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CFPB responds (sort of) to letters on auto lending guidance

July 19, 2013
By Mark Scarpelli, Chicago Metro NADA Director
 
Democratic and Republican members of the House Financial Services Committee sent separate letters last spring to the Consumer Financial Protection Bureau regarding its earlier guidance on fair lending, requesting all relevant documentation that supports the CFPB’s assertion that discrimination exists in indirect auto financing.
 
The letters also requested the studies the CFPB relied on to support its attempt to pressure indirect finance sources to compensate dealers for arranging financing with a flat fee instead of allowing consumers to negotiate competitive rates with dealers.
 
Combined, the signers of the two letters represent a majority of the Financial Services Committee. Richard Cordray, acting director of the CFPB, responded to the Democrats’ letter by providing virtually no new information on the background information and methodology to explain the Bureau’s conclusions, despite a specific request.
 
In NADA news ...
 
• Beginning in 2015, the NADA Convention and Expo will be held Thursday to Sunday instead of Friday to Monday.
 
“After surveying the membership and exhibitors, the consensus was to end the convention on Sunday, instead of Monday,” said Desmond Roberts, chairman of NADA’s convention committee and a Chevrolet dealer in Hodgkins, Ill. “The Thursday-to-Sunday timeframe will allow convention attendees to be back at work earlier the following week.”
 
The 2014 NADA and American Truck Dealers (ATD) conventions will be held concurrently in New Orleans from Jan. 24-27 as scheduled from Friday to Monday.
 
Here are the revised dates for the NADA and ATD conventions:
 
2015: San Francisco, Jan. 22-25
2016: Las Vegas, March 31 - April 3
2017: New Orleans, Jan. 26-29
2018: Las Vegas, March 22-25
 
In other news ...
 
• The Occupational Safety and Health Administration is targeting automotive repair and maintenance businesses, including new-car dealerships, through a Region 8 Local Emphasis Program. This focused inspection activity, scheduled for between April 16 and at least Sept. 30, 2013, stems from five complaints OSHA Region 8 received in FY 2010, all of which resulted in citations.
 
The NADA urges dealerships nationwide to review the inspection directive (www.osha.gov/oshdir/r08.html) and their health and safety compliance. Dealerships with specific questions regarding their compliance should contact Lauren Bailey, of NADA Regulatory Affairs, at regulatoryaffairs@nada.org or (703) 821-7040; or contact their state or local dealer association.
 
• New-vehicle dealers sold more than 17.1 million used light vehicles last year; of these, 9.4 million were retailed and 7.8 million wholesaled.
 
The average 2012 used retail selling price was $17,547, up 1.6 percent from $17,267 in 2011.
 
New-vehicle dealers acquired 61 percent of the used units they retailed from trade-ins, 24 percent from auctions and the remaining 15 percent from street purchases or other sources.
 
• As the U.S. economy gains momentum and auto sales increase, employment at franchised new-car dealerships continued to rise, up 3.2 percent last year, the National Automobile Dealers Association indicated in its latest state-of-the-industry report. In 2012, total employment at new-car dealerships increased to 963,400 employees, up from 933,500, according to NADA Data 2013, a report on dealership sales and financial trends.
 
The average number of employees per dealership rose from 53 to 55 last year. New-car dealerships had an annual average payroll of $2.9 million in 2012, up 12 percent from the previous year. The total payroll for all U.S. new-car dealerships was $51.6 billion, up 12.6 percent. Average weekly earnings of employees at U.S. new-car dealerships last year was $1,030, up 9.1 percent from the previous year.
 
• As the U.S. economy gains momentum and auto sales increase, employment at franchised new-car dealerships continued to rise, up 3.2 percent last year, the NADA reported in its latest state-of-the-industry report.
 
In 2012, total employment at new-car dealerships increased to 963,400 employees, up from 933,500, according to NADA Data 2013, a report on dealership sales and financial trends. The average number of employees per dealership rose from 53 to 55 last year.
 
There also was a net increase of 95 franchised dealerships, bringing the total to 17,635 at the end of 2012.
 
New-car dealerships had an annual average payroll of $2.9 million in 2012, up 12 percent from the previous year. The total payroll for all U.S. new-car dealerships was $51.6 billion, up 12.6 percent.
 
Average weekly earnings of employees at U.S. new-car dealerships last year was $1,030, up 9.1 percent from the previous year.
 
Sales, payroll and employment at new-car dealerships as a percentage of total U.S. retail activity in 2012:
Sales accounted for 14.1 percent of total U.S. retail sales, and payroll accounted for 12.3 percent of total U.S. retail payroll.
Employees accounted for 6.3 percent of total U.S. retail employment.
 
 

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