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News
February 2016
Legislative News
inside
MADA at the Capitol: Leveling the
Playing Field for Minnesota Dealers
2015 BBB Ad Statistics
FTC Hearing on Franchise Laws
Support the Expansion of NitroX
The Minnesota Legislature will convene March 8 in St. Paul for a
fast-paced, ten-week session. MADA is preparing to go on the
offensive for our dealers and is pursuing two bills to maintain a level
playing field for our members in their relationships with the factories
and insurance companies.
Protection against Chargebacks for Exports
The manufacturers’ decision to sell their vehicles in international
markets at double or triple the price of the same vehicle in the
United States has created a secondary market for desirable
vehicles. International buyers look to brokers to purchase a vehicle
more cheaply in the U.S and ship it across the globe. Rather
than adjust their pricing to prevent this practice, the factories are
demanding Minnesota dealers police their customers. Dealers
MADA at the Capitol... continued on page 3
Begin the NADA Convention in Style
You’re Invited
’s
COCKTAIL RECEPTION
THURSDAY, MARCH 31, 2016
7pm-9pm at the
B A R
&
mar
Title Basics
Minneapolis
mar
Certified Title
Minneapolis
8
8
mar
12-20
L O U N G E
in the
BELLAGIO
LAS VEGAS
If you’re heading to Las Vegas in
March, start your NADA Convention
experience in style. MADA will be
hosting a cocktail reception on
Thursday night at Lily, the premier
“ultra-lounge” in the Bellagio. This
gathering replaces MADA’s Sunday
brunch, which is no longer feasible
due to NADA’s reformatting of the
Convention schedule. We hope to see
you there!
Twin Cities Auto Show
Minneapolis
mar
Legislative Reception
Twin Cities Auto Show
mar
SPCC Reception
Twin Cities Auto Show
15
MADA News
to
upcoming events
15
visit
www.mada.org
for details, registration
and a complete list of
Upcoming Events and
Training
Scott Lambert, Executive Vice President • 200 Lothenbach Ave. • West St. Paul, MN 55118 • (651) 291-2400 • 1-800-652-9029 • FAX (651) 291-2894
Industry News
BBB Reports 2015 Dealer Ad Statistics
Better Business Bureau (BBB) reports that Minnesota new car dealers had another strong year for
both advertising compliance and consumer complaint resolution.
BBB’s 2015 year-end report is posted on the MADA web site at http://bit.ly/MADA_BBBreport. Here
are a few highlights:
• Advertising Review. BBB made a total of 128 advertising-related contacts to 92 different auto
dealers in 2015. In 70 of these cases, BBB utilized volunteer secret shoppers to test advertising
claims and sales practices, providing feedback on any modifications needed.
• Prior-to-Publication. The Bureau provided free Prior-to-Publication Advertising Review of 307
different pieces of proposed advertising sent by dealers. The total number of ads submitted was
down slightly from 2014, but 32 different dealers made use of the service in 2015, roughly twice
the number of unique users in 2014.
• Auto Dealer Consumer Complaints. Consumers filed 270 reportable complaints against Minnesota
new car dealers through BBB in 2015, with 142 different dealers receiving one or more complaints.
This represents a 5.4% increase in complaint volume from 2014.
• Complaint Resolution. New car dealers maintain one of the highest complaint resolution rates
among industries served by BBB – 99.66% in 2015.
The contact person at the BBB for dealer advertising issues and Prior-to-Publication review is
Advertising Liaison Steve Farr. Steve may be reached at 651-695-2430 or [email protected]
The Minnesota Automobile Dealers Association is a
non-profit trade association dedicated to the progress of the retail auto
industry in Minnesota.
President
Mike Saxon, Inver Grove Ford Lincoln, Inver Grove Heights
President-Elect
Rick Jensen, Jensen Motors, Inc., New Ulm
Treasurer
Michael Stanzak, Key Cadillac, Inc., Edina
Secretary
Peter Kolar, Kolar Toyota Scion, Duluth
Executive Vice President
Scott Lambert, MADA Executive Vice President
200 Lothenbach Avenue • West St. Paul, MN 55118
Metro: 651-291-2400 • Toll Free: 800-652-9029
FAX: 651-291-2894 • Web site: http://www.mada.org
February 2016 / Page 2
visit us online at
www.mada.org
Industry News
FTC Gets an Earful About Franchise Laws
The Federal Trade Commission (FTC) held a one-day public workshop last month to explore the
pros and cons of state franchise protection laws which regulate the treatment of new vehicle dealers
by motor vehicle manufacturers. Do these laws favor consumers and preserve a multi-pointed
marketplace with vigorous price competition and sufficient service and parts capacity to keep millions
of vehicles in good and safe operating condition? Or, are these laws anti-competitive and anticonsumer, keeping prices up and keeping new entrants out of the automobile retail business?
• Tesla was there demanding the right to sell vehicle direct to consumers.
• Factory representatives complained about the price of warranty and recall work.
• Dealer representatives described the power of the manufacturers and the necessity of the laws to
protect main street and ensure the viability of the distribution and repair system for the future.
Peter Welch, president of the National Automobile Dealers Association, summed up the day as
follows:
“A lot of what we heard today was, in fact, an affirmation of the tremendous value to consumers
that the independent, franchised dealer network provides. Empirical research has demonstrated
that intense competition among franchised dealers lowers new-car prices by hundreds of
dollars. But the benefits to consumers don’t end there -- they extend to service, warranty work,
recalls, and the hundreds of millions of dollars that’s invested in local communities.”
MADA understands the importance of the Minnesota Franchise Protection Law and fights vigorously to
protect it and to enhance it.
MADA at the Capitol... continued from cover
who sell a vehicle that ends up being exported,
typically in 120-180 days, face steep chargebacks
or other penalties from the manufacturer.
of Minnesota dealers to protect their global sales.
MADA will be promoting a bill to prohibit dealers
who have done their due diligence to prevent a
sale for export from being unfairly penalized by
the manufacturer with chargebacks or changes in
vehicle allocation.
Since its inception two years ago, the MADA
Service, Parts & Collision Council has been
working behind the scenes to slow the
proliferation of requirements insurance companies
are placing on body shops that participate in
direct repair programs (DRP). The Council’s
efforts have resulted in productive conversations
yet don’t seem to deter the insurers from
continuing to invent new burdens that inhibit
dealer body shops from serving their customers.
As a result, MADA plans to get the attention of
the insurance companies by introducing a bill to
take away their ability to make referrals based on
whether a body shop is in a DRP. Instead, the
bill will require insurers to make referrals based
on factors that are based on the best-interest of
the consumer, not how a body shop ranks in an
insurer’s DRP.
Minnesota’s Motor Vehicle Franchise Law is an
important tool for ensuring that dealers, who have
made substantial investments in their retail outlets
and act in good faith, are not treated unfairly
by the factories. For 35 years, the Minnesota
Legislature has developed public policy on a
bipartisan basis to promote a distribution system
for new vehicles that is both performanceoriented and even-handed – with both the
manufacturer and the dealer having rights and
responsibilities in their business relationship.
MADA hopes to continue that tradition in 2016
and discontinue factories from taking advantage
Cracking down on Steering by Insurance
Companies
February 2016 / Page 3
Legal News
B10 Litigation Progressing in Federal Court
MADA announced last April that a coalition of
vehicle and fuel industry organizations filed a
federal lawsuit alleging that Minnesota’s biodiesel
content mandate could create significant harm
to vehicles that are not designed to be run using
such fuel blends.
The B10 mandate – which went into effect on
July 1, 2014 – requires all diesel fuel sold in
Minnesota from April through September to
contain at least 10 percent biodiesel (B10).
The primary thrust of the lawsuit is that Minnesota
shouldn’t be allowed to get ahead of the Federal
government in regulating biodiesel content in
diesel fuel. The suit claims that the Federal
government “preempted” state law in this area in
favor of national standards regulating complicated
pollution and environmental issues.
Last summer, the litigation became even more
complex when four organizations successfully
“intervened” into the lawsuit on the side of the
State of Minnesota. The National Biodiesel Board,
the Minnesota Soybean Growers Association,
the Minnesota Biodiesel Council and the Iowa
Biodiesel Board were all granted DefendantIntervenor status by the federal court last August.
There was a flurry of activity over the holidays
with all of the parties filing motions and countermotions all pretty much asking the court for the
same thing: Decide in our favor now without any
further fact finding or a trial.
There’s an indication now that the court may
listen to oral arguments on these various motions
as early as this coming April. MADA will keep
members informed of significant developments.
Council News
NitroX Summer Camp Expands
Dealer Support Requested
Last year, MADA’s Service, Parts & Collision Council helped launch
NitroX, a weeklong summer camp where middle-school youth
get exposed to the automotive industry. The camp was met with
such resounding success that the Council is pleased to announce its
expansion to three locations this summer, thanks to the financial support of the Transportation Center
of Excellence. In addition to the program at St. Cloud Technical & Community College, Central Lakes
College in Brainerd and Hibbing Community College have been chosen to host NitroX camps in 2016.
Get involved
Making these camps successful requires resources of many types, from financial contributions to
student mentors, to real-life experiences. Added together, these help make NitroX a fantastic and
memorable experience for the kids. Your dealership can become a program sponsor by providing:
• a tour of your facility or hosting lunch;
• donating products or equipment; or
• hosting the campers at an entertaining activity (i.e. racetrack experience.)
Please contact Denise Anderson at [email protected] if you are interested in pursuing one of these
opportunities. They provide your dealership the chance to get involved with students, their parents and
educators to promote your business and get youth excited about entering the automotive profession.
Please note that dealerships with Council members are given priority to participate as camp sponsors.
February 2016 / Page 4
Minnesota Auto Outlook
Covering the Minnesota automotive market
Data thru December 2015
Released by:
Minnesota Automobile
Dealers Association
Minnesota New Retail Car and Light Truck Registrations
Most Recent Two Months
11/14 &
11/15 &
12/14
12/15*
38,860
40,134
12,513
11,189
26,347
28,945
Industry Total
Cars
Light Trucks
YTD thru Dec.*
YTD Market share (thru Dec.*)
%
change
3.3%
-10.6%
9.9%
2014
213,557
77,875
135,682
2015
216,052
71,281
144,771
%
change
1.2%
-8.5%
6.7%
2014
2015
change
36.5
63.5
33.0
67.0
-3.5
3.5
Japanese Brands
Toyota
Honda
Nissan
Other
13,121
4,450
3,416
2,147
3,108
13,525
4,715
3,277
2,243
3,290
3.1%
6.0%
-4.1%
4.5%
5.9%
74,448
26,551
19,790
11,401
16,706
73,801
25,917
19,120
11,692
17,072
-0.9%
-2.4%
-3.4%
2.6%
2.2%
34.9
12.4
9.3
5.3
7.8
34.2
12.0
8.8
5.4
7.9
-0.7
-0.4
-0.5
0.1
0.1
Domestic Brands
General Motors
Ford
Chrysler
Other
21,081
8,892
6,839
5,316
34
22,135
9,681
7,045
5,355
54
5.0%
8.9%
3.0%
0.7%
58.8%
112,747
45,973
38,556
28,028
190
116,639
49,285
39,106
27,992
256
3.5%
7.2%
1.4%
-0.1%
34.7%
52.8
21.5
18.1
13.1
0.1
54.0
22.8
18.1
13.0
0.1
1.2
1.3
0.0
-0.1
0.0
European Brands
Volkswagen
BMW
Mercedes
Other
2,515
1,108
663
445
299
2,345
1,047
455
436
407
-6.8%
-5.5%
-31.4%
-2.0%
36.1%
13,088
6,258
3,234
2,181
1,415
12,624
6,034
2,740
2,100
1,750
-3.5%
-3.6%
-15.3%
-3.7%
23.7%
6.1
2.9
1.5
1.0
0.7
5.8
2.8
1.3
1.0
0.8
-0.3
-0.1
-0.2
0.0
0.1
Korean Brands
2,143
2,129
-0.7%
13,274
12,988
-2.2%
6.2
6.0
-0.2
Brands included above: Domestic Brands: GM (Buick, Cadillac, Chevrolet, and GMC), Ford (Ford and Lincoln), Chrysler (Chrysler, Dodge, Jeep, and Ram). Japanese: Toyota (Toyota,
Lexus, and Scion), Honda (Honda and Acura), Nissan (Nissan and Infiniti), Other (Mazda, Mitsubishi, and Subaru). European: VW (Audi, Bentley, Porsche, and Volkswagen), BMW
(BMW, Rolls Royce, and MINI), MB (Mercedes Benz and smart), Other (Alfa Romeo, Aston Martin, Ferrari, Fiat, Jaguar, Land Rover, Lotus, Maserati, and Volvo). Korean: Hyundai and Kia.
*Figures for December 2015 were estimated by Auto Outlook. Data Source: IHS Automotive.
Percent Change in Three Month Moving Average of
New Retail Registrations versus Same Period Year Earlier
Percent Change in State and U.S.
New Retail Light Vehicle Markets
YTD ‘15 thru December* vs. YTD 14
% change vs. year earlier
15.0% 11.7%
10.0%
5.0%
7.2%
7.2%
7.0%
3.4%
3.2%
0.5%
-8.5%
State
6.7%
0.0%
-5.0%
-10.0%
-1.2%
-2.8%
-5.5%
-6.8% -6.2%
Cars
-3.5%
Trucks
U.S.
-15.0%
14.0%
-20.0%
Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15Dec-15*
Last month in period
-15.0%
The graph above provides a clear picture of the trending direction of the state market. It shows the year-overyear percent change in the three month moving average of new retail light vehicle registrations. The three
month moving average is less erratic than monthly registrations, which can fluctuate due to such factors as
the timing of manufacturer incentive programs, weather and title processing delays by governmental agencies.
*Figures for December 2015 were estimated by Auto Outlook. Data Source: IHS Automotive.
-5.0%
5.0%
15.0%
25.0%
The graph above compares the change in new retail car and light
truck registrations in both the state and U.S. markets.
*Figures for December 2015 were estimated by Auto Outlook.
Data Source: IHS Automotive.
Data Information
All data represents new vehicle retail registrations in Minnesota and excludes fleet and wholesale transactions. Please keep in mind that monthly registration figures can occasionally
be subject to fluctuations, resulting in over or under estimation of actual results. This usually occurs due to processing delays by governmental agencies. For this reason, the yearto-date figures will typically be more reflective of market results.
Data Source: IHS Automotive.
February 2016 / Page 5
Minnesota Auto Outlook
Data thru December 2015
Minnesota
New Retail Light Vehicle Registrations
Registrations
TOTAL
Acura
Audi
BMW
Buick
Cadillac
Chevrolet
Chrysler
Dodge
FIAT
Ford
GMC
Honda
Hyundai
Infiniti
Jaguar
Jeep
Kia
Land Rover
Lexus
Lincoln
Mazda
Mercedes
MINI
Mitsubishi
Nissan
Other
Porsche
Ram
Subaru
Tesla
Toyota
Volkswagen
Volvo
State Market Share for Top 15 Selling Brands
YTD ‘15 thru December* vs. YTD 14
Market share
YTD '14 YTD '15
YTD '14 YTD '15
thru Dec. thru Dec.* % change thru Dec. thru Dec.*
213,557 216,052
1%
1,657
1,453
-12%
0.8%
0.7%
1,759
1,669
-5%
0.8%
0.8%
2,700
2,359
-13%
1.3%
1.1%
4,120
4,035
-2%
1.9%
1.9%
1,443
1,347
-7%
0.7%
0.6%
32,139
34,649
8%
15.0%
16.0%
3,637
3,875
7%
1.7%
1.8%
6,970
5,693
-18%
3.3%
2.6%
252
223
-12%
0.1%
0.1%
37,410
37,940
1%
17.5%
17.6%
8,271
9,159
11%
3.9%
4.2%
18,133
17,672
-3%
8.5%
8.2%
6,115
5,885
-4%
2.9%
2.7%
877
792
-10%
0.4%
0.4%
70
66
-6%
0.0%
0.0%
9,504
10,270
8%
4.5%
4.8%
7,159
7,137
0%
3.4%
3.3%
345
528
53%
0.2%
0.2%
2,359
2,446
4%
1.1%
1.1%
1,146
1,149
0%
0.5%
0.5%
4,429
4,494
1%
2.1%
2.1%
2,154
2,103
-2%
1.0%
1.0%
534
457
-14%
0.3%
0.2%
2,154
1,986
-8%
1.0%
0.9%
10,524
10,844
3%
4.9%
5.0%
196
168
-14%
0.1%
0.1%
285
286
0%
0.1%
0.1%
7,917
8,168
3%
3.7%
3.8%
10,113
10,596
5%
4.7%
4.9%
98
200
104%
0.0%
0.1%
24,192
23,464
-3%
11.3%
10.9%
4,214
4,089
-3%
2.0%
1.9%
681
850
25%
0.3%
0.4%
17.6
17.5
Ford
16.0
15.0
Chevrolet
10.9
11.3
Toyota
8.2
8.5
Honda
Nissan
5.0
4.9
Subaru
4.9
4.7
Jeep
4.8
4.5
GMC
4.2
3.9
Ram
3.8
3.7
3.3
3.4
Kia
Data source: IHS Automotive.
Top ten ranked brands in each percent change category are shaded green.
2.7
2.9
Hyundai
*Figures for December 2015 were estimated by Auto Outlook.
2.6
3.3
Dodge
This report is sponsored by the Minnesota Automobile Dealers Association
and produced by Auto Outlook (800-206-0102).
Auto Outlook, Inc. is not responsible for management decisions based on
the content of Minnesota Auto Outlook. Copyright Auto Outlook, January
2016.
Reproduction, including photocopying of this publication in whole or in
part, is prohibited without the express permission of Auto Outlook, Inc.
Any material quoted must be attributed to Minnesota Auto Outlook, published by Auto Outlook, Inc. on behalf of the Minnesota Automobile Dealers Association and must also include the statement: “Data Source: IHS
Automotive.”
YTD '15
thru
Dec.*
Mazda
2.1
2.1
Volkswagen
1.9
2
Buick
1.9
1.9
0.0
2.0
4.0
Data source: IHS Automotive.
YTD '14
thru Dec.
6.0
8.0
10.0
12.0
Market Share
*Figures for December 2015 were estimated by Auto Outlook.
February 2016 / Page 6
14.0
16.0
18.0
Member News
Apple Autos has opened a new dealership in Shakopee. Apple
Chrysler Dodge Jeep RAM is located at 1301 Greenwood Court.
North Star Garage in Milaca has closed.
Christian Brothers Ford, 1375 Hwy 2 East, Crookston is open for
business with a new showroom, offices and service area after a
fire destroyed their building in 2014.
The Minnesota Auto Dealers Association
represents the state’s 363 new car and
truck franchised dealers. We employ almost
19,000 Minnesotans with a payroll of $940
million and annual sales of $11.1 billion,
providing the state over $721 million in sales
tax revenue every year.
Heartland Motor Company in Morris has a new building located
at 1 East Hwy 28.
Andrew Dahl has opened Dahl Toyota at 1077 West Service
Drive in Winona.
Endorsed Service & Vendors
Check Guarantee/Credit Card Processing
FIS / Certegy
Collections
Springer Collections
Computerized Vehicle Registration
CVR
Dealer Bond Program
Ensure Agency
Disability Income Insurance & Section 125
Cafeteria Plans
American Fidelity Assurance
F&I Products
Protective
Fleet Fueling Program
SuperAmerica
MADA News
Legislative Reception at the
Twin Cities Auto Show
Group Health Insurance
Blue Cross Blue Shield of MN
Delta Dental
ReliaStar Life
Hole-In-One Insurance
Hole-In-One-USA
Lighting
LED Supply Company
Office Supplies
Innovative Office Solutions
Gotta Go To The Legislative Reception
March 15, 2016
At The Auto Show
• Participate in the largest gathering of consumers
in the Upper Midwest that fuels tens of
thousands of motor vehicle sales in Minnesota
• View over 525 vehicles worth over $15,000,000
• Get charged in the all-new Electric Room
2016LegInvite.indd 1
OSHA, EPA & DOT Compliance/Training
ComplyNet Corporation
Pre-Paid Legal, Jim Gavin
Identity Theft Shield &
Pre-Paid Legal Services
Uniforms and Linen Services
AmeriPride Linen & Apparel
Services
Workers Compensation
Ensure Agency
2/3/16 10:15 PM
On Tuesday, March 15, MADA will be holding a legislative reception
for Minnesota state representatives and senators. Please join us
from 6-8 to visit with your local elected official and discuss the
issues important to you. Contact MADA Director of Government
Affairs Amber Backhaus at [email protected] for more details.
MADA Services sells a wide variety of
products directly to the dealers including
business forms, clothing and promotional
items. For a full review of options, contact
your sales representative at 651-291-2400
or go to www.mada.org
February 2016 / Page 7
200 Lothenbach Avenue
West St. Paul, MN 55118
ADVOCACY • EXPERTISE • EDUCATION • COMMUNICATION
MADA NEWS • February 2016
FAQ
Q: The January MADA Newsletter told us about a new provision in the DVS Dealer Web
Access Agreement that requires dealers to “maintain a record to verify work-related queries.”
Does DVS want us to log all inquiries into ESupport?
A: The new requirement concerns privacy of customer data and personal information.
It’s
part of an ongoing effort by DVS to protect the integrity of the motor vehicle database. If you
look up a customer record, DVS wants you to document the permissable purpose of that
inquiry.
But not all work that you do on DVS ESupport involves access to customer information.
You may be looking up base values, renewing your dealer license, looking at forms and
resource materials or working in the “held for resale” form where no customer information is
displayed. These inquiries where no customer information is available need not be logged.
Scott Lambert, Executive Vice President • 200 Lothenbach Ave. • West St. Paul, MN 55118 • (651) 291-2400 • 1-800-652-9029 • FAX (651) 291-2894
Education
Fax Registration
FAX REGISTRATION TO: 651-291-2894
Denise Anderson [email protected]
The Certified
Title &
Registration
Program*
Title Basics
Class Options
Sales Tax
9:00 a.m. - 10:00 a.m. $129
New to Fleet
10:30 a.m. - 12:30 p.m. $129
Circle Preferred Date
March 8, 2016
March 8, 2016
Minnesota Titles and Transfers March 8, 2016
1:00 p.m. – 3:00 p.m. $129
Class Options
Circle Preferred Date
Title Basics – Minneapolis
March 8, 2016
9:30 a.m. - 11:30 a.m. $199
Location
Doubletree by Hilton Park Place
1500 Park Place Blvd
Minneapolis, MN 55416
Location
Doubletree by Hilton Park Place
1500 Park Place Blvd
Minneapolis, MN 55416
Name__________________________________________ Title____________________________
Name__________________________________________ Title____________________________
Dealership______________________________________ Customer ID #____________________
Address________________________________________________________________________
Phone______________________________ E-mail______________________________________
*Lunch is included, sponsored by CVR.
For Information on these classes or to register online go to www.mada.org/training