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Auto dealers exempted from Wall Street bill

November 11, 2010

By Ray Scarpelli Sr., Metro Chicago NADA Director

WASHINGTON – Main Street auto dealers were excluded from sweeping legislation to overhaul the nation’s financial system, which President Barack Obama signed into law on July 21. The long-fought victory preserves dealer-assisted financing as an affordable option for car buyers.

"The exclusion for dealers is truly a win for consumers," said NADA Chairman Ed Tonkin. "Dealer-assisted financing will continue to provide more convenience, more competition and more choices for car buyers.

"This is also a testament to the hard work of all of the auto dealers and dealership employees around the country who made sure that the merits of the issue were heard. Their grassroots efforts truly made today’s victory possible."

The House approved new financial regulations June 30; the Senate, on July 15; and the president’s bill-signing came the following week.

The Congressional conference committee’s favorable vote came after stiff opposition to the exemption by the White House, the Pentagon, the Treasury Department and other groups. Automotive News summarized the battle over the bill in a June 28 article: "In the end, (the) NADA prevailed because, with members united, it got rank-and-file Democrats in the House and Senate to buck their leaders and the president." Tonkin sent a message to all members, thanking them for the many weeks of continued engagement.

"I want to personally thank everyone for putting forth such a sustained and effective effort on behalf of dealer-assisted financing," Tonkin said. "This is a victory for consumers who will now continue to have access to affordable and convenient credit options at dealerships."

David Regan, NADA vice president of legislative affairs, also thanked House Financial Services Committee member John Campbell (R-Calif.), and Sen. Sam Brownback (R-Kan.), who took up the cause in the House and Senate, respectively.

In late 2009, Rep. Campbell generated strong bipartisan support for an amendment to exclude dealer-assisted financing from an unwieldy new agency with almost unlimited authority to fundamentally alter the vehicle financing process. After the Campbell amendment passed the House, Sen. Brownback authored an amendment to do the same.

Grassroots efforts by dealers and dealership employees garnered a 60-30 vote to urge Senate conferees to exclude dealerships from the proposed agency. As a concession to secure the dealer exclusion, the Federal Trade Commission, which already oversees dealer-assisted financing, was granted expedited rule-writing authority over unfair or deceptive practices.

"The nation’s 18,000 dealers applaud the persistent efforts of Rep. Campbell, Sen. Brownback and the bipartisan support from both senators and representatives who recognized the need for a balanced approach to protecting consumers while allowing continued access to affordable auto credit," Regan said.

For more information, visit www.NADA.org/KeepCreditAffordable. And if you haven’t contributed to DEAC, please consider one. That’s what helped achieve this result.

In other legislative and regulatory news . . .

The NADA is arguing against the so-called "Right to Repair" provision in the auto safety bill, and recently sent a letter to all senators outlining the association’s concerns with Senate Bill 3181. NADA leaders say the measure is unnecessary because repair data is commercially available to independent repair shops through manufacturer and third-party Web sites.

The legislation may be offered as an amendment to vehicle safety legislation targeted at the sudden unintended acceleration in Toyotas. Earlier this summer, NADA voiced opposition to several components of the auto safety bill, including a proposed tax of $3 to $9 on new cars, which the Secretary of Transportation would have the discretion to raise beginning in 2014 without the direct consent of Congress.

The summer 2010 issue of the NADA Regulatory Review was recently sent to all ATAEs and ATAE counsel. The issue contains a number of active links so readers can view relevant regulations and other materials just by clicking on them. Some of the topics covered in the issue include:

• COBRA premiums extension
• Toyota dealer recall duties
• New fuel economy/GHG rules
• UNICAP concerns

The issue is available at www.nada.org/Publications/Regulatory+Review/default.htm. You will need a username and password to access the publication online.

In other NADA news, registration for 2011 Convention & Expo in San Francisco opens online July 26. Register by visiting www.NADAConventionAndExpo.org. Detailed information about each hotel and a map of its location is also available online. More than 20 hotels have been secured, and rates have been reduced, ranging from $139-$269. Look for promotional materials in the mail soon, as well.

• A Lexus Sales Managers’ 20 Group is launching this month, with a new Kia 20 Group following in August.

 

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