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Inside this issue
NADA Supports Bipartisan Effort to Reform CFPB Auto Lending Guidance
Early-Bird Registration Rates for the NADA Convention End Sept. 12
Bill Ford Warns About 7-Year Auto Loans
Volkswagen Posts a Rise in Car Sales
Dodge Challenger Hellcat Dealer Ordering Begins -- with a Catch
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
NADA Supports Bipartisan Effort to Reform CFPB Auto Lending Guidance

America’s new-car dealers convene on Capitol Hill this week to urge Members of Congress to cosponsor H.R. 5403—the Stutzman-Perlmutter bill.

The National Automobile Dealers Association is urging Congress to pass a new bipartisan bill (H.R. 5403) that nullifies the Consumer Financial Protection Bureau’s flawed guidance on auto lending and requires more transparency and accountability from the agency on future guidance.

“The CFPB’s actions will likely raise the cost of credit for car buyers,” said NADA Chairman Forrest McConnell. “The CFPB is attempting to change the $905 billion auto loan market and limit market competition without prior public comment and without analyzing the impact of its guidance on consumers.”

The new bill, “Reforming CFPB Indirect Auto Financing Guidance Act,” would allow the agency to reissue its guidance under a more transparent process. The measure is sponsored by Reps. Marlin Stutzman (R-Ind.) and Ed Perlmutter (D-Colo.), and was introduced Sept. 8. The bill is a narrower version of H.R. 4811, which was reported out of the House Financial Services Committee by a bipartisan vote of 35-24 in June.

“A majority of car buyers choose to finance their purchases through indirect financing at dealerships, which is always optional,” added McConnell, a Honda/Acura dealer from Montgomery, Ala. “Dealers often discount these interest rates to earn their customers’ business.”

In March 2013, the CFPB issued guidance that threatens to eliminate the flexibility of new-car dealerships to discount the interest rate offered to consumers to finance vehicle purchases. The CFPB claims that negotiated interest rates between dealers and their customers create a significant risk of unintentional “disparate impact” discrimination. However, there are a variety of legitimate business-related factors that can affect finance rates, such as beating a competing rate.

"H.R. 5403 is needed because it requires the CFPB to follow a transparent process when issuing auto finance guidance," McConnell said. "The bill would rescind the 2013 auto finance guidance and require public participation for future guidance before it is issued."
Source: NADA Legislative Affairs

Editor’s note: NADA is urging dealers to contact their House members today to cosponsor H.R. 5403. To locate your House member, click here. For the issue brief on H.R. 5403, click here.
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Early-Bird Registration Rates for the NADA Convention End Sept. 12

Dealers and their managers planning to attend the 2015 NADA Convention & Expo in San Francisco are encouraged to register by Friday, Sept. 12, to receive the early-bird registration rate—a $100 discount from the onsite rate—and make their hotel reservations. Hotel rooms are filling up quickly. Seventeen of the 43 hotels reserved for the NADA convention have already sold out.

The NADA convention runs Thursday, Jan. 22, to Sunday, Jan. 25, at the Moscone Center. Keynote speakers include former Florida Governor Jeb Bush and NADA Chairman Forrest McConnell on Friday, Jan. 23; Jay Leno and NADA Vice Chairman Bill Fox on Saturday, Jan. 24; and inspirational speaker Beck Weathers on Sunday, Jan. 25. Click here for the speaker bios.

Dealers can also meet face-to-face with manufacturer executives at franchise meetings, attend workshops and network with industry colleagues. The American Truck Dealers (ATD) Convention & Expo runs concurrently with the NADA convention. For more information or to register, visit www.nadaconvention.org.
Source: NADA Public Affairs

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Bill Ford Warns About 7-Year Auto Loans

Bill Ford, chairman of the namesake car company, said the increase in seven-year auto loans is worrisome. In a CNBC interview, he said, "I think we have to be careful because we don't want to get into a situation like we did before, where consumers are over-extended. That doesn't do anybody any good." His warning comes at a time when Experian Automotive data show that 24.9% of all new-car loans were for 73 to 84 months the first quarter, up from just 10% four-year ago. The average length of a new car loan now is a record 66 months, Experian reports.
Source: USA Today

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Volkswagen Posts a Rise in Car Sales

But sales continue to fall in Russia, the U.S. and Brazil

Volkswagen AG, Europe's biggest automotive group, said sales of its namesake brand cars in the first eight months of the year rose 3.4%, but growth nearly stalled in August and sales continue falling sharply in Russia, the U.S. and Brazil. The Volkswagen brand, which includes the Golf compact, Passat sedans and station wagons, and the Tiguan and Touran sport-utility vehicles, sold 4.3 million vehicles from January to August, up from 3.9 million last year, mainly on the back of strong growth in China and a recovery of Western European car markets. Growth slowed markedly in August. Volkswagen said sales of the VW brand rose just 0.1% in August to 471,000 cars, up from 470,500 last year.
Source: The Wall Street Journal
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Dodge Challenger Hellcat Dealer Ordering Begins -- with a Catch

Allocations will be based on a dealership's sales performance

Dodge will open dealer ordering for its new 707-hp 2015 Dodge Challenger SRT Hellcat today, but the brand is changing its normal allocation methods to make sure the high-powered coupe gets into the hands of waiting enthusiasts. Dodge will base Hellcat dealer allocation on the total number of Dodge vehicles a dealer has sold within the last 180 days, including everything from Dart to Durango to Viper, brand head Tim Kuniskis said. In December, a second allocation calculation will be made based on the previous 90-days' sales performance, as well as a traditional 30-day inventory turn.
Source: Automotive News
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Quotable
"H.R. 5403 is needed because it requires the CFPB to follow a transparent process when issuing auto finance guidance. The bill would rescind the 2013 auto finance guidance and require public participation for future guidance before it is issued."

   
-- NADA Chairman Forrest McConnell, commenting on a new bipartisan bill that nullifies the CFPB’s flawed guidance on auto lending and requires more transparency and accountability, NADA Headlines, Sept. 9

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