ANNUAL REPORT AND DIRECTORY 2025-2026 CHICAGO AUTOMOBILE TRADE ASSOCIATION
Memberships in: • AUTOCPA Group • The American Institute of Certified Public Accountants • The Illinois CPA Society CERTIFIED PUBLIC ACCOUNTANTS Located in Central Illinois, we serve the entire state. Contact us today to learn how we can help your dealership thrive. Drive Your Dealership Toward Financial Success We specialize in automobile dealers in the following areas: • Dealership valuations • Automobile dealer legal support • Buy-Sells for dealerships • LIFO inventory computations • Financial statement analysis • Corporation Income Tax returns • Personal Income Tax returns • CPA prepared financial statements • Dealer estate planning • Employee theft consulting • Internal control studies and audits • Profit consulting • Training office managers/CFO’s • 401K Audits Serving more than 250 Automobile Dealers throughout the United States (309) 662-8797 Email: woodwardassoc@cpaauto.com Website: www.cpaauto.com 1707 Clearwater Avenue P.O. Box 1584 ·Bloomington, IL 61702
©2025 The Chicago Automobile Trade Association (CATA) | The newsLINK Group LLC. All rights reserved. CATA Annual Report and Directory is published one time each year by The newsLINK Group LLC for the Chicago Automobile Trade Association. The information contained in this publication is intended to provide general information for review, reference, consideration and education. The appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at (855) 747-4003. 18W200 Butterfield Rd. Oakbrook Terrace, IL 60181 Office: (630) 495-2282 Fax: (630) 495-2260 www.cata.info ANNUAL REPORT AND DIRECTORY 2025-2026 4
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Mission Statement: Advancing the Chicago region’s automotive industry and new car dealers through advocacy, events, education and community. Advocacy We represent and protect the interests of area new car dealers. » Legislation: Aggressively represent dealer concerns to lawmakers. » Legal: Monitor and respond to legal challenges through the courts. » Grassroots: Educate and increase dealer efforts in government relations and political contributions (CATPAC). » Coalitions: Collaborate with IADA, NADA and organizations with mutual interests. Shows and Events We plan and deliver signature events that connect buyers and dealers. » Chicago Auto Show®: Amplify and improve Show with expansion; attainment of new performance metrics. » Chicago Drives Electric®: Drive awareness among consumers in experiential/non-sales environments. » Experiences: Seek additional opportunities to expand the reach of the CATA and Chicago Auto Show via speaking engagements or additional event participation. Value We support dealer operations through access to benefits, service and publications. » Benefits and Services: Ensure CATA is indispensable to dealer success. Improve awareness of ROI. » Networking: Plan events for industry networking. Identify and engage future leaders. » Drive Chicago®: Enhance, protect and expand the program locally and nationally. » Member Strength: Increase member market share. Maximize opportunities for Allied Members. Workforce We support workforce and training and provide resources. » Workforce Access: Position CATA as the connector between dealers and job seekers. » Education Partners: Build partnerships with schools, career sites and training programs. » Dealer Needs: Keep open channels of communication with dealers to serve and respond to their workforce needs. » Union Relations: Serve as the liaison between dealers and unions. Governance and Operations » Board and Committees: Ensure volunteer leadership and governance is efficient and effective. » Growth: Focus on organizational and financial growth to ensure sustainability. » Staffing Capacity: Maintain a staffing capacity that supports organizational growth, excellence and member service. Community We promote the community contributions of the dealers and employees. » Philanthropy: Facilitate and enhance programs that serve Chicagoland charities such as First Look for Charity, Drive for the Troops and Chicagoland Dealers Care. » Public Awareness: Promote the contributions of dealers in their communities. » Media Relations: Drive and maximize positive industry messaging. CATA STRATEGIC PLAN 6
TABLE CONTENTS F MEMBERSHIP DIRECTORY 53 DEALER MEMBERS 53 Acura 54 Alfa Romeo 54 Aston Martin 54 Audi 55 Bentley 55 BMW 56 Bugatti 56 Buick 57 Cadillac 58 Chevrolet 61 Chrysler 63 Dodge 65 Ferrari 65 FIAT 65 Ford 68 Genesis 69 GMC 71 Honda 72 Hyundai 74 Infiniti 74 Jaguar 75 Jeep 77 Karma 77 Kia 78 Lamborghini 78 Land Rover 79 Lexus 80 Lincoln 80 Lotus 80 Maserati 81 Mazda 81 McLaren 82 Mercedes-Benz 83 MINI 83 Mitsubishi 83 Nissan 85 Porsche 85 Ram 87 Rolls-Royce 87 Subaru 88 Toyota 90 Volkswagen 91 Volvo 92 ALLIED MEMBERS Annual Report Section 6 CATA Strategic Plan 8 Letter From the President 10 Letter From the Chairman 14 Staff Phone and Email 16 CATA Officers 2025-2026 17 Board of Directors 18 Past Presidents and Board Chairs 21 Board of Director Committees 22 General Counsel 31 Employee Relations and HR Counsel 33 Legislative Consultants 34 CATA Headquarters 36 DriveChicago.com 38 Chicagoland Dealers Care 39 CATA Membership Advantage 42 2025 Chicago Auto Show 44 CATA Approved Member Partners 50 CATA Recommended Consultants 52 Quick Links 7
LETTER FROM THE PRESIDENT Joining Forces to Create an Impact Greetings CATA Members, We’ve certainly had a busy and successful year at the CATA. And, as with any year full of growth, there have been both highlights and challenges. I’d like to reflect on some of the accomplishments of which we’re exceptionally proud. Introduced “Drive for the Troops” — Expanding Barbecue for the Troops This past summer, dealers across the area expanded their fundraising efforts to support the USO — celebrating the program’s 12th anniversary — beyond just barbecues. Dealers came together to host bicycling events, community festivals with DJs and bounce houses, classic car shows and test drives. In all, the fundraiser has raised more than $1.2 million. This is a reflection and powerful reminder of the incredible impact our dealer network has in bringing communities together for a worthy cause. Chicago Drives Electric Our team successfully wrapped our fourth annual Chicago Drives Electric EV ride-and-drive and educational event in October. The event featured more than 40 different EVs, hybrids and plug-in hybrids spanning 16 different brands — the largest manufacturer participation yet. Thousands of local residents came out to experience the latest electrified vehicles. Previous research shows that 90% of attendees reported that this event improved their opinion of EV ownership, a strong signal of the impact we’re having on consumer EV awareness and education. EV Momentum Continues Inside the Chicago Auto Show In February, the Chicago Drives Electric EV hub inside the Auto Show nearly doubled its number of participating brands to a dozen manufacturers, spanning 25 different models. Our data shows that 60% of attendees who experienced an EV at the show were more likely to consider purchasing one. The 2025 Chicago Auto Show — Another Standout Year The 2025 Chicago Auto Show welcomed more than 217,000 attendees to McCormick Place last February. From engaging experiential drives to 8
crowd-pleasing events like the Toyota Miles Per Hour Run and Friday Night Flights craft beer night, the show continues to innovate and engage consumers in new and exciting ways. First Look for Charity The 2025 First Look for Charity black-tie gala surpassed our projected fundraising goal, raising an outstanding $2.5 million for Chicagoland charities. That brings our cumulative total to more than $65 million raised since the event’s inception. Once again, this is another amazing example of car dealers joining forces to create a large impact. CATA’s Advocacy Matters The CATA also exceeded its goal for NADA PAC contributions. These funds are critical in supporting legislation that protects our industry and preserves Illinois’ franchise laws. Thank you to all who participated. You’re helping us ensure the future success of our dealer network. The CATA has ramped up its efforts to expand education and training opportunities for its members. This includes hosting the NADA Professional Series and offering a diverse range of seminars tailored to professional development. Additionally, the 2025 CATA Golf Outing and Annual Meeting united over 280 members for a day of networking, enjoyment and golf. These initiatives demonstrate the CATA’s commitment to fostering both learning and community among its members. I’d also like to thank my talented Board of Directors for their guidance, leadership and — perhaps most importantly — time! Rest assured, the members have appointed a phenomenal team at the helm. Finally, another huge thank you to the talented staff members behind the scenes at the CATA. It’s a small but mighty team that does an incredible job working on your behalf. We look forward to the year ahead and always welcome your input — whether you have an idea, a suggestion, some feedback or just want to say hello. We truly value you and your membership in the CATA community! Sincerely, Jennifer Morand CATA President 9
Dear Dealers, This summer concluded my term as 2024-25 CATA Chairman and now as I step into the role of 2026 Chicago Auto Show Chairman, I am both honored and humbled to reflect on the past year of service. It has been a time marked by both challenges and progress, moments that tested our resolve as dealers, but ultimately reinforced the strength and unity of our industry. In stepping into this leadership role, I was mindful of the legacy built by those who served before me. I stand on the shoulders of generations of dealer leaders who gave their time, energy and expertise to advocate for our businesses and protect our shared interests. Their tireless work laid the foundation that made it possible for our Board to continue advancing the mission of the CATA on behalf of dealers across the Chicagoland area. The CATA standing committees are the engines that drive the organization, so I will begin here. The Government Relations and Lobbying Committee, which I chaired, spent countless hours meeting with our representatives in Springfield to try to effectuate three very important matters to dealers. First, we are concerned that the restructured retail allowance cap is particularly burdensome to our dealers, considering the volume and amounts of transactions they process, and we have sought to create a carve-out for vehicle transactions, with any lost revenue to the state more than made up by tightening the laws on taxing private sales. Secondly, we added our voices and resources to fight for a $100 increase in the documentary fee. Finally, we advocated for an amendment to the Motor Vehicle Franchise Act, which would favorably modify language on warranties and right of first refusal, while clearly providing that legacy manufacturers cannot create new entities to sell directly to the public. Sadly, for differing reasons, none of these endeavors came to fruition in this past legislative session; however, the CATA will continue to advocate for these causes in succeeding sessions for the betterment of all. The Auto Show Committee, with Kelly Webb Roberts as Chairwoman, produced a fabulous 2025 Chicago Auto Show, despite continuing headwinds. Helped by Stellantis’ return, the show resembled past shows, but now with more than 100,000 in-vehicle experiences, an all-time record. The First Look for Charity gala raised $2.5 million for participating charities. Our advertising expenditure of over $438,000 was buttressed by almost $1.6 million in bonus weight. All in all, the show continues to be the premier consumer show in the country and a media and public relations home run for the OEMs and CATA dealers. LETTER FROM THE CHAIRMAN A Look Back on the Year 10
The Member Benefits Committee, under John Crane’s leadership, researched and vetted allied companies that could provide worthwhile programs, vendors and cost efficiencies to CATA members. Only the best of the best of these ultimately received CATA recognition. The Finance, Pension, Audit and Compensation Committee, comprised of CATA officers, has worked diligently over the past several years to stabilize the CATA’s finances in the face of continuing pressures on the auto show. Not only has the committee examined ways to increase revenue and decrease costs, but it has worked hand in hand with the Member Benefits Committee to expand the wide range of benefits the CATA provides to its dealers. The Civic and Dealer Relations and First Look for Charity Committee, under Emir Abinion’s leadership, ensures that the charitable aspects of the CATA continue in high gear. Whether it’s the First Look for Charity Event, which generated $2.5 million this year for charities; the BBQ for the Troops, now rebranded Drive for the Troops, which to date has raised almost $1.2 million for the USO; or the Chicagoland Dealers Care program, where the CATA provides matching contributions of up to $1,500 to charities put forth by our dealer members, these efforts combine significant community engagement with awareness of our member dealers’ continuing generosity to the communities they serve. The Employee Relations Committee, chaired by Jerry Haggerty, continued to set a path forward to provide answers to dealers’ questions in the employment arena as well as to provide a revised strategy for upcoming labor negotiations. Our employee benefits provider, SESCO, has broad experience with many state dealer associations and has shown itself to be an invaluable tool in providing answers to employment issues that arise. 11
The Drive Chicago Committee, under Jared Wickstrom’s leadership, continually looks for ways to update and refine the DriveChicago.com website in its efforts to be the definitive website for vehicle purchases in the Chicagoland area. The Media Strategy Committee, chaired by Steve Phillipos, again strategically directed $438,500 toward media on behalf of the Chicago Auto Show, Chicago Drives Electric, BBQ for the Troops and other worthwhile events. Finally, the Nominating Committee, after reaching out for suggestions from fellow dealers, nominated five outstanding candidates to run for the four vacancies this year on the CATA Board of Directors. The committee continues to seek out and find knowledgeable candidates of the highest integrity to serve as CATA Directors. Congratulations to new CATA Director Tom Wehmeier, Community Honda of Orland Park. Tom has already proven to be a wonderful asset to the CATA. It has been a privilege to serve alongside the 11 dedicated members of the CATA Board of Directors, fellow dealers who continue to give generously of their time, energy and insight to strengthen our industry. I especially want to recognize JC Phelan, who concludes his service on the Board after an incredible nine-year tenure. JC’s leadership across every Director role, including Chairman and Auto Show Chairman, has been marked by wisdom, steadiness and a deep commitment to the dealer community. His presence will be missed, but his impact will continue to resonate. I also extend my deepest appreciation to the CATA staff, led by President Jen Morand in her first full year at the helm. Jen, along with Executive Vice President Chris Konecki, continues to elevate our association through innovation, energy and a deep understanding of the issues we face. Their professionalism and dedication are essential to everything the CATA accomplishes. A special thank you as well to Dennis O’Keefe, our General Counsel, whose unparalleled knowledge of the legal landscape and unwavering guidance have been invaluable, not only during my term, but to every Director who has served over the years. Finally, I congratulate Ryan Kelly on his election as 2025-26 CATA Chairman. Ryan brings not only experience and judgment, but a proud family legacy. His father, Art Kelly, served as Chairman in 2004-05. I have every confidence that Ryan will lead with distinction and vision. For a summary of the actions taken by the CATA Board of Directors over the past year, visit www.CATA.info. Thank you again for the opportunity to serve, and I look forward to what lies ahead. Sincerely, Jason Roberts 2024-25 CATA Chairman 2026 Chicago Auto Show Chairman 12
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STAFF PHONE AND EMAIL Jennifer Morand CATA President and Auto Show General Manager (630) 424-6084 jmorand@drivechicago.com Chris Konecki Executive Vice President and Director of Auto Show Operations (630) 424-6075 ckonecki@drivechicago.com Jim OBrill Senior Director of Marketing, Sponsorship & Strategy (630) 424-6085 jobrill@drivechicago.com Hayley Feichter Director of Communications & Marketing (630) 424-6002 hfeichter@drivechicago.com 14
Megan Plahm Communications Project Manager (630) 424-6065 mplahm@drivechicago.com Donna Young Accounting & Finance Manager (630) 424-6045 dyoung@drivechicago.com Patrick Ziegenfuss Membership, Operations & Events Manager (630) 424-6035 pziegenfuss@drivechicago.com Roxanne Sammarco Administrative Assistant (630) 424-6060 rsammarco@drivechicago.com 15
CATA OFFICERS 2025-2026 Ryan Kelly 2025-2026 CATA Chairman and 2026 Chicago Auto Show Co-Chairman Kelly Nissan (708) 499-1000 rkelly@kellynissan.com Jason Roberts 2026 Chicago Auto Show Chairman Advantage Acura of Naperville Advantage Chevrolet Bolingbrook Advantage Chevrolet in Bridgeview Advantage Chevrolet Hodgkins Advantage Toyota Calumet City (708) 442-4000 jroberts@advantagedealer.net Steve Phillipos 2025-2026 CATA Vice Chairman Chevrolet of Homewood Ford of Homewood (708) 799-2000 sphillipos@homewoodchevy.com Jerry Haggerty 2025-2026 CATA Treasurer & Secretary Jerry Haggerty Chevrolet in Glen Ellyn Haggerty Buick GMC in Villa Park Haggerty Ford in West Chicago (630) 918-5966 jhaggerty@haggrtyautogroup.com 16
BOARD OF DIRECTORS Fred Marks Classic Kia of Waukegan Classic Toyota of Waukegan (847) 336-4300 fmarks@classicdealergroup.com Dan Marquardt Marquardt of Barrington Buick GMC (847) 381-2100 djm@marquardtonline.com Kelly Webb Roberts Webb Chevrolet, Oak Lawn Webb Chevrolet of Plainfield Genesis of Highland, IN Webb Hyundai of Highland, IN Webb Hyundai of Merrillville, IN (815) 436-2071 kelly@webbcars.com Tom Wehmeier Community Honda in Orland Park twehmeier@communityhonda.com Emir Abinion Fox Valley Buick GMC Fox Valley Volkswagen Fox Valley Volkswagen of Crystal Lake (708) 977-0944 emir@foxvalleyag.com John Crane Glenview Luxury Imports Hawk Auto Group (Cadillac, Chevrolet, Chrysler, Dodge, Ford, Jeep, Mazda, Ram, Subaru, Volkswagen) (815) 725-7110 jccrane512@gmail.com Dan Heller Heller Ford in El Paso Heller Lincoln Chrysler Dodge Jeep Ram in Pontiac (309) 527-6050 danheller@hellerstores.com Jared Wickstrom Dick Wickstrom Chevrolet (630) 529-7070 jared@wickstromchevrolet.com 17
1904-1905 Howard Tucker, Winton 1905-1907 Ralph Temple, Electric Cars 1907-1908 Joseph Gunther, Rambler 1908-1909 W.L Githens, Oldsmobile 1909-1910 Thomas J. Hay, Ford 1910-1911 Louis Geyler, Hudson, Autocar 1911-1914 N.H. Van Sicklen, Apperson 1914-1916 H.M. Allison, Packard 1916-1918 J.F. Davis, Winton 1918-1919 G.H. Bird, Paige, Jewett 1919-1921 Leo A. Pell, Mitchell 1921-1923 Thomas J. Hay, Chandler, Cleveland 1923-1925 Henry Paulman, Pierce, Arrow, Velle 1925-1927 C.D. Gambill, Hupmobile 1927-1929 O.G. Heffinger, Marmon 1929-1931 J.R. Histed, Hudson 1931-1932 R.G. Tiffany, Cadillac 1932-1934 Lafayette Markle, Duran, Oldsmobile 1934-1935 M.J. Lanahan, Dodge, Plymouth 1935-1937 K.K. Kenderdine, Buick 1937-1939 H.T. Holingshead, Nash, Lafayette 1939-1941 L.S. Snow, Ford, Lincoln 1941-1943 Ben T. Wright, Ford, Lincoln, Mercury 1943-1945 Paul B. Smithson, Packard 1945-1947 J.F. McManus, Jr., Chevrolet 1947-1949 Wm. D. Reagan, Chrysler 1949-1951 Frank H. Yarnall, Chevrolet 1951-1953 James F. Goodwin, Dodge, Plymouth 1953-1954 Steve J. Barrett, Buick 1954-1955 Earl T. Zweifel, Ford 1955-1957 C.J. McCorkle, Buick 1957-1960 Don C. Mullery, Ford 1960-1961 Maxwell S. Evans, Oldsmobile 1961-1963 Fred G. Litsinger, Ford, Lincoln, Mercury 1963-1964 Michael Schwartz, Chrysler, Plymouth 1964-1965 Walter A. Gerwig, Buick 1965-1967 Lawrence P. Faul, Oldsmobile 1967-1968 William S. Mougey, Pontiac 1968-1970 Richard V. Lynch, Buick 1970-1971 Lee Klinger, Dodge, Volkswagen 1971-1972 Clarence W. Marquardt, Jr., Oldsmobile 1972-1973 Robert M. Foley, Buick 1973-1974 David Ostrow, Dodge 1974-1975 Sidney Markovitz, American Motors 1975-1977 Joseph J. Hennessy, Ford 1977-1978 William J. Sullivan, Pontiac 1978-1979 Stephen X. Foley, Cadillac 1979-1980 David Rick, Volkswagen 1980-1981 Richard Everman, Dodge 1981-1982 Joseph Bidro, Ford PAST PRESIDENTS AND BOARD CHAIRS 18
1982 Ed Mathieu, Buick 1982-1983 Jack Haggerty, Oldsmobile 1983-1984 Kenneth Bennett, Dodge 1984-1985 John Mathias, Pontiac 1985-1986 Robert J. Foley, Buick 1986-1987 Richard Hoskins, Chevrolet 1987-1988 Jerry Schiele, Imports 1988-1989 Robert L. Anderson, Ford 1989-1990 Ronnie Colosimo, Toyota 1990-1991 Fred Tuch, Jr., Buick 1991-1992 Joseph Lesniak, Chevrolet 1991-1992 Edward Mize, Pontiac 1992-1993 *Gerard Haggerty, Pontiac 1993-1994 Stan Mize, Nissan 1994-1995 Lee Weinman, Ford 1995-1996 Patrick Fitzgibbon, Dodge 1996-1997 Raymond Scarpelli, Sr., Chevrolet 1997-1998 Mike Cook, Ford 1998-1999 Bill Stasek, Chevrolet 1999-2000 Dan Feeny, Chrysler, Jeep, Dodge, Plymouth 2000-2001 Greg Webb, Ford 2001-2002 Bob Van Iten, Pontiac, GMC 2002-2003 Mike McGrath, Sr., Lexus, Acura 2003-2004 Casey Wickstrom, Chevrolet 2004-2005 Arthur Kelly, Nissan 2005-2006 Terry D’Arcy, Buick, GMC, Hyundai, Volkswagen 2006-2007 Bob Loquercio, Toyota, Honda, Hyundai 2007-2008 Mark Scarpelli, Chevrolet, Kia 2008-2009 John Phelan, Chevrolet, Chrysler, Dodge 2009-2010 Kevin Mize, Honda, Hyundai 2010-2011 Stephen X. Foley, Jr., Cadillac, Bentley, Rolls-Royce 2011-2012 Michael Ettleson, Buick, Cadillac, GMC, Hyundai 2012-2013 Kurt Schiele, Toyota, Scion, BMW, Jaguar 2013-2014 John Webb, Ford 2014-2015 Colin Wickstrom, Ford, Lincoln, Chrysler, Dodge, Jeep, Ram 2015-2016 Mike McGrath, Jr., Lexus, Acura, Honda, Hyundai 2016-2017 John Hennessy, Ford 2017-2018 Ray Scarpelli, Jr., Chevrolet, Chrysler, Dodge, Jeep, Kia, Ram 2018-2019 Tony Guido, Ford 2019-2020 Bill Haggerty, Buick, Chevrolet, Ford, GMC 2020-2022 Kevin Keefe, Honda, Subaru 2022-2023 JC Phelan, Chevrolet, Chrysler, Dodge, Jeep, Ram 2023-2024 Kelly Webb Roberts, Chevrolet, Genesis, Hyundai 2024-2025 Jason Roberts, Acura, Chevrolet, Toyota *In 1993, the title was changed from President to Chairman of the Board 19
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Auto Show » Jason Roberts, Chairman » Ryan Kelly, Co-Chairman » Steve Phillipos » Jerry Haggerty Civic & Dealer Relations and First Look for Charity » Jerry Haggerty, Chairman » Dan Heller » Tom Wehmeier » Fred Marks » Dan Marquardt Drive Chicago » Jared Wickstrom, Chairman » John Crane » Fred Marks » Kelly Webb Roberts » Emir Abinion Employee Relations » Dan Marquardt, Chairman » Jerry Haggerty » Ryan Kelly » Tom Wehmeier » Kelly Webb Roberts Finance, Pension, Audit & Compensation » Ryan Kelly, Chairman » Steve Phillipos » Jerry Haggerty » Jason Roberts Government Relations & Lobbying » Emir Abinion, Chairman » John Crane » Dan Marquardt » Jared Wickstrom » Jason Roberts Media Strategy » Fred Marks, Chairman » Kelly Webb Roberts » Jared Wickstrom » Tom Wehmeier » Steve Phillipos Member Benefits » John Crane, Chairman » Dan Heller » Steve Phillipos » Emir Abinion » Jared Wickstrom Nominating Committee » Ryan Kelly, Chairman » Steve Phillipos » Jerry Haggerty » Jason Roberts » Kelly Webb Roberts BOARD OF DIRECTOR COMMITTEES 21
Dennis M. O’Keefe, P.C. 1025 W. Everett Rd. Lake Forest, IL 60045 (847) 482-0400 dokeefe@dmokeefepc.com Each CATA member is entitled to a limited amount of general legal advice from the association’s general counsel, Dennis O’Keefe. Dennis has extensive experience in the automotive industry, dealer line associations and manufacturer relations, as well as state and local government. CATA QUESTIONS AND ANSWERS The following is for informational purposes only and does not constitute a legal opinion. Should the need occur, members are encouraged to seek legal counsel. QUESTION 1: What is required under the Illinois Predatory Loan Prevention Act (PLPA)? The Illinois PLPA, which became effective Aug. 1, 2022, requires the dealer to provide a statutory notice to every customer who finances a vehicle explaining that a retailer shall not contract for or receive charges exceeding a 36% annual percentage rate on the unpaid balance of the amount financed for a retail installment contract, as calculated under the Illinois PLPA. The notice must also provide that any retail installment contract with a PLPA APR over 36% is null and void, and no person or entity shall have any right to collect, attempt to collect, receive or retain any principal, fee, interest or charges related to the retail installment contract. Further, the notice must also provide that the annual percentage rate disclosed in any retail installment contract may be lower than the PLPA APR. It should be noted that all retail installment contracts or agreements must include this language as a “separate disclosure” signed by the consumer; the disclosure must be “clear and conspicuous (while ‘clear and conspicuous’ is not defined in the PLPA, other regulatory acts require that a clear and conspicuous disclosure must be in at least 10 point type); the disclosure must be in English and in the same language as the retail installment contract; and the PLPA APR is based on the expansive definition of APR in the Military Lending Act (which includes all fees and charges, including charges and fees for single premium credit insurance and other ancillary products sold in connection with a credit transaction, which might otherwise be excludable from the APR).” QUESTION 2: I understand that dealer cash is now taxable in Illinois. Can you explain? You should note that dealer incentives paid to a dealer based upon the purchase of a vehicle from the supplier, and not conditioned on the retail sale of the vehicle, are not GENERAL COUNSEL 22
taxable. On the other hand, dealer incentives paid to the dealer and conditioned on the retail sale of a vehicle are taxable, except that: A. Dealer incentives contingent, at the time of sale, on making or having any additional retail sales (stair step incentives) are not taxable; and B. Dealer incentives or bonuses contingent on the dealer meeting certain manufacturer required marketing standards, facility standards or sales and service department satisfaction goals are not taxable (such as CSI store based or marketing-based incentives). QUESTION 3: I sell a car to a customer who provides me with the address of their Lake Geneva, Wisconsin, home. Do I need to charge them Illinois sales tax? The Illinois Revenue Code provides an exemption for sales taxes for purchases made by non-residents of Illinois. The fact that a customer has a domicile outside of Illinois does not mean that he is not an Illinois resident. However, since July 1, 2008, the Department of Revenue holds the dealer to the following requirements: 1. The purchaser must sign the following certificate: “I (purchaser), under applicable penalties, including penalties for perjury and fraud, state that I am not an Illinois resident. I understand that if I am a resident of Illinois, or if I use the motor vehicle in Illinois for more than 30 days in a calendar year as provided in 86 Ill. Adm. Code 150.310(a) (7), then I am liable for tax, penalty and interest on this purchase.” 2. The purchaser must also provide one of the following: a. A copy of the purchaser’s permanent non-Illinois Driver’s License; or b. If a copy of the non-Illinois Driver’s License is not kept or an Illinois license is present, a rebuttable presumption that the purchaser is an Illinois resident is created, which in turn requires the dealer to maintain other evidence of the non-residency of the purchaser, such as (i) Voters Registration Card with a non-Illinois address, or (ii) a copy of a purchase contract or lease agreement for a new non-Illinois residence, or (iii) a copy of a non-resident tax return, or (iv) credit report listing the purchaser’s primary residence in another state, or (v) property tax records claiming a homestead in another state, or (vi) other similar documentation. If the documents above are kept, then, absent fraud, the Department will only proceed against the purchaser for any claim that the exemption did not apply. If the documentation above is not kept, the Department will disallow the exemption, subject to further review by the Department. In the case of a motor vehicle lease, the above provision shall apply to the lessee as if the lessee was the purchaser. 23
QUESTION 4: How does a vehicle qualify for interim use exemption from sales taxes? Beginning July 1, 2008, the Illinois Department of Revenue set forth certain tests for automatic disqualification, safe harbor and situations not involving either of the above with respect to interim use exemption. Certain activities automatically disqualify a vehicle from the interim use exemption. They are: 1. Titling a vehicle in any person other than the retailer, manufacturer, the manufacturer’s captive finance company; or 2. Retailer claims IRC Section 179 depreciation on the vehicle (i.e., treats the vehicle as a totally deductible business expense in the first year); or 3. If the vehicle is leased, the gross receipts from the lease of the vehicle exceed the ultimate sales price of the vehicle. If the dealer meets all six of the following requirements, the vehicle will automatically qualify for the interim use exemption: 1. The vehicle must meet one of the following three requirements. It is: a. Listed in the dealer’s records as inventory; or b. Not depreciated by the dealer under IRC Section 167; or c. Otherwise indicated on dealer’s records, documents or operations as available for sale during the interim use period. 2. The interim use period is less than 24 months. 3. The vehicle is of the same general type sold by the dealer (i.e., a dealer of automobiles and light trucks that purchases another automobile or light truck, regardless of the brand, can do so and have it qualify for interim use, but cannot buy a trailer home or a large truck of a type not otherwise sold by the dealer and then claim interim use). 4. The vehicle is ultimately sold by the dealer. 5. For dealers who also lease or rent vehicles similar to the type of vehicle for which the interim use is claimed, then the dealer’s annual lease/rental revenue for all such vehicles must be less than the annual sales revenue for such vehicles. 6. If the vehicle is leased under a lease agreement for more than 30 days, then the lease agreement must contain a provision that if a buyer is found for the vehicle, then either (i) the lease may be terminated within seven (7) days, or (ii) the lessee will receive a comparable vehicle substituted by the dealer for the vehicle within seven (7) days. 24
Finally, if the vehicle is not automatically disqualified, but does not qualify under the safe harbor, then the Department of Revenue will use all applicable and available facts to determine if interim use applies. These factors include, but are not limited to: the retail sales history of such type of vehicles; inventory records; advertising on the vehicle and at the location of the vehicle; manufacturer’s contract terms, conditions, discounts and rebates; length and location of use or lease prior to sale; whether depreciation is taken under IRC Section 167; ownership and control documents; and if leased, whether the lease contract provisions provide that the vehicle is subject to recall, substitution allowance and sale during the lease period. QUESTION 5: I spot-delivered a car to a customer, but I cannot obtain financing for them. What do I do if the customer refuses to return my vehicle or returns it with excess wear and tear or damage? If a customer refuses to return the vehicle, the dealer may sue for replevin and/or damages. However, the dealer does not normally have the right to repossess the vehicle at this time. Repossession is an extraordinary remedy that may be exercised by a dealer only when he has a security interest in the vehicle and there is a default. Inasmuch as the security interest normally won’t arise until execution of the retail installment contract, repossession is not available to dealers in these instances. Oftentimes dealers use riders to the Retail Installment Contracts with language that provides that the buyer shall return the automobile and that the seller shall return to the buyer all deposits less the value of any damage done to the vehicle. However, the Illinois Attorney General has issued an opinion that such language is in violation of Section 2C of the Illinois Consumer Fraud and Deceptive Business Practices Act which provides in relevant part: “If the furnishing of merchandise … is conditioned upon the consumers … having a credit rating acceptable to the seller and the seller rejects the credit application of that consumer, the seller must return to the consumer any down payment … made on the purchase order or contract and may not retain any part thereof. The retention by the seller of part or all of the down payment … is an unlawful practice within the meaning of the Act.” QUESTION 6: Does prior use need to be disclosed on the sale of a used vehicle? A recent Illinois appellate case indicates that a selling dealer has an affirmative obligation to disclose prior use of a used vehicle, specifically if the vehicle was used in fleet or rental operations. Moreover, this obligation is not limited to only the previous owner’s use. It appears that a good method of meeting this duty imposed by the courts would be to provide a customer with a complete vehicle history at the time of sale, using one of the well-known services to accomplish this. This information should be made available to the customer prior to his executing the closing documents; the dealer should have the customer sign an acknowledgment that he has provided this information prior to the sale and should retain that acknowledgment in the dealer file. 25
QUESTION 7: My customer has informed me that they are “revoking acceptance” of the new car that they purchased. What does this mean, and how can I contest it? Under Section 2-608 of the Uniform Commercial Code, revocation of acceptance is provided as an extraordinary remedy to a car buyer. The remedy is available only when the product’s non-conformity substantially impairs the product value to the buyer. While “substantially impairs” is an undefined term, the courts are given wide discretion in this area. The issue is to be judged from the perspective of the buyer, and might well include consideration of diminished value, as well as market value. The UCC clearly provides that revocation must be taken within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in the condition of the goods, which is not caused by their own defects. It is possible to contest revocation on the theory that although the condition of the car may not have changed much in the physical sense, its value on the marketplace will already have declined appreciably since it is a secondhand car. However, if a buyer is successful in revoking acceptance, he is entitled to have refunded the entire retail price plus perceived monetary damages. QUESTION 8: May I do a direct mail campaign wherein a coupon is offered to further discount a vehicle for sale? No. This offer would be in violation of two Illinois provisions. The first, Section 475.530 of the Illinois Administrative Rules on Motor Vehicle Advertising, prohibits cash rebates, including, without limitation, a payment or an offset to a consumer or a payment to a dealer or a third party on behalf of the consumer on the condition that the consumer purchase or lease a motor vehicle, unless it is funded solely by the manufacturer pursuant to a manufacturer’s rebate program. Additionally, the Illinois Consumer Fraud and Deceptive Business Practices Act regulates “coupons.” It prohibits the use of any coupon offered in connection with a retail sale where the price is arrived at through bargaining or negotiation. QUESTION 9: May I send out a direct mail piece targeting customers who have filed for bankruptcy? This issue is covered by the Loan Advertising to Bankrupts Act. That Act provides that no person engaged in the business of making loans or selling property or services under installment contracts may include in any solicitation of or advertisement for such business any language stating or implying that a loan or extension of credit will be made to a person who has been adjudged a bankrupt. Accordingly, a dealer should avoid the use of the words “bankrupt,” “bankruptcy” and the like. It is permissible to imply that credit will be made to consumers who have “bad credit” or the like. Fines for violating this provision can amount to up to $1,000 for each person the advertisement reaches. 26
QUESTION 10: How far back may the manufacturer audit warranty claims or other incentive and reimbursement programs? The Illinois Motor Vehicle Franchise Act provides that the manufacturer shall have the right to require documentation for warranty claims and to audit such claims within a one-year period from the date the claim was paid or credit issued by the manufacturer. With regard to other incentive and reimbursement programs, the manufacturer has the right to audit such claims within a 12-month period after the date of the transactions that are subject to audit. Notwithstanding the above, the manufacturer retains the right to charge back any fraudulent claim if he establishes in a court of competent jurisdiction in this State that the claim is fraudulent. QUESTION 11: What amount of damage must be disclosed on a new or used vehicle? On a new vehicle, the Illinois Motor Vehicle Franchise Act, as amended Jan. 1, 2003, provides that a dealer must disclose in writing any damage of which he has actual knowledge, incurred between the end of the manufacturing process and the time of delivery, which exceeds 6% of the MSRP of the vehicle, excluding damage to glass, tires, bumpers, video and telephonic components, and in-dash audio equipment, if said items were replaced with OEM equipment. With regard to the sale of a used vehicle, no Illinois Statute applies. Accordingly, the theory of common law misrepresentation would provide for dealer liability for an intentional misrepresentation of a material fact relied upon by the customer to his detriment. In this context, intentional means the dealer “knew or should have known” of the damage. The definition of “material” is left to the courts, but the rule of thumb is that it is material if the purchaser would have made a different purchase decision had he had knowledge of the damage. QUESTION 12: How far away must a relocated or new franchise be from an existing franchise of the same line make? The Illinois Motor Vehicle Franchise Act provides that the manufacturer may not grant an additional franchise in the relevant market area of an existing franchise of the same line make or relocate an existing motor vehicle dealership within or into the relevant market area of an existing franchise of the same line make without a showing of good cause. The appointment of a successor motor vehicle dealer is prohibited from granting an additional franchise in the relevant market area, which is defined as an area within 10 miles from the principal location of the dealership in a county of more than 300,000 persons or the area of responsibility as defined in the franchise agreement, whichever is greater, absent a showing of good cause. With regard to both a proposed relocation or grant of additional franchise, the manufacturer may attempt to show, and has the burden to establish, that good cause exists. The relocation or granting of the new franchise may not take place before the hearing process is concluded pursuant to the Franchise Act. A determination of whether good cause exists is made by the Motor Vehicle Review Board pursuant to Subsection (c) of Section 12 of the Franchise Act. 27
QUESTION 13: What does the FTC used car rule generally provide? The used car rule, which became effective in 1985, requires a dealer to post a window sticker, called the Buyer’s Guide, on every used car or light truck offered for sale. The Buyer’s Guide must be in the exact format required by the rule and must be filled in according to the directions. In addition, the Buyer’s Guide, or a copy, must be provided to the purchaser at the time of sale, and the information contained therein must be incorporated into the Contract for Sale. Any dealer who offers six or more used vehicles for sale in 12 months is covered by this rule. However, sales to other dealers are excluded. Demonstrators are specifically covered. You should further note that if a used car transaction is conducted in Spanish, a Spanish-language version of the Buyer’s Guide must be provided to the consumer. Finally, if your dealership enters into a service contract with a consumer either at the time of sale or within 90 days thereafter, federal law prohibits you from disclaiming or modifying any implied warranty to the consumer. QUESTION 14: May I obtain a consumer’s credit report without written permission? Yes. The dealer may always obtain a credit report if the dealer has signed permission from the consumer. However, the FTC has recently interpreted the revised Fair Credit Reporting Act to provide for a two-part test for obtaining a consumer’s credit report without a signature. Those two parts are: 1. The consumer clearly understands that he or she is initiating the purchase or lease of a vehicle; and 2. The seller has a legitimate business need for the consumer report to complete the transaction. Accordingly, a dealer may not obtain a credit report without written permission when a consumer is requesting only a test drive or asking questions about prices or financing, or if it is solely for the purpose of negotiating with a customer. There are inherent risks in taking credit applications over the phone. Penalties can run to $2,500 per violation. When in doubt, written permission is always recommended, and such permission should be retained by dealers for three years. QUESTION 15: My customer purchased a vehicle and executed all the paperwork. Now, two days later, they have returned the vehicle to my dealership and claimed that they are rescinding the sale under the Federal Trade Commission’s “Cooling-Off Rule.” Can they do this? No. The Cooling-Off Rule, which provides three days to cancel purchases of $25 or more, applies to sales at the buyer’s home, workplace or dormitory, or at facilities rented by the seller on a temporary or short-term basis, such as hotel or motel rooms, convention centers, fairgrounds and restaurants. It applies even when the purchaser invites the salesperson into his home. However, it does not apply to sales made on the premises of the dealership. It further specifically exempts sales of automobiles, vans, trucks or motor 28
vehicles at auctions, tents sales or other temporary places of business, provided that the seller is a seller of vehicles with a permanent place of business. QUESTION 16: May I advertise a price for a vehicle wherein all rebates have been deducted, including a “loyalty” rebate that only applies to current owners of my manufacturer’s vehicles? No. A “loyalty” rebate, like a “college graduate,” “Farm Bureau” or “finance company” rebate is a “limited rebate” under the terms of the Illinois Administrative Rules on Motor Vehicle Advertising, since such rebates are not generally available to every consumer seeking to purchase or lease a motor vehicle. As such, it is a violation of Section 475.530 of those Rules to advertise a price or amount of an installment payment in which limited rebates have been deducted, or to advertise a total amount of rebate if a portion of the total consists of a limited rebate. QUESTION 17: May I offer an “internet special” where a specific vehicle or vehicles from my inventory are available at a lower price for a consumer who has logged onto my website and printed out a discount coupon? No. Any advertised price has to be available to all purchasers and cannot be limited to only those who have logged onto the internet. Additionally, use of a coupon on an internet site would similarly be in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act provision that prohibits the use of any coupons offered in connection with a retail sale where the price is arrived at through bargaining or negotiation. QUESTION 18: Is there a 15-day/500-mile limited powertrain warranty requirement in Illinois for used vehicles? Yes, after July 1, 2017, on powertrain components defined as the following: the engine block, head, all internal engine parts, oil pan and gaskets, water pump, intake manifold, transmission and all internal transmission parts, torque converter, drive shaft, universal joints, rear axle and all internal rear axle parts and rear wheel bearings. The law exempts vehicles sold with more than 150,000 miles on the odometer, antique vehicles, vehicles that have a Gross Vehicle Weight Rating (GVWR) of 8,000 pounds or greater, or vehicles where the dealer offers an express warranty with equal or greater warranty coverage. Equal or greater warranty coverage means a warranty that covers powertrain components for 15 days or 500 miles and caps the consumer payment at $100 for up to two repairs unless the second repair is for the same problem. The statutory warranty does not extend to damage that occurs after the sale of the vehicle resulting from off-road use, racing, towing, abuse, misuse, neglect, failure to perform regular maintenance or failure to maintain adequate oil, coolant or other required fluids or lubricants. Furthermore, the warranty is not violated if an alleged nonconformity does not substantially impair the use and market value of the vehicle or if the alleged nonconformity results from abuse, neglect or unauthorized modifications or alterations of the vehicle. 29
If a covered vehicle develops a powertrain problem within the 15-day/500-mile period, the consumer is required to provide reasonable notice no later than two (2) days after the 15-day statutory period by text, phone, in writing or in person. The dealer shall be provided with a reasonable opportunity to fix the defect. The maximum liability of a seller for repairs is limited to the purchase price paid for the used motor vehicle, to be refunded to the consumer or lender, as applicable, in exchange for the return of the vehicle. Coverage on particular components can be waived if the dealer informs the customer in writing at the time of sale about a particular problem and the customer signs and acknowledges that he has been told of the problem. A statutory disclosure of this warranty must be provided to the customer at the time of sale. The warranty disclosure must be on the Purchase Contract or a separate document provided at the time of sale in at least 10-point bold font and must be signed by the customer. Unless the sale is exempt, dealers can no longer use the “As-Is” page of the Buyers Guide. Instead, dealers should use the “Implied Warranties Only” Buyers Guide and mark the “Implied Warranties Only” box if they only want to provide the required statutory warranty. To avoid unintentionally giving other implied warranties, dealers may also want to add a description in the Buyers Guide as to what the implied warranty under Illinois law is, or just refer to the limited powertrain warranty required by Section 2L of the Illinois Consumer Fraud and Deceptive Business Practices Act. If a dealer wishes to offer additional warranty coverage, he should mark the “Dealer Warranty” box, and then select full or limited warranty as appropriate. If the dealer’s warranty provides coverage equal to or greater than the 15-day/500-mile statutory warranty, no additional disclosures are needed. If the dealer warranty does not provide at least this coverage, then the dealer must describe both the 15-day/500-mile statutory limited powertrain coverage and his extended warranty coverage. QUESTION 19: Can you take the benefit of a sales tax exemption for educational, charitable, or religious organizations when leasing a vehicle rather than selling? No. That sales tax exemption only applies to sales, not leases. The only exemption for leases (and sales) is a lease to a governmental body with a valid Illinois exemption number. 30
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