NIADA, NABD Team up for Training

operations.

Ken Shilson unveiled the program at his recent NABD conference in Atlanta. Several NIADA representatives were on hand, including CEO Mike Linn, President Don Fincher and President-elect Chris Martin.

Fincher and Martin are both CMDs who also do in-house financing.
Despite being in the business for decades, Fincher said he learned a lot from his CMD training.

You can never say you ve learned everything you need to know, Fincher said.

The two groups are gathering input from dealers to shape the content of the classes. Some topics are already marked for inclusion, such as compliance and financial management.

We ll sit down and figure out what makes sense, Linn said.

The new program received a positive reaction from the audience at the NABD event. Several conference attendees were already CMDs, and said they would enroll in the new course.

One hope for the CMD program is it improves the tarnished image of buy-here, pay-here dealers. A series of unflattering articles in the Los Angeles Times has lead to new calls for increased regulation of the sector.

The new designation could enhance the image of buy-here, pay-here dealers.
The better we look, the better off we are, Fincher said.

Linn said the NIADA website allows consumers to search for CMDs in their market. This option draws a lot of interest each month, he said.

View the original article here

Turn your Auto Notes into cash

Wealthier Shoppers Looking at New Cars, Used Luxos

2004.

"December has certainly been a month to remember for dealers over the last two years,'" said Edmunds.com Chief Economist Lacey Plache. "And with a substantial number of new car buyers still coming back to the market after deferring their purchases this summer, dealers have plenty of reason to believe that this December will continue the trend.

"Recent income growth, moderated inflation and improved consumer confidence are all combining to put consumers in a better position to spend."

New-car buyers tend toward a wealthier demographic. So do used luxury buyers and they're doing more shopping lately, too.

Luxury vehicles were the certified pre-owned "Big Movers," at the segment level, and in the list of the top 20 most-viewed vehicles for AutoTrader.com in October.

The majority of consumers consider both new and pre-owned choices when they are searching for their next vehicle, so it is no surprise that we saw a spike in activity around luxury cars on the CPO front in the same month that we saw an increase in new luxury car shopper activity," said Rick Wainschel, vice president of automotive insights at AutoTrader.com. "There are strong signs of pent up demand for luxury vehicles among car shoppers, indicating that despite continuing economic headwinds, there are more consumers willing and able to consider higher end choices."

For CPO luxury cars, it was Jaguar that had the most models to make big moves in October, with the XJ Series moving up 34 spots to No. 174, the XF moving up 30 spots to No. 143 and the XK Series moving up 28 spots to No. 177.

On the segment level, luxury cars came in as the No. 1 CPO segment on AutoTrader.com in October. Out of all the CPO segments in October, luxury cars and SUVs were the only ones to see month-over-month increases in consumer interest. The luxury car segment increased 0.4 share points from September to October, and the luxury SUV segment increased 0.7 share points during the same time.

In looking at the most-viewed CPO vehicles, luxury cars claimed six of the top 20 spots on the list of most-viewed CPO cars in October, more than any other segment represented. The BMW 3 Series, always a favorite among CPO shoppers, took the No. 1 spot again in October, a position it held during the same time last year.

View the original article here

Turn your Auto Notes into cash

New Bankruptcy Rules Could Prove Costly

"If you don't fill them out properly, you won't get paid," Sicay-Perrow said.

Buy-here, pay-here dealers work into their business models the reality that a portion of customers will declare bankruptcy. Failing to get paid from the bankruptcy trustee due to paperwork problems hurts their bottom line.

What's more, the individual who fills out the forms improperly could face a 50,000 fine for fraud.

Expect little help from the bankruptcy trustee in figuring out the ins and outs of the forms.

"The trustees are maniacally adverse to giving legal advice," Sicay-Perrow said.

He recommends dealers work with a bankruptcy attorney to make sure they follow the right procedures for their local bankruptcy districts.

View the original article here

Turn your Auto Notes into cash

Thief Makes Repeated Visits to Car Store

front window and removed several personal items from the window sill inside of the building.

The incident occurred about 4 a.m. and was caught by the dealership's surveillance cameras.

The suspect was filmed wearing an orange and white football jersey with the word BEL AIR, and the number 13 on the front. He was also filmed driving off in a small, light-colored vehicle.

In August, at about 6 a.m., the same suspect shattered the front window in another attempt to take personal items from inside the store. He was caught on camera using pliers to take an antique thermometer attached to the outside wall.

This time, the suspect wore a solid blue football jersey with the words BEL AIR and the number 21 on the front.

According to the New Jersey State Police, the suspect is a white male between 5 feet 7 inches and 6 feet tall with long dark shoulder length hair. The vehicle he has been filmed leaving the dealership in is a white or light colored two-door vehicle, possibly a Dodge Neon.

The suspect is wanted by police for multiple thefts and criminal
mischief.

View the original article here

Turn your Auto Notes into cash

New Car Sales Set to Rise as Year Ends

market and another third should return to the market by March 2012.

That remaining third may prove harder to budge.

"The exact number of remaining sales that will return - and their exact pace - depends on economic conditions, since some portion of buyers likely have been deterred by current economic uncertainty," Plache said. "But positive trends in the U.S. economy, such as steady job growth, moderate inflation and income growth could reassure buyers enough to push them to finally make their new car purchases."

The manufacturers are doing what they can to nudge consumers before year's end. TrueCar.com forecasts seven of the top 10 days to buy a car this year occur in the next month.

"December is going to be the best month of 2011 to buy a car with manufacturers offering attractive year-end incentives and dealers motivated to move inventory to get to their sales objectives," said Jesse Toprak, TrueCar.com's vice president of industry trends and insights. "It's also a good month to buy a luxury vehicle or large truck/SUV."

View the original article here

Turn your Auto Notes into cash

Financing Repairs Raises Issues

The old buy-here, pay-here saying says, "If the car stops running, the customer stops paying." But keeping the car running proves harder than it sounds.

The common method is for dealers to finance a repair if a customer has a problem. Very few do this properly, however, said attorney Tom Hudson.

The first mistake comes in the contract's structure, Hudson told attendees at the recent National Alliance of Buy-Here, Pay-Here Dealers conference.

Any contract that requires four or more payments falls under the federal Truth in Lending Act.

Even those done in three or fewer

View the original article here

Turn your Auto Notes into cash

Dealer Takes Anything in Trade

the oddest trade was a horse Najjar accepted in September as down payment on a 2010 Chevrolet HHR.

"We have an ad running that says, When other people say no, we find a way to go'," he said.

It caught the attention of a woman going through a divorce and in need of a car, he said.

When she showed up at his Pinellas Park, Fla., showroom, Najjar assured her he would be flexible on the trade.

"She said she had nothing of real value except a horse," he said. She showed him a video of Dallas, her buckskin quarter horse, and Najjar called his wife.

"I asked her, What do you think about owning a horse?' And she said, I always wanted one.'"

The woman had been paying more than her new car payment to feed and care for the 13-year-old gelding. Those costs now fall to Najjar.

"Somebody told me a long time ago, don't take anything on trade that eats," Najjar said. "I broke the rule I guess."

No matter. Najjar's wife and three kids - ages 5, 7 and 9 - are delighted.

Having to find a buyer for a traded item occasionally takes longer than expected and that can temporarily tie up Najir's cash flow, but it doesn't happen often.

"We try to turn things around pretty quick," he said. "We have a relationship with some local vendors (and) always turn to them first."

Najjar said the occasional hassle unloading the oddball trades are worth it.
They bring in an extra 10 or 15 deals a month.

He avoids taking anything illegal in trade and is careful to do everything by the book.

That includes valuing even the items he keeps and telling the lender he is taking, say, a horse as the trade in. Najjar said his entire sales staff is skilled at assessing the value of a broad range of items.

But if the trade in turns out to be worth less than the required down payment, it is the dealership that comes up short, not the bank.

Creditors don't mind the unconventional deals because all the risk falls on Najjar.
There are some limits to what Najjar will take on trade. He once refused two burial plots.

"He was asking too much money for them," Najir said. "I didn't know how to value them - and I didn't want to use them."

View the original article here

Turn your Auto Notes into cash

Town, Dealers Team up for Test Track

dealers who were also interested in the track. The next step was finding the land.

That became available when Burlington Northern Santa Fe Railroad sold its 60-acre auto storage facility to a consortium that included the city and local car dealers.

A focus group then collectively worked to determine which features and amenities should be included in the design. A design team took the ideas and incorporated them, along with addressing safety and maintenance issues.
A project this size came with a large price tag.

The land was close to 2 million, engineering was around 150,000 and construction was just more than 1.5 million - all of which the city covered.

A group of 12 dealerships signed on to use the track and split the annual 50,000 operating costs. Ten currently belong to the group.

All of it is definitely worth it, especially to dealers like Danny Wolf of Dan Wolf Automotive Group.

Wolf's Lexus and Toyota stores are the main users of the test track, accounting for roughly 65 percent of each month's use. Wolf serves as president of the Naperville Test Track Association, as well.

"I have been in the automobile business for nearly 25 years now," he said. "This is the first I've heard of something like this where the city and the dealers formed a partnership to build and maintain such a facility."

The track's popularity among customers can't be denied.

"It gives us a unique opportunity and environment to demonstrate our vehicles and their features," said Joel Weinberger, dealer principal at the Continental Motors Group.

"It enables us to provide an extra Wow' experience during the test drive phase that cannot be duplicated by our same-brand competitors in the Chicago market."

Weinberger uses the track and he serves on the executive committee of the track association.

The track benefits the city, too.

"It reduces congestion on our roads and provides a safe driving environment for potential car buyers," said Hallgren.

"It is a great economic development tool that supports our local car dealerships."

The track is used for community events along with test drives. A local politician used it recently for a green car show, which highlighted the Naperville Green Fuels Depot project.

Weinberger said cities that follow in Naperville's footsteps need to be sure to utilize a track if they invest in one.

"It can be a valuable asset and differentiator to help attract business to the area, but only if supported by the dealer body through consistent usage and making sure the test track experience is an integral part of the sales process," he said.

Wolf said he can't see selling without the track.

"It works out well for us on so many levels," he said. "I think we would be somewhat lost if it was taken away from us at this point."

View the original article here

Turn your Auto Notes into cash

System Makes Payments Easier

The money is transferred directly into that account when the customer makes the payment.

The one downside of the product is 7-11 stores do have some geographic limitations. For example, there are none in Georgia, one of the largest buy-here, pay-here states.

But the company is common in some of the biggest markets, such as Florida. About 50 percent of the nation's population lives within a mile of a 7-11 store.

And PayNearMe is adding another provider that will give it more than a 1,000 more locations.

"The footprint keeps getting bigger," said Danny Shader, the firm's CEO.

Even if a customer doesn't live near a 7-11, a sizable segment work in fields that wind-up near the stores, such as long-haul truckers.

An advantage for dealers looking to sell their paper is PayNearMe provides a payment mechanism independent of the dealer. That means a contract's owner can change hands, but the customer keeps paying at the same 7-11.

View the original article here

Turn your Auto Notes into cash

NIADA General Counsel Steps Down

throughout his involvement with the association. For years, he presented dealer compliance seminars across the country, which later evolved into pioneering on-demand and live webcasts through NIADA.TV. More recently, Whann's "Car Counselor's TARP" (Together Automotive Retailing Prospers) program brought lenders and dealers together at a time when funding was difficult to find. His "Dealer Tech 2.0" series stresses the importance of social media interaction for dealers.

Keith has been instrumental in representing the interests of car dealers in Washington, DC. He has participated as an industry expert in all recent FTC roundtable sessions, as well as meeting with various members of Congress, White House staff, the Department of Defense, Small Business Administration, and the Consumer Financial Protection Bureau.

"I have thoroughly enjoyed working with Keith for over thirteen years, and I truly appreciate the contributions he has made to NIADA and the industry as a whole," stated Michael Linn, NIADA CEO. "Keith and I have created some ground-breaking innovations, such as the NIADA.TV network. I personally look forward to working with him on industry related projects in the future."

"On behalf of the Board of Directors and our dealer members," continued Linn, "I would like to express my deep appreciation for his dedication and loyalty to NIADA and we wish him continued success in his ongoing ventures."

View the original article here

Turn your Auto Notes into cash

Retail Prices Remain Strong, But That Could Change

Dealers continue to pass on higher prices to consumers as demand for used cars remains strong and credit become more available. But that pricing power is starting to weaken.

Asking prices for the majority of used and CPO vehicles on AutoTrader.com are higher than they were one year ago, the company reports.

In September, 10 out of the top 20 most-viewed used cars and 17 out of the top 20 most-viewed CPO cars showed year-over-year increases in median asking price.

"As the economic challenges that influenced major price changes earlier in the year subside, consumers will have to keep

an eye on the gaps between new and used vehicle prices so they can make the best decision that is right for them," said Rick Wainschel, vice president of automotive insights at AutoTrader.com.

There are signs that retail prices are starting to retreat, just as they have been on the wholesale side.

CarGurus released its CarGurus Used Car Price Index for October, which showed the average price of a used car at 19,278, down by 0.88 percent from September and down 1.7 percent from August.

Despite the recent downtrend, the average price of a used car remains up 2.86 percent over last year at this time. Such year-over-year price increases are most significant for hatchbacks (up 13.62 percent over last October) and coupes (up 14.89 percent over last October) and are negative for SUVs (down 0.26 percent) and pickups (down 1.49 percent).

CarGurus CEO Langley Steinert said while prices on most used cars are still high, they are "less erratic" than in the spring and summer. He expects prices to fall through the rest of the year.

View the original article here

Turn your Auto Notes into cash

Buy-Here, Pay-Here Cars, Customers Better Than Image

addressed the sector's image.

Keith Whann, counsel for the National Independent Automobile Dealers Association, said buy-here, pay-here plays a vital role in getting people back to work and keeping them employed.

"If you want to get the economy growing, people need access to affordable transportation," Whann said.

Of course, critics say dealers lock consumers into contracts doomed to failure and then repossess the vehicle for resale.

Consumers fall into this trap because they're desperate and ignorant, the story goes.

But Melinda Zabritski of Experian Automotive said her company's analysis found buy-here, pay-here attracted better vehicles and better customers than many believe.

Only 8 percent of the cars in the buy-here, pay-here deals Experian looked at had major issues reported in AutoCheck vehicle history reports.

That's higher than traditional used-car sales, but half of the rate for cash sales.
Most buy-here, pay-here customers are locked out of the traditional market due to their low credit scores, Zabritski said.

Most, but not all. She said about 6 percent of the customers who buy from buy-here, pay-here dealers actually have prime credit.

These customers keep shopping at buy-here, pay-here stores because they like the service.

"Imagine that, people actually buy cars from people they trust," Whann said.

The number of prime credit customers at buy-here, pay-here stores also shows they're making a smart decision.

"These are not ill-informed customers," Zabritski said.

In fact, about a third of them have college degrees.

Some perceptions hold up.

Minorities and the working poor make up most of the customer segment. Many are single mothers.

In many cases they rent, but a sizable portion own their homes. Most rent because they're younger than the general population.

So, there is potential to grow with customers as their credit improves.
"People aren't born with bad credit," Whann said. "They're born with no credit and then things happen."

View the original article here

Turn your Auto Notes into cash

Consumers Want Technology, Then Don't

Fancy technology may attract shoppers, but it irritates buyers.

Ford saw its brand drop 20 spots on the Consumer Reports list over concerns about its MyTouch system. David Champion, head of auto testing for Consumer Reports, said the system is difficult to use even when its actually working.

Champion said the technology may draw praise from the consumer electronics crowd, but creates too many hassles in the real world.

There s a difference between sitting in the showroom and driving the car, he said.

The company s powershift and ecoboost features also brought it down.

The challenges go beyond Ford. The entire minivan segment scores below average due to complaints about sliding doors, navigation systems and DVD players.

Consumers demand all these features, Champion said, but are disappointed when they fail to function easily.

Champion said these issues with non-essential items can turn into safety concerns as drivers focus on getting them to work rather than the road. Taking your eyes off the road for only two seconds greatly increases the risk of an accident, he said.

Champion recommends scraping touchscreens.

Make it as simple as possible, he said. Don t listen to the stylists who want to make it look good.

European cars are an example of putting style over substance, Champion said.

The European market weighs handling and appearance more than reliability, which is why manufacturers such as BMW and Audi rank low on the list.

We expect a car in the U.S. to behave more like an appliance, Champion said.

Not all technology hurts a car s reputation. The Chevrolet Volt ranked the highest of any offering from that brand.

View the original article here

Turn your Auto Notes into cash