Vol. 36 № 3 A Publication of the Illinois Automobile Dealers Association Automobile Dealer News An In-Depth Look at One of IADA’s Most Trusted Partners — THE ETHOS GROUP
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
CONCENTRATIONS Dealership Mergers & Acquisitions Dealership Franchise Law Business Litigation/Motor Vehicle Review Board Disputes Manufacturer/Franchisor Relations Business & Commercial Law Advertising Compliance Review Consumer Complaints Dealership Succession Add Points Real Estate Law Employment & Labor Law Federal & State Regulatory Compliance BACKGROUND Principal, Private Law Firm Former, IADA Legal Counsel Former, Illinois Assistant Attorney General, Deputy Chief, Consumer Protection Division Drafted Illinois Motor Vehicle Franchise Act Amendments Creating Motor Vehicle Review Board Drafted Illinois Motor Vehicle Advertising Regulations Julie A. Cardosi, Esq. 3040 Spring Mill Drive, Suite B Springfield, IL 62704 (217) 787-9782 jcardosi@autocounsel.com www.autocounsel.com Exclusive. Strategic. Results. Exclusively representing the unique business interests of automobile dealers for over 35 years.
CONTENTS Vol. 36 No. 3 2025 Officers Chairman Jamie Auffenberg/(618) 624-2277 St. Clair Auto Mall Auffenberg Auto Mall 1130 Auffenberg Ave., Shiloh, IL 62269 Vice Chairman Rick Curia/(815) 288-4455 Ken Nelson Auto Group 1100 N. Galena Ave., Dixon, IL 61021 Secretary/Treasurer Ryan Gremore/(309) 664-1222 O’Brien Auto Group 1601 Fort Jesse Rd., Normal, IL 61761 Executive Director Joe McMahon/(217) 753-0220 Illinois Automobile Dealers Association 300 W. Edwards St., Springfield, IL 62704 ©2025 The Illinois Automobile Dealers Association (IADA) | The newsLINK Group LLC. All rights reserved. Illinois Automobile Dealer News is published four times per year by The newsLINK Group LLC for IADA and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and education. The contents do not constitute legal advice and should not be relied on as such. If you need legal advice or assistance, it is strongly recommended that you contact an attorney as to your circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of IADA, its board of directors or the publisher. Likewise, the appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. Illinois Automobile Dealer News is a collective work, and as such, some articles are submitted by authors who are independent of IADA. While a first-print policy is encouraged, in cases where this is not possible, every effort has been made to comply with any known reprint guidelines or restrictions. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at (855) 747-4003. Illinois Automobile Dealers Association 300 W. Edwards St. Springfield, IL 62704 T (217) 753-0220 / F (217) 753-3424 IllinoisDealers.com Scan here to check out our interactive website at illinoisdealers.com! 6 EXECUTIVE DIRECTOR’S MESSAGE A Positive Impact on Dealership Performance By Joe McMahon, Executive Director, IADA 8 COUNSELOR’S CORNER “No Soup for You” Dealership Best Practices for “Firing” or Legally Refusing Service to a Difficult Customer By Julie Cardosi, Esq., Law Office of Julie A. Cardosi, P.C. 11 Reset and Retool: Dealers Meet 2025 With Resilience Tariffs and Their Impact on the Economy Will Test Dealers’ Resilience By JT Taylor, Managing Director and Head of Automotive Retail, Truist Securities 15 Ransomware A Response Plan Is Essential for Auto Dealers By Bank of America 18 How To Stay Safe at Every Step of the Vehicle Shipping Process Together, We Can Make the Logistics Industry Safer By Cox Automotive 23 Legacy, Liquidity or Something in Between How to Navigate the Next Chapter By Jamie Farley, Partner, Performance Brokerage Services 25 Ethos Group 26 Point of Separation By Tim Marbut, Ethos Group 28 The Power of Perspective Transforming Attitudes in the Retail Automobile Business By Tim Marbut, Ethos Group 30 4 Steps To Creating a Culture of Compliance at Your Dealership By Ben Haile, SHRM-SCP, Ethos Group 31 Starting a Good Habit While Ending a Bad One By Ryan Anzalone, Ethos Group 33 How Well Are You Managing Your Service Providers? By Kaitlyn Paresi, Ethos Group 34 The Importance of Maximizing the F&I Dollar in a Market Where Front Gross is Compressed By Jacob Newman, Ethos Group 4 Illinois Automobile Dealer News
Anticipate every turn In an industry that’s always evolving, your dealership can rely on our Dealer Financial Services team’s 90 years of experience to see what’s around the corner, forward-thinking insights to prepare you, and technology to keep you ahead of the curve. What would you like the power to do?® Ryan Jordan, ryan.m.jordan@bofa.com business.bofa.com/dealer ©2024 Bank of America Corporation. All rights reserved. DFS-699-AD 6942528 Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured Are Not Bank Guaranteed May Lose Value “Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, derivatives, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc., which is a registered broker-dealer and Member of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. is a registered futures commission merchant with the CFTC and a member of the NFA.
Executive Director’s Message A Positive Impact on Dealership Performance JOE McMAHON Executive Director, IADA In this edition of the Illinois Automobile Dealer News magazine, we’re proud to feature valuable insights from one of IADA’s trusted partners, Ethos Group. A few years ago, several of our board members — already experiencing success with Ethos Group’s support — encouraged us to take a closer look. Their strong endorsements highlighted the company’s positive impact on dealership performance and underscored the alignment between Ethos Group’s values and those of IADA. In this issue, we explore key viewpoints from Ethos Group on: • Point of Separation: When we really stop and think about it, our points of separation come within three areas: our people, our products and our processes. What is your point of separation? • The Power of Perspective: Changing your perspective won’t change the challenges of the auto business, but it will absolutely change your experience of them. That change can be the difference between burnout and breakthrough, between surviving and thriving. • The Importance of Maximizing the F&I Dollar in a Market Where Front Gross is Compressed: While the profit generated by the finance department is vital for the financial statement, it is even more critical for the long-term stability of the dealership. Profit is not the primary goal; rather, it reflects the effectiveness of the dealership’s processes and the execution by team members. • Starting Good Habits While Ending a Bad One: Ultimately, the good habits practiced at your dealership are the sum of all the wanted behavior you celebrate, minus all the bad habits you tolerate. You become what you repeat. • Managing Your Service Providers: Dealers need to make sure they can trust their compliance partner to be involved and knowledgeable about not only the regulations and compliance landscape, but also how their specific business functions within them. We hope you enjoy this issue, and as always, we sincerely appreciate your continued support of our state trade association, the Illinois Automobile Dealers Association. Our strength and success will always be a direct reflection of the commitment and engagement of our dealer members. Sincerely, Joe McMahon 6 Illinois Automobile Dealer News
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In the world of automotive sales, customer satisfaction is paramount — but not every customer relationship is worth preserving. Illinois’ new car dealers, like other businesses, have the right to refuse service under certain conditions. However, this must be done carefully and in compliance with both Illinois state law and federal regulations to avoid legal repercussions. A dealership must ensure that refusal of service does not violate anti-discrimination or consumer protection laws or breach a contractual obligation. Legal Grounds for Refusing to Do Business Illinois law does not require businesses to serve every customer. Dealers may refuse a sale or service or terminate a customer relationship as long as the decision is not discriminatory or retaliatory or misleading or harmful to the customer or constitute a breach by the dealership of a contractual duty or obligation to the customer or under the dealership’s franchise agreement with the manufacturer. The following circumstances may comprise permissible reasons, among others, to refuse a sale or service: • Abusive or threatening behavior by the customer toward dealership staff. • Repeated attempts to defraud or manipulate financing or other aspects of the business transaction with the dealership. • Failure to comply with dealership policies. • Disruption of dealership business operations. Notably, having a written policy is highly recommended for dealerships that may need to disengage from difficult customers. This helps to ensure consistency, provides some legal protection to the business and supports staff in professionally handling difficult situations with customers. A documented policy illustrates that decisions are based on best practices and business standards, not personal bias, thus helping to insulate and defend against claims of discrimination or unfair treatment. Moreover, a policy ensures all employees follow the same protocol when dealing with problematic customers, reducing the likelihood of confusion and the risk of escalation. It also helps demonstrate the dealership’s legal compliance with applicable Illinois and federal laws, particularly if the customer or state or federal regulators challenge the dealership’s decision. If a customer files a complaint or legal action, the written policy may serve as evidence that the dealership acted within its rights and established policies. The dealership’s written policy should include a definition of unacceptable behavior (e.g., verbal abuse, threats, repeated contract violations) and should outline the steps to be followed by dealership staff for documenting incidents. The policy should also cover procedures to reduce escalation (e.g., warnings, management review) and the conditions under which a sale or service may be refused or terminated. Importantly, the policy should include a statement of compliance with anti-discrimination laws. JULIE CARDOSI, ESQ. Law Office of Julie A. Cardosi, P.C. “No Soup for You” Counselor’s Corner Dealership Best Practices for “Firing” or Legally Refusing Service to a Difficult Customer 8 Illinois Automobile Dealer News
Prohibited Reasons for Refusing to Do Business It is not permissible to refuse a sale or service or terminate a customer relationship if it is discriminatory or retaliatory or misleading or harmful to the customer, or if it constitutes a breach of a contractual duty or obligation to the customer or under the dealership’s franchise agreement with the manufacturer. For example, the following reasons to refuse to do business with the customer would be prohibited: • Discrimination based on race, gender, religion, national origin, age, disability or other protected classes under the Illinois Human Rights Act and Title VII of the Federal Civil Rights Act of 1964. • Retaliation for filing a complaint or asserting legal rights. The foregoing examples are not exhaustive. There are other applicable state and federal laws that come into effect in the dealership’s decision and ability to refuse to do business with a customer.1 Best Practices for Terminating a Customer Relationship To minimize legal pitfalls, dealerships should: • Have and implement a written policy and ensure that dealership staff follow the policy. • Document all interactions with the customer, especially incidents of misconduct. • Issue a written notice that is reviewed by legal counsel explaining the termination of service, citing specific behavior. • Avoid public confrontation or defamatory statements. • Consult legal counsel if the situation escalates or involves potential litigation. Illinois new car dealers are not powerless when dealing with difficult customers. By understanding the legal boundaries and maintaining clear documentation, they can protect their businesses while staying compliant with state and federal laws. The key is to act professionally, consistently and lawfully — because firing a customer should not mean firing up a lawsuit. Julie A. Cardosi is Principal of the private firm, Law Office of Julie A. Cardosi, P.C., of Springfield, Illinois. She has been practicing law for nearly 40 years and has exclusively represented the unique business interests of automobile dealers statewide for over 30 years. Formerly in-house staff legal counsel for the Illinois Automobile Dealers Association, she concentrates her practice in the areas of dealership ownership transfers (asset purchases and stock acquisitions), mergers and acquisitions, franchise law and franchise issues, factory relations, add points, commercial real estate transfers, advertising and other issues impacting day-to-day dealership operations. Julie also previously served as an Assistant Attorney General and Deputy Chief of the Illinois Attorney General’s Consumer Fraud Division and is the original author of the Illinois Motor Vehicle Advertising Guidelines, which the Illinois General Assembly adopted as the Motor Vehicle Advertising Regulations. 1 • Illinois Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1 et seq.) Protects consumers from unfair treatment but also allows businesses to protect themselves from fraudulent or abusive behavior. • Illinois Vehicle Code (625 ILCS 5/1-100 et seq.) Governs dealer licensing and conduct. Dealers must follow lawful requirements and avoid deceptive practices. • Illinois Lemon Law (815 ILCS 380/1 et seq.) Applies to new vehicle defects—not customer behavior—but dealers must honor warranties and avoid retaliatory service denial. • Federal Trade Commission Act (15 U.S.C. 45 et seq.) Prohibits deceptive practices and requires transparency including in pricing and add-ons. Dealers must avoid misrepresentation but are not obligated to serve every customer. • Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) Requires dealers to protect customer data. If a customer is abusive or violates dealership policies, the dealer may terminate the relationship while still safeguarding personal information. • Equal Credit Opportunity Act (15 U.S.C 1691 et seq.) Dealers must not deny financing based on protected characteristics. However, they may refuse financing based on legitimate credit concerns or abusive conduct. 9 Illinois Automobile Dealer News
RESET AND RETOOL: Dealers Meet 2025 With Resilience Tariffs and Their Impact on the Economy Will Test Dealers’ Resilience By JT Taylor, Managing Director and Head of Automotive Retail, Truist Securities For auto retail dealers hoping for a return to normal conditions and predictability in 2025, disruption has once again taken the driver’s seat. As trade dynamics shift and their impact on the economy remains unclear, auto retailers will need to call upon their adaptability to adjust to a new set of conditions. Strong profit growth since 2019 and resilience through COVID suggest that dealers are ready to reset and retool to address today’s market. Thankfully, dealer average profitability has stabilized at nearly double the rate achieved in 2019. The most successful auto retailers will be able to maneuver to build value without shortchanging growth strategies or slowing their work. As you reset your plans for the coming years, consider the following industry trends. Consumer Demand Will Carry On Auto retail demand depends on the strength of the consumer, and by most measures, the U.S. consumer is relatively healthy. Savings rates are up, as are wages. Consumer spending patterns haven’t changed. Auto financing is holding strong. The percentage of people not paying their credit card bills is low. Taken together, consumer measures point to steady demand for vehicles. Additionally, millennials and Gen Z are entering their prime years for buying cars and trucks, surpassing the baby boomers as drivers of demand. Consumers have adjusted to vehicle prices that have risen 30% over the past seven years, with a marked increase in new, used and fleet sales that have carried over from 2024 into the first part of 2025. Strength in the Used Car Market Offers Good News for Dealers There’s been a surge in used car demand, and we can expect even more as the year unfolds. For some time now, we’ve seen that consumers are especially interested in buying late-model used cars and trucks, keeping these values high. Higher new car prices, combined with rising insurance premiums for more expensive vehicles, nudge more buyers toward the used vehicle market. With the threat of expanding tariffs, inflation or supply chain disruptions, new car prices will be pressured further, pricing more customers out of the new car market and driving them to buy used. Enterprising dealers are already starting to get ahead of the demand surge by boosting their strategies to acquire used vehicles. Dealers can look to gain a competitive edge by sourcing a favorable mix of cars at an attractive price and marketing them to consumers who have become more accustomed to purchasing in the used car market. Combining vehicle sales in a hot and profitable used market with financing or protection products will provide even more support for dealer margins. Pricing Transparency Benefits Buyers and Dealers Alike The spike in digital shopping and purchasing has catalyzed the longer-term shift toward more transparent pricing. Retailers have tried to make it easier for customers to see exactly what a vehicle will cost them so they can determine how it will fit within their budget. That transparency applies to used car trade-ins as well. With a better understanding of the value of their current vehicle, consumers know in advance how much they can contribute toward their next car purchase. Clearer and more precise, “no-haggle” pricing also helps dealers consistently protect their margins. These policies build trust in the buying process, which bolsters consumer relationships that extend beyond the initial sale, ideally into servicing. EVs Persist, Especially in 12 States EV sales will continue to grow, albeit not at the pace some predicted a few years ago. Currently, buyers of commercial vehicles (e.g., Amazon vans) are the fastest adopters of EVs. Over time, we expect this trend to drive down EV prices, which will encourage more widespread adoption. 11 Illinois Automobile Dealer News
Hybrid vehicles, including plug-in hybrids, are a popular alternative that helps bridge the move to fully electrified vehicles, which we expect to represent 40% of the market within the next five to 10 years. Continued headwinds to EV adoption include lagging development of charging infrastructure, consumer anxiety around trip planning due to battery range and subpar battery performance in cold climates and disaster situations (e.g., floods, hurricanes and evacuation scenarios). The used car market for EVs has been marginal at best, but some 70% of EV buyers report plans to purchase another one. In fact, 92% of EV owners in a recent survey by Global EV Alliance said they would never own another internal combustion vehicle.1 The interesting growth story will be in the 12 states phasing in EV vehicle mandates starting in 2026, 2027 or 2028. Given the current climate, we can expect many of those requirements to be reduced or rescinded, but California, Colorado and possibly Oregon are expected to stick to their commitments. These mandates will require much of the EV and hybrid output to be directed to states with EV mandates, leaving a shortage of those vehicles in the remaining states. Service Business Rises as a Robust Center of Profit and Cash Flow The service business is driving profitability and boosting cash flow to a greater degree than many people anticipated. It’s true that vehicles are better built than they were just 10 to 15 years ago — and last longer — but they still need service and parts throughout their extended lifespans. And OEMs will have warranty issues and recalls that require servicing, a meaningful source of revenue, particularly for dealers who maximize their warranty reimbursement rates. An invigorated used car market closely links customer acquisition and rising service needs as a vehicle ages. Focusing on reaching the rising number of used car customers and fulfilling their needs could add critical service volume. Also, contrary to expectations, EVs are contributing to added profitability due to higher average costs for service visits. OEMs Are Producing at Optimal Levels To Drive Organic Growth While many dealers should see solid, organic growth in the coming years, with variation based on brand and individual store performance, the trade policy uncertainty adds a few twists to the story. If the economy avoids a downturn and tariff issues don’t flare up, demand for new and used cars, along with a more normalized market, bodes well for profitability. Manufacturers are building for overall market demand rather than production capacity. Our data shows that the sweet spot for a healthy margin on new car sales is a 65- to 75-day supply of vehicles, and April 2025 closed with a 66-day supply — 16 days lower than a year ago.2 (Compare that to the 110- to 115-day supply in 2019.) At the low end of the ideal new vehicle supply range, dealers enter the summer with inventory levels that should help protect margins. We expect total dealership profit to stabilize at around 4% of sales — twice the historical pre-COVID levels. Brand Dynamics Are Shifting, and Value Offerings Are Emerging Brand value is typically quite stable, something retailers can take as a given. However, recently, Nissan, Chrysler, Dodge, Jeep and Ram have dropped in blue-sky multiple values. Subaru and Ford are down as well, while Toyota has increased significantly. Besides several outstanding products that generate high-volume sales, Toyota now offers a hybrid-heavy lineup to better meet shifting demand, along with a transparent dealer-manufacturer relationship that provides a clear rationale behind their strategy. These factors combine to bring Toyota to a premium brand value level. Mazda, Volvo and Audi blue-sky values are recovering from recent slippage, with Honda moving up as well. Chevrolet, on the other hand, has never lost ground but is enjoying rising brand value based on a superior product mix and go-to-market strategy. Each brand’s strategy in handling tariffs and vehicle affordability pressure in the current market could lead to additional shifts in brand value. For example, Ford has stated they will raise prices on all vehicles produced in Mexico, while Toyota has stated they will not raise prices because of tariffs, instead absorbing a 21% hit to next year’s profits. When it comes to affordability, some brands are introducing value platforms to maintain vehicle affordability and market share in the face of cost increases from tariffs or inflation. Look at the F-100 version of Ford’s F-150 or the Enterprise Edition of the Dodge Ram. These are stripped-down, commercial-looking vehicles with a few nice features in the interior to link to the more expensive 12 Illinois Automobile Dealer News
offering. They allow a buyer to access a brand where they might otherwise be priced out and keep the brand top of mind with the customer. M&A Surges to Even Higher Levels We anticipate even more dealer transactions this year than we saw in 2024, one of the top three years from a volume standpoint. The forces driving M&A to new highs in recent years are still in play, bolstered by new geographic trends. • Dealers are sitting on capital amassed through the COVID-19 boom times, and they’re motivated to grow. In this consolidating market, they can see the urgent need to scale for maximum efficiency. • Both international and large domestic institutional investors have renewed their interest in automotive retail. A number of financial investors, including marquee private equity firms and family offices, see opportunities in franchised auto retail and are pursuing dealership investment strategies. • Leadership teams are stronger. After years of struggle to fully staff management positions, most owners finally have capable executive teams to facilitate efficient expansion. • Technology supports the efficient addition of locations. While dealers have traditionally aimed to scale for five to 10 stores in a specific market, technology now enables multi-store efficiency gains beyond a contiguous geographic area. In response to that new capability, we’re seeing a definite trend toward less-localized growth, with dealership expansions finding scale in systems and processes. • Less favored markets are in. California, Minnesota, Illinois and the Northeast are now becoming M&A targets. Reduced dealership values in California make it an enticing market for M&A value investors. Thirty-nine million Californians still need to buy and service vehicles. “We anticipate even more dealer transactions this year than we saw in 2024, one of the top three years from a volume standpoint.” — JT Taylor, Head of Automotive Retail for Truist Securities Market Conditions Offer an Ideal Window To Monetize Your Business If you’d rather go than grow, now should provide ample opportunity to make your exit. With M&A activity having accelerated to an even higher level, owners who choose an off-ramp rather than facing the challenges of another business reset will have an opportunity to move on. With growth-minded dealership groups coming off strong-performing years and capital available for promising acquisitions, you couldn’t ask for a better time to explore offloading nonstrategic stores or putting your transition plans into motion. What Makes a Dealership Attractive for Acquisition? Stores with specific strengths will command a premium in the rush to snap up solid auto dealerships. Whether they’re private investors, growth-focused auto retailers or other interested parties, buyers are looking for stores with the characteristics that pair maximum potential for continued growth and profitability with the resilience to handle market shifts and downturns. That translates to strong service retention rates following vehicle sales, fully staffed and highly capable management teams, desirable brands and updated facilities that meet manufacturer standards for image and capacity. Businesses that know how to tap the potential of F&I programs to generate profits will have an edge. Dealers who deferred capital investment, or can’t meet these buyer expectations for any reason, will have to sell their stores at a discount. Reset To Meet Today’s Market and Continue Building Value The year ahead holds promise for dealers who can adapt, retool and seize opportunities that emerge. Truist’s knowledgeable Dealer Services team is here to help you make the most of what the auto retail market offers. Count on our experience, insight and strategic support to help you every step of the way. To learn more, visit www.truist.com/dealerservices. This document is being furnished to senior management of existing or prospective investment banking clients of Truist Securities Inc. for information purposes only and may not be reproduced or redistributed to any person outside of their company. © 2025 Truist Financial Corporation. Truist and Truist Securities are service marks of Truist Financial Corporation. All rights reserved. Truist Securities is the trade name for the corporate and investment banking services of Truist Financial Corporation and its subsidiaries. Securities and strategic advisory services are provided by Truist Securities Inc., member FINRA and SIPC. | Lending, financial risk management, and treasury management and payment services are offered by Truist Bank. | Deposit products are offered by Truist Bank, Member FDIC. 1. Global EV driver survey 2024, Global EV Alliance, December 2024. 2. Consumers Face Challenges as New-Vehicle Inventory Drops 7.4% in April Amid Tariff Uncertainty, Cox Automotive, May 15, 2025. 13 Illinois Automobile Dealer News
Truist.com/DealerServices The auto retail industry is more complex than ever. We’re here to help you make the right moves. From adopting AI to navigating economic uncertainty, auto dealers today face unique challenges. Truist Dealer Services knows this industry inside and out—and more importantly, we’re invested in knowing you. Truist Bank, Member FDIC and Equal Housing Lender. © 2024 Truist Financial Corporation. TRUIST, the Truist logo and Truist Purple are service marks of Truist Financial Corporation. All rights reserved.
RANSOMWARE A Response Plan Is Essential for Auto Dealers By Bank of America High-profile cyber incidents have highlighted the need for auto dealerships to prepare for the impacts due to loss of critical services and theft of sensitive data. Here are some factors to consider when creating an incident response plan. Key Takeaways • Auto dealerships are facing an increasing number of cyberthreats that can debilitate operations and compromise customer and financial data. • Creating a ransomware response plan is a critical piece of any dealership’s preparedness. • By implementing basic controls and best practices, an incident response plan can improve security for dealerships, even those with limited IT and cyber defense budgets. When a software and applications vendor was compromised by ransomware in June 2024, thousands of auto dealerships felt the effects. Essential management systems became inaccessible, sales and financing transactions went manual or stopped, and sensitive customer and business data was compromised. By one estimate, auto dealerships lost over 50,000 new vehicle 15 Illinois Automobile Dealer News
sales and suffered over $1 billion in damages in the month after the incident was reported.1 Although this was an “upstream” incident that began with a critical service provider, the ransomware event highlighted the elevated risk auto dealerships face. A 2024 study found that 35% of surveyed dealers had dealt with some type of cyber incident in the past year. What’s more, ransomware was rated as the most serious cyberthreat these businesses face.2 In this environment, every dealership needs a plan for what they must do if they’re targeted. Why a Ransomware Response Plan Is Essential Even dealerships that lack the resources to hire security professionals or invest in advanced controls can greatly improve their defenses by constructing a response plan that includes proactive measures such as data protection, raising employee awareness and implementing core best practices. A plan that outlines how a business can prepare against cybersecurity threats and respond to incidents can help limit the damages related to loss of data and operations. It can also improve the chances of avoiding many types of incidents, including ransomware. The following guidelines can help dealerships create a response framework that can be tailored to their specific organization and capacity for planning. Key Elements of a Ransomware Response Plan Ransomware response depends on a timely assessment of a live incident’s severity and impact, clearly defined roles and reactions and a thorough investigation to ensure the threat is neutralized and operations can be brought back to a secure state. To be effective, your strategy must be in place before an incident occurs. Here’s how to get started. BEFORE AN INCIDENT 1. Prepare • Educate key personnel regarding current cyber-risks and objectives of cybercriminals. • Appoint the most qualified individual to lead the creation, implementation and updating of the response plan. Alternatively, you can supervise a contract with a professional security vendor that creates the response plan. • Conduct a company risk assessment and be sure to include data inventory. • Create and maintain encrypted, offline or immutable backups of essential company and customer data. • Implement strong protections around identity and access management, such as multifactor authentication on all devices that can access company networks. • Formulate, test and continuously evolve the response plan. It should identify stakeholders and their roles, communication tactics and off-network channels, reporting procedures required by regulatory bodies or local law enforcement, and criteria for restoration of safe states. 2. Backup and Test • Regularly confirm the integrity of backups. • Do not look at backups as the “last line of defense.” No backup method is 100% cybersecure, and stealthy bad actors can corrupt backups even before they launch ransomware. DURING AN INCIDENT 3. Detection and Assessment • Use security tools to monitor network traffic for evidence of an adversary’s presence or movement and issue alerts. • Assess which systems are easily compromised by ransomware and isolate them. Coordinate a shutdown of all devices that cannot disconnect from the affected systems. • Reset all credentials and passwords connected to affected systems. 4. Communication and Reporting • Inform all internal teams and stakeholders on a preselected communication channel to ensure individuals essential to the response are engaged. • As needed, report the incident to affected third parties or vendors that assist your dealership with security and incident response. • Notify cybersecurity agencies and/or local law enforcement to maintain regulatory compliance and to receive additional assistance or guidance. • Communicate with third parties and clients to ensure they have not experienced financial impacts after the incident. 5. Containment and Remediation • Disable any system involved in the initial breach, as well as connected systems that malicious actors could use to access other parts of the company network or data systems. 16 Illinois Automobile Dealer News
• Analyze network traffic and endpoints for evidence of the malicious actors’ persistence. Remediate vulnerabilities. • Rebuild the systems that are most critical to business operations. • Reset passwords and permissions. AFTER AN INCIDENT 6. Recovery and Response Plan Update • Complete a thorough forensic analysis of the incident and document all steps taken to eliminate the ransomware or remove footholds the threat actor established. • Confirm that backups remain uncorrupted and don’t contain malicious payloads. Restore affected systems. • Inform all relevant third parties and oversight agencies of the steps taken and the removal of the threat. • Make improvements to company systems based on forensics. • Continue to maintain vigilance. Update security systems regularly and adapt employee training to reflect lessons learned. To learn more, visit business.bofa.com. “Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, derivatives, other commercial banking activities and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities Inc., which is a registered broker-dealer and Member of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities Inc. is a registered futures commission merchant with the CFTC and a member of the NFA. 1. Anderson Economic Group, “Dealer Losses Due to CDK Cyberattack Reach $1.02 Billion.” 2. CDK Global, “The State of Dealership Cybersecurity 2024.” We invite you to join us today. Contact us at ElectrifyIL@Ameren.com to get started. Learn more about our ChargeSmart program at AmerenIllinois.com/ChargeSmart. Engage. Learn. Share. 1. Engage: Join our webinars and boost your EV sales expertise 2. Learn: You and your customers can use our EV calculator to compare gas versus kWh cost savings and more 3. Share: Our ChargeSmart Program can help Ameren customers earn a bill credit and charge for less— sign up is FREE Dealer Partner Network Benefits: • We help you get noticed by listing you on our AmerenIllinois.com/EV web pages • As a Dealer Partner, you get access to a special portal offering resources to help you educate EV customers. Enrollees earn a bill credit and charge for less costs— sign up is FREE An Exclusive Offer to Dealers Join our network of Auto Dealers and let’s transform the EV journey for customers together. The Ameren Illinois Dealer Partner Network is FREE to join and provides resources to help ease the minds of potential EV drivers. 17 Illinois Automobile Dealer News
How To Stay Safe at Every Step of the Vehicle Shipping Process 18 Illinois Automobile Dealer News
With fraud on the rise in our industry, shipping vehicles safely has never been more important. While technology and platforms continue to evolve to offer better protection, shippers must also take proactive steps to safeguard their operations and ensure a smooth experience. Secure Your Account Sharing your sign-in details with others, even people who work for you, can expose you to fraud and unauthorized access. So, we highly recommend setting up your account to give contractors, employees or people outside your organization their own login credentials. This will minimize the risks of identity theft when sharing account credentials. Also, set guardrails on what business information they can view, helping you avoid potential account security risks. Use systems that allow for individual user accounts with customizable permissions. Enabling multi-factor authentication (MFA), especially using a mobile phone number, adds an extra layer of protection. It’s also wise to regularly review account activity to detect any unusual behavior early and to thoroughly vet any third-party contractors before granting them access to your systems. Be cautious about who you add as a user and always vet any third-party companies or contractors before giving them an account. Verify Your Carrier Before Dispatching Many cases of fraud can be avoided with a few important security checks before dispatching. Before dispatching a vehicle, take time to verify the legitimacy of the carrier. Check their registration with the Federal Motor Carrier Safety Administration (FMCSA) to Together, We Can Make the Logistics Industry Safer By Cox Automotive 19 Illinois Automobile Dealer News
ensure they have a valid USDOT and, if applicable, MC number. Authorized and reputable carriers will have this information up to date. Review their insurance documents and consider contacting the provider directly to confirm coverage and request to be added as a certificate of insurance (COI) holder. Reading reviews and ratings from other shippers can also provide valuable insight into a carrier’s behavior and reliability. Be cautious if you see reports of suspicious behavior or poor communication. Secure Communications During Transit Maintaining secure communication is another key aspect of fraud prevention. Dispatching and communicating through private phone calls, emails and texts exposes you to fraud. So, always dispatch vehicles using a fully electronic dispatch system. Assigning vehicles to carriers greatly reduces the risk of falling victim to fake texts and phone calls. Additionally, you may encourage your carrier partner to assign each load to a specific driver. This lets you verify the driver’s identity at pickup and gives you better visibility into your shipments. Get Documentation at Pickup Before a carrier releases a vehicle to you, it’s important to confirm the delivery truck has an MC number that matches the dispatch sheet and check the driver’s license against the assigned driver on the dispatch sheet (if assigned). After the delivery is complete, always rate and review your carrier partner honestly. It’s a great way for the community to help each other avoid bad actors, reward honest carriers who do good work and create a more transparent marketplace for everyone. In the Event of Fraud If you do fall victim to fraud, it’s critical to immediately contact the authorities and file a police report in the jurisdiction of the incident. Provide any information you can to local law enforcement, report the incident to the USDOT’s Inspector General, file a complaint with the FMCSA National Consumer Complaint Database or contact the Federal Trade Commission at reportfraud.ftc.gov. Steps We’re Taking To Help You Ship Safely Central Dispatch is making significant strides in addressing this challenge in our industry and meaningfully reducing the level of fraud on our platform. We are constantly evolving our vetting process alongside the changing market landscape to ensure only legitimate companies gain access to our marketplace so shippers can more confidently find partners. We’ve also formed the Marketplace Integrity Team, which is dedicated to combating fraud and helping you stay secure. This team collaborates directly with Cox Security and other enterprise teams to investigate issues, deactivate fraudulent accounts and proactively protect our customers. We’re partnering with other industry leaders to lobby Congress, advocating for stronger protections against automotive fraud and encouraging action and accountability from the FMCSA. We all play a part in building a safer, more secure marketplace for shipping vehicles. Let’s keep working together to protect our industry from fraud and ensure Central Dispatch remains a trusted platform for everyone. 20 Illinois Automobile Dealer News
Vehicle transportation is now a must-have for dealers everywhere. We think safe vehicle transportation should be too. With robust security features and our dedicated Marketplace Integrity Team, Central Dispatch has everything you need to move vehicles with more confidence. Nissan of Fort Myers Central Dispatch helps you stay safe and master every move. See how you can make every move safer at CentralDispatch.com/MasterEveryMove Mike Spinazze
YOU WANT IT! (801) 676-9722 SALES@THENEWSLINKGROUP.COM ADVERTISE HERE! DON’T ROLL THE DICE CONTACT US TODAY
Legacy, Liquidity or Something in Between How to Navigate the Next Chapter By Jamie Farley, Partner, Performance Brokerage Services For many dealers, the question of what to do with the store doesn’t start with a spreadsheet. It starts around the dinner table — or maybe in the quiet moments when things finally slow down. After decades of building a business, employing people in your community and putting your name on the sign out front, the decision about what’s next is personal. And when family is involved, it’s rarely simple. Some dealers have always imagined passing the business to the next generation. Others have watched their kids build successful lives in different fields and quietly wonder if a handoff is still the right move. And often, there’s a mix of feelings — pride, uncertainty, loyalty, fear of regret. That’s normal. The emotional weight of a family business is real, and the process of transitioning it — whether within the family or outside of it — deserves careful, honest consideration. What we frequently see is hesitation to start the conversation. No one wants to create tension. Parents worry about upsetting their children. Children don’t want to seem disinterested — or entitled. But silence tends to create more confusion, not less. In families where the transition is successful, the common thread is usually clarity: an open dialogue about roles, expectations and timing well before the handoff begins. What many don’t realize is that there’s no longer just a fork in the road — sell it or hand it down. Today, there’s a 23 Illinois Automobile Dealer News
TAKE US ANYWHERE! Scan to read the most recent publication. Stay up to date from your couch, office or even the moon! Place a 1” x 1” QR Code White on Black Here to the main website broader landscape of options. Some families structure phased ownership transfers over time, others pursue internal buyouts with financial guidance. And more recently, new models have emerged that provide liquidity for the current generation while allowing family members to retain operational control and long-term equity. These approaches offer flexibility and customization that weren’t available — or widely known — even a few years ago. In other words, keeping the business in the family no longer has to mean taking on the full burden alone. There are creative, values-aligned ways to protect legacy, preserve harmony and plan for growth across generations. Still, it’s not just about structure. One of the most overlooked parts of the transition is emotional readiness — on both sides. Is the next generation ready to lead, not just manage? Is the outgoing generation truly ready to step back? And is everyone aligned on the vision for the future? These questions don’t have easy answers, but avoiding them doesn’t make them go away. The good news is that starting the conversation doesn’t commit you to any one path. It just opens the door to explore your options — with your family, your advisors and on your own terms. As buy-sell advisors, we’re often invited into these moments of uncertainty — before a decision has been made, when the road ahead is unclear. And it’s in these early conversations that the real value of planning emerges. Our role is not to push a transaction but to help dealers weigh their options, understand what’s possible and make thoughtful decisions that honor both the legacy they’ve built and the future they envision. These decisions don’t come with a playbook. But they do come with the opportunity to pause, reflect and shape the future with intention. Whether your path leads to a family transition, a sale to a third party or something in between, the most important move is starting the conversation — while you still have time to shape the outcome on your terms. After all, legacy isn’t just what you leave behind. It’s how you choose to move forward. Learn how our experienced team can help you navigate your next move with confidence by contacting Emily Bourne at (585) 957-1593 or emily@performancebrokerageservices.com or Matt Willis at (515) 360-6755 or mattw@performancebrokerageservices.com. 24 Illinois Automobile Dealer News
The following are valuable insights from the Ethos Group — one of IADA’s trusted partners. 25 Illinois Automobile Dealer News
There is a lot of talk in our industry about being different; however, with 20 groups, consultants, trainers and attrition, we all seem to drown in the sea of sameness. What does it mean to be truly different? We try with uniforms, coffee bars or cafés. We are all striving to have something special to differentiate us from our competition. When we really stop and think about it, our point of separation comes within three areas: our people, our products and our processes. If we break each of these areas down, it is interesting concerning the original question — what is your point of separation? When it comes to people, we seem to have a problem in this business. The average attrition rate for salespeople is still around 90 days. The reasons for this may be management, culture or other salespeople. We cannot grow our business with a revolving door of new employees. We know customers buy from people they know and trust. Training a new group of employees every 90 days seems to be an exercise in futility. The first way to eliminate turnover is to look for specific personality traits in our people. After analyzing the most successful salespeople in our client base, four behavioral attributes stood out: proactivity, tenacity with knowledge, game-planning and a positive attitude. Proactivity: Proactivity is the catalyst for successful accomplishments. In athletics, our home life or business, whatever the endeavor, proactivity determines the outcome. The opposite behavior is reactivity, which is totally dependent on another stimulus. We found that successful salespeople are proactive in three areas: as an employee, a salesperson and within their personal life. Proactive employees rarely need to be managed. They consistently do things before being told to do them. Personal initiative takes over everyday actions. Proactive salespeople are always in control of their time with the customer. From asking questions to solving problems, they initiate the process. In our experience, the best salespeople are proactively in charge of their personal life as well, including fitness, healthy eating and personal growth. Tenacity with Knowledge: Tenacity with knowledge is an interesting and important attribute. The art of selling is the ability to develop trust with the potential customer, to analyze their needs, to solve their problem and to help them work through their decision. For a salesperson to consistently perform this task appropriately, they must be tenacious with personality, product and process knowledge. We often focus only on the selling process and expect our people to be bullet-proof within the steps to the sale (as if the steps alone sell the car). However, without understanding the four main personality traits of driver personality, analytic Point of Separation By Tim Marbut, Ethos Group SCAN THE QR CODE FOR AUDIO. 26 Illinois Automobile Dealer News
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