FEBRUARY 20, 2008


IN THIS ISSUE

  DEALER NEWS & INFORMATION

     - Automotive News at a Glance

     - Hicks Selected as Colorado

       Dealer of the Year


  LEGISLATIVE UPDATE

     - Under the Gold Dome


  REGULATORY & LEGAL UPDATES

     - Sales to Canadians


  CALENDAR OF EVENTS
     - Upcoming Events

  DEALER MILESTONES,
     HIGHLIGHTS & TRANSITIONS

     - GM Mark of Excellence Given
       
to Ghent Chevrolet

     - Let Us Know About YOUR
       
Accomplishments!


     ARCHIVES

      
CLICK HERE for Open Road
       e-newsletter archives.

       CLICK HERE for 2007 Regulatory
       & Legal Articles
from the Open
       Road e-newsletter.

       CLICK HERE for Bulletin archives.

       CLICK HERE for Colorado Auto  
       Outlook
archives.

       CLICK HERE for Denver Auto
       Outlook
archives.


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        CLICK HERE to register online
        for various CADA seminars & events.


     MEMBERSHIP RESOURCES

        CLICK HERE for details on the
        Speaker and Educational              
        Resources
.

        CLICK HERE for a list of current    
        Endorsed Vendors/Programs
.

        CLICK HERE for a list of current    
        Allied Members
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.



www.nada.org
 

     CLICK HERE for NADA
Regulatory Affairs information
.


     STATE GOVERNMENT RESOURCES

        CLICK HERE for the Auto Industry 
        Division
of the Colorado Dept.
        of Revenue.

        CLICK HERE for the Title and   
        Registration section
of the
        Colorado Dept. of Revenue,
        Motor Vehicles Division.

        CLICK HERE for the Colorado
        Department of Labor &
        Employment
website.




Visit us at www.cadaonline.org.


CADA Hours of Operation
Monday to Thursday, 7 a.m. to 5 p.m.
Friday, 7 a.m. to 4 p.m.


      CADA STAFF

President
Tim Jackson
tim.jackson@cadaonline.org
303.282.1448

Vice President
Tammi McCoy
tammi.mccoy@cadaonline.org
303.282.1449  

Vice President -
Public Policy & Communications
Nancy J. Burke
nancy.burke@cadaonline.org
303.457.5115  

Bond Coordinator
Linda Toteve
linda.toteve@cadaonline.org
303.457.5122

F&I Resource Center -
Manager
Chad Julius
chad.julius@cadaonline.org
303.457.5119 

Insurance Services -
Account Manager
Deb Lay
dlay@cadaonline.org
303.282.1453

Insurance Services -
Account Manager
Bob Kogel
bobkogel@cadaonline.org
303.282.1457 

F&I Resource Center/
Forms, Services Coordinator
Lauren Stadler
lauren.stadler@cadaonline.org
303.457.5123

Services Coordinator
George Billings
george.billings@cadaonline.org 303.457.5123


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contact Nancy Burke at nancy.burke@cadaonline.org

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        Endorsed Vendors/Programs
.
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HICKS SELECTED AS COLORADO DEALER OF THE YEAR
This Just In, Feb. 12
Rocky Mountain News, Feb. 12

The Colorado Automobile Dealers Association selected Don Hicks, president of Shortline Automotive Inc. in Aurora and Porsche of Colorado Springs, as the 2008 Colorado Dealer of the Year. Hicks also will be eligible to compete for the 2008 TIME magazine Quality Dealer of the Year Award. CLICK HERE to read the entire article.

* * * * * * * * *

AUTOMOTIVE NEWS AT A GLANCE

Listed here are several articles pertaining to the auto industry that appeared recently in newspapers and other media outlets across the nation.

  • Dealers top priority for automakers
    Big Three, affiliated sellers consider ways to turn profit in brutal market.
    The Detroit News,  Feb. 11
    Automakers know that shabby, understaffed dealerships can turn off buyers and that money-losing dealers order fewer cars and trucks to sell.

    That reality has Detroit's Big Three carmakers searching for ways to help their legions of dealers make money in a brutal U.S. market. And it's become a top priority for the companies as they head into what's expected to be another painfully sluggish year for the auto industry.

CADA forwards news articles and opinion columns of interest
through the Open Road to inform members of current events. 
These in no way reflect the views, opinions, and/or positions
of CADA or its member dealers. They are sent for
informational and educational purposes only.

 


UNDER THE GOLD DOME

Sunday Sales For Alcohol One Step Closer…Car Dealers Remain Untouched
Senator Viega’s proposed legislation to repeal a portion of the state’s blue law to allow alcohol sales on Sundays (Senate Bill 082) passed through committee this past week. Nancy Burke, your CADA lobbyist, is actively monitoring this bill to ensure that your car dealerships remain exempt from this bill. Why the close relationship with car dealers and liquor stores?

Both car dealers and liquor stores are listed in Colorado’s Blue Laws in the statutes. A blue law is one restricting activities or sales of goods on Sunday, to accommodate the Christian sabbath. The first blue law in the American colonies was enacted in Virginia in 1617. Contrary to popular belief, there is no evidence to support the assertion that the blue laws were originally printed on blue paper. Instead, the word blue was commonly used in the eighteenth century as a disparaging reference to rigid moral codes and those who observed them.

Many states have repealed their blue laws allowing those businesses, once restricted by the blue law, to now be able to open on Sundays. For example, until 1985, Texas car dealerships continued to operate under blue-law prohibitions. Many states still prohibit selling alcohol on Sunday, although it’s now the second busiest shopping day of the week. Senator Veiga understands that Colorado Auto Dealers want to remain under the state’s blue laws. She has spoken on the issue, stating that she does not want her bill to flow over into other areas of the blue laws.  Her attempt is to allow liquor stores to open on Sundays, and keep other businesses (auto dealers) out of the bill. Prior to the legislative session, CADA spoke with Senator Viega in hopes of obtaining a tight title for the bill. Our efforts paid off as the bill was drafted with a very tight title, meaning only alcohol sales could be addressed in the bill. Adding any other business group would be virtually impossible.

We will continue monitoring this bill. From time to time, however, you may see reference to auto dealers just because auto dealers are the last business group to stay under the blue law umbrella.

Franchise Law Reform
We are actively seeking input from dealers on possible revisions to the franchise law in our state. If you have any comments or would like to share a story regarding a manufacturer-dealer issue, please let Nancy Burke know at nancy.burke@cadaonline.org or by calling 303.457.5115. We have hopes of introducing a “late bill” into this year’s Colorado legislative session to revise the statute that would make the playing field, between manufacturers and dealers, a more level one.

CIADA Legislation
The Colorado Independent Auto Dealers Association (CIADA) is currently pushing a bill (SB 151) through the legislature that requires eight hours of pre-licensing training for applicants for a USED motor vehicle dealer, a wholesale motor vehicle dealer or a wholesaler license. The bill allows the MVDB to set the components of the training program. Senator Tochtrop (D) is sponsoring the bill in the Senate and Rep Don Marostica (R) is sponsoring the legislation in the House of Representatives. The Colorado Automobile Dealers Association views this bill as a benefit for the industry as a whole and supports the bill with some minor yet critically important changes to ensure used card dealers are not adversely impacted.

Biennial Motor Vehicle Registration
Senate Bill 070, sponsored by Senator Bill Cadman (R), requires the department of revenue to offer the owner of a vehicle the option to register biennially. The bill exempts vehicles that are required to have an emissions test within the two year period. The proposed legislation also repeals the 2003 limit on biennial emissions testing of light duty non-commercial diesel vehicles. 

Air Quality Controls for Mobile Machinery
Many expressed their views concerning mobile machinery that use diesel fuel to comply with Federal Tier II standards of the EPA’s Clean Air Act.  Rep Fisher (D) of Ft. Collins wants to limit emissions from these sources at the Federal Tier II level and then within five years increase the requirement to the Tier III level. The bill establishes a per horse-power fee for non-compliance which could, in some instances, be upwards of a $50,000 fine. The bill exempts farmers who have an annual adjusted gross income of less than $250,000. In the nearly two hours of testimony, in the Health and Human Services Committee, several lawmakers spoke about the need for cleaner air. The bill is expected to be up for a vote on Thursday, Feb. 21. 

Other bills we are monitoring include business personal property tax, limits on selling items over the internet, license plates, hazardous waste legislation, automobile theft, prohibition of employee sharing wage information, disclosures of credit card receipts and more.                                                                        

New Appointee for House District 42
Karen Middleton (D) was appointed to fill the vacancy left by the resignation of Rep. Michael Garcia. She now represents House District 42 which is in Aurora. Middleton has served on the Colorado State Board of Education since 2004.

________________________________________________________

If you have questions on any legislative topic, please contact:



SALES TO CANADIANS

Certain new car models in the U.S. have become comparatively much less expensive than the same car in Canada—variances can be up to tens of thousands of dollars in some cases. As word has traveled of this disparity, more Canadian citizens and businesses (including re-sellers) are approaching U.S. dealerships about purchasing a new car.  While dealers in border-states were seeing such inquiries last fall, it seems that this practice is now reaching dealers in other states, including Colorado. Additionally, a complaint filed by a Canadian couple alleging discrimination against several manufacturers has generated some press on this issue and spurred questions from dealers about whether they can turn away such buyers. 

First, to clarify—the claim filed by the Canadian couple is currently against the relevant manufacturers—not the 80 or so New England dealerships they allege had rejected their purchase. It is also a claim filed with the Maine Human Rights Commission; not yet a lawsuit, though reports on file indicate the couple “plans” to sue.  Whether they can do so in the U.S. is an issue yet to be addressed.   

CLICK HERE for the Nov. 14, 2007 issue of Open Road, Automotive News at a Glance section, Canadian couple challenges denials
of new car purchase in U.S.
, from DealersEdge Daily Headlines for Oct. 23, 2007.

Second, those dealerships appear to have rejected the Canadian couples’ request to purchase because the dealers’ franchise agreements prohibited such sales.  Dealers should check their Sales and Service Agreements (as well as policy statements and related bulletins) carefully.  Here are a few points to consider:

  • The prohibition generally appears as a positive statement in a dealer agreement defining that the dealer may sell vehicles within the US—it
    may not be stated as a negative prohibition.
  • In the case of one manufacturer, the issue was clarified through a memorandum highlighting the manufacturer’s  “Export Policy” in which
    the following were noted:
    • Vehicles built for the U.S. market may not be properly equipped to meet other country’s standards
    • Contractual commitments typically exist with  dealers/distributors in other countries.
    • Manufacturer may withhold documentation not required by law that might assist a dealer or broker with exporting a vehicle outside of the continental U.S.
    • Penalties may include the refund of any sales contest or other special monetary incentives to dealers for any units which are exported outside of the U.S. within 120 days of sale; additionally, the dealership will be charged back for any payment that the manufacturer is obligated to make for claims made by the distributor in the other country.

Scenarios that have surfaced also include inquiries by Canadian citizens asking if the dealership will sell the car to relatives or friends who live in the U.S.,  who will then re-sell to the Canadian citizen. Note that in the sample “Export Policy” above, the penalties apply to any unit exported within 120 days of sale. Even without those penalties, and on used cars, there are a number of other issues that may arise in titling (Canada is a non-title country), lien perfection (financing a deal on a car that the dealer knows may be removed from the US could leave the dealer unprotected), varying emission or equipment standards, and the inability to transfer the manufacturer’s warranty.

The bottom line is that each dealer should fully understand manufacturer limitations and restrictions concerning sales of vehicles which will be used outside the United States. Dealers are strongly encouraged to consult with an attorney and/or an export specialist if considering selling used cars to residents of another country. 

CLICK HERE for a Canadian news report that may be useful to dealers who have Canadian consumers who may be upset with this perceived inequity resulting from  manufacturer distributorship arrangements. Excerpt from: U.S. car dealer rejects Canadian shopper, Friday, Aug. 31, 2007, CBC News

Biased or not, it's not an unheard-of phenomenon in the states. Angry auto shoppers are typically referred to the Competition Bureau, which says there's nothing illegal about the practice. Bureau spokesperson Chris Busutill said it's generally done to foil "arbitragers" — people who buy cars in the U.S. just to bring them back to Canada to sell at an inflated price. Arbitragers stand to make good money by the practice since some U.S. and Canadian car prices are vastly different, even though the loonie is now closer to parity than in recent years.

________________________________________________________

If you have questions on any legal or regulatory topic, please contact:

DISCLAIMER: CADA is not authorized to dispense legal advice.
The information contained in this weekly email is intended to provide important updates and reminders regarding statutes, litigation, and regulations. CADA always advises that dealers should consult legal counsel on the specifics of any laws or regulations to ensure proper compliance.

Event Description
Date/Time
Location
Denver International Auto Show March 26-30 Colorado Convention Center, Denver
2008 AutoVenture Luncheon presented by the South Metro Chamber

Thursday,
March 27
11 a.m. to 1:30 p.m.

Denver International Auto Show
Colorado Convention Center, Denver
CLICK HERE for more information or go to www.autoventureinfo.com

ATAE (Automotive Trade Association Executives) Service Directors Meetings

July 20-23

St. Julien Hotel, Boulder, CO
CLICK HERE for a registration form. Contact Tammi McCoy for more information or if you are interested in sponsorship information.

Colorado Dealer Management & Leadership Summit

Wednesday,
Aug. 13
8 a.m. to 7:30 p.m.

Marriott Denver South at Park Meadows
CADA Golf Event Monday, Sept. 8 Columbine Country Club
17 Fairway Lane
Columbine Valley, 80123



GM MARK OF EXCELLENCE GIVEN TO GHENT CHEVROLET

Congratulations to Ghent Chevrolet in Greeley, the only Colorado dealership to be named as a 2007 GM Mark of Excellence award. The General Motors Mark of Excellence is a performance-based award program based on customer satisfaction, sales volume and training. It also requires a minimum of completely trained and certified personnel to be qualified.

In addition to dealership qualification there is also a sales manager program. Congratulations again goes to Ghent Chevrolet dealership, which qualified for both the dealership and sales manager programs.

* * * * * * * * *

LET US KNOW ABOUT YOUR ACCOMPLISHMENTS!

Have you or anyone else at your dealership won an award recently? Have you or your dealership provided any outstanding community service? We want to recognize such accomplishments. Please send us a brief write-up of the award or event along with any other information to milestones@cadaonline.org.  Also include your contact information for further follow-up.


If you want to be added to our mailing list, please CLICK HERE.

 

Colorado Automobile Dealers Association
 290 East Speer Boulevard Denver, CO  80203
 Telephone:  303.831.1722  |  Facsimile: 303.831.4205
 www.cadaonline.org