Pub. 2 2024 Issue 3 Meet the 2024-2025 Chairman Paxton King of Stan King GM Superstore
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©2024 Mississippi Automobile Dealers Association (MADA) | The newsLINK Group LLC. All rights reserved. Mississippi Auto Dealer is published four times each year by The newsLINK Group LLC for the MADA 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 the MADA, 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. Mississippi Auto Dealer is a collective work, and as such, some articles are submitted by authors who are independent of MADA. While Mississippi Auto Dealer encourages a first-print policy, 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. 14 16 4MEET THE 2024-2025 CHAIRMAN Paxton King of Stan King GM Superstore 7 2024-2025 MADA Board of Directors 8 The Transformative Power of Generosity 10 Dossett GMC Cadillac Celebrating 50 Years in Business! 12 Training the Techs of Tomorrow A Groundbreaking Partnership Between J. Allen Automotive Group and Mississippi Gulf Coast Community College 14 Dannelle Walker Back to the Beginning 15 NADA Update By Michael Joe Cannon, NADA Director 16 2024 Convention Highlights 19 Thank You Sponsors 20 New Laws Impacting Mississippi Car Dealers 22 Service Warranty Audits Putting Your Best Foot Forward By Justin Carr, Vice President of Sales and Marketing, Warranty Processing Company 26 MADA 2024 Regional Meetings CONTENTSPub. 2 2024 Issue 3 3
Paxton King was born and raised in Mississippi. At the age of seven, his dad, Stan King, bought a dealership in Brookhaven, Mississippi — Stan King GM Superstore. Paxton spent many of his formative years working with his dad at the dealership. Under his dad’s watchful eye, Paxton learned the value of a hard day’s work, the importance of treating others with kindness, and that happy employees and happy customers go hand-in-hand. His dad would often say, “Your best ability is availability.” Being there for employees, customers and family is important. After graduating from The University of Southern Mississippi, where Paxton played baseball for the Golden Eagles, he returned home to work with his dad in the family business. Paxton was named general manager in 2020 and has guided the company forward with strong leadership and dedication to the industry. In addition to running the family business, Paxton has become actively involved with the Mississippi Auto Dealers Association and has served in a number of leadership positions before his election as chairman. As the youngest chairman in the history of MADA, Paxton is living up to everything it means to be a NextGen dealer. We recently had the chance to sit down with Paxton and learn more about his views on the industry and what he hopes to achieve as chairman. The following are excerpts from our conversation. What are the biggest issues facing the auto industry? One of the biggest issues is the uncertainty of the future of EV sales if manufacturers continue to push them — especially before certain markets are ready. There are dealerships that are not selling EVs because the customers are not ready yet, but manufacturers are trying to send more units to dealers. The FTC intrusion and excessive regulation are of concern. I hope that moving forward, dealers are given a seat at the table and are allowed to be part of the conversation and solution. Why is the franchise system still the best way to sell cars? Our customers have their individual salespeople and, in turn, have built relationships and trust. When customers bring their cars back to be serviced from the same place they bought them, they know what to expect, they know us, and they feel comfortable being in our dealership. Additionally, dealers, overall, invest in the communities they work and live in. We have 54 employees, and I’m sure other local dealerships have pretty close to that number. The wages we pay our employees have a big impact on the local economy, their families and the community — not to mention the many charitable ways that dealers give back. How do you think the industry will change in the next three to five years? Over the next few years, I see a slow and steady transition of the market into EVs. I also think there will be a lot of new technology in vehicles that we have to be prepared for. Online Paxton King of Meet the 2024‑2025 Chairman 4
transactions will become more frequent, and we need to be prepared to go to our customers, deliver their car and handle the transaction in a whole new way. We are constantly getting new tools for our techs and investing in new equipment for our service departments to prepare for what is coming. It is important to me that our service team is adaptable and ready to work on whatever rolls into our bay. Our salespeople have to stay up with the times and learn about the new technology as well. They’re constantly having to train and learn new parts of our business. I see the industry getting more and more technical in the near future. How long have you been a MADA member, and why did you get involved in the association? Our dealership has been a member since the day we opened our doors for business. I can’t imagine not being a member of MADA. About eight years ago, I was encouraged by my dad to get involved and stay in the loop of what was going on with MADA. I got involved by going to the regional meetings and conventions. After a couple of years, I was asked to serve on the Board of Directors, and I gladly accepted. I saw the value of what MADA did and wanted to do my part in serving our dealer body and fighting for the franchise system. What do you see as the benefit of being a MADA member? With MADA, franchised dealers have a powerful group to serve as the voice of our industry. Together we can accomplish our mission to promote, advance and protect franchised dealers. MADA is the only organization in Mississippi that is focused on serving the dealer body. MADA does an outstanding job of keeping our members updated and educated about anything going on in our automobile industry. What are your goals as chairman? Our franchise law could be under attack during any legislative session, and it is imperative that we maintain a high-level presence with legislators. The worst thing that we could do is become complacent and let our guard down. Last year, we started hosting NextGen dealers at the Capitol. It was great to see younger dealers engaging with legislators and learning what it takes to make things happen. I really want to keep this event going and even come up with other events for NextGen dealers to get together, network and have new experiences. As a NextGen dealer, I know the importance of getting young dealers involved in the industry. It’s important to me to continue the work on overall dealer involvement. The bigger the association is, the more success we’re going to have. Encouraging members to attend regional meetings and come to the convention will be a focus. What help do you need from members to accomplish those goals? Get engaged. If anything arises in their dealership or if members see something in the industry that needs to be brought to our attention, reach out to us — don’t hesitate to give us a call, let us know, stay in the loop, and try to attend our regional meetings. Try to look at the upcoming convention dates and plan to attend. Members always have a great time at the convention. It’s Stan King GM Superstore 5
very informative with excellent speakers and industry partners, and just a good time for all of our dealer body to get together and network. When we all come together — even though we compete against each other every day — we are stronger and are able to advocate for our industry. Have you had any mentors? What did you learn from them? My dad is my mentor. He has always been there for me. To this day, if I have a question, a problem or just want to catch up, I pick up the phone and call him. He always emphasized the importance of taking care of employees. When employees feel valued and are well-trained, it leads to customer satisfaction. Taking care of customers is just as important. When a customer comes to our store, whether it be for service or buying a vehicle, we do everything possible to ensure they leave happy. When you mentor others, what advice would you share? It goes back to when my dad used to say, “Your best ability is availability.” The one thing I always try to instill in our salespeople is to be available. Be here and answer your phone when someone calls. When you know a customer needs you, be here for them. Whether you’re selling a vehicle or a customer is having an issue with a vehicle they have bought, just to be available to take care of them. At the end of the day, respecting and caring about people is what this business is all about. Any last thoughts? I’m just honored to have the opportunity to serve as chairman of MADA. Along with our board and leadership team, we’ll give back to the best of our ability to serve our dealer body and fight for our industry. Paxton has been married to his beautiful wife, Erin, for 10 years. They have two children: a five-year-old son named Royce, and daughter, Camille, who will be celebrating her third birthday soon. Both kids love going to the dealership, or “Daddy’s work” as they call it, to visit and get a sucker. When Paxton is not working, he enjoys playing golf and hunting. He travels all over the country for turkey hunting. So far, he has been on turkey hunts in over half of the states and tries to hunt in three or four new states every year. BUILD YOUR BRAND, CONTACT US TODAY! (855) 747-4003 | sales@thenewslinkgroup.com 6
2024-2025 MADA Board of Directors Paxton King CHAIRMAN Stan King GM Superstore Brookhaven Jeff Smith CHAIRMAN-ELECT Crossroads Chevrolet GMC Corinth Phil Moore SECRETARYTREASURER Phil Moore Buick GMC Jackson Trudy Moody IMMEDIATE PAST CHAIR Mercedes-Benz of Jackson Ridgeland Michael Joe Cannon NADA DIRECTOR Cannon Motors Oxford NORTHERN DISTRICT Drew DePriest All Star Chevrolet Olive Branch Michelle Chapman Homer Skelton Ford Olive Branch Cannon Kirk Kirk Auto Company Grenada CENTRAL DISTRICT John Scarbrough Paul Moak Automotive Jackson Mike Gregory Triple M Motors Carthage Lauren Wilson Reeves Wilson Kia Brandon SOUTHERN DISTRICT Jared Waldrop Pine Belt Motors Hattiesburg Alton Pierce Toyota of Hattiesburg Hattiesburg Bo Mandal Mandal Automotive Group D’Iberville 7
Butch Oustalet started in the auto business in 1969, working at his dad’s Ford dealership in Gulfport, Mississippi, first as a service writer, and then after about a year, he became the service manager. Shortly after that, he became a salesman in that dealership and did so well that he was promoted to sales manager before becoming the general manager. His father was committed to helping the community and Butch saw first-hand the positive impact that made. Butch explained, “While my father’s work ethic and unwavering dedication to his customers greatly inspired me, it really was his spirit of giving that impacted me most.” On April 1, 1984, Butch bought out his father and took over the family business. Over the next 54 years, Butch’s dealerships grew to great success. Butch prioritized giving back to the community in many ways and his passion for supporting and caring for others never wavered. As part of supporting the community, Butch and his dealerships played an active role with the Mississippi Automobile Dealers Association (MADA). “I’ve done it all,” Butch said. He served as secretary-treasurer, chairman-elect and finally chairman. He was also selected to be the NADA representative from Mississippi and on the board of the Dealer Council. “Normally, board members serve for four years but I served 12 years,” Butch recalled. He also served on the Ford Credit Advisory Board. In 2023, Butch sold his dealerships and instead of retiring, he dedicated himself to continuing his family’s legacy of helping and giving to others. The day he sold his dealerships, Butch said, “Today is the first day of my new life.” He may not be greeting customers anymore, but Butch is actively involved in caring for his community and is more excited than ever to focus on helping others through the Butch Oustalet Foundation. BUTCH OUSTALET FOUNDATION “When I sold out a year ago, I realized that I had to make a decision about the rest of my life. I knew I wanted to spend my time helping people,” Butch said. “God has blessed me in many ways and I felt like it was my responsibility to make sure that I helped as many people as possible, so I started the Butch Oustalet Foundation. This is not about me, it’s about God.” The Transformative Power of Generosity 8
The Butch Oustalet Foundation believes in the transformative power of generosity. The team is dedicated to creating a ripple effect of kindness and compassion on the Mississippi Gulf Coast. Their goal is to honor Butch’s legacy by fostering a culture of giving through strategic partnerships, fundraising events and heartfelt outreach. “I often say that when I’m gone, I don’t want to be remembered as a good businessman. I want to be remembered as a good person. And I believe the Good Lord is still guiding me to that goal,” Butch said. The foundation supports amazing organizations such as the Lighthouse Academy for Dyslexia, Children’s Advocacy Centers of Mississippi and the Home of Grace. The most recent recipient of the foundation’s generosity was the Home of Grace, which has served as a beacon of hope for over 50 years for those struggling with drug and alcohol addiction. Founded on faith and rooted in love, the Home of Grace has become a leader in successful recovery by introducing Jesus Christ as the catalyst for hope, healing and quality of life. The Home of Grace offers highly effective and affordable programs that help both men and women find hope, freedom from their addiction and most importantly, healing in effort to bring families back together. Money was raised at a local restaurant where the foundation threw a “Get Down and Derby” themed party that had all the pomp and circumstance you’d expect from the Kentucky Derby. “On July 1, the foundation made a huge donation of $80,000 to Home of Grace,” Butch said with pride. “It’s not my money; it’s God’s money. God has blessed me in so many ways and He expects me to help and bless other people, and so that’s what I do.” Butch, and the foundation, have big plans for the future, and he hopes that his fellow dealers will also continue to give back to their communities — helping the underprivileged, supporting good causes and bringing the bright light of compassion to otherwise dark situations. To learn more about the Butch Oustalet Foundation, visit www.butchoustalet.org. Butch at the Get Down and Derby fundraiser. • Labor Relations • Employee handbooks • Employment Law Counseling and Litigation • HR Policies and procedures • Independent contractor issues • OSHA Compliance and defense • Purchasing or selling a dealership • Staffing and contingent workers • Workers’ Compensation • Wage and hour law Steve Cupp Partner | Gulfport/New Orleans 228.822.1440 scupp@fisherphillips.com Fisher Phillips brings valuable legal counsel to MADA members. Our labor and employment law firm offers auto dealerships the following services: A driving force in labor and employment law for more than 70 years. fisherphillips.com 2505 14th Street | Suite 300 | Gulfport, MS 39501 9
In 1974, West Pine Street — located in the small, charming town of Hattiesburg, Mississippi — was known as “Automobile Row.” Dealerships selling all makes and models lined either side of the road. People traveled long distances to visit Automobile Row and take advantage of the large selection of what they hoped would be their next car. That same year, Danny Dossett Sr. was looking to purchase a dealership in the area and happened to find one that was for sale right on Automobile Row. The dealership was in financial trouble, and the factory was in the process of taking it back from the previous owners due to their aggressive sales tactics — they set all kinds of sales records of heavy duty trucks and then set records for the highest number of repossessions. That did not deter Danny — he saw the potential and bought the store. “We got right to work. It was seven days before we sold a car and I remember thinking to myself ‘What have I done?’ Then, we sold our first Pontiac and took a trade-in, and I realized that with persistence, we were going to make it,” Danny said. Dossett GMC Pontiac — now Dossett GMC Cadillac — was just beginning their journey. A few years later, Pontiac Catalinas had a 25% price increase, so the invoice went from $4,000 to $5,000. “I thought I’d never sell another car and that it was all over,” Danny recalled. But once again, Danny and his team got to work and rose to the challenge. Through difficulties and changes, Danny learned that success comes from showing up and doing the work, even on the hardest days. He also realized the importance of strong leadership. To this day, Danny arrives at the office bright and early and is always the last one to leave. The longevity of the employees at Dossett GMC Cadillac speaks to Danny’s strengths, good guidance and genuine care for people. What started as 15 employees has grown to 40 employees today — some of them have worked at Dossett GMC Cadillac for 10, 20, 30 10
and 40+ years! That kind of retention is unheard of in the automotive dealership sector and that is a testament to Danny’s dedication. Since 1974, a lot has changed in Hattiesburg; the town and surroundings have grown in many ways. The University of Southern Mississippi and William Carey University, the No. 1 medical school in Mississippi, bring an influx of students and new customers. About two miles from the dealership is Forrest General Hospital, the biggest employer in South Mississippi — it keeps the local economy going and consumers on the showroom floor. One thing that has not changed is Dossett GMC Cadillac. Fifty years later, they are still located in the same location as the day they opened. The commitment to their people, the customer and their community has only gotten stronger with each passing day. To help celebrate 50 years of success, the franchise zone manager, William Page, provided a catered lunch in the dealership showroom for all of the Dossett GMC Cadillac employees. Everyone enjoyed a delicious meal, reminisced about the past and celebrated the momentous occasion. After lunch, Danny was presented with a trophy to recognize his 50 years in business. The trophy is now proudly on display in the dealership showroom. When asked what he attributed his success to, Danny humbly answered, “Our success is because of our employees. It’s not me, it’s the managers and the employees that they hire. They do a super job. We work hard at employee retention and keeping our people here.” Danny was quick to point out that his son, Danny Jr., who is currently the general manager, does a super job and the thought of him taking over the family business one day makes him proud as a father. He also gave huge thanks to his current management staff: Wesley Boutwell, part manager; Sherry Lee, office manager; Lee Brooks, service manager, Chris Lowery, body shop manager; Erik Hunter, used car manager and Shaun Burt, new vehicle manager. Congratulations to Danny Dossett Sr. and Dossett GMC Cadillac on your 50th anniversary. Here’s to 50 more successful years! 11
On July 11, 2024, Jonathan Allen, CEO/president of J. Allen Automotive Group, and President Dr. Mary S. Graham of Mississippi Gulf Coast Community College (MGCCC) announced a groundbreaking partnership when they launched the Automotive Technician Apprenticeship program. Both Jonathan and Mary expressed their enthusiasm for the partnership and excitement for the opportunities it will provide to students. The program kicked off with a signing event as David Garcia, the first to enroll in the program, chose his draft team and signed up for the Toyota tech program. This new apprenticeship program gives enrollees a chance to “earn while they learn.” Students will spend three days in the classroom learning from expert instructors and two days working at the dealership, making money, being mentored by experienced professionals and gaining real-world experience. Unbeknownst to each other, both Jonathan and MGCCC had been thinking about this idea for years. But no one knew how to execute the program until Rachel Mills was hired to the position of chief experience officer at J. Allen Automotive Group. Rachel came from the healthcare field and had run a successful program, hiring medical students to work at the local hospital. It was a win-win. The students gained real-world experience in their field of study, and the hospital had knowledgeable employees who could easily assimilate and get right to work. When Rachel suggested they apply a similar program for skilled techs, Jonathan was all in. The program opens doors for franchise dealers to start filling their service departments with much-needed, highly qualified techs. According to NADA, “The industry needs to replace 76,000 technicians each year to keep up with retirements and new demand, but only about 39,000 new technicians graduate from training programs each year.” That leaves dealers with approximately 56,000 unfilled tech positions. With the launch of this program, Jonathan’s love and dedication for the industry have come full circle. As a third-generation dealer, Jonathan brings all the experience he gained from his grandfather, Bert Allen, and his father, David Allen, who were both successful dealers in their own right. Jonathan also brings out-of-the-box thinking and persistence to solve problems, instilled in him by his mentor that Jonathan’s mentor, Butch Oustalet. In helping to get this program up and running, Jonathan brought MGCCC and the Ford, Mazda and Toyota representatives together. MGCCC asked the representatives, “What do you need us to teach?” Without any hesitation, the representative from Ford said, “We desperately need transmission techs.” So, a Ford transmission class was formed. The conversation of “what’s needed” and “this is the class we are going to have to fill the need” continued and everyone did their part to bring the program to fruition. “We have been frustrated over the years with sending our technicians to go get certain certifications at schools outside of the community and as far away as Houston, Texas,” said Jonathan. “MGCCC can teach these classes, and they’re right here.” “The world needs automotive technicians, and they need them badly,” said Jonathan. “I could hire double what I have at my dealerships, and there would be enough work for all of them.” When students finish the program, they walk out of MGCCC with an associate degree, and they walk into a well-paying career. “We Training the Techs of Tomorrow A Groundbreaking Partnership Between J. Allen Automotive Group and Mississippi Gulf Coast Community College 12
need to prioritize techs, treat them like doctors because that’s what they are,” Jonathan stated. “A car has 15,000 moving parts; it takes a diagnosis and someone who knows what they’re looking at to properly fix it. This is a real profession that takes real thinkers and that needs to be taken seriously. So, anything we can do to support that, I am all in!” There will be about 20-25 students per class, so once the wheel gets turning, a steady flow of skilled techs will be entering the local workforce. That is a huge benefit for J. Allen Automotive Group and for South Mississippi dealerships. “We’ll get the pick of the litter of the interns that come through the program,” said Jonathan. But ultimately, it’s the industry that wins. Additionally, J. Allen Automotive Group has committed to donating older cars to the schools so the students have the opportunity to take them apart and put them back together. If needed, parts will be donated as well — whatever it takes to help the techs of tomorrow receive the best education possible. Looking ahead, there are talks of implementing a scholarship program of sorts. Scenarios have been played out where a student with promise suddenly stops showing up to class, the school would then reach out to them and ask them why. If tuition, or something similar, is an issue, the financial barrier would be removed with some sort of scholarship from the dealership side. That is how passionate Jonathan, J. Allen Automotive Group and MGCCC are about the future generation of techs. ENDORSED BY: ON AVERAGE, MS DEALERS ADD $60,468 IN PARTS UPLIFT ANNUALLY ARMATUS HAS COMPLETED OVER 15,500+ SUBMISSIONS NATIONWIDE ON AVERAGE, MS DEALERS ADD $53,820 IN LABOR UPLIFT ANNUALLY ARMATUS WORKS WITH 35% OF MISSISSIPPI DEALERS OUR COMMITMENT TO OUR CLIENTS: ÙYou Won’t Lift a Finger: Armatus does all the work for you. ÙFully Contingent Fee: You only pay when you are approved. ÙSpeed and Accuracy: No one completes a submission faster. ÙOptimization: Proprietary software guarantees you the best result. (888) 477-2228 | info@dealeruplift.com WWW.DEALERUPLIFT.COM If you have already completed a submission in-house or with another vendor, you may still have significant opportunities to gain more. If we can’t improve your results, you owe us nothing. Between our scientifically proven optimal results, and our speed of processing, we will literally pay our own fee. Reach out today for a no-obligation evaluation of your parts and labor rates. MS Dealer Magazine-HP AD.indd 1 1/23/24 1:13 PM 13
Upon graduating high school, Dannelle Walker, the daughter of Jimmy Walker (a successful auto dealer) and Zonda Walker (a teacher) — left behind the small town of Laurel, Mississippi, and headed off to The Big Apple to pursue her dreams. She attended New York University, seeking a career far away from the auto industry she grew up around, with no intention of returning home or to the family business. Last year, after nearly 20 years of a successful career in advertising and marketing in New York — a stark contrast to the town and industry she grew up around — Dannelle began exploring the idea of returning home and succeeding her father. Her decision was a weighty one, but she knew that it was time to go back to the beginning. In a recent interview, Dannelle recalled her thought process at this time, “He can’t do this for the rest of his life, and I don’t want him to do it for the rest of his life; I want him to get a break, but also knowing that there are a bunch of people in the store that I genuinely love and consider family. It didn’t feel right, not giving it a go.” So, in late 2021, Dannelle decided to prepare for her return to the industry. With her cat, Lady, she began her journey across the country, all the way to California. She trained at Fullerton Ford in Fullerton, California, which she got connected with through the Ford Minority Dealers Association. At the same time, she attended the NADA Academy, a multiweek program that teaches future dealership owners and managers how to run a successful business. In pursuit of this, Dannelle flew out for one week every other month. It was at both of these places that she was able to learn valuable skills and build a network of people that she can still contact for advice or help. “It was great. You learn so much. It’s a very intense process, but also very beneficial. The NADA instructors are, quite frankly, legends in the industry,” said Dannelle. “They know their stuff and they’re really helpful and you can reach out to them anytime. But outside of even the curriculum being really helpful and useful, meeting the people and having the connection was really great.” In her graduation speech as class president at the NADA Academy, Dannelle testified to the opportunities that dealerships provide: “My parents grew up relatively poor … in small-town Louisiana. They were part of the first group to integrate their middle school [both went on to graduate from Grambling State University, an HBCU]. They now own two dealerships,” Walker recalled. “Sitting in class this week, it struck me how generations later, people still have very similar stories — people, who by their own accounts, say they came from nothing. People without college or even high school degrees who are running successful businesses. How many other industries can give people that kind of life-changing opportunity? This is one does it every day.” After graduating from the NADA Academy this past April, Dannelle has begun to work under her father, Jimmy, and is preparing to take over their two stores: Laurel Ford Lincoln and Kia of Laurel. “I am responsible for running the daily operations of the store and he is the dealer principal,” said Dannelle. “He’s still in the building almost every day but I’m trying to get to a point as soon as possible where I feel supremely comfortable running the stores.” Jimmy Walker knows the weight of passing the baton to his daughter, and, for the time being, remains in the office next to hers, available for Dannelle to ask questions or bounce ideas off. Her ultimate goal? Giving her father a chance to take a long vacation. After a lifetime of hard work and building his dealerships from the ground up, a break is well-deserved. Almost 20 years later, Dannelle has come full circle; she’s gone back to the beginning and the dealership culture she so eagerly left behind in her younger years. She has picked up on a journey that she began at 8 years old, back when she helped answer phones at her father’s first dealership in Oklahoma. With the tools from her training and the many connections, along with the mentorship of her father, Dannelle is well-equipped to continue her father’s legacy — a legacy that he has dedicated his entire life to building. Dannelle Walker Back to the Beginning 14
NADA Update By Michael Joe Cannon, NADA Director I hope your year is going well. As we all know, there is plenty going on in Washington on the issues important to our industry, and I am happy to report on the work of NADA. First, an issue that is front and center for many of our businesses: the cyber incident that shut down CDK’s dealers’ systems. I do not need to emphasize the impact this has had on auto retailers across the country. This is a forceful reminder to the automotive retail industry — including dealers, ATAEs and the vendors we work with — to remain vigilant and proactive in the protection of our data. NADA has numerous resources for strengthening compliance in data protection, including the recently updated NADA Safeguards Driven Guide. This can be found on the NADA website. While dealers work to manage these challenges, one positive development is the FTC’s recent acceptance of NADA’s proposal — made in coordination with CDK — to allow CDK to file a consolidated breach notification with the FTC on behalf of its dealer clients if CDK determines that this new federal notification requirement has been triggered. While dealers still must contend with state breach notification requirements, dealers now have no obligation to file a breach notification with the FTC related to this matter. Next, most of you are well-informed about NADA’s strong opposition to the Federal Trade Commission’s (FTC) Vehicle Shopping Rule (VSR), which was finalized in December 2023. NADA is actively challenging the onerous VSR on multiple fronts, and we have progress to report. NADA commissioned an updated study from the Center for Automotive Research, which found that the final VSR will require at least an additional hour to complete the vehicle purchasing process and generate a net cost to consumers and dealers of $24.1 billion over 10 years. Armed with this information, NADA has been able to push a provision in the House Financial Services and General Government appropriations funding bill for Fiscal Year 2025, which would stop the FTC from implementing or enforcing the VSR until Sept. 30, 2025. This bill passed the House Appropriations Committee and was scheduled to be considered on the House floor at the end of July. Meanwhile, NADA and the Texas Automobile Dealers Association continue to challenge the rule in the U.S. Court of Appeals for the Fifth Circuit. Our arguments here are that the FTC failed to follow its own rules when it issued the rule, the record it assembled does not support the rule’s new mandates, and the FTC failed to adequately consider the rule’s costs and benefits to consumers and dealers. The case will be assigned to a three-judge panel, and oral arguments could begin as soon as September. Finally, I’ll turn to the emissions regulations, which are now coming from two regulatory bodies: the Environmental Protection Agency (EPA), through its final greenhouse gas rule released in March, and the National Highway Traffic Safety Administration (NHTSA), through its final Corporate Average Fuel Economy (CAFE) standards released in June. These rules align along the same percentages for zero-emissions new vehicles that will need to be sold from 2027 through 2032. As we all know from the lack of interest from our customers, selling electric vehicles is a challenge. NADA’s position is that these rules are far ahead of the market and consumer demand. NADA has supported joint resolutions as part of the Congressional Review Act to disapprove of the final EPA rule and stop it. We will support similar measures disapproving the NHTSA CAFE rule. Stay in touch with your Members of Congress and Directors. And utilize the many valuable resources included in your NADA membership. Thank you for allowing me to serve as your Mississippi NADA Director. 15
As the grand finale fireworks reflected over the Gulf of Mexico, many attendees remarked, “This was the best ever.” With a record number of dealership representatives in attendance, the three-day event was a fantastic mix of meetings, networking and even a bit of relaxation. The convention offered something valuable for everyone. Families enjoyed playing in the waves, splashing around the pool or searching for sand crabs with flashlights on the moonlit Sandestin beach. The speaker lineup was exceptional. NADA’s president and CEO, Mike Stanton, shared insights on the national organization’s efforts on behalf of franchised dealers in Washington, D.C. Kevin Tynan, senior automotive analyst at Bloomberg Intelligence, provided an up-to-date look at automotive manufacturing trends. In light of the CDK data breach incident, Nick Moyes delivered timely information on cybersecurity. Jim McLaughlin, a pollster for the Trump campaign, concluded the speaker circuit with his insights. Trudy Moody officiated the state meeting in her last official act as chair of the board of directors. She was recognized for her commitment and dedication as the top elected officer of MADA. The gavel was passed to Paxton King as the 2024-2025 chairman of the board. During the state meeting, MADA recognized Trudy Moody for her year of service as chair of the board and welcomed Paxton King as the new chairman. Jeff Smith was elected as chairman-elect, and Phil Moore will serve as secretary-treasurer. 20 24 Convention Highlights 16
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New Laws Impacting Mississippi Car Dealers As a new fiscal year for our state began on July 1, 2024, new laws went into effect where dealers should take notice. EXTENDED PERIOD FOR PURCHASING CAR TAGS One of the most notable changes is the extension of the timeframe for purchasing a new license tag. Car buyers in Mississippi now have 30 working days to obtain their tags, a considerable increase from the previous seven-day window. This adjustment aligns Mississippi with most other states, where car buyers typically enjoy a more generous period to complete their tag purchase. This change comes as a relief to many car buyers who found the previous seven-day requirement to be overly restrictive. TOUGHER PENALTIES FOR CAR THIEVES In response to the increasing incidents of car thefts, particularly targeting dealerships, MADA has successfully advocated for tougher laws. The enactment of Senate Bill 2174 marks a significant escalation in the state’s approach to combating auto theft. Under the new legislation, judges now have broader discretion to impose severe penalties on convicted car thieves. The maximum fine has been doubled to $20,000, and the potential prison sentence has been extended from 20 years to a maximum of 30 years. These harsher penalties reflect the seriousness of car theft and aim to deter potential criminals from targeting dealerships. By increasing both the financial and custodial consequences of auto theft, Mississippi is taking a strong stance to protect its car dealerships and their inventory. MADA’s efforts underscore the importance of maintaining a secure environment for automotive businesses and their customers. SUMMARY By extending the tag purchase period, the state provides much-needed flexibility to car buyers. Simultaneously, the imposition of stricter penalties for car theft sends a clear message that such crimes will be met with severe repercussions. These measures highlight Mississippi’s commitment to fostering a fair and secure automotive market. 20
The Zurich Advantage F&I is evolving, and your F&I provider should, too. Leveraging over 100 years of automotive experience, we’ve developed The Zurich Advantage, a suite of products and services that meet the needs of today’s consumers at the time of purchase – and beyond. The Zurich Advantage provides flexible and customized solutions built to help you maximize every F&I opportunity and deliver a superior customer experience. Universal Underwriters Service Corporation (UUSC), an individual member company of Zurich in North America, is the issuing provider and administrator of Zurich’s vehicle service contracts in all states except Florida. In California and New York, UUSC operates under its DBA, UUSC Service Company (CA License #0C17302). In Florida, the issuing provider an administrator is Vehicle Dealer Solutions (FL License #60132). More Profit. Enhanced Customer Experience. © 2024 Universal Underwriters Service Corporation For more information, contact Michael Firsick at 214-784-5181 or Chad Mains at 901-831-6433. zurichna.com/dealer
Over the past few years, warranty audits have become mandatory. They are no longer driven by your dashboard or the health of your dealership in the eyes of the manufacturer. They are happening more randomly as manufacturers work to claw back warranty dollars however and wherever they can. Planning for an audit includes having strong processes in place before a manufacturer pays you a visit. Preparing the claims for presentation once the audit comes can be difficult if your team isn’t organized. Challenging the findings will be daunting if your team doesn’t have a strong grasp of the manufacturer’s policies and procedures and the state laws that can help protect your money. Falling short in an audit scenario can be incredibly damaging for your business. Reputation, monetary loss and key players time being consumed in a market that needs their expertise are just a few reasons why it makes sense — on many levels — to be proactive. The good news is there are tools out there to help. After dealing with the pandemic, supply chain shortages and a changing economy, the auto industry is trying to find its center. Dealers are looking to fixed operations to fill the short fall of smaller profit margins experienced on the front side of the house. This high level of disruption to dealerships has changed many long-standing policies. This fact alone increases the likelihood of things slipping through the cracks. When this is paired with new staff who may not be fully trained, the stage is set for mistakes, as well as the probability of poor decisions. Since warranty audit visits are back, you are creating a high-risk, high-liability scenario if you are not prepared with a document management process that has vigorous checks and balances. Knowing this begs the question: Does your team have efficient and consistent processes in place? In a typical warranty audit, most manufacturers review 50-100 VINs. We all know how much detail, as well as supporting documentation, is involved in warranty claims. This equates to many labor hours pulling documents, checking for completeness and accuracy and re-filing the requested documents. Additionally, compiling all this information can lead to misfiling down the road or result in lost documentation. Dealers who do not have a solid electronic system for organizing their documents are putting themselves at great risk. EMPLOYEE TRAINING Given the complexity of the warranty process, regular reviews and consistent reminders are a necessity. This may require training service and parts employees to follow all the necessary steps through the life cycle of a repair order to make sure nothing is missed. It begins with the client booking an Service Warranty Audits Putting Your Best Foot Forward By Justin Carr, Vice President of Sales and Marketing, Warranty Processing Company 22
appointment for service and doesn’t end until the claim is 100% properly paid and filed for review, should there ever be a need to look back. This requires creating, writing down and making those procedures and policies available to employees. Don’t forget, it’s extremely important to keep employees accountable for the process. Would you take a long road trip without a map? This would likely end poorly, having wasted lots of time in the process. Traveling with no road map is like holding your team to a process that isn’t written down and clearly documented — only this time, you’re not just getting lost, you’re losing lots of money. It only takes one employee not following the process to cost your dealership thousands of dollars. Thousands of dollars that could have been avoided. In order to steer clear of this, employees should know their role in the process and make sure they complete their responsibilities before moving the claim forward. The following are just a few examples of some of the key players touching a warranty claim: • Service advisors should make sure the VIN Inquiry is run and attached, prior approvals are handled, signatures are present and repeat repairs follow manufacturer guidelines. • Technicians are responsible for documenting the 3 Cs (Complaint, Cause, Correction) with diagnostic test results. Failure to include all and complete 3 Cs on any line may lead to a chargeback during the audit. They will ensure the Technical Service Bulletins are followed in their repair and noted in their story. They are responsible for their time punching and making sure all one-time-use parts are replaced and charged out on the repair order. • Managers need to make sure they are authorizing add-on repairs, multiple component replacements, straight time and more. These are just a few important examples of the hurdle’s dealers can run into during an audit. Another area where documentation must be researched thoroughly is customer eligibility for incentives. Client information and eligibility are being scrutinized at a new level. You always want to avoid giving the impression of misconduct or being tagged for fraudulent submission by the manufacturer. Fortify yourself and your team by communicating with them about the expectations of an audit so they can be prepared. A “no exceptions” policy pertaining to paperwork and warranty work should be understood by properly trained 23
employees. Fraud should never be taken lightly. It is a serious issue that warrants serious action. Help your new hires understand committing warranty fraud or performing unnecessary work will result in termination without warning or second chances. Implementing self-audits is a great way to help your team stay compliant. DESIGNATE A COMPLIANCE OFFICER Routine self-audit reviews are one of the best ways to ensure your program is compliant when an actual audit happens. Designate an employee as a compliance officer and assign them to regularly spot-checking claims and pulling a few job cards to check for complete, accurate information. You can direct them to conduct these weekly or monthly, but make sure it is consistent. Along with this, there are some important criteria to keep in mind: This position should be assigned to someone other than the service manager or an employee who is incentivized by closed claims or collected dollars. This is to make sure there is transparency and integrity in the process. Extra compensation can be considered for this person since their workload will increase, but their incentive should be based on a clean audit. Make sure their focus is on keeping all the dollars the dealership deserves instead of just closed claims or paid receivables. ELECTRONIC DOCUMENT STORAGE There’s no better time than now to invest in electronic document storage! Stuffed filing cabinets and overflowing document boxes can lead to disaster. A single missing document could result in a costly chargeback for your dealership. Using web-based software to scan and store documents electronically provides a simple solution with significant benefits. It can take your storage from looking like Grandma’s attic to an organizer’s dream. Even better, all documents become instantly available through a quick search, allowing you to compile required auditing materials in seconds instead of hours. Scanning may not be anyone’s favorite pastime, but it is essential. Scan all documents, including signed invoices, receipts, technician notes, diagnostic tests and warranty claim reimbursement forms. By using a document scanning provider, you can quickly locate all documentation associated with each VIN through web-based software, making the audit process painless and smooth. Typing each VIN into a search bar is much easier than searching through filing cabinets for hundreds of documents. This simple solution offers a big payoff. Like most things in life, an electronic storage system is only as good as what you put into it. Even the best storage system can’t compensate for careless and haphazard scanning. Assign one of your stronger employees who will have a direct role in the audit presentation process to organize the scanning. Their time will be worth keeping your business in order if it can prevent chargebacks. Given that the role has a direct impact on your bottom line and dealership health, it should not be put on the back burner for an entry-level clerical employee to tackle. HIRE PROFESSIONAL HELP Hire someone in the industry who is familiar with the warranty process. It will pay off in the long run by saving you time and money as well as relieving unnecessary stress — and who doesn’t need that? Make sure they follow best practices and document consistently with uniform standards. You will want them to customize internal auditing procedures for your specific dealership or dealer group. Many companies offer health checks if you don’t have the bandwidth to perform a self-audit. Others offer self-audit checklists so you can perform informal audits on a regular basis. It’s best to find someone with significant experience who has navigated the industry over a long period of time. If they have their finger on the pulse of the industry, and they can help get your employees working together as a team or better yet, help in the training process, it’s a no-brainer. Remember, those who are prepared need not panic. Have consistent policies in place, and be organized so you can put the cleanest, most complete repair orders in front of the manufacturer when they ask to review them. Know the manufacturer policy and procedure manual as well as your state laws so no dollars are taken from you unnecessarily. Review the final summary with your team to identify accountability. Then, make sure to retrain and update your process list so you know your dollars are protected. Follow our advice above, and audits will be a breeze. Get your dealership in order and make the stress of warranty audits a non-issue! Warranty Processing Company has been helping dealerships since 1986. They have a number of service plans to fit your needs. Their knowledge of cars, industry experience and extensive service background make them the perfect partner to increase your warranty gross profits. Justin Carr is the vice president of sales and marketing at Warranty Processing Company, which recently relocated to Texas. Justin works with dealers nationwide to increase efficiencies within service departments and educates dealer staff on why efficiencies. To learn more, visit warrantyprocessing.com. 24
MADA 2024 Regional Meetings MERIDIAN Monday, November 11 11:45 am-1:00 pm Weidmann’s Dealers and Sponsors: $45 Other Guests: $85 JACKSON Tuesday, November 12 11:45 am-1:00 pm Table 100 Dealers and Sponsors: $45 Other Guests: $85 HERNANDO Tuesday, November 12 6:00 pm-7:30 pm Hernando Golf & Racquet Club Dealers and Sponsors: $80 Other Guests: $130 TUPELO Wednesday, November 13 11:45 am-1:00 pm Park Heights Dealers and Sponsors: $45 Other Guests: $85 BROOKHAVEN Tuesday, November 19 11:45 am-1:00 pm Mitchell’s Dealers and Sponsors: $45 Other Guests: $85 BILOXI Wednesday, November 20 6:00 pm-7:30 pm Mary Mahoney’s Dealers and Sponsors: $100 Other Guests: $150 HATTIESBURG Thursday, November 21 11:45 am-1:00 pm Patio 44 Dealers and Sponsors: $45 Other Guests: $85 SCAN THE QR CODE TO REGISTER TODAY! Have questions? Contact Beth Morton at (601) 957-6868 or beth@madaonline.com. Sponsorship opportunities available! madaevent.com 26
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