CATA News

Twenty-eight area dealerships are winners of DealerRater’s 2021 Dealer of the Year Award, for providing outstanding customer experiences: Arlington Heights Buick-GMC, Audi Naperville, Berman Nissan of Chicago, BMW of Schererville (Ind.), City Volkswagen of Chicago, D’Arcy Hyundai (Joliet), Fox Lincoln (Chicago), Gerald Subaru of Naperville, Hawk Mazda (Joliet), Heritage Cadillac (Lombard), Infiniti of Naperville, Bill Jacobs BMW-Mini (Naperville), Jaguar Schaumburg, Gary Lang Kia-Mitsubishi (McHenry), Mercedes-Benz of Chicago, Muller’s Woodfield Acura (Hoffman Estates), Napleton Aston Martin (Downers Grove), Napleton Autowerks of Indiana (Schererville), Phillips Chevrolet of Frankfort, Porsche Orland Park, Joe Rizza Alfa Romeo-Maserati (Orland Park), Taylor Chrysler-Dodge-Jeep-Ram, Bourbonnais, Taylor Ford of Manteno, Toyota of Naperville, Valley Honda (Aurora), and Volvo Cars Lisle. Phillips Chevrolet is the award’s national winner among Chevrolet dealerships. 

 

MotorWeek, television’s longest-running automotive series, on Feb. 10 named the new Ford Mustang Mach-E the best vehicle of the year, in its 2021 Drivers’ Choice Awards.

The awards, presented in 12 categories, traditionally are announced during the Media Preview segment of the Chicago Auto Show. This year, the winners were revealed in a YouTube video.

MotorWeek host John Davis said the Mach-E brings a host of firsts to the Mustang: first battery-electric powertrain, first with all-wheel-drive, and, of course, the first SUV to ever wear the Mustang badge.

Other 2021 Drivers’ Choice category winners:

 

Best Small Car: Mazda3

Best Family Sedan: Kia K5

Best Luxury Sedan: Acura TLX

Best Sport Sedan: Mercedes-AMG CLA 35

Best Sports Coupe: Toyota GR Supra

Best Performance Car: Porsche 718

Best Eco-Friendly: Ford Mustang Mach-E

Best Small Utility: Ford Bronco Sport

Best Midsize Utility: Land Rover Defender

Best Large Utility: Chevrolet Tahoe/Suburban

Best Luxury Utility: Mercedes-Benz GLE

Best Midsize Pickup: Honda Ridgeline

Best Full-size Pickup: Ford F-150

 

Kentucky dealer Steve Gates on Feb. 17 assumed the chairmanship of the American International Automobile Dealers Association for 2021.

"Becoming chairman of the AIADA is by far the biggest honor I’ve ever received," said Gates, who represents the third generation of dealers in the Gates Auto Family. "I can promise you that day in and day out I will do everything I can for this industry and the AIADA. I’m excited and ready to go." 

The Gates Auto Family operates Audi, Ford/Lincoln, Honda, Hyundai, Kia, Lexus, Nissan, and Toyota dealerships with more than 500 employees. Gates has served on the AIADA’s board of directors since 2014 and in 2018 testified during a U.S. Senate Finance Committee hearing on behalf of dealers on the disastrous impact of 232 proposed tariffs on vehicles. 

His industry leadership also includes representing dealers on Toyota’s National Dealer Council for six terms, Toyota’s National Product Advisory Council, and the state of Kentucky’s Motor Vehicle Commission. Gates also is a former Kentucky Automobile Dealers Association board member.

 

In his final remarks to dealers as outgoing NADA chairman, Rhett Ricart — who led the organization through one of the most tumultuous years in recent memory — had a simple message during Feb. 9 remarks at NADA Show: "Never forget what we went through, because it shaped who we are today."

Ricart took over as NADA chairman at the previous NADA Show in mid-February 2020. Less than a month into his tenure, the coronavirus pandemic upended everything in the auto industry, including the priorities of the organization Ricart was tapped by his fellow dealers to lead in 2020.

Even though "no playbook was ever written for the challenges we faced in 2020," Ricart said, the NADA rallied immediately and refocused on the single goal of steering America’s franchised auto dealers through the pandemic.

"This association has never fought harder, worked faster, or given so much of itself so that business owners, like you and me, had a franchise that remained valuable and protected," Ricart said at the opening session of NADA’s first-ever virtual Show.

From advocating for dealerships to be deemed essential businesses, to helping dealers navigate coronavirus-related regulations, to maintaining dealership workforces, Ricart reminded auto dealers nationwide of the importance of the NADA’s efforts on behalf of, and hand-in-hand with, franchised dealers.

"We’ve lived through a year we’ve never witnessed before, but the NADA rose to the occasion," Ricart said. "It is a forcefield that covers every dealer. I am in awe of the NADA staff, our state and metro associations, and their leadership. Everything they did, they did on our behalf."

And Ricart, president and CEO of Ricart Automotive Group in Columbus, Ohio, credited his fellow dealers for their perseverance, determination and flexibility in the face of a constantly changing and ever-challenging business environment.

"Despite the darkest days, we kept people on the payroll, we reformulated our business model, we prioritized the health of customers, employees and our families, and we continued to sell and service cars," Ricart said. "Through the chaos, I saw the strength of auto dealers like I never have before. Dealers became life preservers, contortionists and survivors."

Ricart urged dealers to stay vigilant and remain confident in their ability to thrive in the face of adversity. And he reiterated his belief that the challenges dealers survived in 2020 will leave them better positioned to succeed well beyond 2021.

"After the year we’ve been through, I know one thing for sure: We are a bulletproof band of brothers and sisters who are stronger, tougher and wiser," Ricart said.

 

The NADA’s annual Dealership Workforce Study is now open. Dealers are encouraged to participate in the study, which provides valuable compensation and retention data on more than 60 dealership positions. 

Participants receive a custom report that compares and ranks their dealership against a peer group of participating dealerships; a national and regional analysis report; and access for one year to NADA’s Database Search Tool. 

The study closes April 15. Enroll at www.nada.workforcestudy.com. For questions, contact workforcestudy@nada.org.

 

AutoNation Inc., the country’s largest auto dealer chain, expects U.S. sales of new cars and trucks to hit 16 million vehicles this year, rebounding on a pandemic-fueled increase in demand for personal transportation.

Chief Executive Mike Jackson predicts the growth despite disruptions to vehicle production caused by a global semidconductor shortage and lingering inventory issues from pandemic-related shutdowns last year. He expects the seasonally-adjusted rate of U.S. new-car sales to grow 7% this year, up from 14.5 million vehicles in 2020, which was the lowest since 2012.

"The demand is higher than that, but I think it’ll be constrained by production," Jackson said in a phone interview. "The situation is very opaque, no one knows exactly how this is going to unfold, production is definitely unpredictable."

Vehicle production by carmakers this year has been pinched by the shortfall in supplies of chips, as semiconductor makers have allocated more capacity to consumer products than cars. Now snowstorms are adding to carmakers’ woes by forcing plant shutdowns in states in the central part of the country.

 

Industry executives and analysts predict strong consumer demand will continue this year and expect a return of commercial fleet sales as local officials distribute the Covid-19 vaccine.

"While the coronavirus was something that no one in the auto industry expected, the industry rallied and adapted to the new state of play," Patrick Manzi, chief economist at the National Automobile Dealers Association, said in a statement. "Looking forward, we are optimistic about the continued recovery of the new light-vehicle market."

 

The U.S. Labor Department has published a final rule that helps clarify how to distinguish an  "employee" from an "independent contractor" for purposes of the Fair Labor Standards Act. The FLSA is the law that governs an employer’s minimum wage and overtime obligations, among other things. 

The final rule, which takes effect March 8, contains: 

 

• a multifactor test for determining when workers are employees or independent contractors; 

• a clarification that when applying the test, no one factor is conclusive and that the actual practices between workers and employers are more relevant than what is stated contractually or is theoretically possible; and

• six fact-specific examples applying the multifactor test.

The multifactor test is designed to determine whether a worker is economically dependent on a business and is its employee, or whether the worker is self-employed. The test identifies and explains two "core factors" and lists three other factors that are probative to worker classification determinations.

The two core factors are:

• the nature and degree of control over the work; and

• a worker’s opportunity for profit or loss based on initiative and/or investment.

The three other probative factors are:

• the amount of skill required for the work;

• the degree of permanence of the working relationship between a worker and a business; and

• whether the work is part of an integrated unit of production.

 

Caution to dealers: The final rule applies to dealerships with respect to their federal FLSA compliance. It does not necessarily apply to other federal or state laws governing the relationship between dealerships and workers, including federal and state tax laws.

Dealers are advised to work with their attorneys and HR professionals to carefully evaluate those relationships where it is not readily apparent whether workers are employees or independent contractors.

 

WASHINGTON — The Internal Revenue Service has posted updated FAQs about recent legislation that extended and amended tax relief to certain small- and mid-sized employers under the Families First Coronavirus Response Act (FFCRA).

The FAQs are available at COVID-19-Related Tax Credits for Required Paid Leave Provided by Small and Midsize Businesses FAQs.

The updates to the FAQs cover how the COVID-related Tax Relief Act of 2020, enacted Dec. 27, 2020, extends the availability of the tax credits created by the FFCRA to eligible employers for paid sick and family leave provided through March 31, 2021, as well as other amendments to the credits.

The paid sick and family leave credits, which previously were available only until the end of 2020, have been extended for periods of leave taken through March 31, 2021.

The paid sick leave credit is designed to allow qualified businesses — those with fewer than 500 employees and who pay "qualified sick leave wages" — to get a credit for wages or compensation paid to an employee who is unable to work (including telework) because of coronavirus quarantine or self-quarantine or has coronavirus symptoms and is seeking a medical diagnosis. 

Eligible employers may claim credit for paid sick leave provided to an employee for up to two weeks (up to 80 hours) at the employee’s regular rate of pay up to $511 per day and $5,110 in total.

In addition, an eligible employer can receive the paid sick leave credit for employees who are unable to work due to caring for someone with coronavirus or caring for a child because the child’s school or place of care is closed, or the paid childcare provider is unavailable due to the coronavirus. Eligible employers may claim the credit for paid sick leave provided to an employee for up to two weeks (up to 80 hours) at 2/3 the employee’s regular rate of pay, or up to $200 per day and $2,000 in total.

Employers also are entitled to a paid family leave credit for paid family leave provided to an employee equal to 2/3 of the employee’s regular pay, up to $200 a day and $10,000 in total. Up to 10 weeks of qualifying leave can be counted towards the family leave credit.

Eligible employers are entitled to immediately receive a credit in the full amount of the paid sick leave and family leave plus related health plan expenses and the employer’s share of Medicare tax on the leave provided through March 31, 2021. The refundable credit is applied against certain employment taxes on wages paid to all employees.

Eligible employers may claim the credits on their federal employment tax returns (e.g., Form 941, Employer’s Quarterly Federal Tax Return), but they can benefit more quickly from the credits by reducing their federal employment tax deposits. If there are insufficient federal employment taxes to cover the amount of the credits, an eligible employer may request an advance payment of the credits from the IRS by submitting a Form 7200, Advance Payment of Employer Credits Due to COVID-19.

 

The attorney general’s office probably would not treat the matter as a stand-alone issue to pursue, but it could use it to bundle with other advertising infractions by a dealership.

 

In May 2020, DriveChicago.com made a significant programming change designed to drive in-market shoppers direct to CATA dealer websites. Prior to this change, DriveChicago.com sent customers to dealers in the traditional portal method, with email leads, phone ups and map views. 

Since last May, DriveChicago.com is driving site visitors directly to dealerships’ vehicle detail pages. Over the past nine months, more than 50,000 customers have been sent to CATA dealership websites.

More specifically, the change involved deep linking into dealer website vehicle detail pages. Previously, a DriveChicago.com visitor would search through the more than 100,000 vehicles in inventory and land on a DriveChicago.com vehicle details page that provided links to contact the dealership or send an email lead.

Now, instead of landing on a DriveChicago.com vehicle details page, that site visitor is sent directly to the vehicle details page on dealership websites. 

For many dealers, this change has resulted in DriveChicago.com becoming their No. 1 referral site.

"As traditional email leads continue to dry up, we realized that dealers best convert from their vehicle details pages," said Richard Wickstrom, chairman of the CATA’s DriveChicago.com Committee. "So, by making this simple change, DriveChicago.com instantly becomes significantly more relevant to CATA dealers and better fulfills its mission to drive in-market shoppers to members."

While this lead-generation change continues to drive 6,000-7,000 site visitors directly to CATA dealer websites each month, DriveChicago.com is also upping its marketing spend to identify and connect with current vehicle shoppers. Though its partnership with Automotive Internet Media, DriveChicago.com has gone all-in on the CarClicks program. As a result, DriveChicago.com traffic went up 35% in one month with a spend of less than $1,500. 

 

Together the lead-generation change and enhanced CarClicks marketing continue to provide CATA dealers a free alternative to expensive programs of competing automotive shopping portals such as Cars.com and AutoTrader. DriveChicago.com is just another way that the CATA provides benefit to its members.

For more information on DriveChicago.com, contact Mark Bilek at (630) 424-6082 or mbilek@drivechicago.com.