuss with other major players.

“We do have plans in the coming weeks to be meeting with the major DMS providers to have an open and frank discussion with them about what type of tools they offer for dealers to both monitor access and also control and or restrict access,” he said. “We will probably be meeting with auto manufacturers in the coming weeks or months to discuss these issues with them as well.”

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Resource: 
NADA Issues Dealer Data Guidance
NADA Issues Dealer Data Guidance

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Police Catch Kidnapper Using Dealership’s GPS Device

By: The Washington Post
Feature by Abby Ohlheiser

Local and federal law enforcement officials announced Wednesday that they had rescued a nursing assistant whose violent abduction in Philadelphia was caught on surveillance video. And as police credit that video for its role in finding Carlesha Freeland-Gaither, 22, and her alleged abductor, Delvin Barnes, another sort of surveillance technology also helped lead officials to the suspect and the victim: a GPS device, planted in Barnes’s car by the dealership that sold him the vehicle.

 

Barnes, 37, was arrested in Maryland on Wednesday, three days after Freeland-Gaither was abducted on a Philadelphia street. Freeland-Gaither was with Barnes at the time of his capture in Jessup and was in reasonably good condition, authorities said at a news conference.

 

Officials began to zero in on their location after the victim’s credit card was used near the Maryland-Delaware border.

 

But a major break in the case came from law enforcement in Virginia, where police already were investigating Barnes in a different case. The images of the suspect in the Philadelphia abduction indicated that it might be him.

 

Barnes has a long criminal history and was wanted in Virginia as a suspect in an abduction there.

 

Investigators began tracking the movements of his car — a gray Ford Taurus — through the GPS device. The dealership installed it because of Barnes’s poor credit at the time of purchase.

 

Two detectives working together in neighboring Virginia counties guessed that the car might have such a device after they “noticed a Virginia inspection sticker on the front windshield and a decal from a car dealership in the Richmond area,”as The Post reported Thursday night. The detectives were aware that the dealership placed GPS devices in some of the vehicles it sold.

 

Capt. Jayson Crawley of the Charles City County Sheriff’s Office and Sheriff’s Lt. J.J. McLaughlin III of the New Kent County Sheriff’s Office asked the dealership to activate the device on Wednesday, they told The Post.

 

The dealership complied, and Barnes’s car was located that day in Jessup.

 

Over the past few years, car dealerships — especially those catering to lower-income customers and those with poor credit — have placed GPS devices in the cars they sell, sometimes without the knowledge of the buyer. The practice is controversial.

 

The devices are generally “designed to help the repo man find your car if you stop paying,” the Tampa Bay Times reported in 2013. The devices stay on the car until the loan is paid off.

 

“They don’t want the customer to know that if they don’t pay, they can come find it,” Duane Overholt, a consumer advocate who runs the Web site StopAutoFraud.com, told the Times.

 

In the case of one Florida dealership, customers whose cars were equipped with tracking devices were invited in for a “safety check” after they finished paying, at which time the device was covertly removed, the Times reported.

 

It’s not clear whether Barnes knew about the device in his car.

 

 

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Resource: 
Police Catch Kidnapper Using Dealership’s GPS Device
Police Catch Kidnapper Using Dealership’s GPS Device

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Check Your DMS Bill

By: Auto Dealer Monthly
Feature by Brian Reed
Billing errors for dealership management systems are more common than you may think. Technology expert suggests you check your monthly invoice for erroneous charges related to hardware and software, annual increases and click fees.

You know the approximate amount of your dealership’s monthly electric bill, but do you know what you pay per kilowatt-hour? Many dealers manage the monthly invoice for their dealership management system (DMS) much like their electric bill. They know the total amount they pay but not the detail behind it.Auto Dealer Monthly - Feature by Brian Reed

I’m aware of an internal study by one DMS provider which found that as many as 40% of the invoices sent to dealers who had their system for at least one year were incorrect. In some cases, they paid back thousands of dollars in overcharges.Auto Dealer Monthly - Feature by Brian Reed

So is there a conspiracy among the DMS providers to overcharge their dealers? Absolutely not. But it is possible for a provider to make mistakes. More often than not, those mistakes are the result of changes at the dealership that are not reflected in the monthly invoice. Let’s review three key areas that can result in overcharges on your monthly DMS bill:Auto Dealer Monthly - Feature by Brian Reed

1. Hardware and Software: Many dealers sign up for the DMS provider’s software and applications and later replace them with software from a third party. In many cases, when a dealership stops using an application or software feature of the DMS, the monthly billing for the built-in software can and should stop.Auto Dealer Monthly - Feature by Brian Reed

The same goes for hardware. You could be paying monthly fees and maintenance charges to your provider for hardware you have (a) replaced with hardware from a third party or (b) upgraded via your DMS provider. Incredible as it may seem, many dealers who have updated hardware find they are still paying for the old gear. Again, there is no conspiracy at work; it’s simply a matter of failing to update your agreement.Auto Dealer Monthly - Feature by Brian Reed

2. Annual Increases: Many DMS contracts include a built-in annual increase, often in the neighborhood of 4%. This increase varies based on the upfront negotiations. Check to be sure the actual annual DMS price increase matches the contract.Auto Dealer Monthly - Feature by Brian Reed

3. Click Fees: Some DMS providers charge “click fees” for the paper and toner they use. Always audit actual usage versus what is invoiced. Don’t assume the total clicks you are being charged for are correct.Auto Dealer Monthly - Feature by Brian Reed

This is not a one-time process. Dealers should manage their monthly DMS invoices as prudently as they manage any other expense. Each line item of each invoice should be audited on a monthly basis, and don’t be afraid to ask for help from your provider. Recently, a dealer friend of mine sat down with a representative from his provider. Working together, they found several items that had been on his invoice for two years that the representative simply could not explain.Auto Dealer Monthly - Feature by Brian Reed

Many dealers who do monthly audits can attest to the financial benefit. Dealership-savvy accountants are an excellent resource. There are also a number of consultants who specialize in reviewing invoices for dealers on a monthly basis. Some are so confident in their skills that they only get paid when they save the dealer money. These companies and consultants can also perform a pricing benchmark study for you to compare what you are paying for your DMS versus a large sampling of dealers who are similar in size.Auto Dealer Monthly - Feature by Brian Reed

Finally, this is one issue you should feel free to bring up in your 20 Group. Some groups discuss this very topic on a regular basis. Why not start the conversation yourself? Once you have completed your review, ask your fellow dealers to do the same. You could be responsible for starting a new best practice.Auto Dealer Monthly - Feature by Brian Reed

The bottom line is that every dealer should be proactive in reviewing their monthly invoices from their DMS provider. The same is true whether they do it themselves or retain outside expertise. Unlike your electric bill, every line is crucial.Auto Dealer Monthly - Feature by Brian Reed

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Resource: 
Check Your DMS Bill
Check Your DMS Bill

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Zero to 60 in Less Than Three Seconds

By: Auto Dealer Monthly

 

It’s insane! Chrysler will soon begin production on 700-horsepower editions of the Dodge Charger and Challenger, both due in the 2015-MY. Considering my 1968 Dodge Super Bee was rated at 335 hp and was one of the fastest production cars of the day, I have to ask, where’s it all going?

 

Trumping the 650-hp 2015 Corvette Z06 and the 662-hp Mustang Shelby GT500 — and a host of European exotics — Chrysler’s SRT Hellcat line should be the ultimate “Need for Speed” machine, assuming buyers can find a public highway suitably equipped and unguarded to exercise its capability.

 

Well, hang on, speed freaks. In Monterey, Calif., Brandon Boeckmann is preparing to put his private-label, 1,058 hp Galpin GTR1 supercar in production. He and his team have been showing off the prototype at car shows. Prices will begin at a cool $1 million. I wonder if that includes floor mats.

 

Boeckmann is the grandson of a friend, Bert Boeckmann of the Galpin dynasty in the San Fernando Valley. The group includes the nation’s No. 1 Ford dealership and a myriad of other super-performing franchises. They stated they only intend to sell six units the first year. I am trying to picture a group of salesmen out in front of the GTR1 showroom, smoking cigarettes and waiting for an up. Will they put an inflatable gorilla on the roof? Only time will tell.

 

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Resource: 
Zero to 60 in Less Than Three Seconds
Zero to 60 in Less Than Three Seconds

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The Wolf of Walmart

By: Automotive News
AutoDealer Monthly
I have been to Atlantic City many times. I have conducted seminars there, spoken at conferences and consulted nearby dealers. It isn’t the nicest part of New Jersey, and it sure ain’t Las Vegas. Unlike Vegas, where the airport is a stone’s throw from the Strip, the closest major airport is in Philadelphia. The streets and sidewalks around the casinos are nice enough, but you wouldn’t want to stray too far from the bright lights. The surrounding blocks are seedy, dirty and crime-ridden. It’s the kind of place that makes you feel like taking a long, hot shower after each visit.

The Borgata and the Revel were the only hotel-casinos where the Alpha Dawg would rest his head, and the Revel closed its doors over the summer. So did the Trump Plaza and the Showboat, and half of A.C.’s big gaming venues could be shuttered this time next year.

As anyone who has visited Atlantic City knows, with a few notable exceptions, customer service is notoriously poor. They don’t care and it shows. Aside from generating tax dollars, the casino owners appear to have done little to reinvest in their city. They allowed their properties to deteriorate and their neighborhoods to decline.

When Indian casinos started popping up all over the Northeast, gamblers left Atlantic City in droves. Now it’s on its way to becoming America’s largest ghost town.

Dealers, take heed. This applies to you. Competition is increasing, and some of you don’t seem to be paying attention.

I have visited thousands of dealerships over the previous 28 years. Frankly, I am ashamed to set foot in some stores. Even with all the latest factory-mandated renovations, some of your showrooms look like pig pens. Yes, I am a dealer advocate, but some dealerships are a disgrace to the rest of us.

Don’t get me wrong. I despise the manufacturer programs that make every dealer adhere to identical, cookie-cutter models. Those factory stiffs who think uniformity sells cars and trucks are idiots. No manufacturer should dictate the sights and smells that greet your customers. It should be up to the dealer. But many of your dealerships need a serious housecleaning, and some much more than that.

Clean up your showrooms and properties. Take a serious look at your conference and training rooms. Repave your lots and fix the lighting.

How many outdated materials are thrown in corners and stacked against the wall? Display and take pride in your inventory. Make your staff dress and look presentable. Some of your older employees look like bums. Some of your younger ones are displaying too many piercings and too much body art. And they’re all constantly texting. Enough!

This is a people business. Put that damn phone down and pay attention. True professionals come to work well-groomed and dressed for success with a winning attitude.

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Resource: 
The Wolf of Walmart
The Wolf of Walmart

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