march 2014 msada magazine

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March 2014 • Vol. 27 No. 3

FIRST CLASS MAILUS POSTAGE PAID

BOSTON, MAPERMIT NO. 216

MSADA, One McKinley Square, Sixth Floor, Boston, MA 02109

autoD E A L E R

M A S S A C H U S E T T S

The official publication of the Massachusetts State Automobile Dealers Association, Inc

SteppingFrank Hanenberger

TA B L E O F C O N T E N T S

4 FROM THE PRESIDENT: Seizing Our Power

6 THE ROUNDUP: Business Uncertainty Continues

10 TROUBLESHOOTNG: Dealer Data and Service Providers

11 SOUND OFF: Tesla aka TSLA

12 AUTO OUTLOOK

14 ACCOUNTING: Will You Be Ready When Windows XP Ends?

15 ACCOUNTING: Seek, Attract and Retain the Best Salespeople

16 COVER STORY:

Frank Hanenberger is

Stepping Up

19 INSURANCE: OSHA

Cracks Down on Lift Safety

20 NEWS From Around the Horn

25 FINANCIAL SERVICES:

Navigating the Challenging Landscape of Health Care

26 NADA UPDATE: The Franchise Dealer Network—

An Economic Engine

28 NADA MARKET BEAT

www.msada.org Massachusetts Auto Dealer MARCH 2014

The official publication of the Massachusetts State Automobile Dealers Association, IncS TA F F D I R E C T O R Y

Robert O’Koniewski, Esq.Executive Vice [email protected]

Jean Fabrizio Director of Administration

[email protected] Brennan, Esq.

Staff [email protected]

Paul FellowsAdministrative Assistant/ Membership Coordinator

[email protected]

A U T O D E A L E R M A G A Z I N E

Robert O’Koniewski, Esq.Executive Editor

Catherine MacDonaldEditorial Coordinator

[email protected]

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autoD E A L E R

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about the Bay State auto retail industry and news of MSADA and its membership.

AD DIRECTORYBellavia & Blatt, 2BlumShapiro, 22

Boston Herald, 32Lynnway Auto Auction, 23

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Schlossberg, LLC, 20Southern Auto Auction, 24

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from the PRESIDENT4

MARCH 2014 Massachusetts Auto Dealer www.msada.org

by Scott Dube, MSADA President

“W

Seizing Our PowerLeadership roles bring their own unique rewards

“ e’re never going to be perfect, but we’ve always got to strive to be perfect.”

Sage advice from our newest Middlesex County Board Mem-ber Frank Hanenberger. As dealers, we’re constantly in search of better ways of doing business. Whether it’s working on our relationships with our employees, strengthening the bond with our customers or something as simple as trimming the hedges, there’s always another checklist item. Our work is never finished.

Given that pressure, it can be tempting to shut out external pressure. Why worry about the welfare of others when tend-ing your own affairs is so difficult? At MSADA, we hope to do the vast majority of that collective worrying for you. We’re on top of all manner of regulatory and legislative issues so that you don’t have to be.

But sometimes we need to lift the curtain and show the world our numbers. We need you to seize the power you have as an American, a taxpayer and a voter to make your voice heard. For Frank, that moment came at our an-nual Dealer Day on Beacon Hill, when we invite all of our dealer members to visit with their legislators and take part in the politi-cal process.

As you’ll read in this month’s cover story about Frank, par-ticipating in Dealer Day opened his eyes to the realities we face on Beacon Hill. The gap in understanding is large, and we need people to represent who we are as a community. Frank decided to step up.

“I think our business gets a bad rap,” Frank explains. “Not that we’re perfect by any means, but the car dealer stereotype is particularly a negative one. I try to take every opportunity I can to promote a positive image of what dealers do, both on a local level as well as a statewide level.”

As you’ve heard me say time and time again, we all can do a few simple things to make a big difference when it comes to our collective well-being. When was the last time you called up your legislator? Was it when we were fighting Right to Repair or working for 93B reform? It’s time to call again. And while there’s always something on our agenda, it’s important to remember that engaging on a relationship level is key. Your legislator should care about how your business is doing, not just the legislation in front of him.

You may not be a political junkie like Frank, but we’re all in this together. As we finally enter Spring, I encourage you to grow your relationship with your legislators. It’s a relationship that will always pay off when it counts, and it’s as simple as a few minutes here and there.

I hope you will join me in showing Frank our appreciation for deciding to serve as a representative of our way of life. Like all of us, he is self-made, and is engaged with the world around him. And while not all of us have the time or ability to contribute at the director level, we can all be useful in helping to spread the word about the positive work that we do.

Bob O’Koniewski Elected to ATAE BoardCongratulations to our Association’s Executive Vice President

Bob O’Koniewski for his election to the Automotive Trade As-sociation Executives (ATAE) Board of directors.

Bob will represent Region 1, which includes auto trade asso-ciations in Connecticut, Delaware, Maine, Maryland, Massachu-setts, New Hampshire, New Jersey, New York, Pennsylvannia, Rhode Island, Vermont and the District of Columbia. He will serve a two-year term until January 2016.

t

MSADA

“We need you to seize the power you have as an American, a

taxpayer and a voter to make your voice heard.”

5


Name Contact TelephoneADESA Boston Chris Carli (508) 270-5403ADP Dealer Services Maria Trezza (973) 404-4466Albin, Randall & Bennett Barton D. Haag (207) 772-1981American Fidelity Assurance Co. Tom Trudell (413) 885-5477AutoRaptor (RAL) Howard L. Leavitt (401) 421-6533Bank of America Merrill Lynch Dan Duda and Nancy Price (781) 534-8543 Bellavia Blatt Andron & Crossett, PC Leonard A. Bellavia, Esq (516) 873-3000 Blum Shapiro John D. Spatcher (860) 561-4000Boston Globe Mary Kelly (617) 929-8373The Boston Business Advisory Group Paul Cuomo (781) 681-1501 Vincent Saccone (781) 681-1519Burns & Levinson LLP Paul Marshall Harris (617) 345-3854Cars.com Heidi Allen (312) 601-5376 CitNOW Jack Gardner (617) 221-8008 CloudDOCX Michael DeCarlo (585) 704-6826 Construction Management & Builders, Inc. Kate Sullivan (781) 246-9400CVR John Alviggi (267) 419-3261Dealermine Inc. Karen Parmenter (800) 304-3341 x5179 DealerTrack Ernest Lattimer (516) 547-2242Downey & Company Paul McGovern (781) 849-3100EasyCare New England Inc. Mike Douglas (770) 246-9724Ethos Group, Inc. Drew Spring (617) 694-9761F & I Resources Jason Bayko (508) 624-4344Federated Insurance John Ballard (859) 312-9896First Citizens Federal Credit Union Joe Ender (508) 979-4728 Fisher & Phillips LLP John Donovan (404) 240-4236 Joe Ambash (617) 532-9320Grant Thornton LLP Alan Oslomowski (508) 926-2200GW Marketing Services Gordon G. Wisbach Jr. (781) 899-8509 Huntington National Bank John J. Marchand (781) 326-0823Key Bank James Q. Moretti (781) 558-5132Leader Auto Resources, Inc. Brendan J. Murphy (518) 878-6341Lynnway Auto Auction Jim Lamb (781) 596-8500M & T Bank John Federici (508) 699-3576MetroMedia Energy Timothy Teevens (800) 828-9427Micorp LLC Ryan Kim (508) 832-9816Mid-State Insurance Agency James Pietro (508) 791-5566Mintz Levin Kurt Steinkrauss (617) 542-6000Murtha Cullina Thomas Vangel (617) 457-4000Nancy Phillips Associates, Inc. Nancy Phillips (603) 658-0004O’Connor & Drew, P.C. Kevin Carnes (617) 471-1120Performance Management Group, Inc. Mark Puccio (508) 393-1400Ray-Jurgen Richard Thibadeau (860) 585-0111R.L. Tennant Insurance Agency, Inc. Walter F. Tennant (617) 969-1300Resources Management Group J. Gregory Hoffman (800) 761-4546Reynolds & Reynolds Marc Appel (413) 537-1336Robinson Donovan Madden & Barry, P.C. James F. Martin, Esq. (413) 732-2301Samet & Company John J. Czyzewski (617) 731-1222Schlossberg, LLC Michael O’Neil, Esq. (781) 848-5028Sentry Insurance Company Eric Stiles (715) 346-7096Shepherd & Goldstein Ron Masiello (508) 757-3311Silverman Advisors, PC Scott Silverman (781) 591-2886Southern Auto Auction Tom Munson (860) 292-7500Sovereign Bank Richard Anderson (401) 432-0749Target Dealer Services Andrew Boli (508) 564-5050TD Auto Finance BethAnn Durepo (603) 490-9615TD Bank Michael M. Lefebvre (413) 748-8272TrueCar Steve White (774) 392-2904 Wells Fargo Dealer Services Christopher Peck (508) 314-1283 Wicked Local Media Massachusetts Jay Pelland (508) 626-4334 Windstream Rick Caruth (978) 296-0313; (413) 977-6111 Zurich American Insurance Company Steven Megee (774) 210-0092

AssociAte MeMber Directory

MSADA BOARD Barnstable County

Gary Beard, Dick Beard Chevrolet

Berkshire CountyBrian Bedard, Bedard Brothers Auto Sales

Bristol CountyRichard Mastria, Mastria Auto Group

Essex CountyWilliam DeLuca III, Woodworth Motors

John Hartman, Ira Motor Group

Franklin CountyJay Dillon, Dillon Chevrolet

Hampden CountyJack Sarat, Jr., Sarat Ford

Hampshire CountyBryan Burke, Burke Chevrolet

Middlesex CountyChris Connolly, Jr., Herb Connolly Motors

Scott Dube, Bill Dube HyundaiFrank Hanenberger, MetroWest Subaru

Norfolk CountyJack Madden, Jr., Jack Madden Ford

Charles Tufankjian, Toyota Scion of Braintree

Plymouth CountyChristine Alicandro, Marty’s Buick GMC Isuzu

Suffolk CountyRobert Boch, Expressway Toyota

Worcester County Steven Sewell, Westboro Mitsubishi

Steve Salvadore, Salvadore Auto

Medium/Heavy-Duty Truck Dealer Director-at-Large

[Open]

Immediate Past PresidentJames G. Boyle, Tuck’s Trucks

NADA DirectorDon Sudbay, Jr., Sudbay Motors

OFFICERSPresident, Scott DubeVice President, Chris Connolly, Jr.Treasurer, Jack Madden, Jr.Clerk, Charles Tufankjian

MSADA

UI Rates and the Minimum Wage – No Quick Fix in Sight

As March was drawing to a close, the Massa-chusetts Legislature had not resolved two out-standing issues that will affect your businesses’ bottom-line in 2014 and beyond: the minimum wage hike and unemployment insurance (UI) rates.

The minimum wage, by far, is garnering the most attention, both here and nationally, as Dem-ocrats attempt to create a political narrative that does not have the word “Obamacare” in it head-ing into this year’s state and federal mid-term elections.

Further, an additional political factor driving the General Court’s interest in minimum wage legislation which cannot be ignored is the pro-posed ballot initiative for the November election. (As you may recall from our “right to repair” saga, if the Legislature does not act on the initia-tive by the first week in May the proponents can take their proposal directly to the people for the November vote.)

The proposed initiative petition would increase the state’s minimum wage to $9.25 per hour on January 1, 2015 and to $10.50 per hour on Janu-ary 1, 2016. Beginning in 2017, the minimum wage would be annually adjusted based on the Consumer Price Index, rounded to the nearest five cents.

The UI situation has become the proverbial bad penny of the state’s economic policy insiders. Although the business community is strongly in-terested in making long-term reforms to the out-dated unemployment system, the immediate need

at the start of the year was for the Legislature to enact a rate freeze before the Department of Un-employment Assistance sends out first-quarter tax bills in April. By February in each of the last five years, the Legislature had passed a law to freeze the state’s UI rates charged to businesses, thereby saving businesses upwards of $2.2 billion in the aggregate over that time. Even with the freezes, the Unemployment Insurance Trust Fund used to pay jobless benefits in Massachusetts currently enjoys a healthy balance of approximately $800 million.

This year the UI issue has become a political football between the House, Senate, and gover-nor over the minimum wage issue and the pursuit of UI reforms. The Senate has passed legislation to address the two issues separately in their own bills. The House Speaker, Robert DeLeo (D-Win-throp), however, has insisted that any minimum wage hike include reforms to the UI system in order to reduce business costs and provide em-ployers with certainty instead of annual angst re-garding potential rate freezes. The governor has indicated he supports UI reforms over a pro forma rate freeze extension.

Readers may recall that the Senate last Novem-ber passed legislation to hike the minimum wage to $11 per hour by 2016 at increments of $1 per year: $9 per hour in 2014, $10 in 2015, and $11 in 2016. At that time, the Speaker stated that he would consider a minimum wage hike if it was part of a UI reform package.

Then, on February 5, the Senate passed UI reform legislation that did not include any rate freeze for 2014. Senate leaders have said that their UI reform bill is designed to stabilize UI

6


The Roundup

by Robert O’Koniewski, Esq. MSADA Executive Vice President

Business Uncertainty Continues

7


MSADA

tax rates for most employers and make those rates more dependent on the hiring and firing record of individual companies. Under the Senate bill:• The wage base upon which UI payments are calculated would rise from the current $14,000 per year to $21,000 per year in 2015, a change that by itself would esca-late costs for employers;• An expanded rate table would take effect in 2015, and rates would be set at a new Schedule C for 2015, Schedule A for 2016 and back to Schedule C for 2017. The ex-panded rate table should offset the effects of the increased wage base for companies with stable employment histories while raising rates for some companies that add and terminate workers frequently. Under the new rates, the most stable employers would pay $153 per employee per year, while the worst-rated companies would pay $2,337 per employee annually;

• Company UI taxes rates will be based upon the average of three years payroll instead of one, minimizing rate shock for expanding companies or those that en-counter cyclical economic problems and find themselves having to lay people off.

The Senate bill did not reduce the maxi-mum duration of benefit weeks from 30 to 26 or increase the time people must work before collecting benefits.

True to his word, the House Speaker, along with the House Chairman of Ways and Means Brian Dempsey (D-Haverhill), on March 26 unveiled legislation (House 3983) that would address both issues.

First, regarding the minimum wage, the House’s legislation would increase the minimum wage in three steps over the next two years: to $9 per hour effective on July 1, 2014; $10 per hour effective on July 1, 2015; and $10.50 per hour effec-tive on July 1, 2016.

The House bill also contains a provi-sion extending the statute of limitations for minimum wage and overtime claims to three years and requiring that wage records be retained for three years; both of these requirements are presently two

years under state law. The three-year stat-ute of limitations already exists under federal law, as does the three-year records retention requirement. However, under state law, employers are subject to man-datory triple damages for these claims, so an additional year’s liability could be substantial.

The House bill also would raise the re-quirement that in no case shall the Mas-sachusetts minimum wage be less than 40 cents below the federal minimum wage. Under current law, this rate is set at no less than 10 cents below the federal minimum wage, which is currently $7.25 per hour.

Finally, the House bill would create a five-member Minimum Wage Advisory Commission comprised of labor and busi-ness representatives, financial experts, and the secretary of the Executive Office of Labor and Workforce Development. The commission would study and report on, among other matters, the value of the Massachusetts minimum wage relative to the cost-of-living and other necessary ex-penses, including transportation, daycare, food, and health care.

As for UI reforms, the House legisla-tion would:• Freeze UI rates for 2014;• Expand the wage base upon which UI benefits are calculated from $14,000 to $15,000 in 2015;• Incorporate an expanded rate table pre-viously passed by the Senate that would make rates more dependent on the hiring and firing record of individual companies. Rates for 2015, 2016 and 2017 would be frozen at Schedule C on the new table;• Retain the current one-year window for determining the experience rating of em-ployers;• Prohibit self-employed “persons of in-fluence” from laying themselves off on a seasonal basis and collecting unemploy-ment benefits.

Further, same as the Senate bill, the House measure would not reduce the maximum duration of benefit weeks from 30 to 26 nor increase the time people must

work before collecting benefits.The House is scheduled to take up this

comprehensive minimum wage-UI pack-age the first week of April. Senate Presi-dent Therese Murray (D-Plymouth), in response to the unveiling of the House package, immediately warned that a com-bined bill could jeopardize resolution of the issues during this session’s remaining four months, given that the House and Senate must pass a budget by July 1, the early May initiative petition deadline, and the July 31 end of formal sessions.

Legislatively speaking, March this time is certainly not going out like a lamb.

Annual Meeting – May 2, Mandarin Oriental Hotel,

BostonYour Association will conduct this

year’s Annual Meeting on Friday, May 2, at the Mandarin Oriental Hotel in Boston. We will commence with a buffet lunch at Noon, with our business meeting running from 1-5 p.m. We will conclude with a cocktail reception for attendees from 5-7 p.m.

We have an exciting line-up of industry and political speakers including:• Jeremy Anspach, President and CEO, PureCars.com;• Jason Stein, publisher and editor of Automotive News;• George Magliano, IHS Global Insight;• Celia Blue, Massachusetts Registrar of Motor Vehicles;• Sen. Stan Rosenberg, Majority Leader, Massachusetts Senate;• Gubernatorial candidates State Treasurer Steve Grossman (D) and Charles Baker (R).

Invitations and reminder e-mails have been sent out, so please do not delay…register today. If you have any questions, contact Jean Fabrizio in our office by phone at (617) 451-1051 or by e-mail at [email protected].

Recalls and Dealer ObligationsAs you know, each year, millions of

vehicles become subject to safety recalls.

The Roundup


8

A relatively small percentage of these recalls involve “stop operation” or “stop sale” notices. The following informa-tion illustrates potential steps for dealers to take based on the safety recall at issue and the vehicles involved:

• For new vehicles in inventory or in transit: Once any notice of an outstand-ing safety recall is received, federal law prohibits the delivery of impacted new vehicles until the recall is remedied.

• For used vehicles in for service, in inventory, or coming into inven-tory that are of the same make as the dealer sells new: Federal law neither imposes an obligation on dealerships to know the safety recall status of used vehicles, nor prohibits the resale of used vehicles with outstanding safety recalls. However, it is recommended that used vehicles of the same make a dealer sells new be checked for outstanding, unrem-edied recalls (safety or emissions) since the dealership is authorized to do service or repair work involved. Importantly, if and when a dealership receives a recall notice indicating that certain used vehi-cles should not be operated and/or resold, they should not be operated or resold un-til the recall is remedied.

• For used vehicles in for service, in inventory, or coming into inventory that are not of a make the dealer sells new: Again, Federal law neither impos-es an obligation on dealerships to know the safety recall status of used vehicles, nor prohibits the resale of used vehicles with outstanding safety recalls.

Massachusetts law has no affirmative duty to check for open recalls on vehi-cles. However, in order to best protect themselves, dealers should always run a vehicle check report on a used vehicle taken in trade or purchased at auction in order to ascertain as much information about the vehicle as a consumer could. We have seen a number of situations in which a consumer, after the purchase, finds out things regarding the purchased car that a dealer could have, and should have, determined for him or herself prior

to making the vehicle available for pur-chase.

Further, our Massachusetts Attorney General has promulgated regulations un-der the Consumer Protection Act (MGL Chapter 93A) regarding disclosure of product information to a consumer. The Act is broadly written to make unlawful any unfair methods of competition and any unfair or deceptive acts or practic-es in the conduct of any trade or com- merce.

The disclosure issue is addressed in the regulations at 940 CMR 3.16(2), which states, “Without limiting the scope of any other rule, regulation or statute, an act or practice is a violation of [the Act] if: … (2) Any person or other legal entity subject to this act fails to disclose to a buyer or prospective buyer any fact, the disclosure of which may have influenced the buyer or prospective buyer not to enter into the transaction;…” [emphasis added]

Thus, the failure to disclose any infor-mation (including repaired vehicle dam-age) – regardless of dollar amount – that would influence a buyer not to enter into the transaction is an unfair and deceptive practice. The law and the regulations make no exception for seemingly incon-sequential damage, say, under $100.

This obviously creates a sliding scale in terms of disclosure: The greater the problem with the vehicle, the stronger a consumer’s argument that it would have influenced his or her decision not to pur-chase the new or used vehicle.

As such, dealers need to disclose any and all facts about a vehicle to a buyer or prospective buyer no matter how trivial the information may appear to be. In this manner, a dealership can protect it-self and avoid the severe penalties (treble damages, attorneys’ fees) provided under the Consumer Protection Act.

Further information on safety re-calls is available from OEM policy and procedure documents and from http://www.nhtsa.gov/Vehicle+Safety/Recalls+&+Defects.

ICYMI – NADA’s Welch Responds

On March 16, NADA President Peter Welch authored the following response to a recent Washington Post op-ed piece regarding Tesla:

“In his March 13 op-ed column, ‘Tes-la vs. the Dealerships,’ Charles Lane claimed that dealers have a monopoly on selling new cars. That’s like saying doctors have a monopoly on the practice of medicine. There are 17,600 new-car dealerships in our country competing for customer business on price and service. Tesla fixes its car prices with no oppor-tunity for consumers to benchmark or negotiate price. There are no other Tesla retailers to compete with, and that’s bad for consumers.

“Cutting out dealers would not lower car prices; a factory-owned retail network requires the same investment in physical assets and the same operating expenses that dealers now shoulder. However, tak-ing dealers out of the mix would have a negative effect. Automakers have an economic disincentive to issue recalls or incur warranty expenses. Dealers earn money by performing safety and war-ranty work and, therefore, are always on the customer’s side. Dealers also handle trade-ins, sell used vehicles and compete for service and financing business.

“Each state has the right to determine which vehicle sales and service system works best for its residents. Some allow automakers to sell directly, while others require dealers as an additional layer of accountability. Most believe their resi-dents are better served by multiple local retailers competing for their business.”

MSADCF Auto Tech Scholarships Available

Applications for the Massachusetts State Auto Dealers Charitable Founda-tion’s 2014-2015 Auto Tech Scholar-ships are now available on our website at www.msada.org. The Foundation’s auto tech scholarship program awards schol-arships to eligible applicants for use at

MSADA 9


post-secondary educational institutions that offer auto tech training programs. Since its inception in 2003, the Founda-tion has awarded in excess of $900,000 to more than 200 students. A scholarship award is worth $6,000-$13,000 each over two years.

Five years ago the Foundation’s schol-arship program expanded to include not just manufacturer-backed programs but also general automotive technology pro-grams at a greater number of colleges in the Massachusetts area. This gives deal-ers an even greater chance to capitalize on a highly skilled base of potential em-ployees.

To obtain additional information on the scholarship program, contact Jean Fab-rizio at MSADA at (617) 451-1051 or by e-mail at [email protected].

The application deadline is Friday, May 23, 2014.

FTC Action Against Mass. Dealer’s Ads

A Massachusetts franchise dealership recently agreed to resolve Federal Trade Commission charges that the dealership violated the FTC Act by deceptively ad-vertising that consumers could lease a vehicle for $0 down and specific monthly payments when, in fact, the advertised amounts excluded substantial fees. The ads also violated the Consumer Leasing Act (CLA) and Regulation M, by failing to disclose or clearly and conspicuously disclose certain lease related terms.

The proposed consent order prohibits the dealership from engaging in similar deceptive advertising practices in the fu-ture. It prohibits the dealership from mis-representing in any advertisement for the purchase, financing, or leasing of motor vehicles the cost of leasing a vehicle, the cost of purchasing a vehicle with financ-ing, or any other material fact about the price, sale, financing, or leasing of a ve-hicle. The dealership is further prohibited from stating the amount of any payment, or that any or no payment is required at lease inception, without clearly and con-

spicuously disclosing the terms required by the CLA.

This case was brought as part of Opera-tion Steer Clear, the agency’s nationwide sweep against 10 auto dealers announced in January. The FTC also announced fi-nal consents with two additional dealers in February. These cases are all a part of the FTC’s continued efforts to combat deceptive motor vehicle dealer practices, and protect consumers in the auto mar-ketplace. (We discussed these FTC ac-tions in our Bulletin #4 (1/9/14) and Bul-letin #5 (1/10/14).)

The Commission vote to accept the consent order for public comment was 4-0. The agreement is subject to public comment for 30 days, through April 21, 2014, after which the Commission will decide whether to make the proposed consent order final.

Doc Fee, Title Prep Fee & Sales Tax Update

Since our previous writing on this sub-ject matter, your Association and our tax consultant, O’Connor & Drew, have had several conversations with the Massa-chusetts Department of Revenue (DOR) to discuss the sales tax treatment of deal-ers’ documentary preparation fees and the statutorily allowed title prep fee.

As a result of those conversations, on March 20 DOR issued Directive 14-1, which answers the following question: Are separately stated documentary prep-aration fees and the title preparation fee charged by a motor vehicle dealer in con-nection with the sale of a motor vehicle subject to sales tax?

The answer: Yes.The DOR’s directive explains that,

under Massachusetts sales tax law, the taxable sales price includes services that are part of the sale and that both the documentary preparation fee and the title preparation fee are services that are part of the sale.

The directive is available at this link: http://www.mass.gov/dor/businesses/help-and-resources/legal-library/direc-

tives/directives-by-years/2014-direc-tives/dd-14-1.html.

Therefore, if you have not yet done so since our January 23 guidance (Bulletin #9), during a vehicle sale you need to include the “doc prep fee” and the “title prep fee” (if you charge either or both fees) as part of the Total Sale Price and the Taxable Sales Price listed in section 56A of the RMV-1.

Dealers also need to be sure that when your employees are completing the Motor Vehicle Purchase Contract (the “P&S”, so called) the “doc prep fee” and the “title prep fee” are calculated with the full vehicle purchase price for sales tax purposes.

Finally, you may recall we sell various forms to our dealers as part of our forms program with our endorsed partner, Reyn-olds & Reynolds. (Association members can take advantage of a member discount when purchasing through this program.) Reynolds & Reynolds has available for sale to dealers a Motor Vehicle Purchase Contract that complies with this DOR di-rective – the line for each the doc prep fee, as set by the dealer, and the title prep fee, as set by state law at $5, are located above the sales tax calculation line. The Reynolds & Reynolds Forms Program can be reached at (800) 896-2886.

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Happy 5-0, MustangFord’s iconic Mustang celebrated

its 50th birthday this month. The first Ford Mustang – a Wimbledon white convertible with a blue top – rolled off the assembly line on March 9, 1964. Congratulations on a great run that is still going strong.

MSADATroubleshooting10


Last month, this column addressed some of the basic elements of dealer data protection, including regulatory require-ments such as the “Safeguards Rule” and the “Privacy Rule” implemented by the passage of the Gramm-Leach-Bliley Act (GLBA). In that column, it was noted that the Federal Trade Commission con-siders the mere ability of a third party to access a customer’s nonpublic personal information (NPI) held by the dealer to be an offense on par with if the third par-ty were to actually access the data.

While complying with the various federal and state regulations designed to protect your customer’s NPI from getting into the wrong hands is tricky enough, an even more complicated situ-ation may occur when the dealer wants to intentionally share the customer’s NPI with a third party. Even if a dealer is be-ing vigilant in its protection of a custom-er’s NPI, actions by third parties can put both the dealer and the customer at risk.

In order to comply with the above-listed regulations, many dealers simply provide customers with a notice stat-ing that the customer’s NPI will not be shared. This is an effective way to com-ply with the Privacy Rule, but may limit the dealer if they need to share the NPI in the future for legitimate reasons.

One common situation that the dealer may encounter is that a customer’s NPI is required by a third party in order to service the customer’s account. GLBA

takes this situation into account, and dif-ferentiates between an “affiliate”, which is controlled by, controls, or is under common control with your business, and a non-affiliated third party, which is any person or entity other than your busi-ness, employee, or an affiliate.

A non-affiliated third party that assists your business in administering, process-ing or servicing a customer’s account is known as a “service provider”. The Safeguards Rule further defines “service provider” as “any person or entity that receives, maintains, processes, or oth-erwise is permitted access to customer information through its provision of ser-vices directly to a financial institution that is subject to this [regulation].”

Therefore, any organization that you do business with that can come in con-tact with protected information, such as an outsourced information technol-ogy department, a customer relations management firm or lead provider, your DMS provider, potentially even your manufacturer, will be subject to over-sight and compliance with the Act and the regulations. Depending on the nature of the service provider’s role, they may require access to the customer’s NPI, which creates a potentially dangerous situation for dealers.

If a dealer gives a customer a notice pursuant to the Privacy Rule that states that the customer’s NPI will not be shared with a third party then it cannot be shared, period. This prohibition on sharing customer NPI extends to all non-affiliate third parties, including a manu-facturer. If the dealer plans to share the data with any non-affiliate third party, then this must be clearly stated in a no-tice to the customer and the notice must include what information will be col-lected and what will be disclosed. A full list of notice disclosure requirements under GLBA is too extensive for inclu-sion here, but can be found through the Massachusetts Secretary of State’s web-

site at: www.sec.state.ma.us/sct/sctgbla/gblaidx.htm.

Importantly, there is an exception contained in the regulations that per-tains to the sharing of NPI with service providers. Whereas a dealer would gen-erally need the customer to “opt-in” to an agreement in order to share their data with an unaffiliated third party, if that unaffiliated third party is a service pro-vider, as defined under the Safeguards Rule, then the only requirement is prop-er notice that the customer’s NPI may be shared.

If sharing customer NPI with a service provider, the dealer must, in addition to giving proper notice to the customer, take reasonable steps to select service providers that are capable of maintaining appropriate safeguards for the custom-er’s NPI. The dealer should also execute an agreement with the service provider that contains clear provisions relating to the treatment of customer NPI.

Recently, NADA published a sam-ple Service Provider Dealer Data Ac-cess Addendum. The guide is available through the NADA website (www.nada.org/dealerdata), and it provides dealers with excellent template language for inclusion in any future contract with a service provider. As noted in the NADA Dealer Data Guidance, the provisions of the Addendum are not one-size-fits-all, and dealers should use the language as a starting point towards crafting a contract that fits their unique needs given the ex-pectations and goals in the dealer’s rela-tionship with the service provider.

If you require any additional infor-mation on dealer data security regula-tions, service provider agreements, or any other issue, please contact Robert O’Koniewski, MSADA Executive Vice President, [email protected] or Peter Brennan, MSADA Staff Attorney, [email protected] or by phone at (617) 451-1051.

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Dealer Data and Service Providers

Staff attorney, MSaDa

By Peter Brennan, Esq.


By Nancy Phillips This month’s interesting headline,

“New Jersey to Tesla: You’re Outta Here” (Forbes.com), delivered a mes-sage from auto dealers everywhere. With it, the stock plunged nearly 10 percent – but not for very long. What is going on out there? Is the conventional

auto dealership model under siege?Nikola Tesla was a Serbian-American inventor, engineer,

physicist and futurist best known for the design of modern alternating current electric supply. He was a genius who in-vented many other things for which he received no credit and he appears to be a postmortem mentor of Tesla CEO, Elon Musk.

I admit to being skeptical about Tesla, believing that our current system would throw over the upstart Musk before he got his sea legs. Between the idiosyncrasies of the vehicle itself and the difficulties inherent in the plan to push aside the traditional dealership network – my money did not go toward acquiring his stock.

But I wish it did, at least up until now. For $500,000 invest-ed in Tesla only 30 months ago would have delivered about 6 million today. Such a monumental return speaks volumes about the future of our industry and how the real world views us. I truly hate to say it, but the image of an auto dealer has not been elevated commensurate with the culture of today. Most people still don’t really love their dealer but merely tolerate a system that has been in place for a very long time.

Tesla’s stock price tells me there are a lot of people out there rooting for a very big change to dealership practices, the type of product offered and to the franchise system itself. The franchisors know this; you can see it in their long-term planning, the positioning of their respective dealer body and the increasing control they have gleaned through supporting acquisitions by dealership groups and incentivizing the weak to depart. Dealers, on the other hand, believe they are pro-tected by their new state franchise laws and seem stuck in time, making moves that individually may be divisive to their long-term health and well-being.

While the share price of other automotive competitors re-

flects their actual perceived value in the market place, the price of Tesla tells us just how much investors are willing to pour into a company that has yet to make a profit and most likely won’t for some time. It is an investment of hope and anticipation for a future automobile industry that differs radi-cally from the one we have today.

Perhaps the writing is already on the wall. It is possible that 10 years from now the number of individual dealers will be insignificant compared to the number of multi-franchised groups. It may be that Tesla will have multiple outlets in ev-ery state and that other new entries to the market will have followed the same path. It could even be that a failing fran-

chisor may throw in the towel on the dealer network in favor of the same type of market representation at a fraction of the cost.

Can car dealers successfully face off against Google, Ama-zon, Tesla and others? Our industry needs to acknowledge that the car buying public has already begun to answer that question by their strong support of Tesla and take heed. Mak-ing plans now for a new and different future is the smart thing to do. If you are staying in, you need to grow in different ways. If you are not, determining the right time to exit is the most significant decision you will ever make in your automo-tive career.

t

Do you have an opinion you want to share? Send submissions to [email protected].

MSADA Sound Off

Tesla aka TSLAMaking plans for a new and different future

may be the smart thing to do!

Nancy Phillips Associates specializes in sales, acquisitions and evaluations of franchised automobile

dealerships. Contact Nancy Phillips at (603) 658-0004 or email [email protected].

11

12


AUTO OUTLOOK


13MSADA

According to NetMarketShare, a com-pany tracking market share for Internet technologies, Microsoft Windows XP is still in use by more than 30 percent of the desktops connected to the Internet. Unfortunately, Microsoft has announced that April 8, 2014 will mark the official end of life (EOL) for Windows XP.

This type of end of life statement for a computer operation system can put your business in a dangerous position. Do you upgrade with all of its headaches, or risk being vulnerable if the worst should happen? There are three very good rea-sons to upgrade:

SecurityEven though XP is more than 12 years

old, vulnerabilities and stability issues are still being discovered. As a currently maintained product, Microsoft routinely creates patches and publishes these up-dates in an effort to fix these vulnerabili-ties.

After April 8, 2014, your installation of Windows XP will probably continue to run normally. For those who can re-member Y2K, this is not that type of situ-ation. The computer will boot, programs will run, and nothing will appear differ-

ent. Behind the scenes, however, you will not receive any new updates or hotfixes, including the famed Service Packs.

It has been proven that connecting to the Internet a brand new installation of Microsoft Windows XP with no service packs or updates installed can be ex-ploited in less than four minutes. Micro-soft has done a great job over the last 12 years fixing vulnerabilities quickly after being made aware of the issue, but once Microsoft Windows XP goes end of life, exploits will continue to be discovered, and unfortunately will not be fixed.

Attackers will post these discovered vulnerabilities in public forums and, even worse, post them for sale in the under-ground market. These vulnerabilities can disrupt business operations and threaten confidentiality, integrity, and availability (better known as the CIA Triad).

UsabilityFrom Microsoft’s standpoint, XP will

no longer be an officially supported operating system. Many hardware and software developers will also stop sup-porting Windows XP in their future products. Even current software that runs on Windows XP may stop running without vendor product updates.

The contracts you have with your dealer management systems may force you to upgrade to continue using their Internet based products. When launching your DMS software, in the background, the vendor is checking your computer for certain patches before letting the soft-ware run. Your vendor may stop allowing you to use your DMS without a vendor supported operating system.

ComplianceAfter April 8, 2014, dealerships run-

ning Windows XP may not be in com-pliance with Massachusetts regulations. Under section 6 of 201 CMR 17.00, per-sonal identifiable information (PII) on

a workstation connected to the Internet “must be reasonably up-to-date… [with] operating system patches.” Companies that are not compliant can expect heavy fines, and other legal and civil recourse. In addition, there may be compliance is-sues for those who fall under other regu-latory or industry requirements such as PCI DSS 2.0 and 3.0.

The best practices published under the SANS 20 Critical Security Controls, recommends installing security patches within 24-48 hours of the patch release (a quick win) and using automated up-date tools (another quick win). In order to meet these industry best practices, or-ganizations will need to remove all XP systems and migrate users to a newer op-erating system such as Windows 7 or 8.

Upgrading to a supported operating system is not trivial, nor cheap. Your business applications need to be tested to ensure that they work on the new op-erating system. You may find applica-tions that do not work on Windows 7 or 8, and you will have to consider solu-tions to work around these challenges.

The monetary cost to upgrade can extend past the actual cost of the oper-ating system license. Newer operating systems, which include new features, re-quire more horsepower, so you may also have to upgrade memory or disk space in your computers (or in some cases, you may need to purchase new computers).

Even with all of these hurdles to over-come, it is important to the security, usability, and compliance of your com-puters, and more importantly, to the se-curity of your company, to upgrade to a vendor supported operating system.

For more information or if you have any questions, please feel free to contact Michael Hammond, Director of IT Au-dit Practice, O’Connor & Drew, P.C. at 617-471-1120 or email at [email protected].

t

By Michael Hammond

CISa, CrISC, CISSP, CeH DIreCtor, It auDIt PraCtICe, o’Connor & Drew, P.C.

14 MSADAAccounting

Will You Be Ready When Windows XP Ends?


15


MSADA Accounting

To be a successful and profitable dealer today, you have to cre-ate a positive shopping experience for your customer. The most important factor contributing to a customer’s positive experience with a dealer is his or her interaction with the salesperson. Deal-ers need to focus on seeking, attracting and retaining the best salespeople to create a positive shopping experience for their customers, which will undoubtedly lead to increased profits.

If you are seeking new candidates, ask the dealership’s most talented salespeople: How did they find you? Why did they want to work for you? Change the avenues you usually look for candidates, if need-ed, based on their answers. If you are finding candidates that have worked at several dealerships in recent years, this should be a red flag that they will not succeed or last very long at your store.

Maybe you should consider hiring someone from outside the industry, with no dealership experience, but a lot of en-thusiasm for the business. One of our cli-ents had success in hiring several sales-people that had been working at Best Buy. These candidates were proficient in explaining the “gadgets” and technology available on various models. The dealer was able to offer these candidates a pay package that would double their current income.

Keep in mind it may take a year or so for that individual to develop his or her skills, but it may be worth the gamble in the long run. Also, make sure that your sales staff reflects your cus-tomer base. Make sure women, minorities and younger adults are adequately represented in your sales force. You want your customers to walk in to your store to a welcoming face.

To attract the right candidates:1. Make sure that you maintain a clean, neat and inviting work-place for all employees.

2. A team atmosphere that has clear policies that apply to every-one is paramount. 3. Make sure that there is adequate training, and consistent on-going training, as well as a mentor or coach that new hires can rely on. 4. As always, competitive pay plans, opportunities for career ad-vancement, reasonable sales goals, fair benefits, and predictable work schedules will help attract the best candidates. 5. Consider supporting or sponsoring community events, schol-arship programs, and/or internship programs to generate positive impressions of your store in the community and attract people who want to work for you.

In order to retain the successful sales staff you have, consis-tently review and evaluate your employees and gather feedback from your employees. Make changes, if needed, based on this feedback. Remember the cost of replacing and training new salespeople far out ways taking the time to listen to your key salespeople. Financial incentives are a must, but consider other

options such as flexible work hours and small perks.

Long-term employees become the face of the dealership to customers who appre-ciate doing business with the same people each time they come to the store. How-ever, don’t be afraid to replace someone if you feel he or she could be doing a bet-ter job.

Although this article is geared toward seeking, attracting and retaining sales-people, it can also be applied to manag-ers. It is worthwhile to note that our most profitable clients have familiar faces in key manager positions. The key here is to find competent managers and retain them.

Combat the issue of high employee turnover by focusing on seeking, attracting and retaining the right salespeople for your store. The best sales staff will create a positive shopping expe-rience for your customers. Utilizing these suggestions should increase your customer base, reduce absenteeism, reduce costs, improve employee morale and, most importantly, positively impact your bottom line.

If you have any dealership management questions, please contact Paul McGovern at [email protected].

Seek, Attract and Retain the Best Salespeople

By Paul McGovernPaul MCGovern, a Partner at Downey & CoMPany, HaS SPeCIalIzeD In auto DealerSHIP aCCountInG anD ManaGeMent for 30 yearS.

Long-term employees become the face of the dealership to customers who appreciate doing

business with the same people each time they

come to the store.

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UpMARCH 2014 Massachusetts Auto Dealer www.msada.org

16 COVER STORY

Frank Hanenberger

Stepping

by Catherine MacDonald

In many ways, Frank Hanenberger’s path to becoming MSADA’s newest director is a familiar story. His father, a 46-year GM lifer, had worked his way up from apprentice to auto group vice president. Cars and the auto in-dustry dominated conversation around the dinner table.

16

The MSADA Board’s newest member is ready to represent his industry

“I grew up in the business,” Hanenberg-er said. “It’s always been in my blood.”

That’s where many of the similarities end. Hanenberger’s child-hood dinner table was in Wiesbaden, Ger-many, a small city near Frankfurt. During high school he decided to attend GMI Engineer-ing and Management Institute (his father’s alma mater) in Flint, Michigan.

“I fell in love with living in the U.S. and decided to stay,” he said.

The next decade saw Hanenberger earn de-grees from Stanford University and Har-vard Business School. His work had him bouncing from coast to coast before he settled in Massachusetts in 2004.

After trying his hand at engineering, marketing and an Internet startup, Hanenberger said the retail bug got a hold of him. When the opportunity came to own a Subaru dealership, he couldn’t resist. “I had to take the gamble.”

Today Hanenberger is dealer principal and owner of MetroW-est Subaru in Natick and Brattleboro Ford Subaru in Vermont. This year, both dealerships won the Subaru Stellar Care Award for customer care and satisfaction -- the highest honor a Subaru dealer can achieve, according to Subaru.

“Usually dealers grow up in the re-tail business. I took a slightly different route,” Hanenberger said.

MSADA Board Treasurer Jack Mad-den Jr., owner of Jack Madden Ford in Norwood, recommended Hanenberger join the board. He says Hanenberger’s lack of automotive background is a good thing.

“He was an engineer,” Madden said. “He’ll certainly bring a different per-spective than those who have been influenced by our parents to enter the industry.”

The path he took might be less com-mon, but his passion resonates with anyone committed to dealerships. His love for the industry, coupled with his nature as a self-identified political junkie, cemented his decision to join the MSADA board.

“If I turn on the TV, I’m either watch-

17MSADA


“I think our business gets a bad rap. Not that we’re perfect by any means, but the car dealer stereotype is particularly a negative one. I try to take every opportunity I can to promote a positive image of what

dealers do, both on a local level as well as a statewide level.”

18


18

ing the Red Sox, col-lege basketball or politics. The chance to represent our busi-ness and our industry on a statewide level is where the real excite-ment came for me.”

Dealer Day on Beacon HillOn Dealer Day last

year, dozens of mem-ber dealers took to the State House, where they met with more than 100 legislators to make their views heard. Dealer Day gives dealers a chance to build and strengthen

relationships with their legislators. Every year legislators are pre-sented with significant decisions to make on dealer issues, and the event gives the lawmakers a real life glimpse of the people affected.

This particular Dealer Day occurred at a time when three key pieces of dealer-related legislation faced potential activity in the Senate and the House. Crucial Right to Repair legislation, changes to the state’s franchise law, and legislation related to Tesla were the main issues brought to the table by dealer industry representatives.

For each issue, the stakes are high. Taking in both the lingering Tesla battle or the effects of Right to Repair first-hand, Hanenberger says participating in Dealer Day last year ramped up his excitement and helped solidify his decision to take on a leadership role.

“I really enjoyed being able to talk about our business to our state representatives and senators. It was really neat to be able to do that,” he said.

As a representative of the industry, part of Hanenberger’s goal is to show dealers in a more positive light and help dispel negative stereotypes.

“I think our business gets a bad rap,” he said. “Not that we’re perfect by any means, but the car dealer stereotype is particularly a negative one. I try to take every opportunity I can to promote a positive image of what dealers do, both on a local level as well as a statewide level.”

Many aspects of the industry make dealers quite easy to defend. Hanenberger emphasizes that dealers provide almost 20 percent of all retail sales activity in Massachusetts and employ more than 20,000 people.

“The economic impact that our business has is substantial,” Hanenberger said. “For us to continue to have this kind of tar-nished image, I kind of take offense to that.”

leaDersHip roleAfter going from four cross-country relocations in five years

during the first part of his career to crossing state lines several times a week in order to serve both dealerships in New England, Hanenberger is settled but busy. Despite a full plate, he says he was not worried about making the commitment to take on this new role. He says he’s always appreciated the efforts of the as-sociation’s executive committee and its staff.

“I think the executive committee and our MSADA staff mem-bers have a good handle on the heavy lifting,” Hanenberger says. Thanks to them, he does not expect his new leadership role to in-terfere with running his dealerships and striving to meet his stan-dards for himself.

Hanenberger teaches his children his personal motto on perfec-tion, and says it applies to his industry as well.

“We’re never going to be perfect, but we’ve always got to strive to be perfect,” he says. “Perfection is really a fantasy but that doesn’t mean you should ever give up.”

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Stepping Up MSADA

MSADA Insurance

by Rob StansburyWould you be surprised if an OSHA in-

spector showed up at your shop and asked to take a look at your lifts? OSHA is using the General Duty Clause, which is a catch-all for unsafe working conditions, as an en-forcement tool for lift safety. Since 2007, three-fourths of all General Duty Clause citations issued to dealerships and service centers, have been for safety issues around automotive lifts.

All of these citations have been “serious violations,” which means that the workplace hazard could cause an accident that would most likely result in death or serious physi-cal harm. Most of the citations are also “willful violations,” meaning that the employer either knowingly failed to comply with a legal require-ment (purposeful disregard) or acted with plain indifference to employee safety. A single incident can warrant both kinds of violations and result in much higher fines.

OSHA has recently implemented local emphasis programs (state by state) that highlight the importance of lift safety in the automotive in-dustry. KPA is aware of these inspec-tions occurring in Massachusetts, and we expect to see a significant increase in the state as part of the local emphasis program moving forward.

Not only is lift safety important for worker protection, but regular maintenance is easy and contributes significantly to your dealership’s bottom line. Productivity stud-ies have found that adding a single vehicle lift to the shop can add another $100,000 or more to the bottom line in terms of annual profits or reduction in labor overhead. How-ever, if the lift goes down for repair, those contributions vanish.

Start by following the manufacturer’s specific maintenance, adjustment and lu-

brication recommendations in the owner’s manual for each lift. Maintenance proce-dures and frequencies vary for different styles and brands of vehicle lifts, so keep your owner’s manual handy and use it as a reference if you are servicing your own lifts.

Alternatively, most dealerships find it cost effective to outsource lift inspec-

tions and maintenance to service provid-ers. You’ll still need to keep your owner’s manuals handy as well as documentation from these visits. Records of automotive lift maintenance need to be available upon request from the state/federal agencies.

According to the guidelines that OSHA follows, each of your employees is re-quired to be trained on the operation of your lifts prior to use, and each of your lifts must be inspected on an annual basis by a qualified lift inspector.

The recent surge in inspections falls in line with a trend that KPA has seen develop over the past three years. Nationwide, but specifically in the Northeast, dealers are

facing enforcement visits at a significantly higher rate than they ever have in the past. State and Federal agencies alike have been funded and staffed, which has led to a very proactive climate for enforcement com-pared to the typical reactive climate (for example – responding to whistle blowers). Regulation updates and new classifications of violators have been established. New

car and truck dealers have become targets in the revenue generation for the government agencies. Fines in excess of $50,000 are not uncom-mon, with the average citation falling into the $20,000+ range

Lift Safety Training and Inspec-tions are only one area that the gov-ernment is cracking down on recent-ly. Above and beyond the safety reg-ulations, dealers have seen enforce-ment on the bureaucratic aspects of their businesses (written programs/employee training/chemical inven-tories), as well as the environmental aspects (permits, registration, and inspections of tanks). With the atten-tion being paid to these areas of the business, it makes sense for dealers to ask themselves how they’d fare if the Massachusetts DEP or the U.S. Department of Labor showed up at their dealership unannounced today.

For questions/concerns regarding your compliance with Lift Safety requirements, or any Environmental or Safety related issue, please contact Rob Stansbury with KPA @ (484)326-9765 or [email protected].

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OSHA Cracks Down on Lift Safety

19


19MSADA

rob StanSbury HaS workeD wItH kPa for 9 yearS. HIS PrIMary role IS MeetInG wItH DealerS to aSSeSS tHeIr level of lIabIl-Ity aSSoCIateD wItH GovernMent enforCeMent, anD to eStablISH

a Plan to CorreCt DefICIenCIeS for botH tHe PreSent, aS well aS MovInG forwarD.

BOSTON

Mass. State Auto Dealers Association Receives 2013 Boston Award

The Massachusetts State Auto Dealers Association has been se-lected for the 2013 Boston Award in the Non-Profit Organization category by the Boston Award Program.

According to its press release, each year the Boston Award Pro-gram identifies companies that it believes have achieved excep-tional marketing success in their local community and business category. These are local companies that enhance the positive im-age of small business through service to their customers and our community. These exceptional companies help make the Boston area a great place to live, work and play.

“Various sources of information were gathered and analyzed to choose the winners in each category. The 2013 Boston Award Program focuses on quality, not quantity. Winners are determined based on the information gathered both internally by the Boston Award Program and data provided by third parties.”

NORWOOD

Ernie Boch Jr. Will Raise Hourly Wages

Ernie Boch Jr.’s full-page ad in the The Boston Globe coincided with Present Barack Obama’s recent Boston visit and delivered a clear message: Boch isn’t waiting for the government to raise the minimum wage. “President Obama: I did it!” he wrote in the signed ad.

Boch, a Republican who has supported political candidates from both parties, said he will raise the pay of his minimum wage workers to $10.10 on April 1.

The change will affect more than 80 of Boch’s 819 employees, most of whom are sales people who earn a minimum wage hourly rate and an additional commission for every car they sell. He said about 30 of his workers are strictly paid minimum wage.

The president is promoting a Democratic proposal to increase the federal minimum wage from $7.25 to $10.10 per hour by 2016. Massachusetts legislators are also discussing a possible in-crease in the state minimum wage, currently $8 per hour.


from Around the HornNEWS20


21MSADAfrom Around the HornNEWSThe Boch news-

paper ad appeared as Obama was scheduled to make fund-raising visits to Cambridge and Boston.

In the ad, Boch said he wanted to “strongly encourage” other New England businesses to join him and sup-port “this new living wage.” He said his de-cision on the minimum wage wasn’t purposely timed with the arrival of Air Force One in Massachusetts.

The Norwood resident said he saw Obama on television as he made made his morning coffee and mistakenly believed the presi-dent was in Boston that day. The image triggered thoughts of a minimum wage increase Boch had been mulling over for months, and he decided to act.

WELLESLY

BMW Tosses Salesmen for ‘Geniuses’

Luxury car maker BMW AG wants to bring its dealerships into the digital age and recommends several showroom overhaul ideas in a Wall Street Journal MarketWatch article.

BMW’s new program could mean, among other things, fewer sales people and fewer cars on showroom floors, and more in-formation delivered through video displays and by employees who are “definitely, definitely not salesmen,” sales and marketing chief Ian Robertson told MarketWatch.

BMW’s plan reflects a broader anxiety among auto company executives and independent dealers that consumers accustomed to online shopping and the ultraclean look of Apple stores are unimpressed with the ambience of most auto dealerships.

Joe Shaker, owner of Shaker Automotive Group, was among the dealers outlining a new sales future. “People are coming from full electronics at home, and they get to a dealership and it is a hard stop,” said Shaker, who led development of an iPad app now used by Mazda’s U.S. dealerships.

He described the coming dealership as being more hands-on and experiential with retailers using interactive displays and vir-tual demonstrations—akin to what BMW is building. More new-car inventory will be kept off site, rather than in lots out front, as dealers, especially those in urban areas, seek to save on real estate costs, he said.

Ernie Boch Jr.

AwAr dsseAson

The season for manufacturers recognizing the achieve-ments of their franchise dealers is in full-swing. Here is a list of some of our Massachusetts dealers who have re-ceived recognition recently.

NISSAN 2014 AWARD OF EXCELLENCE WINNERSMarlboro Nissan, Marlborough

Nisson 24, Brockton

FORD 2014 PRESIDENT’S AWARDHerb Chambers Ford

Imperial Ford Lamoureux Ford

Metro FordOwen Motors

Quirk Ford

MERCEDES BENZ 2013 BEST OF THE BEST DEALER RECOGNITION AWARD

Herb Chambers

HONDA 2013 COMMAND OF EXCELLENCE AWARD WINNERS

Balise Honda, West SpringfieldHyannis Honda, Hyannis

Weymouth Honda, Weymouth

ACURA 2013 COMMAND OF EXCELLENCE AWARD WINNERS

First Acura, Seekonk

TOP DEALER GROUPS ANNOUNCEDAutomotive News released their annual list of the top

125 dealer groups based on total 2013 new-vehicle retail sales units. Four Massachusetts-based dealer groups made the list: Herb Chambers Companies (No. 16), Balise Motor Sales (No. 69), Colonial Automotive Group (No. 102), and Kelly Automotive Group (No. 111).

Additionally, three groups based outside Massachusetts with dealerships located here achieved recognition: Group 1 Automotive (No. 3), Lia Automotive Group (No. 55), and AutoFair Automotive Group (No. 113).

Congratulations to all!

from Around the Horn22 NEWS


NATICK

New 2014 Ram 1500 EcoDiesel Rolls Out to Dealers in High Demand

Diesel engines may have fallen off in popularity in the United States in the past two decades, but the tide may be turning if the responses to Ram’s latest effort are any indication. The 2014 Ram 1500 EcoDiesel is just now heading to dealerships, but the pickup truck has already sold nearly twice the Chrysler Group’s cor-porate average for special orders from buyers. Mean-while, more than 8,000 units have been requested by Ram dealerships overall, fulfilling the initial production allotment for the new diesel-powered Ram 1500.

The 2014 Ram 1500 is the first half-ton pickup truck since the mid-1990s to offer a diesel engine in the Unit-ed States, and a little more than half of the recent orders for the vehicle have specified the oil-burning power-plant. Housing a 3.0-liter EcoDiesel V6, the new diesel-powered Ram 1500 is far more advanced than the diesel

trucks of the past, returning the best fuel economy of any full-size pickup with its 28-mpg highway rating. Despite those fuel savings, the 2014 Ram 1500 EcoDie-sel produces 240 horsepower and 420 pound-feet of torque while towing up to 9,200 pounds.

“The early demand for the Ram 1500 EcoDiesel is resounding proof that America is ready for the return of the diesel engine to the half-ton pickup segment,” said Richard Gill, owner of Brigham-Gill Chrysler Jeep Dodge Ram. “It also doesn’t hurt that the recently rede-signed Ram 1500 is the first in its class to reintroduce diesel technology, because the entire truck was devel-oped to create an unmatched balance of fuel efficiency and performance.”

23MSADA


BOSTON

DealerRater names 18 Massachusetts Dealerships Among Top-Rated in America

DealerRater’s Dealer of the Year Award Program recognizes a se-lect number of car dealerships throughout the United States and Canada for outstanding customer satisfaction as ex-pressed through customers’ on-line reviews posted on DealerRater.

According to the site, Massachusetts has 18 top-rated dealerships among their respective brand peers. All dealers here must score a minimum average of 4.0 during the calendar year based on price, quality of work, customer ser-vice, friendliness and the overall experience. Only dealers with at least 25 reviews are counted.• Audi Burlington • BMW of Peabody

• Colonial Chevrolet in Acton• Colonial Chrysler Jeep Dodge in Hudson• Jannell Ford in Hanover • Herb Chambers Honda of Seekonk• Route 2 Hyundai in Leominster • Kelly Infiniti in Danvers • Fathers & Sons Kia of West Springfield • Herb Chambers Lexus of Sharon• Lannan Mazda in Lowell • Mercedes-Benz of Boston • Michaud Mitsubishi in Danvers • Milford Nissan • Father & Sons Audi Porsche Volvo in West Springfield• Toyota Scion of Braintree • Steve Lewis Subaru in Hadley • Colonial Volkswagen of Westborough

from Around the Horn24 NEWS MSADA


ACTON

Reality Check: Snow Slows US Auto Sales Comeback in February

A tough winter continued to take a toll on U.S. new-vehicle sales in February, as snow and arctic temperatures doused show-room traffic, according to dealers around the country.

Auto salespeople in the East and Midwest said weather foiled sales momentum again in February, as it did in January. But they said underlying demand remains on an uptrend, as drivers continue to trade in their recession-worn rides. Some dealers reported slight improvement in consumer spending per vehicle. Others said the economy remains the top concern for most customers.

“Despite the weather challenges, we’re having a terrific month,” Pat Browne, chief operating officer of Colonial Auto-motive Group, told MNI Market Watch.

His new vehicle sales are up about 8 percent compared to last February, even though he lost two selling days this month to snow.

Browne also lost a couple of selling days in January, another snowy month in Boston, but he’s optimistic sales will continue to ratchet higher through the summer.

BROCKTON

2014 Toyota Highlander Receives 5-Star Safety Rating from the NHTSA

The Toyota Highlander was redesigned with a sleeker exterior for the 2014 model year, but its more stylish body is also proving to be safer. Recently receiving a 5-Star Safety Rating from the Na-tional Highway Traffic Safety Administration (NHTSA) in its New Car Assessment Program, Highlander bested the four-star perfor-mance of its predecessor in the organization’s stringent crash tests.

To earn the NHTSA’s highest overall rating, the 2014 Toyo-ta Highlander took home five stars in side-crash testing while achieving four-star scores in frontal-crash and rollover tests.

“After the tough crash testing from the NHTSA, it’s clear that the Highlander’s redesign was much more than just a facelift be-cause the SUV is more crashworthy at its core than past models,” said Shahzad Shahab, general sales manager of Copeland Toyota, a Greater Boston Toyota dealer. “Buyers can also get more peace of mind with the optional active-safety technologies that can make accidents less likely to happen in the first place.”

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Is your dealership finding it difficult to navigate the changing landscape of the health care industry? If you answered “yes,” you are not alone.

Many business owners are over-whelmed with what seems like daily changes to consider. For most compa-nies, employee benefits are the second largest budget item behind payroll. And as health care costs continue to rise with no end in sight, it’s now more important than ever to implement efficient and cost effective employee benefits plans. The role of the insurance broker has also changed recently. Now, you have to be working with an expert in the field to avoid overpaying and to ensure the best selection.

As consumers, we’re beginning to see innovations emerge in the healthcare mar-ket notably, defined contribution plans and needs based purchasing models. These plans have been increasing in pop-ularity with the advent of exchanges and a return to the old “Cafeteria Plan Model.”

Traditionally, employers bear the bur-den of offering one or two plans from which the entire employee population must choose. The difficulty in that ap-proach is that individual employees have different health care needs. Defined con-tribution plans and needs based purchas-ing models offer choice to employees based on their requirements. These strat-egies allow employers to create a pre-dictable budget, while at the same time

saving employees’ money.The defined contribution model is be-

ing expanded in both public and private health insurance exchanges. As part of ObamaCare, each state is tasked with setting up their own health insurance ex-change. Currently, the public exchanges are only available to “Small Groups” -- employers with less than 50 eligible em-ployees, however there is speculation that by 2017 public exchanges may be avail-able to large employers. Public exchanges offer employees with incomes between 100 percent and 400 percent of the fed-eral poverty level the opportunity to have a portion of their care subsidized to make their health care plan more affordable. However, you must keep in mind that this does not include the employer’s portion of the cost of the health care plan.

In 2016, all employer groups un-der 100 employees will be considered “Small Group”. This means that if you are an employer group with 50 to 99 employees you are potentially at risk of receiving an increase to your cost in the 20-30% range in 2016. When the markets merge, employers in the 50-99 employee range could see massive in-creases. We’re seeing a resurgence of the “Partial Self-Funded” plan as a result. These plans include features of fully insured plans, but carry with them the ability to be refunded if claims exceed expectations.

ObamaCare has resulted in health in-surance companies beginning to inno-vate and create new products and strat-egies. BCBS, Tufts, and Harvard Pil-grim have all created their own private exchanges to compete with public ex-changes. The private exchange model is the same “Cafeteria Plan” approach that allows employees to pick and choose their health plan and also add on dental or other ancillary benefits. The newest versions of these private exchange plans

have decision-making tools built in to educate the employee on the best op-tion for them and their family’s specific health care needs.

The bottom line is this: Numerous changes to the healthcare model are here to stay and it is now as important as ever to investigate all of your options and to make sure you are working with an expert in the field of employee ben-efits. Employers have several options in the market to review and consider. Make sure you see and understand all of them.

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Saccone & cuomo, RegiSteRed RepReSentativeS and Saccone, Financial adviSoR oF paRk avenue SecuRitieS llc (paS), 160 gould StReet, need-ham, ma 02494, (781) 449-4402. SecuRitieS pRoductS/SeRviceS and adviSoRy SeR-viceS aRe oFFeRed thRough paS, a RegiSteRed bRokeR-dealeR and inveStment adviSoR. Financial RepReSentativeS, the guaRdian liFe inSuRance company oF ameRica (guaRdian), new yoRk, ny. paS iS an indiRect, wholly owned SubSidiaRy oF guaRdian. neitheR guaRdian noR itS SubSidiaRieS, agentS oR employeeS pRovide tax oR legal advice. you Should conSult youR tax oR legal adviSoR RegaRding youR individual Situation. the boSton buSineSS adviSoRy gRoup iS not a RegiSteRed in-veStment adviSoR. the bulFinch gRoup iS not an aFFiliate oR SubSidiaRy oF paS oR guaRdian. liFe inSuRance oFFeRed thRough the bulFinch gRoup inSuRance agency inc., an aFFiliate oF the bul-Finch gRoup, inc. the bulFinch gRoup iS not li-cenSed to Sell inSuRance. neitheR guaRdian noR any oF itS SubSidiaRieS, employeeS oR agentS pRo-videS tax oR legal advice. 2014 3264paS iS a membeR oF FinRa, Sipc.

MSADA Financial Sevices

by Jed DavidsondiRectoR oF paRt-neRShip SaleS, paRt-neRS beneFit gRoup

Navigating the Challenging Landscape of Health Care

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the boSton buSineSS adviSoRy gRoup will ad-dReSS youR Financial iSSueS on a monthly baSiS. email SpeciFic queStionS oR SuggeStionS FoR Fu-tuRe aRticleS to [email protected].

NADA Update by Don Sudbay

This month’s cover story is about our new MSADA Di-rector for Middlesex County, Frank Hanenberger. I want to personally thank Frank for stepping forward and agreeing to serve. Our state association is very fortunate to have dealers like Frank take the time out of their busy schedules to help all dealers in matters regarding government and manufacturer issues. These issues, if not vigilantly watched by our associa-tion, can have very detrimental effects on us all.

Please, when you are asked to make a call or visit one of our elected government officials, follow through and help us to spread our message. If we all do our part, it will greatly benefit the association and its members in the future.

A Special Note from NADA Chairman Forrest McConnell:

“Next month, attention shifts to the New York International Auto Show—the host of the fifth annual NADA/J.D. Power Automotive Forum. Whether you’re a new-car dealer, auto-maker, supplier or journalist, the full-day forum will provide you with unique and relevant perspectives about the opportu-nities and challenges facing key players in the industry.

“The forum is an ideal venue to talk about what makes auto retailing a true economic engine—the franchised dealer net-work. Last year, the industry rebounded to sell 15.6 million new cars and light trucks in the U.S, and we’re expecting sales to increase this year. New-car dealers employ one mil-lion people across the country.

“The franchised dealer network, which as you know has been the topic of much recent debate, is the most efficient and cost-effective way of selling and servicing vehicles any-where. From sales and financing to performing repairs, war-ranty and recall work, we provide our customers with unpar-alleled service.

“It’s a message NADA and its members are promoting this year, and one that I will reinforce during my opening remarks at the Automotive Forum in New York City on April 15.

“The featured industry speakers are Mary Barra, CEO of

General Motors Co., and Joe Hinrichs, executive vice presi-dent and president of the Americas for Ford Motor Co.

“A panel session on the luxury market includes an all-star lineup: Michael Bartsch, vice president of Infiniti Americas; Steve Cannon, president and CEO of Mercedes-Benz USA; Uwe Ellinghaus, Cadillac’s global marketing chief; Scott Ke-ogh, president of Audi of America; and David Zuchowski, president and CEO of Hyundai Motor of America.

“IHS chief economist Nariman Behravesh will provide a macro-economic overview, and John Humphrey, J.D. Power senior vice president of Global Automotive Practice, will provide an industry briefing on the North American market.

“A panel session on Wall Street’s perspective of the auto industry will feature Adam Jonas, managing director of Mor-gan Stanley; Itay Michaeli, Citi auto analyst; and John Mur-phy, managing director of Bank of America Merrill Lynch.

Registration for the Automotive Forum includes access to all networking events and the auto show’s press preview on April 16-17.

“We hope to see you there.”

During Congressional Recesses Try to Meet with Lawmakers in Their Home Districts

New-car and -truck dealers are effectively positioned to build long-term grassroots relationships with members of Congress. During this election year, most representatives and senators would welcome the opportunity to visit dealer-ships in their districts and interact with those whose liveli-hoods depend on the continued success of franchised dealers. NADA has been encouraging dealers around the country to meet with their senators and representatives during Congres-sional Dealership Days to discuss ongoing concerns with the Consumer Financial Protection Bureau and other federal leg-islative and regulatory issues impacting franchised dealers. There are two upcoming Congressional recesses for both the House and Senate: March 17-21 and April 14-25. If you are interested in hosting a Congress member and would like as-sistance with setting up a visit, contact Patrick Calpin, NADA Director of Grassroots Advocacy, at [email protected] or (202) 547-5500.

Enroll Today in NADA’s Dealership Workforce Study

A major challenge facing new-car and -truck dealers is at-tracting and keeping talented employees. To assist dealers with this task, NADA offers the Dealership Workforce Study, now open for enrollment to NADA and ATD members. There

The Franchise Dealer Network—An Economic Engine

don Sudbay, pReSident oF Sudbay automotive gRoup, RepReSentS mSada membeRS on the nada boaRd oF diRectoRS. he welcomeS youR queStionS and conceRnS ([email protected]).

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is no cost to participate. Participating dealers will receive a complimentary 2014 Dealership Workforce Study Basic Report, a custom report that compares the individual dealer-ship’s compensation for 60 job positions, employee benefits programs, hours of operation, work schedules, and retention and turnover to the aggregated data of other participating dealerships, both regionally and nationally; and 2014 Deal-ership Workforce Study Industry Report, which provides an overall industry-wide analysis of the aggregated DWS data, including hiring and retention trends, demographics such as generational differences and the gender gap, compensation, tenure, employee benefits statistics, plus hours of operation and work schedules for all U.S. regions, as well as an eco-nomic overview of 2013 and forecast for the future.

Dealers can enroll at www.nadaworkforcestudy.com. For more information, send an email to [email protected] or call (800) 557-6232.

Company Responsible for Telemarketing Violations; List Purchased from

Lead GeneratorThe Federal Trade Commission on March 12 reached a

$3.4 million settlement with a company for violations of the Do-Not-Call (DNC) restrictions under the FTC’s Telemar-keting Sales Rule based on phone calls the company made to consumers on lists purchased from “lead generators” who had represented they had consent from the consumers for those calls. However, they did not have consent, and many of the phone numbers were on the national and com-pany-specific DNC lists. This is a valuable reminder that dealers—not the vendor—are likely to be held liable for any DNC or similar violations related to leads purchased from a third party vendor. “Companies that use lead generators must exercise due diligence when they buy lists of phone numbers,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection, “or else they can be on the hook for illegal telemarketing.”

Editor’s note: NADA encourages dealers to not only conduct due diligence with all their vendors based on the services that vendor is providing, but also to clarify compli-ance obligations via contract and ensure that the dealership is protected in the event that the vendor has misrepresented its compliance efforts. For one example of this type of con-tractual protection, visit www.nada.org/dealerdata.

NADA Names Jonathan Collegio as New Head of Public Affairs

Jonathan Collegio was named NADA vice president of public affairs. He reports to NADA President Peter Welch, and he is responsible for the organization’s communications and marketing efforts. “NADA is working to take our com-

munications efforts to the next level, and hiring Jonathan Collegio to run our public affairs division is a great step forward,” said Welch. “Collegio is one of the sharpest, most well-regarded and well-connected public affairs and com-munications executives in the country, and we are excited to have him join our team.” Collegio, who was named Public Affairs Executive of the Year by PR News in 2009, has ex-tensive experience in public affairs spanning both political and corporate work. “America’s new-car and -truck deal-ers are the most entrepreneurial and hard-working business owners in the country,” said Collegio. “Their products keep America moving; their good-paying jobs propel local econ-omies, and it is an honor to advocate on their behalf.” Since 2010, Collegio has served as communications director for American Crossroads in Washington, D.C.

NADA: Used Vehicle Values to Peak in March Extremely cold weather during the first two weeks of

February and more moderate temperatures over the second half of the month correlated exactly with used price move-ment, according to the NADA Used Car Guide in the March edition of Guidelines, a monthly report on new and used vehicle sales trends and price movement. “Used prices grew by 0.7% over the first half of the month, but more favorable weather over the second half of the month allowed prices to grow 2.2% by month’s end, which is in line with NADA’s forecast of 2.1%,” said Jonathan Banks, executive automo-tive analyst of NADA Used Car Guide. NADA expects the seasonal uptick in used auto demand to continue for another month before dissipating in the second quarter of the year. NADA’s forecast has prices rising by an additional 1% in March and then falling by an average range of 2.5% to 3% per month from April through June. Prices are forecast to be 0.5% to 1% lower than 2013 levels by the end of year.

NADART Has Banner Year in 2013 with Nine State Dealer Groups Joining

NADART, the retirement plan and benefits division of NADA, had a banner year in 2013. The Georgia Automo-bile Dealers Association and the South Carolina Automo-bile Dealers Association were the eighth and ninth state dealer groups, respectively, to select NADART last year to provide customized retirement plans for their member deal-ers and dealership employees. In addition to Georgia and South Carolina, the state dealer associations in New York, Louisiana, North Carolina, Oregon, Pennsylvania, Califor-nia and Ohio selected NADART in 2013, joining the previ-ous partner Colorado.

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oveRallNationally there were 1.2 million light-vehicle sales in February 2014. This marked an increase of 17.9 percent from January 2014 and a decline of 0.1 percent over last February. The abnormally cold weather and heavy snow continued to dampen sales in Feb-ruary. Barring a few brands, namely Fiat Chrysler’s Jeep brand,

most automakers saw sales decline. February 2014 YTD figures bring total

light-vehicle sales to 2.2 million, down 1.5 percent from a year ago. The February 2014 Seasonally Adjusted Annual Rate (SAAR) for light-vehicle sales is 15.3 million.

In February 2014 YTD figures, car sales held a market share of 47.4 percent, with sales down 7.3 percent from a year ago, while corresponding figures for light trucks put the light-truck share at 52.6 per-cent with sales up 4.4 percent from a year ago. See Figure 1.

companieS/bRandSCompanies with a geographic base in

North America (Detroit 3 and Tesla Mo-tors) held the largest market share of light-vehicle sales for February 2014: 46.9 per-cent of the market. This was followed by

companies based in the Asia/Pacific region at 44.7 percent and then companies based in Europe at 8.4 percent.

In February 2014 YTD figures, companies based in North America also held the largest share of light-vehicle sales in the U.S. at 45.8 percent; this was a decline from a share of 46.3 per-cent a year ago. The corresponding share held by the Asia/Pacific-

Review of New Light Vehicle Sales

NADA Market BeatProduced by NADA’s Industry Analysis Group • Angela Lisulo, Economist


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Produced by NADA’s Industry Analysis Group • Angela Lisulo, Economist

based companies was 45.4 percent, which was up from 44.7 percent a year ago, and that for the Europe-based companies was 8.7 percent, which was down from 9.0 percent a year ago.

The North America and Europe company categories both experienced a contraction in sales in February 2014 YTD figures from Feb-ruary 2013 YTD.

Of the Detroit 3, Ford experienced the great-est contraction for February 2014 YTD with sales down 7.0 percent from a year ago, fol-lowed by General Motors with sales down 6.1 percent from a year ago. Fiat Chrysler experi-enced growth in sales of 9.8 percent over this period.

From the group of Asia/Pacific-based com-panies (excluding Suzuki which had no sales for February 2014 YTD), Mazda experienced the most contraction for Feb-ruary 2014 YTD with sales down 6.7 percent from last February followed by Toyota with sales down 5.7 percent. Isuzu experienced the most growth in sales over the pe-riod.

From the group of Europe-based companies, Volvo ex-perienced the most contrac-tion for February 2014 YTD with sales down 20.1 percent. Jaguar Land Rover experi-enced the most growth for February 2014 YTD with sales up 12.6 percent from a year ago. See Figures 2, 3 and 4.

SegmentSIn February 2014 YTD terms, there were seg-

ments which experienced a contraction in sales compared to last year: the small car segment, middle car segment, the sport utility vehicle (SUV) segment and the pickup segment.

This marked a continuation from January 2014 when these same segments experienced a contraction in sales compared to January 2013.

For February 2014 YTD, the greatest contrac-tion in sales was evident in the middle car seg-ment with sales down 15.4 percent from last year.

The cross utility vehicle (CUV) segment has continued to hold the largest share in sales in

NADA Market Beat30

YTD terms: 27.9 per-cent. This was fol-lowed by the middle car segment at 18.9 percent and then the small car segment at 18.7 percent.

Within the CUV segment, the middle CUV sub-segment has been the largest sub-segment, hold-ing 64.9 percent of February 2014 YTD CUV sales. See Fig-ures 5 and 6.

poweR SouRceGasoline-powered light vehicles held a market share of 94.0

percent of February 2014 YTD light-vehicle sales which was up from its corresponding share of 93.6 percent a year ago.

The market share held by the diesel category rose slightly to 2.7 percent, in YTD terms, from its value of 2.5 percent last year.

The market shares held by electrics and plug-in hybrids, in YTD terms, have each grown since last year.

In February 2014, for the alternative power category, the U.S. automobile industry sold the following light vehicles: 3,798 elec-trics, 0 units powered by fuel cells, 29,784 hybrids, 37 units pow-ered by natural gas and 3,721 plug-in hybrids amounting to 37,340 light-vehicle sales. See Figure 7.

modelSThere were three pickup trucks and two cars occupying the Top

Five ranks of the best-selling light vehicles for February 2014 YTD.

The three pickup trucks were models from the Detroit 3: Ford F-Series, Chevrolet Silverado and the Ram pickup. The two leading cars were models from companies based in the Asia/Pacific region: Nissan Altima and Toyota Camry.

From the list of the 15 best-selling light vehicles for February 2014 YTD, 7 out of 15 light vehicles were Detroit 3 models while the rest were from companies based in the Asia/Pacific region. See Figure 8.

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