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Inside this issue
NADA Calls on CFPB to Accept Dealer Group's Anti-Discrimination Approach
Commentary: Dealers Are Best Deal for Consumers
Dems Introduce New Auto Safety Bill
IRS Issues Tangible Property Accounting Guidance
Mitsubishi to Supply Pickup Trucks to Fiat as of 2016
Fortune Magazine: Barra #2 Most Powerful Woman Boss
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
NADA Calls on CFPB to Accept Dealer Group's Anti-Discrimination Approach

The National Automobile Dealers Association called on the Consumer Financial Protection Bureau to recognize NADA’s Fair Credit Compliance Policy & Program as a valid way to avoid discrimination, at a CFPB hearing [Thursday] in Indianapolis into auto-lending practices. NADA also asked the bureau to change the way it analyzes loan portfolios to detect discrimination. NADA distributed the Fair Credit policy to its members earlier this year. The central idea -- borrowed from an earlier discrimination case brought by the U.S. Department of Justice -- is for dealerships to choose a fixed rate for dealer reserve. F&I managers aren’t allowed to exceed the fixed rate, and if they offer a discount below it, they must document a business reason for doing so from a pre-approved list. “Our program fully adopts -- and indeed adds to -- the very well-thought-out fair credit risk mitigation model that the Department of Justice developed in 2007 to resolve fair credit cases involving two auto dealerships,” Paul Metrey, NADA chief regulatory counsel, said in remarks prepared for the hearing.
Source: Automotive News

Editor's note: To download the NADA Fair Credit Compliance Policy & Program, go to www.nada.org/faircredit.

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Commentary: Dealers Are Best Deal for Consumers
By Jonathan Collegio, VP of Public Affairs for NADA

Roughly 16.4 million new cars and light trucks will be sold this year, virtually all through America's franchised new-car dealerships. Local independent dealers provide the most competitive, efficient and consumer-friendly model for the buying, selling and servicing of cars - and policymakers should work to strengthen the franchise model. New-car dealers compete fiercely for their customers' business - and that competition in sales and financing drives prices down. In many major metro areas, multiple stores across and within brands compete for the business of every customer, and that competition incentivizes the lowest cost distribution model for virtually any consumer good anywhere.

No business model in America is more efficient, competitive or decentralized than the network of franchised new-car dealerships. The franchise model allows manufacturers to do what they do best: design, build and market great new vehicles, instead of investing in a low return-on-investment, capital intensive retail business where local businesspeople have a real advantage. High volume manufacturers from America and abroad recognize the value of local dealerships and embrace the franchise model as the best system of retailing new cars. The franchise model should be strengthened. Click here for the full commentary.
Source: McClatchy Tribune News Service

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Dems Introduce New Auto Safety Bill

Top Democrats on the House Energy and Commerce Committee introduced a new auto safety reform bill on Thursday that would require automakers to make public technical service bulletins, ban recalls that apply to only certain parts of the country, and require car companies to keep records about possible defects for 20 years. The Vehicle Safety Improvement Act was introduced by Rep. Henry Waxman, D-Calif., the ranking member of the committee and Rep. Jan Schakowsky, D-Ill. It would for most defects remove the $35 million cap on maximum fines. The Obama administration has proposed hiking it to $300 million. It's the latest in a series of auto safety measures introduced this year.
Source: The Detroit News
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IRS Issues Tangible Property Accounting Guidance

The IRS released Revenue Procedure 2014-54, which provides the procedures by which a taxpayer may obtain the automatic consent of the Commissioner of Internal Revenue to change to the method of accounting; modifies previous IRS guidance regarding changes in method of accounting related to dispositions of tangible depreciable property, or for amounts paid to acquire, produce or improve tangible property; and allows certain late partial disposition elections to be treated as a change in method of accounting for a limited period of time.
Source: NADA Regulatory Affairs
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Mitsubishi to Supply Pickup Trucks to Fiat as of 2016

Fiat SpA plans to cooperate with Japanese carmaker Mitsubishi Motors Corp. on pickup trucks, enabling the Italian company to add to its lineup while conserving cash after merging with U.S. manufacturer Chrysler. Under a memo of understanding on the project, Mitsubishi will build as many as 170,000 trucks for Fiat over six years, with production beginning in the first quarter of 2016, Yuki Murata, a spokesman at the Tokyo-based company, said by phone. The mid-sized model will be based on the next version of Mitsubishi's L200, Turin-based Fiat said in a statement.
Source: Bloomberg

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Fortune Magazine: Barra #2 Most Powerful Woman Boss

Fortune magazine ranks GM's Mary Barra the second most powerful woman in American business

Fortune Magazine is out with its annual list of the most powerful women in American business and General Motors' Mary Barra rises to number 2 on the list, up 27 places from last year. Barra, GM's CEO since January, ranks second only to IBM's Ginni Rometty, the tech company's chairman, president, and CEO. Barra became the auto industry's first female CEO in January and soon faced the crisis of GM's largest vehicle recall ever (29 million vehicles so far) from a faulty ignition switch linked to at least 13 deaths since 2005. In an interview with Fortune, Barra said, "I don't want to set it aside and explain it away. Because I think it uncovered some things in the company that it's critical we challenge ourselves to change and to fix."
Source: Detroit Free Press
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Quotable
"Our program [NADA Fair Credit Compliance Policy & Program] fully adopts -- and indeed adds to -- the very well-thought-out fair credit risk mitigation model that the Department of Justice developed in 2007 to resolve fair credit cases involving two auto dealerships."

   
-- Paul Metrey, NADA chief regulatory counsel, in comments at a CFPB hearing on auto finance on Thursday, Automotive News, Sept. 18

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