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NADA responds to point-of-purchase EV tax credit proposal

June 10, 2011
By Mark Scarpelli, Chicago Metro NADA Director
The NADA has expressed concern with a proposal the Obama administration is pushing to extend tax rebates to consumers at the dealership when they purchase an electric vehicle.
The government currently offers a $7,500 tax credit on the purchase of electric vehicles. Transportation Secretary Ray LaHood supports a point-of-sale rebate, comparing it to the 2009 Cash for Clunkers program.
The NADA pointed out that LaHood’s proposal, however well intentioned, would needlessly complicate the car-buying process. Furthermore, changing the vehicle tax credit is unnecessary; the current tax credits have been successful in stimulating consumer interest in emergent technologies. The rebate proposal is so complicated that it likely would deter sales of alternative fuel vehicles, which is exactly the opposite effect that LaHood intends.
In other NADA news . . .
• Days after tornadoes ripped through parts of Iowa and Alabama in late April, the National Automobile Dealers Charitable Foundation mobilized its Emergency Relief Fund to aid dealership employees recovering from the deadly storms.
Six people have received grants from the foundation to help them get back on their feet after losing their homes and most of their possessions. And the foundation continues to seek donations to help more dealership employees displaced by natural disaster, as the need for aid rises.
Jack Leigh, of Leigh Automotive, says the tornadoes on April 27 left thousands in his community of Tuscaloosa, Ala., either without homes or with severe damage. At least two dealerships in Tuscaloosa suffered substantial damage.
The foundation’s Emergency Relief Fund aids recovery efforts after natural disasters, such as flooding, hurricanes and tornadoes. Since the program started in 1992, it has provided more than 7,500 dealership employees with financial assistance totaling almost $5 million.
If you know a dealership employee affected by the tornadoes or would like to donate to the NAD Charitable Foundation’s Emergency Relief Fund, contact the foundation at (703) 821-7233 or
• First quarter results of NADA’s monthly Dealership Financial Profile, which provides a snapshot of the financial condition of the average new-car dealership, portrays an industry well into recovery, says NADA Chief Economist Paul Taylor. Despite challenges such as higher gas prices and generally slow economic growth during the first quarter, total sales at the average dealership were up 22.5 percent while expenses increased just 14.2 percent. The stronger financial performance yielded net profits before taxes of 2.4 percent for the typical dealer, Taylor says, which represents a 34 percent increase over performance in the first quarter of 2010. “Dealers showed strength in all areas of operations in the first quarter,” Taylor said. “Their strong performance suggests that as new-car production is restored, the stage is set for continued strong growth in the future.” For more analysis from NADA’s Industry Analysis group and Chief Economist Paul Taylor, visit NADA’s Dealership Financial Profiles online.
• The 2012 NADA and ATD Convention and Expo will be Feb. 3-6 in Las Vegas. It will be the first time the two conventions will be held together. ATD members will participate in events geared solely to the trucking industry, including luncheon general sessions at the Las Vegas Hilton Hotel. And ATD and NADA registration, franchise meetings, workshops and expos will take place in the Las Vegas Convention Center adjacent to the Las Vegas Hilton. ATD attendees also will be able to attend the NADA expo, workshops and general sessions. And they can stay at any hotel of their choice in NADA’s block. Online registration for the NADA and ATD conventions will open in mid-July at and  
• A bogus website,, has been set up to look like the legitimate website of The fraudulent Web page offers services for “Auto Purchase Protection” and facilitates the transfer of funds between buyers and sellers. This Web page has no connection with the NADA or The NADA is attempting to shut down the site, which appears to be hosted overseas.
Dealer Executive Education if forming a class for August at Babson College in Babson Park, Mass. The curriculum is an integral part of the dealer development program of NADA University. Babson’s MBA program is ranked number one in the country for entrepreneurship, a distinction it has earned for 17 consecutive years. Its focus on innovation and what Babson faculty call “opportunity obsession” are key. Visit to download a brochure and learn more. Don’t wait—apply today.
• NADA University’s Resource Toolbox will present a complimentary MarketINSIGHT webinar, “Dealership Valuation for Estate and Succession Planning,” at 12 p.m. CDT June 16. To register, call NADA U at (800) 557-6232.