October 2015 SDADA Column

What if you were asked to travel over 1,400 miles to a place of complete dysfunction, where people
think differently (not raising the budget is viewed as cutting it); act differently (people says things they don't believe to get recognition); fight with their friends (members are known to battle it out on the Hill before breaking bread together later that day); and generally act like they have no connection to the people who sent them there in the first place?

Your mission (should you decide to accept it): to change minds, affect policy change and to make it all happen fast (before the makeup of Congress changes again!). Sounds easy right?

Our South Dakota delegation to the NADA Washington Conference in September (Chairman Bruce Eide, Jim Burgess, Dutch VanSanten, NextGen delegate Nick Simon, Myron and me) accepted the mission. The jury is still out on the success of the mission!

As any South Dakota dealer who has attended the NADA Washington Conference can attest, the experience of traveling to DC to learn the issues and lobby our Congressional delegation is invaluable. Not only do dealers learn the current issues that NADA is addressing, they get an opportunity to meeting Senators Thune and Rounds and Representative Noem on their turf and seeing how our government works up close and personal.

The addition of the NextGen program keeps our national association relevant. Many trade organizations are struggling to remain pertinent to their young members. I am extremely pleased that we have brought a NextGen member of the delegation each year that NADA has offered the program. I believe that Nick found this year's NextGen program to be of value.

The Washington Conference is one of the best investments of time and money our South Dakota Automobile Dealers Association makes each year.

Safety Recalls into the Foreseeable Future

One of the issues we discussed with our South Dakota Congressional delegation was legislation that would ground all vehicles under open recall at a dealership. This "one size fits all" concept is flawed because it fails to differentiate between recalls that involve a defect that should be immediately addressed and those with a negligible impact on safety, such as an incorrect phone number in the owner’s manual, or an airbag warning sticker that might peel off the sun visor.

At our October NADA board meeting, we had an extended discussion about how dealers should handle safety recalls. NADA has issued guidance for this topic. It can be found here. (Because of the sensitive nature of this topic, you must log on to nada.org with your user id and password to access this guidance.)

I want to encourage you to look at this valuable information. Dealing with recalls will be a significant part of our business going forward. We are the front line for almost all safety recalls and thus promote the safety of the motoring public. We need to handle these recalls effectively and correctly.

NADA Convention Registration Now Open 

Considered the “Automotive Industry Event of the Year,” the NADA convention includes dealer-manufacturer franchise meetings, new educational workshops for dealers and managers, hundreds of exhibitors on the expo floor showcasing the latest equipment, services and technologies for dealerships and numerous networking events for attendees.

The NADA convention—which runs from Thursday, March 31, through Sunday, April 3, 2016—will be held at the Las Vegas Convention Center.
Dealers and their managers who register by Nov. 27, 2015, will receive the early-bird rate—a $100 discount from the onsite registration rate.
For more information or to register, visit www.nadaconvention.org.

ICYMI (In Case You Missed It…)
A 60-year dealership employee receives a 2015 Chevrolet Colorado truck as a parting gift.

The mind-numbing number of automobile color choices and color names can paralyze customers.

One industry consumer magazine asks the question: Why Do We Keep Buying Vehicles at Dealerships? 

Will Volkswagen AG's twelve brands survive the recent emissions cheating scandal?

October 2012 SDADA Column

You may recall that I told of my visit to the General Motors Renaissance Center headquarters back in August as a member of NADA's Task Force on Facility Image Programs and Multi-Tier Pricing in the space. One of the results of that meeting was a commitment by General Motors to consult with small and rural dealers on the EBE program.

Mark Reuss commented that he wanted to help dealers "do what they COULD do" on a timeline that “worked for them”. I specifically asked if that meant some flexibility going forward. I did not get a straight answer on that question.

So shortly after I returned from Detroit, I called my GM Regional manager and asked him to schedule a visit to my store. I got a call back a few weeks later from my Zone Manager who scheduled a visit to my store in mid-October.

The Zone Manager came to visit my store recently. After introductions, he lusted over my desk for a couple of minutes (more on that later). I found him to be a very pleasant gentleman and we had a very cordial conversation as we learned a bit more about each other.

Eventually, the discussion turned to my facility and the EBE program. I gave him a bit of my background with the EBE program told him of the exceptions that I had asked for.

The short story here is that he had no authority, had no discretion, had no flexibility and was no help in getting relief from the EBE program. I could revisit all my discussion points that I visited with him about (they can be found here and here and here). But the bottom line is that it was a waste of time for both of us.

The irony of whole visit was the fact that he was smitten by my desk. When we discussed "customer touch points" and the fact that the EBE program disallowed the customer from seeing the desk in my office, he was stumped. After he thought about, he realized that the office was a customer touch point and there was no way that a customer could see the desk if my office was in compliance with EBE standards.

He took photos and is going to go through the motions of submitting (again) my requests but we both know that it is an exercise in futility. The requests go to the same group that rejected them before.

So I am much more skeptical about our visit to Detroit now. I feel like the whole notion about GM placing people in the field was more of an appeasement than an actual effort to help RCC dealers.

I will reiterate a point that I made after the Detroit trip: the NADA task force must hold GM accountable for the commitments they made.

I am not done with this. Stay tuned for developments...

NADA Issues Dealer Guidance on Counterfeit Air Bags

The National Highway Traffic Safety Administration (NHTSA) announced in early October a consumer advisory on counterfeit air bags.

Federal investigators have determined that thousands of counterfeit bags have been bought and installed in U.S. motor vehicles over the past three years.

NHTSA also has determined that in the event of a frontal collision, these counterfeit bags are unlikely to deploy properly or may deploy in a manner that can harm vehicle occupants. See below for an NADA dealer Q&A document.

Vehicles with counterfeit air bags installed are believed to constitute less than 0.1% of the total in-use fleet. Nonetheless, dealers should be prepared to respond to inquiries from the public on this matter.

NHTSA is urging concerned owners to start by visiting www.safercar.gov/Air+Bags to determine if they are at risk.

In addition to the NADA guidance, dealers should expect to receive communications directly from the auto manufacturers they represent, addressing how to detect and manage counterfeit air bags.

It's important to note that unlike a safety recall campaign, customers should expect to pay to have their air bags diagnosed, and if necessary, replaced.

Service Advisors Overtime Exemption Extended Through March

Congressional legislation to prevent a government shutdown includes an extension of a federal overtime exemption for service advisors through March.

Since the late 1970s, the U.S. Department of Labor (DOL) has held that the frontline employee-salespersons in the service department remain exempt from federal time-and-a-half pay requirements. In 2011, DOL attempted to reverse this policy. Congress intervened and temporarily stopped the Department from enforcing the change.

The Congressional ban was included in a funding measure that was set to expire at the end of September. Under the new continuing resolution that extends government spending through March 2013, DOL is prevented from enacting the new policy for service salespeople.