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MARCH/APRIL 2012

inside• EDUCATION: LUXURY OR NECESSITY? • GOING GREEN: AUTO RECYCLING IS BOOMING• COMPLIANCE OVERDRIVE

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PRSRT StandardU.S. Postage

PAIDDALLAS, TEXASPermit No. 2079

V i s i t u s a t w w w . o h i a d a . o r g

INDEPENDENT DEALERO F F I C I A L P U B L I C A T I O N O F T H E O H I O INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION

Now is your opportunity to aid two wonderful organizations, support military families and have a chance to win one or all three collector guitars, worth thousands of dollars each. Tickets are on sale for $5 each or five for $20. The winner will be announced on Aug. 10 at the OIADA Golf Tournament. Entrants need not be present to win.

GUITAR RAFFLE

OUR SACRIFICECHARITYFUNDRAISER

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MARCH/APRIL 2012 I N D E P E N D E N T D E A L E R

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w w w . o h i a d a . o r g

As U.S. troops return from Iraq, no welcome-home parade is planned. More than 6,000 families have lost a

father, mother, son, daughter, brother, sister, aunt, uncle, niece or nephew, and once again many of those families who are left to financially fend for themselves suffer daily because someone they loved died defending our great country and our freedom.

I have heard it said, “But they volunteered and knew what they were getting into.” The fact is that’s true. But the families of these brave American soldiers who died for their love of our country, in a land thousands of miles away, didn’t volunteer to have their loved ones suffer the “ultimate sacrifice.” The sad truth is that most of these families will suffer financial setbacks as a result of their sacrifice.

The OIADA has been blessed over the years to have many members join our

organization, and in recognizing a great need across our country we would like to do our patriotic duty to help these brave families. In October, I received a call from Mark Reis, a music industry professional, and a plan was born.

We at the OIADA are proudly inviting everyone to celebrate your American spirit, to honor those who serve and remember all who have fallen.

Mark has donated three guitars to the OIADA.

One was autographed by legendary guitarist and Rock and Roll Hall of Famer Joe Walsh of the Eagles.

One was autographed by the Red Rocker guitarist and lead vocalist Sammy Hagar and his group, the Wabos.

One was autographed by four-time Entertainer of the Year and Grammy winner

Kenny Chesney.All three of these collector guitars, complete

with letters of authenticity, will be raffled off in an effort to raise money for the OIADA PAC Fund and the Our Sacrifice Foundation, which was formed to provide support to those families who have suffered as a result of the ultimate sacrifice.

Now is your opportunity to aid two wonderful organizations, support military families and have a chance to win one or all three collector guitars, worth thousands of dollars each. Tickets are on sale for $5 each or five for $20. The winner will be announced Aug.10 at the OIADA Golf Tournament. Entrants need not be present to win.

To purchase tickets with any major credit card call the OIADA offices at 614-863-5800, return the order form on page 20 or visit our website at www.ohiada.org

GUITAR RAFFLE

OUR SACRIFICECHARITYFUNDRAISER

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I N D E P E N D E N T D E A L E R MARCH/APRIL 2012

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MAGAZINECONTENTS

ADVERTISERSINDEX

INSIDEMAGAZINECONTENTS

ADVERTISERSINDEX

06 Is Technology Costing You?12 Going Green: Auto Recycling22 Compliance Overdrive

ADESA .......................................... Inside Back CoverAutoTrader.com ...................................... Back CoverAuto Use ..................................... Inside Front CoverBerkshire Risk .......................................................3Columbus Fair Auto Auction ....................................7Corry Auto Dealers Exchange ..............................11Indiana Auto Auction.............................................10Insurance Auto Auctions ......................................17Manheim.com .....................................................15Protective ............................................................13ShipCarsNow .......................................................19SmartAuction .........................................................9United Acceptance ..............................................16UsedCars.com by Dealix .........................................5Westlake Financial ...............................................21

WHAT’SNEW

DON’T FORGET TO VISIT OUR WEBSITE FORIMPORTANT INFO: WWW.OHIADA.ORG

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATIONWWW.NIADA.COM • WWW.NIADA.TVNIADA HEADQUARTERS: 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838FOR ADVERTISING INFORMATION CONTACT: TROY GRAFF (800) 682-3837 OR [email protected] OHIO INDEPENDENT DEALER NEWS IS PUBLISHED BI-MONTHLY BY THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION SERVICES CORPORATION, 2521 BROWN BLVD., ARLINGTON, TX 76006-5203; PHONE (817) 640-3838. PERIODICALS POSTAGE PAID AT DALLAS, TX AND AT ADDITIONAL OFFICES. POSTMASTER: SEND ADDRESS CHANG-ES TO NIADA STATE PUBLICATIONS, 2521 BROWN BLVD., ARLINGTON, TX 76006-5203. THE STATEMENTS AND OPINIONS EXPRESSED HEREIN ARE THOSE OF THE INDIVIDUAL AUTHORS AND DO NOT NECESSARILY REPRESENT THE VIEWS OF OHIO INDEPENDENT DEALER NEWS, THE OHIO INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION, OR THE NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION. LIKEWISE, THE AP-PEARANCE OF ADVERTISERS, OR THEIR IDENTIFICATION AS MEMBERS OF OIADA OR NIADA, DOES NOT CONSTITUTE AN ENDORSEMENT OF THE PRODUCTS OR SERVICES FEATURED. COPYRIGHT 2011 BY NIADA SER-VICES, INC. ALL RIGHTS RESERVED.

STATE MAGAZINE MGR./SALES Troy Graff • [email protected] Andy Friedlander • [email protected]/PRODUCTION MGR. Christy Haynes • [email protected] Nieman Printing

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R A2Z EDUCATION SERIES - AutoZoneEducating the independent dealer to deliver the highest quality service levels to your customers, manage your shop efficiently, train your technicians and maximize profits.niada.tv

R TURBO TIPS – Cars.comProvides Independent Dealers with practicable and actionable tips to help you sell more cars now! niada.tv

R World Automobile Auctioneers Championship Live online coverage of the event begins at 11 am ET on Friday, March 3O, 2012 and is free for all online viewers. visit www.niada.com and click on the “EVENTS” tab or call (303) 807-1108.

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Technology, or the lack thereof, could be costing you millions.

OK, millions might be a bit much, but thousands doesn’t sound much better. Either way, profit dollars could easily be leaving your pocket on a monthly basis at an alarming rate.

Technology, or the lack thereof, is costing dealers in every market and in every state in the country. The dealers in question are either technological junkies or technologically challenged. Neither scenario is conducive to success.

In the current economic climate, having and using what is necessary for the foreseeable future makes the best and only economic sense. Not too much, not too little.

Technology touches many facets of the Buy Here-Pay Here industry. Video surveillance, starter interrupt/GPS and software are the most popular areas for technological discussion in BHPH, and those areas seem to be the most under- and over-utilized as well.

Of the three, DMS software is the only one that is necessary for current and future success. The others? Well, that’s up to the dealer.

Video surveillance is probably more overused than the other two – too many dealers have thousands of dollars tied up in high-tech systems that are really not necessary. Those dealers have convinced themselves they are preventing not only outside theft, but internal theft as well. Surveillance systems have proven to aid in deterring both kinds of theft.

The decision whether to use video surveillance should be based on specific market conditions in regard to preventing

outside theft and providing additional security. A lot in a small rural market that displays 20 or so vehicles and employs a total of four people doesn’t necessarily need a 16 exterior color camera system with real-time web access. That example may seem extreme, but that dealer exists.

For preventing internal theft, the money might be better spent on developing the organization’s culture. Studies have shown office supplies are the most commonly pilfered items at a business, not money. This is a direct result of lack of pride and ownership in the business by the employee.

A background investigation and personality profile prior to hiring a new employee, and ongoing training and open lines of communication after hiring are ways to instill and improve an organization’s culture. There is a good possibility those steps will also reduce turnover and, in most cases, prevent if not halt employee theft – and will likely cost less than a surveillance system over time.

Payment devices – starter interrupt, GPS, and combo devices – are still a topic of great debate and ongoing discussion. This is an area that seems to be either black or white in most dealers’ eyes. Dealers seem to be 100 percent for them or 100 percent against them, with little in between.

Data shows such devices can increase collections dollars and, in some cases, reduce the amount of personnel needed to manage a portfolio. Data also shows they do not have a significant impact on loss rates. That data is what causes the “all-in” or “all-out” mentality. There are just as many highly successful dealers not using the devices as there are using them.

As with any technological advance, they are only effective if used as directed or intended. Too many dealers don’t. And by not doing so, they are wasting money.

The decision to use payment devices, and specifically which kind, is a significant one. It is a decision that should be based solely on the dealer’s personal business philosophy. As with any business decision, it shouldn’t be made until all the homework is done. Also not to be overlooked in the decision-making process is preparing internally. Policies and procedures will have to be created and implemented.

Last, but definitely not least, is DMS software. This is an area where dealers have a tendency to cut corners and cost themselves in the long run. Bigger is not necessarily better.

Software packages have undergone significant technological advances in recent years, and there are an increasing number of provider options. For better or worse, nowadays there seem to be more providers than actual dealers. That’s better in that more options provide a more diversified product offering and pricing structure. It’s worse in that when it comes time to choose a system, a dealer can be buried by information overload and the process can become overly time-consuming when he’s trying to comparison-shop.

Technology can take any business to the next level. Technology can also set any business back. The key lies somewhere between being a junkie and being challenged.

Which one are you?

BY BRENT CARMICHAELEXECUTIVE CONFERENCE MODERATORNCM ASSOCIATES [email protected]

IS TECHNOLOGY - OR THE LACK OF IT- COSTING YOU?

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It was recently suggested to me that dealers might be viewing the education of their employees as a “luxury.” We all understand

that when a company’s belt is tightened, advertising and education are among the first expenses to be cut.

But can education actually be viewed as a luxury item?

For years, most of us on every level have been doing more with less. How is that possible? The answer is we used the education and technology we have invested in. We have made some difficult choices regarding employees in addition to changing our processes.

Using technology for education has once more been brought into the spotlight. While e-learning has been around for many years, it has not been widely used. Many who sit on the sidelines continue to wonder why – after all, it saves on travel expenses.

Many dealers have expressed the opinion that e-learning should be free. All I can say to that is: Do you sell units and expect to earn zero gross profit? Of course, you go to work to gain a profit. We all do that. So why would you expect educators to give away what they know for free?

Of course, e-learning saves on travel. If you want to know how much, go to your favorite discount travel web site and check. With proper planning, you can secure a ticket to travel across the country for less than $500. Dealerships that use e-learning also save the expense of a room and meals.

But while they are saving on these expenses, what are they giving up?

Set the stage for success: When a participant is in a learning environment, whether in his office or away in a seminar setting, it is critical that the student have dedicated time to focus on the lessons.

When participants are expected to respond to text messages from senior management or answer cellphones, they are not focused on what is happening in their environment. And when they are listening to a web seminar and are interrupted by sales consultants, sales managers, service personnel or customers, they are not focused on the message being delivered. No focus equates to no learning and no value realized from the investment.

Do you save time using e-learning? As an educator, I can attest that it takes two weeks of two hours a day online to cover most of the topics I can cover in a three-day seminar. I can verify reception and understanding of concepts in a face-to-face environment more effectively than I can using the Internet. Most participants are very quiet during a web seminar, even when questions are being solicited from them.

Web seminars do have a great use in the learning circle. Web-based education is best used as a follow-up to a traditional seminar setting due to the limited amount of time and focus we have with online participants. After 25 minutes, we lose the attention of part of the audience. Fifteen to 25 minutes is more effective in a web seminar environment.

When a dealership chooses to use web seminars in lieu of traditional seminars, what do they sacrifice? They sacrifice time, and they lose the value of group studies after the session. In every group environment, everyone has selective hearing. We retain what is important to us. The value in a group setting is gaining as many perspectives as we can after the meeting is over. What was important to whom, and why?

Learning does not cease when the educator gives the evening assignments. It only takes on a different coat.

Some dealers do not want to expose their personnel to another dealership’s processes. They also fear that when a group gets together, they chat about pay plans and duties. Well, in all the years I have been teaching, I have yet to walk up on such a conversation.

How does a dealership get the most out of the limited dollars it has allocated to education? The answer lies in planning. Advance planning for air fare and for e-learning events, because all events have limited space available.

If you have multiple participants, or cannot send your personnel out of the dealership, an alternative is to bring the educator to your location, split the team and run double education shifts. Your team will have the opportunity to implement new ideas right away and provide an immediate report to the senior management.

When managing a sales team, it is essential that the entire team is using the same processes with customers. Consistency is

easy to manage. It is also easy to see when someone goes off track.

The most important thing a dealer can do is choose an education venue. Make the plans, implement the plans and make inquiries to the participant in addition to the educator. What ideas were shared during the educational event that the participant thinks should be integrated and implemented into your current process?

The second most important thing is choosing quality vendors and quality products and services for the finance department to present to the customers. If the finance and sales teams do not believe in the products’ value or have had difficulty with the company in the past, they will not present the policy to the customers.

I advocate that the dealership do proper vetting of companies and vendors prior to signing up. Verify references and insurance policies. Ask the vendor for a certificate of insurance and make it a practice to do so every year. That is the only way to verify the policies being sold are actually backed by an insurance company.

Begin to collect testimonials from customers. Create a brag book to be shared with your customers. A brag book is a binder that includes positive feedback from your previous customers about the products and the dealership. How was their buying experience? How did the policies serve them in a time of need? Would they purchase the policies again?

Happy customers are a result of happy, well-educated and well-compensated employees with a strong commitment to customer satisfaction. Happy customers bring their friends and family to purchase from you. Happy customers are essential in building customer retention and referrals.

Education should be a critical part of every business plan. Investing in your human capital brings the highest rate of return. When successful dealers are quizzed about why they are successful, the answer is they surround themselves with quality people who have both the customer’s needs and the bottom line in focus.

Education is the foundation for a strong business model and essential for success!

BY JAN KELLY JAN KELLY, PRESIDENT OF KELLY ENTERPRISES, IS AN EDUCATOR, CONSULTANT AND CONVENTION SPEAKER, AND WRITES FREQUENTLY FOR INDUSTRY PUBLICATIONS. FOR INFORMATION ABOUT EDUCATIONAL VENUES OR JOINING AN F&I 20 GROUP, CALL 1-800-336-4275 OR VISIT WWW.JLKELLY.COM.

EDUCATION: LUXURY OR CRITICAL PART OF YOUR SUCCESS?

BACK TO BASICS

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NORTHWOOD HONORS DEALERS WITH DEALER EDUCATION AWARDS

Seven car dealers from the United States, Germany and the Netherlands were named winners of Northwood University’s annual Dealer Education Awards, which recognized the dealers for their contributions and efforts to improve

education at all levels.The winners were: Byron T. Brisby of Flemington Car & Truck Country in Flemington,

N.J.; Daniel G. DeVos of DP Fox Ventures LLC in Grand Rapids, Mich.; Charles T. (Chip) Lindsay III of Lindsay Cadillac in Alexandria, Va.; J. Douglas North of North Brothers Ford in Westland, Mich.; Collin M. Sewell of Sewell Family of Companies in Odessa, Texas; Susanne Bautz of Germany’s Autohaus Bautz & Klinkhammer GmbH & Co. ; and Eric Tak of Bovag Autodealers in the Netherlands.

The awards were presented at the NADA convention in Las Vegas. Northwood has been giving the awards since 1972.

“We have been recognizing outstanding dealers for 41 years and there has never been a time when their contributions have meant more to their communities than they do today,” Northwood president Keith A. Pretty said. “These leaders have made outstanding sacrifices of time and resources. We are proud of all the Dealer Education Award winners and commend them for their leadership.”

Internet searches for full-size trucks are up and those for compact cars are down, and that could be good news for the economy,

according to Autoshopper.com.Searches on Autoshopper.com for pickup

trucks, led by the Ford F-150, have risen significantly in January 2012, said Dani Lunsford, the web site’s national marketing executive. Meanwhile, searches for compacts, which had soared during the toughest economic times, declined slightly.

Lunsford said part of the reason for the change is that the construction industry is picking up, prompting more consumers to look for heavy duty work-related vehicles. Business Insider magazine recently reported that the construction industry is adding jobs after five years of shedding workers, and construction spending rose sharply in December. Construction jobs have historically been a key component of economic recovery.

“The renewed interest in full-size trucks and the decline in searches for compact cars show an uphill trend in workload related jobs, a positive economic indicator for all of us,” Lunsford said. “This continued economic recovery has the middle-class American looking for a larger, less fuel-efficient vehicle to carry out the workload requirements of newly created jobs in the construction field.”

A SIGN OF RECOVERY: MORE TRUCK SEARCHESTHE AWARDS WERE PRESENTED AT THE NADA CONVENTION IN LAS VEGAS.

NORTHWOOD HAS BEEN GIVING THE AWARDS SINCE 1972.

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Nowcom, a leading provider of dealer management solutions, announced it has renewed its partnership with

the National Independent Automobile Dealers Association for a second year as a Gold National Corporate Partner.

Nowcom has worked with NIADA since 2005. It became a Preferred Partner in 2009, a Bronze Corporate Partner in 2010 and began as Gold National Corporate Partner in 2011. NIADA Member Services partners with industry leaders that offer excellent services to help their members grow their business, protect their assets and enhance profitability.

The NIADA Member Services National Corporate Partner Program was formed in 2010 to provide NIADA members with an extensive, highly vetted roster of partners they can rely on to provide a broad portfolio of services they use on a daily basis. Through discounted affinity agreements, NIADA Member Services offers numerous member benefit services. For dealers with neither the time nor staff to conduct thorough supplier evaluations, NIADA members look to NIADA Member Services for outstanding partner recommendations and discounts.

Nowcom is the provider of DealerCenter.net, an all-in-one web-based dealer management software system that allows the dealer full control over sales, inventory, credit reports, insurance offering and financing.

For more information, visit www.nowcom.com.

NOWCOM RENEWS GOLD PARTNERSHIP WITH NIADA

The World Automobile Auctioneers Championship will be webcast live this year for the first time, courtesy of NIADA.TV. The live webcast of the 2012 WAAC can be viewed in its entirety on the home pages of www.niada.tv, www.niada.com and www.waacnet.net . Coverage begins at 11 a.m. Eastern time on Mar. 30 and is free for all online viewers. Cheer on your hometown favorite auctioneers and ringmen, and catch all the fun and excitement of the 2012 World Automobile Auctioneers Championship at your leisure, exclusively on all three websites. For more detailed information please visit www.niada.com and click on the “Events” tab, or call (303) 807-1108.

WORLD AUTOMOBILE AUCTIONEERS CHAMPIONSHIP

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As we come into the second month of the 2012, how are your business New Year’s resolutions evolving? I’m sure on the

list there are goals to increase profitability and growth, and to improve customer service.

What about going green and saving you and your customers money at the same time?

The auto recycling business is booming and helping its customers do just that. There are about 8,400 auto recycling businesses in the United States generating about $23 billion each year.

Auto recycling is the practice of removing and reusing automotive parts from inoperable vehicles, then safely disposing of the portions of the car that cannot be salvaged. It is performed at auto salvage yards, also called auto recyclers. Auto recycling prevents the waste of usable parts and materials, and promotes environmental conservation by reusing vehicle components instead of disposing of them in a landfill.

There is no product recycled more than the automobile. More than 10 million vehicles reach the end of their lives each year, which equates to acres and acres of landfill space.

The auto recycling industry saves that space – 95 percent of vehicles retired from use are recycled. The process saves an estimated 85 million barrels of oil per year, which would have been used to make replacement parts. About 84 percent of each vehicle is recycled in one way or another. Some 40 percent of the ferrous metal for scrap processing comes from auto recycling. Oils and fluids recycled by the auto recycling industry are equivalent to eight Exxon Valdez oil disasters every year.

“One of the meanings of recycle is to reuse,” said Jason Hilsman, owner of Ace Auto Recyclers in Iowa City, Iowa. “Reusing auto parts helps the environment by saving on the energy and waste produced in making new parts. And, of course, the price is cheaper.”

On average, purchasing a green, recycled part from a recycling yard will save 50 to 75 percent of the original equipment

manufactured price. Because buying used parts from an auto recycler is cheaper than buying them new, repair shops can not only lower the cost of a repair for customers, but can also lower insurance rates if the repair is an insurance claim.

Auto salvage yards also commonly offer recycling of older vehicles for scrap. The yards recycle batteries, tires, fluids and thousands of tons of metal a year. And auto recyclers provide owners of rare, out-of-production vehicles a chance to obtain hard-to-find replacement parts.

Recycled vehicles go through a thorough tear-down and inspection process on delivery to the recycler to ensure the highest quality parts for resale. When a vehicle comes into the recycler, it receives a stock number for tracking, and the VIN is checked to make sure it matches the title. Pictures are taken of all angles of the vehicle and the VIN number, allowing the auto recycler’s customers to see a part before it is delivered and be knowledgeable on the part’s condition prior to a sale.

The vehicle is then inventoried. All parts are checked, including checking whether the car starts, runs and drives, and a check of allpart of the transmission. If the auto recycler decides no parts have any value, fluids are drained and tires, battery and catalytic converter are removed to prepare the car for scrap and crushing.

If the auto recycler will keep the car for its inventory, the catalytic converter and battery are removed and the vehicle is placed in the yard. The fluids are not drained until the car is dismantled. Then the fluids are drained and the usable parts are ready to sell.

In 2008, a group of auto recycling businesses from across Iowa banded together to improve the purchase process and quality of recycled parts.

“When we started the group, the idea was to get 20 of the most progressive auto recyclers in the state to sell a better product by improving the quality of the part, description of the part, the delivery time for less down time for the

repair shop, and to open communication to all repair shops,” said Mike Swift, president of QRP Central and owner of Trails End Auto & Truck in Des Moines.

QRP Central is a group of 18 family-owned professional automotive recyclers that function as trading partners to provide customers with quality recycled used auto parts. The group is committed to the highest quality of recycled and new aftermarket auto parts, delivered on time as described, usually within 24-48 hours.

The combined inventory of the 18 independent auto recyclers is massive: more than 11,000 vehicles purchased annually, more than 1 million parts in computerized inventories and nearly 26,000 parts vehicles stored on site. In addition, yard management technology has advanced to give auto recyclers access to more parts from around the nation.

QRP holds its parts inspection process to a higher standard. One of the first things it decided as a group was to make sure there are no surprises. Every step is taken to make sure a part is good. If it is not a good part but is still usable with repair, the recycler makes sure the customer knows and can make an informed decision.

All parts that leave QRP auto recyclers go through a three-point inspection process. They are inspected first by the salesperson, then the parts puller, then the delivery driver. If a part is shipped, the last person to check the part is the shipping department.

Another important aspect for QRP customers is that the businesses are locally owned.

“When a repair facility purchases a green recycled part from QRP Central, it is not only saving the environment but helping keep jobs and revenue in the city, county and state,” Swift said.

For more information on using recycled auto parts for your business, visit www.qrpcentral.net.

GOING GREEN

AUTO RECYCLING IS BOOMING

BY QRP CENTRAL

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AUTO RECYCLING IS BOOMING

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In order to eliminate some of the confusion surrounding the Title Defect Rescission (TDR) fund, the Ohio General Assembly made some changes to TDR effective Sept. 29, 2011.

The TDR law was established as a helpful tool to allow car dealers to sell a used car without having first obtained title in the dealer’s name. However, dealers must understand the requirements of the TDR law as well as the consequences if the attorney general must tap the TDR fund to pay a claim against a dealer.

What should you know?Before displaying any vehicle for

sale without first securing title in your dealership’s name, you must possess a bill of sale, a properly executed power of attorney or other related documents from the prior owner that allow the dealership to secure title to the vehicle in its name. Where before, dealers in business less than three years were required to post a bond with the attorney general’s office, the dealer must now post a $25,000 bond with the attorney general’s office only if the attorney general has paid a retail purchaser from the TDR fund within the preceding three years.

The remedies available to a retail purchaser can be severe if a dealer fails to comply with certain obligations. A retail purchaser is entitled to demand that the dealer rescind the transaction if the

THE NEW TITLE DEFECT RESCISSION

dealer fails to obtain title in the consumer’s name within 40 days of the transaction, fails to disclose in writing that a vehicle’s title is branded as a rebuilt salvage prior to execution of the purchase agreement, the title indicates that the dealer made an inaccurate odometer disclosure, or the dealer fails to disclose in the purchase agreement that the vehicle title is branded as a “buyback,” if that is the case.

In order to seek a remedy under the statute, the retail purchaser must notify the dealer of the request for rescission. If the dealer has failed to deliver title within 40 days, the retail purchaser must provide this notice within 60 days of the date the vehicle is titled in the name of the retail purchaser. If the dealer has failed to properly disclose a rebuilt salvage or buyback-branded vehicle or has provided an inaccurate odometer disclosure, the retail purchaser must notify the dealer within 180 days of the date the vehicle is titled in the purchaser’s name.

In either event, once notice is provided, the dealer has seven days to refund the full purchase price of the vehicle or reach a satisfactory compromise with the retail purchaser. If the retail purchaser traded in a vehicle, the dealer is required to return the trade-in vehicle or the value of the trade-in as contained on the purchase agreement.

Failure to provide proper notice to the dealer within these time frames bars the retail purchaser from recovery. However, if proper notice is provided and the dealer failed to

rescind the transaction in accordance with the statutory requirement, the attorney general will reimburse the retail purchaser the full purchase price and the cost of additional temporary tags from the TDR fund.

A payout from the fund would likely lead the attorney general to pursue an action to reimburse the fund in addition to seeking civil penalties under Ohio’s Consumer Sales Practices Act (CSPA). The retail purchaser also has a private right of action under the CSPA, which could lead to treble damages and attorney’s fees.

I am often asked if participation in the TDR fund is mandatory. The short answer is yes, it is! With the recent changes to the law, each dealer must pay $150 to the attorney general for deposit into the fund if at any time the fund dips below $300,000. The attorney general will send notice of the assessment to a dealer’s licensed location. Additionally, 50 cents of the title fee collected from a licensed dealer for resale purposes is deposited into the fund.

While the changes to the TDR law are a great benefit to dealers, as always, compliance is the key to success. Follow the law and stay on safe ground. One slip can unwind an entire deal.

BY SHAUN PETERSEN SHAUN PETERSEN IS A FORMER OHIO ASSISTANT ATTORNEY GENERAL

AND A PARTNER IN THE LAW FIRM OF MAC MURRAY, PETERSEN &

SHUSTER. HE SERVES AS LEAD LEGISLATIVE/REGULATORY/COMPLIANCE

COUNSEL FOR THE NATIONAL INDEPENDENT

AUTOMOBILE DEALERS ASSOCIATION.

BEFORE DISPLAYING ANY VEHICLE FOR SALE WITHOUT FIRST SECURING TITLE IN YOUR DEALERSHIP’S NAME, YOU MUST POSSESS A BILL OF SALE, A PROPERLY EXECUTED POWER OF ATTORNEY OR OTHER RELATED DOCUMENTS FROM THE PRIOR OWNER THAT ALLOW THE DEALERSHIP TO SECURE TITLE TO THE VEHICLE IN ITS NAME.

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THE NEW TITLE DEFECT RESCISSION

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September 23, 2010.• Tele-Express, phone application - no paper applications to complete.• Dental Insurance available with or without medical.• Vision Insurance available with or without medical.• Critical Illness coverage available that pays a cash benefit directly to you. • Disability coverage available up to 15,000 per month benefit.

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HEALTH INSURANCE

MEMBER BENEFIT PROGRAM!

Note: Features are subject to state availability and may not apply to all physicians.To learn more about the options available to lower your health insurance costs and maintain comprehensive coverage, visit www.NIADAHealthPlans.com for an INSTANT online rate or contact JLBG Health at 1-888-308-9340 for more details, physician rates, and a 15-minute phone application.

MAJOR MEDICAL COVERAGE AVAILABLE THROUGH NIADA.

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NIADA NAMES OHIO FIRM AS NEW LEGISLATIVE COUNSELOhio-based law firm Mac Murray,

Petersen & Shuster LLP has been named legislative/regulatory/compliance

counsel for the National Independent Automobile Dealers Association, NIADA chief executive officer Michael Linn announced.

The firm, based in New Albany, Ohio and led by former Ohio attorney general and state senator Betty Montgomery, will add additional expertise to NIADA’s legislative and regulatory efforts in Washington D.C. to stay ahead of issues affecting the association and its approximately 18,000 members.

“Adding Mac Murray, Petersen & Shuster to the efforts of Federal Advocates, NIADA’s lobbing firm on Capitol Hill, will round out our strategy to work more closely with key federal regulatory agencies,” Linn said. “Staying ahead of rapidly expanding agencies like the CFPB (Consumer Finance Protection Bureau) will be much easier as Betty and her team engage key relationships with their former colleagues at key federal agencies like the CFPB and the FTC.”

In addition to Montgomery, three former Ohio assistant attorneys general will be advising NIADA on compliance updates and changes in government regulations to the automotive industry. Shaun Petersen, Michele Shuster and Helen Mac Murray all served as chiefs of the Ohio AG’s Consumer Protection Section. Together they have more than thirty years of experience managing consumer protection initiatives and helping businesses comply with those programs.

Petersen’s extensive work representing auto dealers in Ohio through the Ohio Independent Automobile Dealers Association gives him a deep understanding of dealer operations and concerns. He will act as NIADA’s lead counsel from the firm.

DealerTrack announced it has introduced SmartFind, an online inventory search and comparison tool tied to actual dealer inventory.

The new web service allows dealers to dynamically limit online vehicle selec-tions on their web sites to inventoried vehicles using proprietary “best match” search algorithms to return a ranked list of available vehicles in inventory based on a con-sumer’s specific search parameters. The service then allows consumers to perform comparisons of actual vehicles in inventory.

“In today’s market, consumers expect to perform more of the vehicle transaction process online than ever before,” DealerTrack Data Services general manager Amit Maheshwari said. “However, traditional inventory searches have been a stumbling point because they don’t link directly to current inventory at a particular dealership. The SmartFind solution will integrate fully with the dealer’s existing online vehicle and inventory workflows to deliver timely and more accurate vehicle availability informa-tion and the ability to compare inventoried vehicles.”

NEW SMARTFIND TOOL TIES SEARCHES TO DEALER’S INVENTORY

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Manheim has agreed to purchase Dealer Services Corporation (DSC), a used vehicle floor plan company for independent dealers based in Carmel, Ind. The acquisition complements Manheim’s current lending products provided through

Manheim Financial Services (MAFS).Manheim said the move reinforces its commitment to provide inventory financing to

independent dealers. “Manheim is always looking for ways to enhance its service offering to customers,”

Manheim president Sandy Schwartz said. “The purchase of DSC presents a great op-portunity for us to broaden our lending scope and customer base. In addition, we gain access to state-of-the-art technology and digital tools that will enhance our customers’ experience and improve the company’s efficiencies and opportunities for lending.”

Adding the DSC line to MAFS’s existing products will give dealers access to broader offerings and additional staff to serve their needs both in-lane and online, as well as technology designed to make it easier for customers to get information about Manheim lines of credit through their smart phones and desktops.

CEO Brian Geitner will remain in charge of DSC, which had been the largest inde-pendently owned inventory finance provider for used vehicles.

“Like Manheim, DSC is a company that focuses on the success of its customers,” Geitner said. “Our mission of empowering our customers with strategic products and services is only more enhanced by joining the Manheim group of companies. It’s easy to see how MAFS’s and DSC’s service platforms will complement each other and broaden Manheim’s service reach across the country.”

MANHEIM PURCHASES FLOOR-PLAN PROVIDER DSC

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OIADA

Guitar RAFFLE

#_______ #_______ #_______

Joe Walsh Sammy Hagar Kenny

of the and the Chesney

EAGLES WABOS

TOTAL TICKETS # _ @ $5.00 each OR 5 FOR $20.00 FINAL TOTAL $ ______

*Name of Person Purchasing Tickets* -

*Address of Purchaser* -

*Telephone #* - *Work Industry* - ALL (*) MUST BE FILLED OUT COMPLETELY

Type of Payment:Type of Payment: CheckCheck ( Enc losed)( Enc losed) MasterCardMasterCard VisaVisa DiscoverDiscover AmexAmex

___________________________________________________________________________ __________________________ Name (as it appears on credit card) Current Date _______________________________________ ____________________________________ ( ) __________________ Billing Address (where the credit card statement goes to) Phone __________________________________________________________ ______________ __ ___________________ City State Zip _____________________________________________________________________ _____________ _____________ Card Number Exp Date *Card Code I hereby agree to pay the above named company for all charges agreed to for the purchase of the following product or service:

____________________________________________ ___________ ____________ *Signed By (Must be signed if using Credit Card) Date Total

*Card Code in lieu of Signature may be used for telephone transactions

Mail Form to: OIADA 2040 Brice Road Suite 110, Reynoldsburg, OH 43068

Fax Form to: 614-863-5801

For additional information call 614-863-5800

All proceeds from the purchase of this ticket benefit the OIADA PAC Fund

and the Our Sacrifice Foundation equally.

Winner will be announced on - AUGUST 10, 2012 THANK YOU FOR YOUR SUPPORT

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MEMBER APPLICATION

MANY SHERIFFS CREATE REGULATORY UNCERTAINTY

Remember when the Dodd-Frank bill was being debated in Congress and we all hoped motor vehicle dealers would be exempt from the oversight of the new sheriff – the Consumer Financial Protection

Bureau (CFPB)?Be careful what you wish for. You just might get it. As you know, a “dealer exclusion” was included in the Dodd-Frank Wall

Street Reform and Consumer Protection Act (Dodd-Frank Act). Ironically, the dealer exclusion might only increase industry regulatory oversight and add compliance uncertainty.

Under Section 1029 of the Dodd-Frank Act, the CFPB may not exercise regulatory supervision or enforcement authority over “a motor vehicle dealer that is predominantly engaged in the sale and servicing of motor vehicles, the leasing and servicing of motor vehicles, or both.”

An exception to the exclusion is that the CFPB does have authority over businesses that provide “the extension of retail credit or leases involving motor vehicles,” retail credit or retail leases “directly to consumers” and a contract covering the retail sale or lease that is “not routinely assigned to an unaffiliated third-party finance or leasing source.”

The exclusion and exceptions can be a bit confusing, but the net result is that the CFPB has regulatory authority over Buy Here-Pay Here dealers. And even dealers who do not consider themselves to be Buy Here-Pay Here might be regulated by the CFPB if they are assigning contracts to an affiliated third-party finance or leasing source, or if they are not “routinely” assigning contracts to an unaffiliated third party. If you assign some contracts and hold others, there might be some uncertainty about whether you are regulated by the CFPB.

The CFPB authority leaves us with a framework in which some auto dealers are regulated by the CFPB and the rest are regulated by the Federal Trade Commission (FTC). That means that in spite of the “dealer exclusion,” we have two sheriffs in town.

The two federal regulators have promised to work together, but the regulatory framework itself could create obstacles. For example, the CFPB now has rulemaking authority for a number of consumer financial protection laws formerly granted to several federal agencies, including the Truth in Lending Regulation Z and Consumer Leasing Regulation M. In republishing these regulations, the CFPB made it clear that they applied “except with respect to persons excluded from the bureau’s rulemaking authority by section 1029 of the Dodd-Frank Act.“ That is a clear reminder that CFPB enforcement authority of Regulations Z and M are technically separate from the enforcement authority of the FTC.

Dodd-Frank also authorized states to enforce certain federal consumer protection laws. The concern is that might result in local differences in interpretation and enforcement of federal requirements. So essentially, there are now three sheriffs in town.

Over time, rules, regulations and interpretations will be published providing clarification on the scope and limits of authority assigned to those three. But for now, we need to deal with the regulatory uncertainty as best we can.

It is helpful to keep in mind that the various regulating authorities are trying to protect consumers from unfair and unscrupulous consumer credit transactions. The best practices for these times apply in all situations – be clear, be transparent and be honest in your sales and financing transactions. That should help you satisfy the spirit and intentions of all but the most technical standards of any regulator.

BY CHIP ZYVOLOSKIChip Zyvoloski is a senior attorney for indirect lending at Wolters Kluwer Financial Services.

For more information, visit www.wolterskluwerfs.com/indirect.

ComplianceOverdrive

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