Tag: National Automobile Dealers Association

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EFG Companies

Labor in the Retail Automotive Space

2022 is already shaping up to be another banner year. In fact, the National Automobile Dealers Association (NADA) issued their 2022 forecast recently, projecting new vehicle sales to reach 15.4 million units – an increase of 3.4 percent. However, labor shortages could put a crimp in an otherwise positive 2022. The good news is there are three simple steps you can take to make your dealership more competitive in today’s labor market.

2022 Labor Market

Auto dealerships certainly felt the impact of the pandemic on employment. In March 2020, COVID-19 shutdowns forced dealerships across the country to lay off most of its sales staff. Since then, many dealers have not returned to pre-pandemic staffing levels. According to NADA, dealership employment for 2021 measured down 4-5 percent throughout the year.

As dealers look to restaff in 2022, some are finding themselves competing in a very tight labor market. Some economists are starting to believe the pandemic has changed the behavior of the job market in ways that could have a lasting impact, including resetting the relationship between workers and their employers.

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Industry Trends Training

Max Out Productivity

We have had some much-needed good news for dealership productivity over the past few weeks. Parts of the United States are opening to nearly full capacity.  The number of unemployed workers declined a bit as businesses brought back furloughed staff or hired new team members. And, vehicle sales picked up in May, averaging 12.2 million vehicles on an annualized basis, according to Autodata. While no one is popping any celebratory champagne corks, the positive headlines are a balm to our bruised economy.

However, the COVID-19 pandemic remains a real threat. Hot spots continue to flare, sending record numbers of people to the hospital. A large percentage of Americans are still hesitant to visit businesses in person, instead relying on the online platforms that have sustained their lives since mid-March. As a retail auto dealer, how do you maximize your opportunities to sell vehicles?

Digital options pay off in productivity

Since we have all been forced to rely on our online tools during the shutdown, more sales are taking place on digital platforms. A recent Cox Automotive survey found that over half of consumers plan to complete at least some portion of their purchase online. Dealers are encouraging customers to use online shopping tools, including online chat, virtual test drives, trade-in valuation, and financing calculators. However, simply providing online tools is not enough to differentiate your dealership from the competition for today’s consumers.

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Compliance

DOD Reverses Course on MLA Interpretation

Contributing Author: Steve Roennau Vice President Compliance EFG Companies
Contributing Author:
Steve Roennau
Vice President
EFG Companies

In February, the Department of Defense (DOD) issued a statement regarding its interpretation of
the Military Lending Act (MLA). According to a filing in the Federal Register,

“The Department of Defense (Department) is amending its interpretive rule for the
Military Lending Act (the MLA). The MLA, as implemented by the Department, limits the military annual percentage rate (MAPR) that a creditor may charge to a maximum of 36 percent, requires certain disclosures, and provides other substantive consumer protections on “consumer credit” extended to Service members and their families. The Department is now withdrawing the amended question and answer number 2 (Q&A #2), published in the December 14, 2017 Interpretive Rule, which discussed when credit is extended for the purpose of purchasing a motor vehicle or personal property and the creditor simultaneously extends credit in an amount greater than the purchase price of the motor vehicle or personal property.” – federalregister.gov/d/2020-04041

This statement follows a joint petition, filed in January 2018 by the National Automobile Dealers Association (NADA) and the American Financial Services Association (AFSA), requesting the DOD to review the interpretation. When the DOD issued its 2017 interpretation, there was no public notice or opportunity for the NADA and other retail automotive trade associations to comment on the implications.

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