CATA News

In the wake of the COVID-19 pandemic, car dealerships must consider major changes to adapt to our ever changing society. Many customers no longer feel safe or comfortable entering or exiting businesses, including showrooms and service departments, without the option of not having to grab a frequently touched surface such as a door handle. Dealers can overcome that trepidation with the Record 8100 Automated Touchless Entry System.

 

The Record 8100 swing operator is the ideal solution and the most inexpensive way to retrofit any manually operated pedestrian door and any ADA-compliant push-button door without having to replace it. The technology incorporates motion sensors which signal the door to open once an individual gives a waving motion with their hand. Each unit comes with a 2-year warranty, is rated for more than 1 million cycles, and is installed by technicians certified by the American Association of Automatic Door Manufacturers. 

 

To obtain an estimate or for further consultation, contact Toby Holtz at American Door and Dock at (847) 815-5916 or tholtz@americandooranddock.com.
 

Dealers across the country have been supporting their communities during this time with a myriad of philanthropic giving — ranging from charitable grants to the donations of medical supplies to providing complimentary auto maintenance to first responders, NADA Chairman Rhett Ricart said in a recent video message to dealers, employees and customers.
 
In his message, Ricart underscored the importance of safety. "Safety is our first concern — both for our staff and for the customers who rely on us," Ricart said. "To keep everyone safe, we’re maintaining safe social distancing; we’re wearing personal protective equipment while we service cars and help folks who might need a new or used car during this difficult time."

 

Golf courses in Illinois have reopened, but not to the degree that they can accommodate the CATA’s annual golf outing, which had been planned for June 18 at Cog Hill & Country Club, in Lemont.

 

Upwards of 500 golfers often are drawn to the annual CATA event.

 

Part of the outing traditionally includes the association’s annual meeting during dinner, at which the results of the board of directors election are announced. Those results this year will be announced separately.

Littler Mendelson, the CATA’s labor relations counsel, continues to produce helpful information for dealers and other businesses navigate the current climate. Among them:

 

Updated COVID Response Kit
The kit’s third edition, sent free via email to all dealers on May 27, incorporates recent guidance by the Centers for Disease Control and Prevention on quarantining and returning to work after an employee tests positive or has symptoms, and also incorporates further guidance issued by OSHA in late May on determining whether a COVID incident is "work-related." Previous editions of the kit were sent to dealers March 27 and May 1.

 

COBRA: New notice and election forms released by DOL; Modified COBRA deadlines
Since many businesses either already have implemented layoffs or are about to, they need to know about the new COBRA forms that were released by Department of Labor in May, and also about the modified COBRA deadlines during the COVID outbreak which were established by IRS guidance issued in late May. This notice, sent via email to all dealers May 29, is Littler’s first bulletin to dealers regarding COBRA issues.

 

FFRCA Paid Sick Leave and Paid FMLA Leave policies and forms
Littler sent notice to dealers about these new laws on April 3 and again on April 9 and offered the materials for $250 ($400 for multiple rooftops), but few dealers responded. Dealers at the time likely were focused on Paycheck Protection Program loans and the fact that PPP loans have largely covered continuing pay for all employees during recent weeks. Now that PPP is coming to an end, Littler’s notice will be sent again about June 3.

 

What’s a dealer to do when the OEM is not offering any relief on floorplan expenses, one participant asked during a recent NADA webinar that considered best ideas from 20 Groups. Based on his sales rate, the questioner said he had a 12-month inventory supply.
 
"There is tremendous strength in numbers in the dealer body," said Tom Carney, a 20 Group management consultant who led the presentation. "The best way I see to leverage that is, you get together your fellow dealers that are within your OEM and you basically trade.
 
"If they’re not trading, you need to contact your regional vice president. They are influenced by some of the key dealers, especially if you have worked together with some of your 20 Group dealers, and put together a letter saying, ‘We need to talk about some floorplan assistance, or some sort of bonus or something that is going to help us as dealers to get through this, almost like a Paycheck Protection Program for dealers.' "
 
The OEMs will listen to such an appeal, Carney said, because they only make money when vehicles are sold.

Ballots mail June 2 to CATA member dealers to choose the next four members of the association’s board of directors. There are four candidates on the ballot.
 
The aberration in the structure of the annual elections comes in light of the board voting to contract the size of its body from 15 directors to 13 over two years, a change that comes in light of the Coronavirus pandemic.
 
Directors said they reasoned that most dealers would prefer to focus on their business concerns in the current climate rather than mount a campaign to get elected to the board. The board constricted from 18 directors following the Great Recession in the 2000s.
 
"The first reduction to 14 members takes place this year. That means that this year we have no incumbent directors ineligible for reelection," CATA President David Sloan wrote in an April 29 letter to member dealers.    

"With that in mind, and due to the unique conditions brought on by the pandemic, the Nominating Committee determined that it will not present additional nominations for Director. (There is, however, an additional process for any interested dealer to gather petition signatures to be placed on the ballot, so please contact me if you are interested.)"
 
Voters will be asked to return to the board John Crane (Hawk Auto Group), Fred Marks (Classic Toyota-Kia, Waukegan), Jason Roberts (Advantage Chevrolet, Bolingbrook and Hodgkins; and Advantage Toyota, Calumet City), and Richard Wickstrom (Wickstrom Auto Group, Barrington).
 
"Next year, when the Board further reduces to 13 members, and there are only three incumbents, we plan to return to the practice of nominating five or more candidates for four vacancies, assuming business conditions have returned to normal," Sloan wrote in his April 29 letter.
 
A director can serve up to three three-year terms on the board. All the incumbents on the 2020 ballot are completing their first terms.

Efforts to rescind the $10,000 cap on the value of traded-in vehicles in Illinois failed as the state’s General Assembly ended its spring legislation with lawmakers struggling to reach agreement on a budget that’s been blown apart by the coronavirus-induced economic downturn.
 
Borrowing from the federal government was a key component to address a budget hole that Gov. J.B. Pritzker’s office estimated is at least $6.2 billion. With the state in such dire financial straits, lawmakers appeared loathe to forsake the revenue that the cap generates for the state by increasing the amounts of trade-in credits consumers buying or leasing another vehicle can apply to the final transaction amount, upon which sales tax is calculated.
 
The trade-in cap, which took effect Jan. 1, first emerged in the final days of May 2019, as Pritzker and lawmakers sought funding for the governor’s $45 billion capital infrastructure plan. Also impacted by the plan: a doubling of the state’s gasoline tax and nearly 50% jumps in title and registration fees.
 
The CATA and other groups backed an alternate path for raising state revenue — increasing the tax on private party vehicle sales — but an abbreviated fall veto session last year and the chaotic atmosphere this year did not enable that argument to gain traction.
 
Lawmakers stretched their session into overtime on May 23, as they sought to finalize details on a maintenance-level $40 billion state budget that would depend heavily on federal funds while also making another effort to get a Chicago casino off the ground.
 
A Chicago casino is seen as key to the capital bill the legislature passed last year.

 

Illinois on May 29 moved to Phase 3 of Gov. J.B. Pritzker’s five-phase Restore Illinois Plan, paving the way for an estimated 700,000 Illinoisans to return to work. Car-shoppers in Illinois no longer must arrange for an appointment to visit a showroom.
 
However, businesses must limit customers in their stores at one time to five customers per 1,000 square feet (excluding employees). The customer occupancy limit is calculated by taking the total square footage of the permanent structure the business occupies and dividing by 1,000. If the square footage of the facility is less than 1,000, the number of people is also less than five, based on percentage.
 
Pritzker’s guidelines came with a set of industry-specific toolkits. The guidelines and toolkits can be found online through the Department of Commerce and Economic Opportunity’s website.
 
"Social distancing, wearing face coverings, and capacity limits are just a few of the responsible actions we must all take in order to avoid a second wave of COVID-19 infections," said Dr. Ngozi Ezike, director of the Illinois Department of Public Health. "I applaud (businesses’) willingness to follow these guidelines and keep your communities safe. Please set the example as an anchor in your community. The actions we take today will shape the future of Illinois for years to come."
 
All businesses also must have a procedure in place for asking if any customer is currently exhibiting COVID-19 symptoms before allowing entrance, if necessary.

The highly lucrative truck segment dominated by Ford, General Motors and Fiat Chrysler Automobiles outsold passenger cars by more than 17,000 units in April, according to market researcher Autodata Corp.

 

It’s a remarkable turn of events for an industry that’s long been reliant on trucks as cash cows, but never to this degree. Just five years ago, cars outsold pickups by more than half a million units in a single month. Detroit began ditching sedans the following year and hasn’t looked back. Full-size truck models alone were more than 40% of GM, Ford and Fiat Chrysler’s sales in April, according to Evercore ISI.

 

There are a few factors contributing to the development. Detroit’s deliveries -- pickups and otherwise -- are concentrated more so in middle America than the coastal states that introduced some of the earliest and most aggressive shutdown orders. Trucks also were bolstered by 0% financing offers, some of which stretched loans out for as long as seven years, Joe Spak, an RBC Capital Markets analyst, wrote in a report.

 

The chief executive officer of Fiat Chrysler, which reported first-quarter earnings May 5 in the midst of a seven-week shutdown of its North American auto plants, told investors its vehicle inventory in the U.S. was running low, particularly for some pickup models.

 

"There are certain configurations that will be running short," CEO Mike Manley said on an earnings call, adding he expected truck sales to outperform other vehicles again this month. "That’s reflected in the number of dealer orders we’ve received in the last few weeks that are just waiting for our plants to restart."

 

Littler Mendelson P.C., the CATA’s labor relations attorneys, this month updated its COVID-19 Response Kit to incorporate guidance in Illinois Gov. J.B. Pritzker’s Executive Order that took effect May 1.

 

Most importantly, the kit now incorporates the requirement that all employees wear face coverings.

 

The executive order also requires employers to post a notice with guidance on maintaining the workplace health and safety of employees, and on safety and OSHA issues that are potentially implicated in certain COVID-related scenarios.