CATA News

The Illinois Environmental Protection Agency is implementing a Charging Infrastructure Grant Program. The primary goal of this program is to substantially offset the installation costs of electric vehicle charging infrastructure, beginning July 1, 2022, and continuing as long as funds are available. The Agency will award grants in accordance with Section 45 of the Electric Vehicle Act, to public and private organizations and companies to install and maintain Level 2 or Level 3 charging stations. 

For more information on this grant program, you can download the 2022 Illinois Register of Rules of Governmental Agencies, Vol. 46, Issue 34.

President Biden signed the signed the Inflation Reduction Act into law on August 16, fundamentally changing the way EV tax credits are handled. For the past few days, government agencies, auto manufacturers, the NADA, and industry news providers have been scrambling to make sense of the new law and detail the changes for new-car dealers. Key takeaways include:

1. The old $7,500 credit is no more. However, customers who took delivery or entered a binding purchase contract for a qualifying PHEV or BEV prior to Aug. 16, 2022, are still eligible to claim the old credit on their taxes.
   
2. From Aug. 16, 2022, to Dec. 31, 2022, only one requirement applies for a PHEV or BEV to get the $7,500 credit. The vehicle must be assembled in North America.
   
3. Starting Jan. 1, 2023, additional requirements are added for a PHEV or BEV to be eligible for the $7,500 credit.
   

Providing a little detail on each of the requirements:

The U.S. Department of Energy has provided a list of vehicles with final assembly in North America. That list is located here: https://afdc.energy.gov/laws/inflation-reduction-act. It should be noted that simply being on this list does not guarantee that the vehicle qualifies for the credit because some vehicles are built in multiple locations. The build location of a particular vehicle should be confirmed by referring to its Vehicle Identification Number (VIN) using the VIN decoder or an information label affixed to the vehicle.

The MSRP qualifications are clearly specified in the legislation:

The income thresholds are also clearly defined in the legislation:

Like the income threshold and MSRP limitations, the battery component and battery minerals production requirement does not kick in until 2023. At that time, 40% of the critical minerals used to create a vehicle's battery must be extracted or processed in the United States, or a country that has a free trade deal with the US. By 2027, that number will rise to 80% of the battery minerals. The battery component requirement calls for 50% to be manufactured or assembled in North America starting in 2023 and 60% in 2024 and 2025 with the number gradually growing to 100% in 2029.

Also, the amount of credit available for a specific vehicle depends on several factors. For the remainder of 2022, new vehicles that meet the guidelines set up in the Inflation Reduction Act receive up $7,500. Starting in 2023, a vehicle will receive $3,750 if it meets the battery minerals requirement and $3,750 if it meets the battery component requirement.

The Inflation Reduction Act also defines a new credit for some buyers who purchase a used electric vehicle of up to $4,000. However, the credit may not exceed 30% of the vehicle's sale price.

Starting Jan. 1, 2024, the federal tax credit can be assigned to the seller (new-car dealer) by the buyer, resulting in a purchase price reduction. However, prior to that date, the customer must claim the credit when filing federal taxes or assign it to the leasing company.

Keep in mind that the new law does not affect the current Illinois EV tax rebate. You can get more information on that here.

From an advertising perspective, it is advisable for dealers to follow these guidelines:

For the ninth year, the Chicago Automobile Trade Association partnered with the USO Illinois to host Barbecue for the Troops fundraisers. This summer, 63 local new-car dealerships fired up their grills to host community Barbecue for the Troops events featuring everything from patriotic ceremonies, classic car shows, live music, games for kids of all ages and, of course, barbecues. The dealerships rallied their communities once again, bringing in more than $78,000 for local military and their families.

“CATA dealerships are committed to giving back to their communities, and the USO Barbecue for the Troops initiative is one great example of dealers helping people in need – right in our own backyards!” said CATA Chairman JC Phelan. “This year is especially wonderful because of the $1 million fundraising milestone we achieved and I am so proud to present this check to USO Illinois on behalf of all participating dealers.”

This year’s fundraiser brought the grand total of the nine-year program to more than $1 million overall, supporting the USO Illinois initiatives with nearly 700 fundraisers. These funds enable the USO Illinois to lend support to more than 326,000 service members and their families annually.

“We are overwhelmed with the amount of support we have seen this year from our partners at the Chicago Automobile Trade Association and the local new-car dealerships,” said USO Illinois Executive Director, Christopher Schmidt. “What started as a grassroots effort has now turned into more than $1 million in support for our local service members and their families.”

In addition to the community fundraisers, awareness spread via social media. The CATA and USO Illinois ran a #BBQ4Troops social media contest where people could nominate individuals they deem worthy of winning the Ultimate Backyard Barbecue. Entries poured in throughout the month of July; wives nominated husbands who served overseas, parents nominated children who are active duty military and friends nominated deserving friends and neighbors.

The CATA and USO Illinois are already planning for next year. The USO Barbecue for the Troops fundraising events are set to take place at local new-car dealerships on Sat., July 15, 2023. 

“This program could not have been a success without the incredible support of our media partners,” said Phelan.  “Many thanks are due to all of our partners in TV, radio and outdoor advertising media who helped us promote this worthwhile program.  And a special thanks to ABC 7 for producing the TV spot that aired throughout the market.”

The daughter of Lonnie Johns, assistant service Manager at Elgin Toyota and her entire family were involved in a tragic accident along I-90 recently. Tom and Lauren Duboz and their four children were killed in the accident

A GoFundMe has been set up by Lonnie and Eva Johns and the owner of Elgin Toyota and the Bob Loquercio Auto Group has pledged to match the first $10,000 in donations. If you are interested in donating, please visit https://www.gofundme.com/f/tom-and-lauren-dobosz-family.

John G. Mathias, 82, of Arlington Heights, passed away on August 6, 2022. Beloved husband of Theodora "Teddy" Mathias; loving father of Mary (Bill) Bauer, George Mathias, Thomas (Kathy) Mathias and the late Constance "Connie" Mathias; adoring "Papou" of Alexis & Bradley Bauer and John (Bianca) & Lauren Mathias; dear brother of Elaine Mathias and brother-in-law of the late Despina (Andy) Kyriazes and the late Steve (Linda) Messerges; dear uncle of many nieces and nephews.

John was the proud owner of Franklin Weber Pontiac and a past President and Chairman of the Chicago Auto Trade Association.

Donations can be made in John's name to the Illinois Alzheimer's Association at www.alz.org/illinois or the St. Nectarios Greek Orthodox Church at www.stnectariosgoc.org/stewardship/donations, under the "give now" button please select "Memorial Donations" and write John's name in the note.

Charles “Chuck” Weck, 66, of Marengo, died on July 30, 2022. Chuck was instrumental in the growth of the Napleton Group and later started the WAG, Weck Automotive Group, which included Elgin Kia and Mount Prospect Volkswagen.

Chuck was born in Chicago on July 14, 1956, to parents Marion and Grace (nee Massarelli) Weck. Chuck was a loving husband, dad, grampy, brother, and prolific rescuer of dogs. He was a dedicated and self-made leader and mentor in the automotive industry; a “car guy” in the truest sense. He was a championship winning racer and speed record holder at Great Lakes Dragaway. He was a friend to so many. He was kind, charitable, and willing to extend himself to anyone in their time of need. He will be greatly missed by all who knew him.

Chuck is survived by his beloved wife of 39 years, Carol (nee Kosek) Weck, his children, Chris (Abby) Weck, Kyle Weck, and Carly Weck, his grandchildren, Charlie and Maggie, and his six dogs. Funeral arrangements have not been set.

Registration for the 2023 NADA Show is now open. The event will be held in Dallas Jan. 26-29. It will feature 80+ workshops, 60,000 sq. ft. of exhibits, more than 500 exhibitors, and much more. Main stage speakers include Nikki Haley Greg Gutfeld, Deion Sanders, Michael Alford, and Geoffrey Pohanka.

NADA members can click here for more information and to register: https://www.nada.org/nada-show.

The CATA is seeking nominations for the TIME Magazine Dealer of the Year Award Nominee from the Chicago area. This is a prestigious recognition for one CATA member to compete against 50+ dealers from across the country, culminating in the ultimate winner being crowned at the NADA Show in Dallas, TX next January.

If there is a member dealer who you feel deserves this recognition, please Click here to complete the short 3-question TIME Dealer of the Year Nomination Survey. Please note that nominations for this award must be submitted by a dealer for themselves or a fellow dealer.

All nominations will remain confidential. Thank you for your continuing support and cooperation.

A new report shows new car shoppers are more likely to purchase an electric vehicle (EV) from a traditional, legacy automaker than from an upstart EV specialist manufacturer—including Tesla.

More than one-third (35%) of the survey’s respondents favor purchasing from a well-established automaker, while just fewer than one-quarter (24%) indicate they’d likely look to an EV start-up to purchase their first electric vehicle. A further 41% of the study’s participants are undecided, highlighting the stakes at play for familiar brands and start-ups seeking to capitalize on rising waves of EV interest among consumers and win over future EV buyers.

Those are the latest findings of the new Brand DeepDive report from EVForward™, the largest, most comprehensive study of the next generation of electric vehicle buyers. The dedicated platform was developed in 2019 by Escalent, a top human behavior and analytics advisory firm with extensive experience counseling the world’s automotive companies.

“While brands such as Tesla and Rivian continue to make headlines as the fresh entrants into an industry dominated by decades-old multinational corporations, many consumers have taken notice of the strides familiar auto brands have been taking to market—and improve—their electrified offerings,” said KC Boyce, vice president with the Automotive & Mobility and Energy practices at Escalent. “The idea that a new player to the automotive market will remain the leader as more and more established brands expand their EV offerings is far from a certainty.”

For more information, read the full report here: https://escalent.co/news/established-automakers-hold-edge-over-ev-start-ups-in-race-to-win-ev-shoppers/.

[From NADA] The NADA recently alerted members to a little-known requirement under what is known as the Mail, Internet, or Telephone Order Merchandise Rule that could arise as a potential issue for dealers as a result of the current market conditions. This week, the Federal Trade Commission (FTC) announced two enforcement actions under this Rule. A few things to note from the FTC notice published this week – according to the FTC:

1. First…

“a refresher on the requirements of the Mail, Internet, or Telephone Order Merchandise Rule. Under the Mail Order Rule, at the time sellers solicit an order, they must have a reasonable basis they will be able to ship: 1) within the stated time; or 2) if no time is stated, within 30 days. If a shipment is delayed, the Rule lays out sequential if-then steps sellers must take to ensure buyers aren’t left in the lurch….

2. There is no “COVID exception” to the Mail Order Rule.

“Certainly the pandemic has had an impact on the supply chain. But as the Court in the American Screening case observed, “[T]he law provides no exceptions for sellers that do their ‘best’ during pandemics”….That’s because the Mail Order Rule presciently built in procedures for times such as these. Assuming a seller had a reasonable basis to make a shipping claim in the first place, the Mail Order Rule includes step-by-step instructions on how to address an unanticipated shipment delay and still comply with the law.

3. Without records proving compliance, there is a rebuttable presumption of a violation of the Rule:

…If a company fails to have “records or other documentary proof establishing its use of systems and procedures which assure compliance,” the Rule establishes “a rebuttable presumption that the seller failed to comply with said requirement.”

While there may be arguments/reasons why this Rule does not apply to specific dealers, out of an abundance of caution it may be worthwhile for many dealers to review their practices in light of the FTC guidance and attached materials to ensure appropriate systems and procedures are in place to meet any applicable requirements under this rule.