1. business and industrial

Oregon Dealer News
March 2011
www.oiada.com - 1-800-447-0302
January 2013
www.oiada.com 800-447-0302
Oregon Independent Automobile Dealers Association
Representing all Auto, Truck, Trailer, RV, and Power Sport Dealers of Oregon
Unintended Express Warranties: What Sales Staff Says Matters [p8]
The Environmentally Conscious Dealer [p10]
What’s in Store [p12]
SIDE
EXPECT MORE WITH MANHEIM
Political Action Committee . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .1
THIS ISSUE
Shifting Gears. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 3
Staff Changes . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 5
OIADA Education Schedule . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .7
Unintended Express Warranties: What Sales Staff Says Matters . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .8
The Environmentally Conscious Dealer . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 10
What’s in Store . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . 12
Oregon Dealer News Corner. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . 14
Associate Member List. . .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . 15
Read and Respond. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .16
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Tuesdays starting at 8:30 am
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3000 N Hayden Island Drive
Portland, OR 97217
503.286.3000
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Sales every Tuesday starting at 8:30 a.m.
PolitiCal
TOYOTA & MAZDA
OF GLADSTONE
Action Committee
OIADA must be a constant presence in monitoring current legislation within our state. We need
to interpret legislative activity that may impact our industry. It is the association’s responsibility to
maintain an ongoing relationship with governmental officials and regulatory agencies. Your voluntary
PAC contribution helps our legislative representatives work for you, the independent auto dealer.
OIADA has worked on many issues affecting dealers such as stopping the 3 day right of rescission,
getting temporary motorcycle permits that actually fit on the rear plate area, extension of DEQ slips
from 90 days to 180 days, all new broker disclosure forms, new silver dealer plate that makes us really
look like a dealer, opposing no sales on Sunday, saying no to a big increase in DMV fees, as well
as ongoing dealings with regulatory agencies, just to mention a few. An added benefit to making a
political contribution is the Oregon Tax Credit. You can take this directly off your state tax liability.
The credit is $50 for an individual and $100 on a joint return.
We thank you for understanding the importance of a strong presence within our Legislature. Please
remember the next time you renew your membership to consider your PAC contribution.
2012 OIADA Executive Committee
OIADA Staff
Dan Nicholson, CMD,
President
Central Oregon Motors
1123 N 6th Street
Redmond, OR 97756
541-923-3961
Fax 541-923-3964
[email protected]
Diane Sparks
Executive Director
[email protected]
Bryan Steward,
Executive Vice President
AAA Oregon AutoSource
6 SW Centerpointe Dr. #100
Lake Oswego, OR 97035
503-973-6570 Cell 503-709-3835
[email protected]
Pauline Sill
Office Manager
[email protected]
Doug Blizzard
1st Vice President
Blizzard Motors, Inc.
1604 E. Burnside
Portland, OR 97214
503-238-5510
Fax 503-238-3838
[email protected]
First, let me introduce you’re your Executive Committee. These gentlemen are vital
to the association and each one of them brings a unique set of skills and talents to your
association.
Dan Nicholson (CMD)
Executive Vice President- Bryan Stewart, AAA Auto Source.
Central Oregon Motors
1St Vice President- Doug Blizzard, Blizzard Motors.
541-923-3961
2nd Vice President- Tommy Wilson, Tommy Wilson Motors.
Chairman of The Board- Your past President Gary Sargent, Sargents Motors Sports.
Bryan Stewart is overseeing the Salem and Klamath Falls Regions. Doug Blizzard is
overseeing the Portland and the Medford Regions. I will be overseeing the Eugene and the
Central Regions. Our goals for the Regions this year is to bring events once a quarter to
your local areas. These events will be up to you, we want to hear your ideas so we can tailor
them to meet your needs.
Tommy Wilson is overseeing the Legislation and Membership Committees. Our
goals for Legislation are always to be a watch dog for up coming bills that may affect our
industry. We would also like to sponsor 2 bills that would improve or protect some aspect
of our industry. Your membership committee would like to develop a welcome program
for new members. Also a mentor program, this would assign new members or dealers to a
veteran dealer to seek advice or help when needed.
Eric Freeman, CMD
Secretary
7524 SW Macadam Ave
Portland, OR 97219
Office 503-310-5555
Cell 503-320-1596
[email protected]
2 | OIADA January 2013
Hello everyone and happy New Year. As we are entering into this New Year, I hope all
of you are sitting down writing your goals for 2013. Last month the Executive Committee
also sat down and outlined OIADA’s goals for 2013. I would like to share those goals with
you, along with the responsibilities of each Executive Committee member.
Secretary – Eric Freeman, Freeman Motor Company.
Tommy Wilson
2nd Vice President
Tommy Wilson Motor Company, LLC/
9215 SW Canyon Rd.
Portland, OR 97225
503-629-6000
[email protected]
Gary Sargent,
Chairman of the Boardt
Sargent’s Motorsports
10207 SE Foster Road
Portland, OR 97266
503-775-9445 Fax 503-777-9886
Cell 503-969-5228
[email protected]
GEARS”
“Shifting
With Dan Nicholson
Eric Freeman will be overseeing the Education and Image Committee. The Education
Committee is looking for new education classes and new ways to present these classes such
as webinars. Currently Eric has 8 education classes planned. We are currently looking at an
online course for your continuing education that will provide more solid material for your
business. Our Image committee is looking to put together a Certified Dealer program and
revamping your Quality Dealer program.
Oregon Dealer News is a publication of the Oregon Independent
Auto Dealers Association, 1475 Capitol St. NE, Salem, OR 97301
and is published every month. The association was established
in 1948, chartered as a non-profit organization in Oregon
and is affiliated with the National Independent Auto Dealers
Association. Advertising rates may be furnished upon request.
~
The statements and opinions expressed herein are those of
the authors and do not necessarily represent the views of the
Oregon Independent Auto Dealers Association. Likewise, the
appearance of advertisements or the identification as members
of OIADA does not constitute endorsement of the products or
services featured.
*For advertising information please contact OIADA at
800.447.0302
Your Executive Committee is committed to these goals to bring your Association to
the next level, but of course they can not do it alone. We need your to help coordinate
the regional events and work on these committees. This is your Association and if we are
to stay strong we need your help. I am again going to challenge you to find an area that
interest you and get involved. Make it part of your New Year goals and take ownership in
this great association.
Dan Nicholson
President
Oregon Independent Auto Dealers Association
OIADA January 2013 | 3
Staff Changes
Wendy Riggi
It is with great appreciation of everything that
Wendy Riggi has done for OIADA over the last 3
years that we bid her well wishes as she ventures
into her next challenge in life. Wendy has been
going to school full time while working for the
OIADA. Her new career choice is to be a Dental
Hygienist and is near completing her general
studies at the end of this school year. From there
she will be applying to 3 schools that accept a
limited number of students and could mean a
great deal of travel and dedication to attend the school of choice.
Over the last 3 years Wendy has been our go to staff member, she
has answered your calls, helped you with your education needs and
reviewing your credits to keep your business on track. She has taken
great care in answering all your questions, tracking down answers
that may have been unique and following up to keep you informed.
She has been prompt in getting you the business forms that
everyone needs in our industry, we thank Wendy for keeping our
OIADA running smoothly and for all her dedication to our industry.
Again Thank You for your Dedication to the Membership,
Executive Committee and Board of Directors.
Pauline Sill
We are pleased to introduce our newest staff
member Pauline Sill. Pauline comes to us with
past experience in the cycle industry as operations
manager. We are delighted with her knowledge
from precious positions that will help with
sliding into the role of Office Manager here at
OIADA. Pauline brings to us her knowledge in
accounting/bookkeeping, customer service and
HR experience.
Pauline although not a native Oregonian she
has lived in the Salem area for over 12 years, has 2 grown children
and 4 grandchildren. She has served on the Arizona Dept. of
Environmental Quality, named Arizona Small Business Association’s
“Small Business Entrepreneur in 1999”
Pauline in the short time she has been with OIADA she has
proven to be dedicated, experienced a team player and above all
committed to putting the membership first. We are delighted that
we will be able to make the transition easy, so help us out and next
time you call the office, introduce yourself and welcome our newest
member of the team, Pauline Sill
4 | OIADA January 2013
OIADA January 2013 | 5
OIADA EDUCATION CLASS SCHEDULE
Pre-License - Continuing Education – Title & Registration
January 2013
Is Proud To Be In Oregon!
TO REGISTER FOR A CLASS
4 – Brasher’s Portland AA Office – Pre-licensing
18 –Manheim Portland – Title & Registration/
Compliance Class
February 2013
8 – OIADA Salem Office – Pre-licensing
15 –Brasher’s NW Eugene – Title & Registration/
Compliance Class
March 2013
8 – Brasher’s NW Eugene – Pre-licensing
15 –Brasher’s Portland AA – Title & Registration/
Compliance Class
22 – OIADA Salem Office – Pre-licensing
29 –BManheim Portland – Title & Registration/
Compliance Class
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Manheim Portland Auto Auction:
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Brasher’s Portland Auto Auction:
23585 NE Sandy Blvd, Portland, OR 97238
OIADA: 1475 Capitol St NE, Salem, OR 97301
Call 503-362-6839 or 1-800-447-0302
(All times, dates, locations subject to change)
Driver’s license or other positive ID required
BEFORE class begins
PRE-LICENSING IS AVAILABLE IN A “LIVE CLASSROOM FORMAT” OR
“HOME STUDY” COURSE
• Pre-licensing classes begin at 8:30 a.m. unless otherwise
noted
• Title & Registration classes begin at 9:00 a.m. unless
otherwise noted
• All dealers must complete 5-hours of Continuing
Education per year
• All persons who desire to be licensed as a motor vehicle
dealer must complete an
• 8-hour pre-licensing seminar before DMV will issue a
dealer’s license.
WWW.OIADA.COM
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2. ComScore MediaMetrix, September 2011.
we will, replace it with a new lead.
Dealix®
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Educational Instructor
Bobbi Cockeram
Born and raised in Eastern Oregon in the little town of Vale,
Bobbi worked for the local GMC dealership in Ontario, Oregon
at the age of 18 selling to the local “Good ol’ boys” farmers and
ranchers. This is where her love for the Auto Industry started.
She relocated to the Portland area in 1996 where she entered
her career as a “Title and Registration Specialist.” It was a very
challenging time back then as there were no classes or training
of any sort, so after years of hard work, dedication, and making
it her business to become as knowledgeable as she could from
whatever resources she could find, she successfully graduated
from the school of “Hard Knocks,” and took off in the world as
an independent Auto Dealer Consultant/Title and Registration
Specialist for Oregon auto dealers. Bobbi has not only had the
opportunity to work with Oregon auto dealers, but with Dealer
Auctions, and several other states dealers as well. Additionally,
she is well versed in other state laws and DMV statues. Bobbi
started instructing Title and Registration classes as well as Prelicensing Courses and other forms of Continuing Education for us
at the OIADA 3 years ago and the classes just keeping better and
bigger. She brings to us a great deal of knowledge and experience
to our members and staff. We are very excited about partnering
with Bobbi. Her addition to the team has taken our educational
and consulting programs for our members to the next level.
Services Provided
by Bobbi:
Dealer-to-Dealer and Dealer-toConsumer Mediation
Title Training
CarFax and Auto Check Cleaning
Lost Duplicate Titles (in all states)
Title clerk fill-in
Dealer Setups
Title Preparation/Processing
Notary Services
Book Keeping Services
Title Corrections/Problem Titles
V-3 Training/ Setup
Deal Jacket Compliance Audits
Bobbi L Cockeram
Po Box 727
Gladstone, Or 97027
503-810-5535
[email protected]
OIADA January 2013 | 7
Unintended Express
Warranties: What Sales
Staff Says Matters
Compliance Overdrive
By Chip Zyvoloski
There’s no question that what a
dealer says to a customer as part of
the sales process matters.
But it’s not just about what is said
by the F&I department and what’s
documented on a sales contract to
finalize a deal. It’s also about what is
being communicated outside, on the
car lot.
No matter how accurate and
compliant your finance documentation
is, if it disconnects from promises
made during the sales process, you
could be facing a problem.
Though the law is different in
every state, most have passed some
version of the model Uniform
Commercial Code (UCC) § 2-313. It
provides that an express warranty is
created by the seller when it makes a
statement of fact or promise to the
buyer relating to the goods, which
becomes part of the basis of the
bargain.
The elements are pretty broad
and cover a wide range of common
statements a salesperson might make
when discussing a vehicle with a
potential buyer. For example, if a
salesperson says to a potential buyer,
“This car comes with a new spare
tire,” as part of the sales discussion,
the promise is probably an express
warranty.
8 | OIADA January 2013
What happens if the customer
picks up his or her car after the sales
contract is signed and a used spare tire
is in the trunk?
Contrary to what some might
think, express warranties generally
can’t be waived or disclaimed. UCC
§ 2-316 provides that words or
conduct creating an express warranty
and words or conduct disclaiming
or limiting the warranty must be
interpreted in a way that makes them
consistent with each other. If that’s
not possible, then the disclaimers or
limitations will not be enforced.
In short, you can’t give with one
hand and take away with the other. If
a salesperson promises the car comes
with a new spare tire and a used
one is delivered, a written warranty
disclaimer will not help.
Note that the express warranty
doesn’t have to be in writing and
it doesn’t require using the word
“warranty.” As a result, what
the salesperson says can affect a
transaction just as much as the
documents produced by the F&I
department.
That’s why it’s important to
know what your sales team is
communicating and, more important,
promising to customers.
Sometimes the situation involves a
simple mistake on the sales lot. A car
could be presented as a six-cylinder
when it’s actually an eight-cylinder. Or
maybe the customer is told the car had
two prior owners but there were really
three. An uninformed or mistaken
salesperson might also tell a customer
the car has never been in an accident
when in fact he or she doesn’t really
know if it has or not.
or at least bring them to light before
an agreement is finalized, dealers
are still facing situations in which
customers are unhappy because an
expectation that played a key factor
in their decision to buy has not been
met.
have the best opportunity to know the
features, functionality and condition
of the vehicle without relying
on information from you. Some
dealerships have installed Internet
kiosks for customers to conduct onthe-spot research.
So what can you do to help prevent
this from happening?
This is a complex area of law,
littered with exceptions and replete
with court decisions that are very
fact-specific and findings that are not
always consistent. For example, in
some situations, disclaimers or waivers
can be enforced if the sales contract
includes a provision saying it is the
all-inclusive and exclusive agreement
covering the sale.
Tell your sales staff that what they
say matters and why: A salesperson
is a liability risk if he or she thinks all
promises are wiped out by a disclaimer
in the sales contract.
Train your staff on proper sales
techniques: That includes arming
them with facts about the inventory
available for sale.
Encourage potential buyers to take
a test drive: Also encourage them to
take the vehicle to a mechanic or get
a vehicle history report and other
information about the car so they
Whether a given statement is a
statement of fact or promise (creating
an express warranty) or merely sales
puffery (not an express warranty) is
regularly litigated. Many case decisions
exist and entire books have been
written on the subject.
The key point is that what your
sales team says on the lot is important.
If there is conflict between what was
promised during the sale and what was
delivered, the dealer has a problem.
The problem could be characterized
as the breach of an express warranty,
but it could also be a fraudulent
misrepresentation, unfair or deceptive
act, etc. – keep in mind that 15 causes
of action were alleged in the Sanchez
case based on the tires and other
inconsistencies.
Creating consistency throughout
the entire sales process and making
sure the lines of communication
between the sales staff and F&I team
are open can help mitigate risk for
your dealership, ultimately saving time
and money.
Chip Zyvoloski is a senior attorney for
indirect lending at Wolters Kluwer Financial
Services. For more information, visit www.
wolterskluwerfs.com/indirect.
The new spare tire example may
sound farfetched, but a dispute about
whether new or used tires were
delivered was just one of numerous
inconsistencies between promises
and documentation by the seller and
what was delivered to the buyer in the
California case of Sanchez v. Valencia
( 201 Cal. App. 4th 74 (2011)). The
case is known for its decision on
arbitration clauses and wasn’t about
warranties. Still, it is a good example
of how discussions on the lot can
have a big effect on the dealer’s
liability.
Those kinds of express warrantycreating mistakes can be avoided
by simply being careful about
representations about vehicle features
and facts.
While services like CARFAX and
certain branding of vehicle titles can
help prevent some of those mistakes,
hecht_autoins_ad_final_out.indd 1
2/3/11 2013
10:23:10|AM9
OIADA January
The Environmentally Conscious Dealer
Not only is it cost effective, it can be financially rewarding to embrace the green revolution.
By Garrett Jorewicz
Each day, consumers and
businesses grow more environmentally
conscious. Yet we are a long way from
where we need to be.
Make no mistake. This is a call for
action.
For all of us in the auto industry,
each car deal is part of a gigantic
revenue machine. Our focus is on
retail market value vs. wholesale cost.
Subtract recon expenses, advertising
expenses, commissions, etc., and we’re
left with net profit.
The question many of us fail
to ask: What is the impact on the
environment?
Fact: The second-leading cause
of global warming is carbon dioxide
emissions from burning gasoline.
Our industry is married to the
internal combustion engine. Our
success is predicated on profits from
selling large volumes of gas-guzzling,
oil-burning hunks of metal to
consumers.
Often we gauge our performance
on volume. The more, the better.
Given the nature of our industry,
it’s vital that we all embrace, with open
arms, the need for a heightened level
of environmental responsibility.
There are countless ideas each of
us can implement today that will make
a difference to the environment while
feeding our bottom lines.
Green Solutions
Recycle: In my travels and visits to
dealerships, I’m constantly surprised
– and disappointed – by the lack of
recycling bins at dealerships. That is
the easiest way imaginable to have a
positive impact on the environment.
10 | OIADA January 2013
Simply put, we can no longer
ignore the fact we are depleting the
world’s natural resources. We are
driving at a very fast pace toward a
hotter and hotter future. Why ignore
the facts when you can benefit in
numerous ways by making some
positive changes?
with extended range. It can go up
to 50 miles on 100 percent electric
power, then the internal combustion
engine engages for another 250 miles.
It averages about 58 mpg.
In addition, the consumer climate
has changed to the point that it is
not only cost effective, but it can
be financially rewarding to embrace
the green revolution. Be green and
make sure the world knows! You will
attract better talent along with more
customers as a result.
Toyota Prius: Arguably the most
cost-effective solution on the market.
Though not a full electric vehicle, it
deserves a spot in the lineup based on
its massive success in the U.S., coupled
with its extreme efficiency at 50 mpg.
Electric Vehicles and Hybrids
Electronic fax: There are several
companies that provide the service.
Using an e-fax service drastically cuts
down on paper and ink, and is super
easy to implement.
customers’ information is being retained in
accordance with the dealer’s privacy policy.
So, the dealer may either need to look for a
different app/vendor or amend its privacy
policy.)
Forget traditional mailers:
Typical response rate on mail
advertising is a mere 2 percent.
Save the paper, ink, fuel and money.
Allocate those resources elsewhere.
Do business with green
businesses: Ask your body shop
how it disposes of waste. Choose
companies and vendors that act in an
environmentally responsible manner.
Turn off excess lighting.
Use a green demo: Take the
Prius for a spin instead of the Yukon.
Most of us drive without passengers
a large majority of the time. Driving a
smaller, more efficient vehicle will save
you gas money while reducing toxic
greenhouse emissions.
Walk or cycle: Go by foot or bike
to work or to your favorite lunch or
coffee spot.
Smartphone apps: Use the
extremely broad selection of apps
to replace paper whenever possible.
(NOTE:when using smartphone apps,
dealers need to be aware of what information
the apps ask for and make sure that their
Eliminate bottled water: Bottled
water is extremely inefficient. Instead,
install and use a water filtration
system.
Hit the switch: Turn off and/
or unplug unused appliances and
computers when they’re not in use.
Lot lights: Be diligent about
adjusting the timer that controls your
lot lights.
Every one of those items can be
easily implemented today with little or
no negative impact on your business.
In most cases, you will experience
a significant cost savings, especially
when that savings accumulates over
the course of one or more years.
A major industry shift is staring
all of us in the face like a hungry
bear fresh out of hibernation, and
the electric/hybrid market segment is
growing rapidly. Nearly every major
manufacturer is getting into the space,
and new competitors are emerging
with cutting-edge products that use
state-of-the-art technology to meet
consumer demand.
The products currently on the
market are extremely compelling, and
the future of the segment is exciting.
Here’s a lineup with some
information about several of the
products available now:
Tesla Model S: The first full
electric vehicle to (mostly) overcome
consumers’ No. 1 concern – range
anxiety. There are different battery
options designed to go up to 160, 230
or even 300 miles per charge at 55
mph.
Consumer interest in the product
is phenomenal. The fast, sporty
and beautiful sedan is expensive
for the average consumer, but will
be attractive to the masses on the
remarketing side.
Tesla Roadster: Similar to the
Model S, but not as practical. This is a
pure sports car.
Fisker Karma: Electric/hybrid
BMW ActiveE: BMW’s first full
electric vehicle is only available in
select markets on a two-year lease.
Chevrolet Volt: The Volt can go
up to 50 miles on full electric power
before engaging the gasoline engine
for up to another 350 miles. Range
anxiety is a thing of the past with this
electric/hybrid vehicle.
Ford Focus Electric: The Focus
can go up to 100 miles on a charge
and is more affordable than any of
its luxury counterparts. Super-fast
charging, and 100 percent electric.
Nissan Leaf: The Leaf was the
first mainstream pure electric car
offered for sale in the U.S. It is an
excellent urban commuter vehicle
but falls short when it comes to the 1
range anxiety concern.
Consumers are more informed and
environmentally conscious today than
ever. They are actively seeking out and
going out of their way to find green
solutions that meet their needs.
Additionally, gasoline prices are still
historically high, so the financial and
environmental need for alternative
fuel solutions is growing by the
minute. As more products emerge
that meet the demands of the modern
“eco-sumer,” those products will
inevitably gain more traction.
When it comes to pricing, most of
those vehicles are at the top end or
just outside the reach of the average
consumer. But as they flow into the
remarketing space, a majority of them
will fall right into the sweet spot.
Unfortunately, a large portion of
our electric power comes from coalburning sources. According to the
Energy Information Administration,
the most predominant sources of
electricity in the U.S. come from
coal (48.7 percent), natural gas (21.5
percent) and nuclear power (19.4
percent).
Because so much of our energy is
created by coal-burning power plants,
it is arguable that electric vehicles
consume similar amounts of energy
and as a result produce nearly as much
greenhouse emissions as gas-powered
vehicles. Until we create more clean
and renewable energy sources, electric
vehicles will remain an imperfect
solution, But they represent a big step
in the right direction.
In the end, innovation without
capitalization will die. But if enough
of us buy in and support the
movement, the sky is the limit.
The question remains: Where do
you stand on the matter? Are you
going to be one of the dealers with
your hand raised when an electric
vehicle crosses the block? Or are
you going to stand on the sidelines
and watch your competitors lead the
charge?
Technology and the environment
are two major items that influence
and change how our industry looks
and feels. DSC remains committed to
providing you not only with the best
financing options, but also cutting
edge technological solutions to
enhance and take your business to the
next level.
We are also committed to shifting
with your business as environmental
needs and consumer demand dictates.
We are confident we have the most
flexible floorplan finance solutions in
the industry, designed to empower you
and your business to embrace change
and grow green.
Garrett Jorewicz is Northwest regional
director of Dealer Services Corporation.
OIADA January 2013 | 11
What’s In Store
Now, I’m normally a glass-half-full kind of guy, but when
it comes to this, I think the glass might still be half empty.
Even though the prices somewhat leveled off during the last
half of last year, the numbers still seem to be dwindling for
that sub-$5,000 vehicle.
By Brent Carmichael
The 2012 portfolio performance included some
stabilization from a dollar loss standpoint, but from a
number loss standpoint, there was a slight increase or
worsening from 2011.
What’s in store for your
store in 2013?
That was driven by a couple of factors, the first being the
need for inventory. Some dealers accelerated their repo times
when a desirable unit was involved. That also helped stabilize
the dollar losses, as the vehicles were repossessed earlier and
in better condition and thus earned larger recovery amounts.
Dealers have seen the error of their past ways and are enjoying the spoils of their more disciplined labor
If it’s anything like
2012, it should be another
good year to be in the Buy
Here-Pay Here industry.
The new year will not be
without its challenges,
though. In fact, there
are certain areas of the
industry that could be
more challenging than
ever.
To get an idea of what
to look forward to in 2013,
we first need to review
how 2012 treated the
BHPH world. Tax season
was again sporadic at best,
which pretty much set the
tone for all facets of the business for the rest of the year.
From a profitability standpoint, the dealers I have the
distinct privilege of working with enjoyed another modest
3 percent increase in profitability in 2012 versus 2011. That
increase was smaller than the previous year-over-year, and
was due mostly to the continued focus on the “rightsizing”
of overall operations.
Dealers focused on their entire operations, from top
to bottom, on continuing not only to “cut the fat” but to
keep it off and run their operations based on the cash being
generated instead of relying on lines of credit.
I expect that focus to continue in 2013. Though funding
sources have become more readily available, overall most
dealers will be focusing again on generating the capital
necessary to run their businesses from their businesses.
As always, there will be dealers looking to grow
aggressively through borrowing, and rates will continue
to make that a very viable option. I don’t see rates rising
drastically in the coming year, so it will still be a good time to
borrow.
12 | OIADA January 2013
Having said that, I
still see it being difficult
to secure new lines of
credit in 2013. It’s going
to take some patience and
the willingness to educate
some institutions on our
industry.
Another financing
option that has received
quite a bit of interest
recently is selling blocks
of portfolios or payment
streams to generate capital
to operate with. The
available resources for
that are at an all-time high
and rates seem attractive
as well. Depending on the
resource, it can be done
either at point of sale or on seasoned receivables.
The other factor was renewed focus on underwriting
and the overall collection process. Dealers remained more
disciplined in both areas, seeking quality over quantity.
For 2013, I see more of the same. Dealers have seen the
error of their past ways and are enjoying the spoils of their
more disciplined labor. Expect the average charge-off to
remain essentially the same and the number as a percentage
of sold to remain higher than in past years, but expect
collections dollars to improve as well as overall collection
effectiveness.
The biggest thing to affect our industry again in 2013
will no doubt come in compliance. The Consumer Financial
Protection Bureau was very active in 2012. It has reached out
to a few dealers on a number of auditing fronts. Although
no new formal regulations have been drafted, it is truly only
a matter of time.
We did dodge a fairly substantial bullet with the legislation
that was passed – and more important, the bill that was
vetoed – in California. While it would only have affected
California, passing tight new regulations easily could have
influenced other state’s legislators.
Here is the best advice I can give to existing dealers as
well as those wanting to get into the business in the coming
year: don’t wait. Don’t wait to get compliant. Don’t wait
to spend a little money to do so. Don’t wait to review all
processes and procedures. Don’t wait to review all expenses.
Don’t wait to review all of your employees. Don’t wait to
train.
And definitely don’t wait to sell cars, collect money and
make money.
Brent Carmichael serves as the Executive Conference Moderator for
NCM Associates Inc.. He can be contacted at bcarmichael@ncm20.
com.
Rates will depend on the resource, aging, recourse
aspects, performance and securitization. The key to this
option is reinvesting the capital received back into receivables
in a timely fashion so as not to affect future cash flow levels.
Sales volume for our dealer clients increased by a modest
3 percent in 2012 over 2011. Not a record-setting year by
any means, but a sporadic tax season and the resurgence of
subprime and special finance are the two dominant factors
leading to it. Dealers seemed to want to sell what their cash
flow and underwriting standards dictated rather than sell as
much as possible.
We all know we can sell as many as we want or have the
financial resources to in this industry. There doesn’t seem to
be a lack of customers needing or wanting what we have to
offer.
We will see those factors continue to hold for 2013. We
should have the customers in the market to sell the vehicles
we want or need. The biggest question will be the quality of
those customers and the availability of inventory.
OIADA January 2013 | 13
ASSOCIATE MEMBER LIST: Your Dealer Products and Service
Oregon Dealers News Corner
Welcome New Members - OIADA Thanks You!
Affordable Auto Sales & Broker
Auto Trans NW
3/13 Motors
Rent 2 Own Auto
KC Auto Sales, LLC
Redmond Motors, LLC
Ron’s Auto Sales
Urymann Auto Group, LLC
Shepard & Shepard
Scott Ski Motor Co. LLC
Mickey (Michael) Pattingale
Shawna Saxton
Joel Krebs
Alan Hart
Kevin Chappelle
Jerry Hagberg
Ron Vaday
Dave Ury
Todd Shepard
Scott Stanislowski
Cottage Grove
Tualatin
Portland
Salem
Salem
Redmond
Beaverton
Turner
Kennewick, WA
Tualatin
541-942-4988
503-691-2506
971-235-3208
503-362-5572
503-585-0463
541-548-5116
503-913-8101
503-302-6292
509-948-0040
503-305-8518
What’s Happening Nationally with NIADA
The CERTIFIED MASTER DEALER®
The CERTIFIED MASTER DEALER® program
was developed in 2001, in collaboration with Northwood
University, to help dealers manage and grow their businesses.
Since then, it has grown into one of the industry’s most
respected training programs. Dealers who attend this
training are committed to the industry, support ethical
business standards and practices, and are leaders in their
communities. They bring a wide range of experience to
each class, and leave with new strategies for analyzing
their business practices and increasing their bottom line.
Instruction is provided by Joe Lescota, NIADA Director of
Dealer Development and former retail automotive executive
with more than 25 years of frontline dealership, selling
management and training experience.
I wasn’t sure what to expect from the class because after
being in this business for over 10 years,
I began to fool myself into thinking that as President and
CEO I already knew everything about the car business. Boy
was I wrong!
- Michelle Groover, Members Auto Choice (Lawrenceville, GA)
Dealer 20 Group
January: Atlanta, April: Dallas, August: Atlanta,
December: Dallas
2013 National Convention & Expo
The theme for the 2013 Convention & Expo is “New
Strategies for Tomorrow.”
Join thought leaders for the most sought after education
and best practice sharing in the used auto industry, in a
dynamic environment filled with prizes, hosted meals and
bars, and a WI-FI business lounge. Topics may include:
Affiliated Media LLC
Ronald Massey, 503-705-9497
Skywerks
Martyn Olliver, 425-738-0234
AutoTrader.com
Ed Merrick, 503-747-9162
[email protected]
Frazer Computing
Michael Frazer, 888-963-5369
Hecht & Hecht Insurance
Evelyn Hecht, 800-609-0979
[email protected]
FEE-BASED INCOME PRODUCTS
Kelly Martin Insurance Agency, Inc.
Kelly Martin, 503-625-2615
Mile High Consulting Inc.
Mike Cintron 720-838-7400 Cell
Shepard and Shepard Business Solutions
Todd Shepard, 509-396-2439
FINANCING
LEASING
Credit Acceptance
John Bragg, 253-279-3230
Oregon Roads, Inc.
New & Used Vehicle & Commercial Leasing
Joseph McKinney, 541-683-2277
Carsforsale.com
Aaron Oestretch, 605-306-3302
Cars.com
312-601-6134
The Oregonian
Rich Fryback, 503-221-8486
UCMLink www.ucmlink.com
Allison Pittman, 601-812-5876
UsedCars.com by Dealix
Tamara Garris, 704-243-6652
AUTO ACCESSORIES
Northwest Auto Accessories
Craig Lessard, 503-288-5700
PRIVATE AUCTIONS
Brasher’s Portland Auto Auction
Jerry Hinton, 800-300-3200
Credit Concepts
Jason Moon, 541-342-8545
JP Morgan–Chase Auto Finance
Jeff DeGarmo, 503-201-4370
Nationwide Northwest, LLC
Mark Tischer, 503-339-4165
Reliable Credit Association
David Marx, 503-462-3022
Gold Acceptance/ Oregon Auto Finance
1700 Valley River Dr. #300
Eugene, OR 97401
Gary Veum, 541-868-0472
CrosspointNW Dealer Auction
Brian Hardy, 503-457-4000
United Finance:
Burnside, 503-232-5153
Eugene, 503-342-7671
Salem, 503-585-6411
Medford, 541-779-7391
Manheim Portland Auto Auction
503-286-3000
SmartwayAdvisors
Sheldon Harris, 503-795-7700
OUT-OF-STATE AUCTIONS
FLOORPLAN FINANCING
Adesa Seattle Auto Auction
Jason Arcaro, 253-735-1600 x 213
Floorplan Xpress
Sean Fodrea, 503-621-9260
[email protected]
Brasher’s Northwest Auto Auction
Lisa Larkin, 800-905-3901
• Compliance trends and changes for 2013 and beyond
• Managing your social brand and leveraging partners’
Internet presence
• F&I and operational improvements as business enablers
• Strategic and proactive sales tactics
Exhibitors and sponsors will also set aside dedicated time
to explore product solutions to dealer challenges.
Dealer’s Auto Auction Northwest
Steve Doyle, 509-244-4500
For information on these programs and much more go to
www.niada.com
Petersen Auction Group of Oregon
Curt & Susan Davis, 541-689-6824
Moderated by Joe Lescota, NIADA Director of Dealer
Development, this unique and cost-effective 20 Group
14 | OIADA January 2013
DEALER SOFTWARE
Auto Marketing Associates Northwest
Gary Palaniuk, 503-519-7725
provides a rare opportunity for retail and BHPH dealers to
share successful ideas and best business practices. Join us for
one of four sessions in 2013:
INSURANCE & BONDING
ADVERTISING
Manheim Seattle Auto Auction
Julie Picard, 206-762-1600
PUBLIC AUCTIONS
Insurance Auto Auctions, Inc.
Ryan Hall, 503-253-1500
Dealer Services Corporation
Garrett Jorewicz, 866-230-0820
Consumer Insurance USA
Robert Wells, 877-431-0970
SERVICE CONTRACTS
A.U.L. Corporation
Gina Eagerton, 800-826-3207
Automotive Business Developers
Shannon Meany, 541-944-9186
Auto Marketing Associates Northwest
Gary Palaniuk, 503-519-7725
Auto Services Company
Dick Proudfoot, 503-705-7597
A.U.L. Corp/ D.P.C. Inc.
Jim Bangert, 360-834-3333
Protective - Asset Protection Division
Dylan Doran, 818-836-1455
GWC Warranty
800-482-7357 ext. 767
TRAINING
OIADA: Continuing Education, Title &
Registration, & Pre-licensing
Wendy Riggi, 800-447-0302
Automotive Business Developers
Shannon Meany, 541-944-9186
HEALTH CARE & BENEFITS
The Summit Group of Oregon, LLC
John Petrie, 503-581-2825
Woodburn Auction
Steve Morin, 503-981-8185
OIADA December 2012 | 14
OIADA January 2013 | 15
Read & Respond
and
Certify Below
OIADA CONTINUING EDUCATION PROGRAM
Complete this test and Certify below that you have read the articles for January 2013
Compliance Over
Drive
Though the law is different in every state, most have passed some version
of the model Uniform Commercial Code (UCC) § 2-313. It provides that
an express warranty is created by the seller when it makes a statement of
fact or promise to the buyer relating to the goods, which becomes part of
the basis of the bargain.
True _____ False _____
A disclaimer will wipe out all promises made by a sales person
True _____ False _____
By creating consistency throughout the sales process and making sure that
the lines of communication between the sales staff and F&I are open, this
can help mitigate a risk for your dealership.
True _____ False _____
The Environmentally
Conscious Dealer
Name 2 vehicles list that are 100% electric
1)_____________________ 2) _____________________
Name 2 ways your dealership can become more environmentally conscious
1)_____________________ 2)______________________
ANNIVERSARY SALE
Celebrating 22 Years
23
Nine O’Clock
WEDNESDAY
January
®
When using a smart phone app it is not important to make sure the
customers’ information is being retained in accordance with the dealer’s
privacy policy.
True _____ False _____
I certify to OIADA that I have personally read these articles in The Oregon Dealer News Magazine for #01-2013
My Name __________________________________________________________________________(printed)
Dealership Name ___________________________________________________________________________
Dealer License Expiration Date:_______________________________ Dealership #_____________________
Signed: __________________________________________________________Date _____________________
FAX TO: 503-364-7331 or mail to OIADA, 1475 Capitol St. NE, Salem, Oregon 97301
16 | OIADA January 2013
700+ Units | 7 Lanes
90485 Auction Way
EUGENE, OR
www.brashersnw.com
800.905.3901
PRSRT STD
U.S. POSTAGE
PAID
Albany, OR
PERMIT NO. 188
1475 Capitol St. NE
Salem, OR 97301
503.362.6839 ●800.447.0302
Fax: 503.364.7331