Tag Archive | "NADA"

Colorado’s Jeff Carlson Elected NADA Chairman for 2016

PALM BEACH, Fla. — The National Automobile Dealers Association (NADA)’s board of directors has elected Jeff Carlson as chairman for 2016.

Carlson, who is currently serving as NADA vice chairman, is president of Glenwood Springs Ford and Glenwood Springs Subaru in Glenwood Springs, Colo., and co-owner of Summit Ford in Silverthorne, Colo. His term as chairman officially begins in January 2016. The ceremonial event of “passing the gavel” will occur at the 2016 NADA Convention and Expo in Las Vegas.

“This is a great honor, and I’m eager to lead NADA as we continue the important job of protecting the interests of America’s 16,500 franchised new-car dealerships, and the more than 1 million people they employ nationwide,” said Carlson, who represents Colorado’s new-car dealers on NADA’s board.

Mark Scarpelli, who represents Metropolitan Chicago’s new-car dealers on NADA’s board, was elected vice chairman. He is president of Raymond Chevrolet and Kia in Antioch, Ill., and is co-owner of Ray Chevrolet in Fox Lake, Ill.

Bill Willis, president of Willis Automotive Group (Chevrolet, Buick and Ford) in Smyrna, Del., was elected secretary. Neale Kuperman, president of Rockland Toyota in Blauvelt, N.Y., was elected treasurer.

The election took place at NADA’s board meeting in Palm Beach, Fla.

Posted in Auto Industry NewsComments (0)

NADA Files Second Request for Internal CFPB Documents

MCLEAN, Va. — The National Automobile Dealers Association (NADA) filed a Freedom of Information Act (FOIA) request today, asking the Consumer Financial Protection Bureau (CFPB) to release internal documents acknowledging that the agency intended to regulate the auto finance market through enforcement action, and eschewed evidence that its methods for estimating disparate impact were deeply flawed.

This is the second time in less than three months that the NADA has requested internal CFPB documents leaked to American Banker. A request filed in July asked that the bureau turn over documents that allegedly stated the CFPB’s “goal” in the auto lending arena was to significantly limit dealer discretion, despite the fact that the regulator is specifically prohibited from regulating auto dealers under the Dodd-Frank Wall Street Reform and Consumer Protection Act. The CFPB denied the NADA’s request three days later.

On Sept. 17 and Sept. 24, American Banker published articles that made numerous references to internal CFPB documents. Those documents supposedly show that the CFPB based its understanding of vehicle financing on a now-discredited study conducted by the Center for Responsible Lending. The bureau also allegedly acknowledged in the documents that the proxy methodology it uses to determine the presence of discrimination in auto lending is flawed, yet it continues to use the results to reach large settlements with finance companies like Honda Finance Corporation and Fifth Third Bank.

“These documents demonstrate a lack of transparency and accountability that should be deeply troubling to anyone concerned about how significantly a regulator can influence a market that affects millions of consumers,” said NADA President Peter Welch in a statement on the NADA’s website. “Consumers benefit tremendously from the discounts they get from dealers, and they have every right to demand that their voices be included in — not willfully excluded from — the debate about how to regulate the auto finance market.”

Earlier this month, during the bureau’s semi-annual report to Congress, CFPB Director Richard Cordray was challenged by lawmakers over the methods the bureau is using to bring enforcement actions against auto lenders. The regulator noted that “‘Accurate’ is in the eye of the beholder,” and that the CFPB is working to find the most reliable method possible to determine the presence of discrimination in auto lending.

However, Cordray was not forthcoming about the internal documents cited by American Banker, telling members of Congress he was only “roughly familiar” with the memos.

Posted in Auto Industry NewsComments (0)

CFPB Accused of Using ‘Junk Science’ to Regulate Auto Lending

WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB)’s Richard Cordray was met with hostility Tuesday as House Financial Services Committee Chairman Jeb Hensarling (R-Texas) attacked the “junk science” he said the bureau is using to impose regulations on indirect auto lending. The hearing occurred a day before the committee passed two bills aimed at reforming the bureau.

The CFPB has been pressuring auto lenders — most recently Fifth Third Bank — to cap the amount their dealer partners can mark up the interest rate on retail installment sales contracts as compensation for arranging a car buyer’s financing. The bureau alleges such practices result in minority car buyers paying higher rates for auto loans. But during the CFPB’s semi-annual report to Congress Tuesday, lawmakers repeatedly pointed to studies that show the CFPB’s method of determining the presence of discrimination in auto lending has high error rates.

Earlier this month, American Banker reported that internal CFPB documents acquired by the news source — including a memo from assistant director of the bureau’s Office of Fair Lending, Patrice Ficklin — indicate that bureau officials are aware that the agency’s methodology overestimates disparities.

“I believe I am roughly familiar with various memos I have seen,” Cordray said when asked about Ficklin’s memo during Tuesday’s hearing.

The director went on to say that “‘Accurate’ is in the eye of the beholder,” and that the regulator is working to find the most reliable method possible. Those methods, however, do not include taking the creditworthiness of car buyers into account.

“I don’t think it’s fair to say that credit scores can explain the disparities,” Cordray told Rep. Hensarling.

In its joint enforcement action with the Department of Justice Monday, the CFPB claimed that Fifth Third Bank’s dealer markup policy resulted in African American and Hispanic car buyers paying, on average, $200 more for car loans than similarly situated Caucasian customers.

“The CFPB have done some good things, but this business with the auto dealers is a bad thing,” said Rep. David Scott (D-Ga.) at Tuesday’s hearing. “… You based that on a report that was shamefully flawed, it was inaccurate, and to tell you the truth, it was downright insulting to African Americans because you just assumed our last name was Johnson or Williams or Robinson or maybe even Scott.”

The hearing preceded the House Financial Services Committee’s approval of two bills, H.R. 957 and H.R. 1266, that aim to restructure the CFPB to provide more transparency and oversight.

Sponsored by Rep. Steve Stivers (R-Ohio), H.R. 957 would create an independent inspector general for the bureau. That individual would be nominated by the president and confirmed by the senate. It passed the committee by a 56-3 vote.

H.R. 1266, which the committee passed by slimmer 35-24 vote, would remove the CFPB from within the Federal Reserve System and reestablish it as a standalone agency governed by a five-member, bipartisan commission. All powers of the CFPB would remain unchanged.

“Consumers are understandably concerned about our economy. We remain stuck in the worst recovery of the last 70 years,” said Hensarling after the committee’s approval of both bills. “At the same time, they’re concerned that Washington is taking away their choices and raising many of their costs. Our committee has the privilege — and responsibility — to fight for them.”

Testifying before the House Financial Service Committee, Cordray offered auto finance data countering the belief that the bureau’s activities have stunted market growth. In the first half of 2015, he noted, more than 14 million consumers obtained new auto loans, an 8% increase from a year ago.

“For auto loans, this marks a 45% increase since 2011 (when the bureau began operations) and a nine-year high,” he noted, with Rep. Maxine Water backing the bureau’s work during her opening statements at the hearing.

“It is unfortunate, however, that rather than working to encourage good behavior in our markets and support American consumers, opponents on this committee continue to promote measures to eliminate or weaken the bureau,” the lawmaker said. “They perpetuated false narratives of an agency that is unaccountable and lacks transparency despite the record number of times [Cordray has made himself] available to Congress and the many checks and balances contained in Dodd-Frank.

“So what we’re seeing now that the CPFB has celebrated its fourth birthday is that the dire predictions that the Republicans on this committee have made have not come true.”

Posted in Auto Industry NewsComments (0)

NADA Expands Effort to Protect Dealer-Assisted Financing

WASHINGTON, D.C. — The National Automobile Dealers Association (NADA) has launched a new initiative to highlight the true economic value of dealer-assisted financing, including video testimonials and a new website, officials announced this week.

On the new site, users can view testimonials from real consumers who benefited from receiving financing through a dealership.

“Consumers save money every day when they finance through dealerships, but that truth is getting lost in Washington, and that needs to change,” said NADA President Peter Welch. “The stories that we’re highlighting are far from unique. Dealers across the country save consumers money every day, and right now Washington is failing to understand what’s at stake for these consumers and millions more if competition is stifled and dealers are prevented from offering discounts on financing.”

In today’s vehicle finance market, local dealerships are able to shop a customer’s credit application to dozens of lenders all competing for the same loan. As a result, dealers usually offer better interest rates than consumers can find on their own. Furthermore, dealers have the ability to discount their rates to meet or beat a competing credit offer, which results in further savings for consumers.

“Most consumers know that financing is available at their local dealership, but what many don’t know is that dealer-assisted financing usually saves them money,” Welch added. “Many policymakers might not realize this either, but once the savings that comes from dealer discounting is made clear, it will be hard for Washington to turn a blind eye.”

The initiative is part of the NADA’s effort to stop the Consumer Financial Protection Bureau from restricting or eliminating the ability of dealers to provide competitive financing. The regulator has been targeting dealer markups, which it believes cause minorities to pay higher rates. But NADA officials have said the CFPB’s actions will have a negative effect on consumers’ ability to secure affordable auto loans.

Earlier this year, Reps. Frank Guinta (R-N.H.) and Ed Perlmutter (D-Colo.) introduced legislation — H.R. 1737 — that would promote transparency at the CFPB in order to help ensure that its policies do not unintentionally hurt consumers. In July, the legislation, which has 55 Democratic and 71 Republican cosponsors, passed the House Financial Services Committee on a 47-10 vote. The bipartisan vote included the support of 13 of the committee’s 26 Democrats, and House Republicans have indicated that the bill may come to the floor for a vote within the coming weeks.

“Our message is getting out, the facts are on our side, and people are starting to take notice,” Welch said. “But there’s too much at stake for consumers, so we don’t intend to take our foot off the gas until we know that consumer rights and consumer savings are adequately protected.”

Posted in Auto Industry NewsComments (0)

NADA Urges Dealers to Review FCC’s TCPA Ruling

WASHINGTON, D.C. — The National Automobile Dealers Association (NADA) is urging dealers to review their telephone and text marketing practices to ensure that they are in line with the Federal Communications Commission’s omnibus ruling and order regarding the Telephone Consumer Protection Act.

Issued on Friday, the ruling will affect a number of areas related to “autodialed” and pre-recorded telephone calls. Among the changes that could affect dealers, the NADA said this week, is the TCPA’s interpretation of the term “automatic telephone dialing system,” which encompasses “any technology with the capacity to dial random or sequential numbers.”

“The interpretation and several others in the order could require changes in dealers’ telephone and text messaging practices,” the NADA warned. “Dealers should review those practices and the system used to make calls and send text messages in light of these changes, and should consult with councel to ensure compliance with the new rulings.”

Dialing equipment that simply has the capacity to store or produce as well as dial random or sequential numbers would meet the TCPA’s definition of an autodialer. Predictive dialers also meet the definition of autodialer.

“Dialing equipment generally has the capacity to store or produce, and dial random or sequential numbers (and thus meets the TCPA’s definition of ‘autodialer’), even if it is not presently used for that purpose,” the commission said.

The ruling also puts the burden on the calling party to prove it obtained prior express consent should questions arise. It also requires that consent be obtained from the subscriber of the phone service, not the intended recipient of the call.

For telemarketing calls, prior-express-written consent requirements apply for each call made to a wireless number, rather than to a series of calls to wireless numbers made as part of a marketing campaign.

The commission also clarified whether telemarketers may make autodialed or prerecorded message calls to a wireless number that was initially linked to a wireline service. “Porting a telephone number from wireline service to wireless service does not revoke prior express consent,” the commission said. “If the consumer who gave consent to be called and later porter his wireline to wirless no longer wishes to be called because he may incur charges on his wireless number, it is the consumer’s prerogative and responsibility to revoke the consent.”

To review the FCC’s ruling, click here.

Posted in Auto Industry NewsComments Off on NADA Urges Dealers to Review FCC’s TCPA Ruling

Depreciation Slows in June, NADA Used Car Guide Reports

MCCLEAN, Va. — Used-vehicle depreciation slowed modestly in June compared to May’s more rapid pace, according to the NADA Used Car Guide, with prices for vehicles up to eight years in age falling 2.5% on a monthly basis in June, or more than a half a percentage point less than the 3.2% drop recorded a month earlier.

While May depreciation was among the worst recorded for the month since 1995, June’s drop wasn’t so dramatic. As a result, the NADA Used Car Guide’s seasonally adjusted used vehicle price index dropped a 0.2% relative to May to 123.7.

“With the first half of the year now behind us, one could say used-vehicle prices have held up well despite mounting pressure from the new-vehicle market and rise in supply,” the firm said in its monthly newsletter. “After all, NADA UCG’s index slipped by just 0.6% over the first half of 2015 compared to the all-time high reached over the same period in 2014.”

Year-to-date depreciation stood at 9% relative to all of 2014, which, according to the firm, was only moderately higher than the 7.2% rate recorded last year and less than the nearly 10% year-to-date drop logged in 2013.

“Digging a bit deeper, we see the year’s steady performance is a result of strong truck prices compensating for weak car prices,” the firm noted.

Cars, subcompact, compact and mid-size car prices have been among the softest all year, which the firm said is due in large part to intense new-market competition — both within their respective segments and from high-demand crossover utilities. Lower gas prices haven’t helped the situation, either, the firm noted.

“For example, new subcompact, compact and mid-size car incentives were up by a combined 10% through May, and the average spent per unit for the trio is similar to what’s been spent on luxury compact and mid-sized utilities — vehicles costing thousands of dollars more,” the NADA Used Car Guide noted.

The downward pressure has taken its toll on used prices for the group, with compact and mid-size car prices falling nearly 3% on a monthly basis in June. Prices for the pair on a year-to-date basis were 11% lower, on average, than in 2014. “This compares to depreciation of 7% over the same period last year,” the firm said.

Subcompact cars have performed even worse, with prices for the smallest car segment plunging by an average of nearly 4% in both May and June. That brought year-to-date depreciation to 12%, which is four percentage points worse than last year’s mid-year figure.

“By comparison, prices for used trucks and utilities have remained strong,” the firm noted.

With prices declining by 2.1% in June, compact utility prices bounced back from May’s 3.3% fall. Depreciation for the group on a year-to-date basis stood at 7%, which is just slightly worse than last year’s 6% figure.

“In June, mid-size and large utility prices fell by averages of 2.2% and 1%, respectively, which brought YTD depreciation to 6% — essentially unchanged from 2014,” the firm said.

Down 1.8%, mid-size van movement was fairly typical for June; however, the 10% drop in value on a year-to-date basis is two points higher than last year’s 8% figure. As for large pickups, prices dipped by 0.5% in June, bringing year-to-date depreciation to just 4% — and industry low.

“Large pickups continue to be the market’s standout performer,” the firm noted. “Large pickup prices haven’t fallen by more than 2.5% on a monthly basis in five years, which is a threshold passed by compact and mid-size cars more than a dozen times.”

As for the luxury segment, losses were less substantial than what occurred in both May and last June, with declines ranging from 1.5% to 2%. “Even so, YTD depreciation for luxury cars i among the highest in the industry,” the firm said.

Luxury compact car prices were down 11% in June, while luxury mid-size and large car prices were off by 13% and 15%, respectively. As for luxury utilities, prices of compact and mid-size luxury utilities were down by respective averages of 8% and 10% so far this year.

“On a like-age basis, we continue to see trucks and SUVs outperforming their car counterparts,” the NADA Used Car Guide said. “Through the first half of 2015, large pickup prices were 7.3% higher than the same period last year. Other strong performers include the mid-size utilities and large SUV segment, whose prices were 4.1% and 3.1% higher than last year, respectively.

“Subcompact and compact car prices were 1.7% and 6.9% lower than last year, respectively,” the firm added. “On the luxury side of the market, compact and mid-size SUV prices were around 1% higher than last year, however, compact, mid-size and large car prices were down between 0.6% and 2.9%.”

Posted in Auto Industry NewsComments Off on Depreciation Slows in June, NADA Used Car Guide Reports

Page 4 of 26« First...23456...1020...Last »