Pub. 21 2022 Issue 1

The Direct Sales model is WRONG FOR CONSUMERS. New Jersey has been at the forefront of this fight for several years, but direct
sales fights continue to rage all over the country, as you will see in our featured story from this issue of New Jersey Auto Retailer. Initially, it was just Tesla, but now Rivian, Lucid and other startups are taking up the mantle and trying to gain special consideration from Legislatures coast to coast. Even some legacy automakers are toying with the idea of breaking off their EV product into standalone companies.

Two of the most important and widely used forms in a dealership include the Prior Use Disclosure Form (Sample on page 37) and Prior Use and Damage Disclosure Acknowledgment Form. (Sample on page 36) These forms were developed by NJ CAR. The Prior Use Disclosure Form is used by dealers to disclose all possible prior uses of a vehicle, including use as a Company Vehicle/Factory Executive Vehicle (ex. Demonstration and Loaner vehicles), Program Vehicle/Factory Repurchase Vehicle, Rental Vehicle/Off-Lease Vehicle, and Wholesale Vehicle. If applicable, each disclosed use should be signed for by the customer.

Earlier this year, Bill S1031 was introduced in the New Jersey Legislature. The bill would require licensed dealerships to report their documentary preparation fees (Doc Fees) to the Attorney General’s office. Subsequently, the fees would be posted on the websites maintained by the Department of Law & Public Safety and the Division of Consumer Affairs.

NADA Chairman Paul Walser recently authored an article regarding NADA’s efforts to find relief for the many dealers that rely upon the Last-In, First-Out (LIFO) accounting method for their new vehicle inventories. Below is an edited version of the article.

Electric Vehicles (EVs) and hybrid EVs have been steadily growing in popularity over the past decade, especially in the last two years, as talks of climate change, sustainability, and environmental stewardship come to the forefront. Many car manufacturers are already making plans to expand their plug-in offerings or are going all-electric, mandating that dealerships adopt EV charging infrastructure as a result. Navigating the new electric vehicle charging landscape in New Jersey can be overwhelming.

For more than 100 years, auto manufacturers have used franchisees to distribute their products to consumers. The franchise model provides many benefits to consumers, including inter and intra-brand price competition and ready access to warranty, recall, and general maintenance service.

Increasing awareness of environmental issues caused by vehicles is one of the primary factors driving the growth of the global zero-emission vehicle (ZEV) market. As a result, reducing carbon emissions from vehicles has been identified as one of the key strategies in limiting climate change.

NJ CAR appreciates the support of the 312 dealers who contributed to CAR-PAC, the Coalition’s political action committee, between Jan. 1, 2021 and Dec. 31, 2021. CAR-PAC needs the contributions of ALL dealers to ensure it has the necessary financial resources to support candidates (on both sides of the aisle) who support the franchised retail automotive industry in New Jersey and ensure the dealers’ voice is heard in Trenton on a wide variety of important public policy issues. CAR-PAC has been (and will continue to be) very active in supporting the candidates who support our industry.

NADA PAC helps to elect to Congress qualified individuals who understand the needs of new car and truck dealers. NADA PAC is consistently credited as being one of the nation’s top trade association political action committees in terms of both total fundraising and contributions to federal candidates. NADA PAC supports candidates for Congress on a bipartisan basis from the recommendations of the NADA PAC dealer leadership for each state.

The Federal Trade Commission recently announced a newly updated rule that strengthens the information security safeguards that automotive dealers are required to put in place to protect their customers’ financial information. In recent years, widespread paper-based documents, other data information breaches, and cyberattacks have significantly harmed consumers, including monetary loss, identity theft, and other forms of financial distress. The FTC’s updated Safeguards Rule requires motor vehicle dealers to develop, implement, and maintain a comprehensive security system to keep their customers historic and current paper-based document information safe.

Cyber-attacks on dealerships are becoming more and more prevalent and are costing hundreds of thousands of dollars, lost customers, and reputational damage. You probably already know of a dealership that has been a victim of this growing crime.

Imagine fishing from your favorite pond and catching the same fish over and over again. And even when you catch a new type of fish, you aren’t able to keep it on the line because you don’t have the right pole. You hope things improve, but you continue to fish out of the same pond with the same pole. This simple metaphor reflects the state of diversity and inclusion in automotive retail.