Official Publication of the Montana Auto Dealers Association Auto Dealer PUB. 3 – 2023 – ISSUE 1 2023 MTADA ANNUAL Family Convention AUGUST 24-27 Grinnell Lake in Glacier National Park
Running a dealership comes with its share of uncertain terrain. But one thing is certain. Our Dealer Financial Services team is dedicated to being by your side with the resources, solutions and vision to see you through. Paul Cluff paul.cluff@bofa.com 208.908.2099 business.bofa.com/dealer Making business easier for auto dealers. Especially now. “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, 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. and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: | Are Not FDIC Insured | Are Not Bank Guaranteed | May Lose Value | ©2022 Bank of America Corporation. All rights reserved. 4826555 08-22-0145 Running a dealership comes with its share of uncertain terrain. But one thing is certain. Our Dealer Financial Services team is dedicated to being by your side with the resources, solutions and vision to see you through. Paul Cluff paul.cluff@bofa.com 208.908.2099 business.bofa.com/dealer “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, 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. and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: | Are Not FDIC Insured | Are Not Bank Guaranteed | May Lose Value | ©2022 Bank of America Corporation. All rights reserved. 4826555 08-22-0145
Quick. Secure. Easy. Vitu ushers in a new era of Digital Title and Registration (DTR) processing. Locally and across the nation, Vitu supports all of your title and registration needs. Visit vitu.com or call 406-285-8280 to learn more and schedule a demo today. Dealer titling made easy Account Executives check in Instant vehicle status Started Pending Completed Dealer titling goes digital. Up and running in no time Completely digital process DMS integration Incredibly efficient integration minimizes errors and re-keying of deal info. Vitu Interstate 50-state title & reg made easy. Digital Audit Real people — real support Local experts answer your calls. VITU MANUAL Days Weeks Quick turnaround times No need for runners
©2023 The Montana Auto Dealers Association (MTADA) | The newsLINK Group, LLC. All rights reserved. The Montana Auto Dealer is published twice each year by The newsLINK Group, LLC for the MTADA and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and dealer 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 specific circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of the MTADA, 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. The Montana Auto Dealer is a collective work, and as such, some articles are submitted by authors who are independent of the MTADA. While the Montana 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. CONTENTS 16 36 6 MONTANA AUTOMOBILE DEALERS ASSOCIATION EVP’S MESSAGE: SUPPORTING MONTANA'S DEALERS 7 2023 MTADA ASSOCIATE MEMBERS 8 MTADA OFFICE STAFF, EXECUTIVE COMMITTEE, BOARD OF DIRECTORS, AND INSURANCE TRUST 10 NEW BOARD MEMBER SPOTLIGHT 11 2023 MTADA ENDORSED PARTNERS 12 LEGAL UPDATE: CONSUMER LOSES SUIT VS. MONTANA DEALER 14 2023 MTADA LEGISLATIVE SUMMARY 16 DIGITAL DEALER TITLING IS YOUR NEW GO-TO FOR DTO 20 NADA ACADEMY GRADUATES 25 2023 MTADA 109TH ANNUAL FAMILY CONVENTION • REGISTER TODAY! • AGENDA • CONVENTION SPEAKERS 30 THANK YOU TO OUR 2023 CONVENTION SPONSORS 34 REMAINING COMPETITIVE IN THE CAR BUSINESS: PROFESSIONALIZING THE FAMILY-OWNED AUTO DEALERSHIP 36 POSITIONING FOR THE FUTURE OF EV MARKET GROWTH 39 PARTNERSHIPS HELP DEALERS SUCCEED 42 7 POWERFUL VEHICLE ACQUISITIONS TACTICS THAT WILL BOOST YOUR PROFITS 44 INTRODUCING COMPLYAUTO SAFETY 46 DRIVING MONTANA'S ECONOMY 4
Whether online or in-store, Accu-Trade empowers your team and customers to appraise exact values for each VIN — down to each feature and recon cost — to acquire more vehicles, more profitably. And because we’ll buy any Accu-Trade acquisition back from you at the same price, every appraisal is a no-risk, high-reward opportunity. Get started at accu-trade.com Empower Profitability
MONTANA AUTOMOBILE DEALERS ASSOCIATION EVP’S MESSAGE Bruce Knudsen Executive Vice President The 109th Annual Family Convention is almost here. I can’t wait to see you in person, catch up and enjoy the one-of-a-kind experience that Butte has to offer. If you haven’t registered for the convention yet, there is still time. You won’t want to miss this family-friendly, educationpacked event. We have an amazing list of speakers lined up. From helping family-owned dealerships overcome challenges to dealing with fraud in the post-pandemic world to used vehicle acquisition and current market trends, we have something for everyone. In this issue, you will find more about the phenomenal speakers who are bringing their expertise to you. Additionally, in this issue, we have highlighted our NADA Academy Graduates and encourage you to learn more about this program, the benefits it brings to attendees and how it can help your dealership succeed for years to come. This year has brought changes, like the Safeguards Rule, and we expect that more change will come, especially with the push to switch to EVs. No matter the issue, we are here for you. We will always have our dealers’ best interests in mind in all we do. I encourage you to donate to MONCAR. Your donations help us support candidates that strengthen our industry. Having elected officials that understand the auto industry helps make good laws and regulations. As always, please reach out to me if you have any questions or concerns. Feel free to call me anytime if I can be of service at (406) 461-7680. I am happy to help in any way I can. See you at the convention! Bruce SUPPORTING MONTANA’S DEALERS 6
700 Credit Britney Fischer bfischer@700credit.com (586) 915-4703 ADS of Montana Mark Nania markn@adsfi.com (406) 522-9071 (See ad page 24) Ally Financial Erin Eurich erin.eurich@ally.com (989) 980-0161 Ascent Bank Brock Carlson bcarlson@ascentbank.com (406) 442-8870 Auto Auction of Montana Terry Scheetz terry.scheetz@autoauctionmt.com (406) 252-6332 BMO Harris Bank Kim Fix kim.fix@bmo.com (888) 340-2265 Carbon Offset Company Patricia Diaz admin@carbonoffsetco.org (719) 623 1306 ComplyAuto Sherryl Nens sherryl@complyauto.com (661) 210-3453 (See ad page 45) Cox Automotive Michele Wright Michele.Wright@coxautoinc.com (801) 550-6815 DAA Northwest Mitzi VanVoorhis mvanvoorhis@magauctions.com (509) 435-0191 (See ad page 13) Dealer Development Systems Chris Nelson (406) 580-8204 Dealer Vault Patrick McKeever patrick.mckeever@authenticom.com (800) 289-3283 Dominion DMS Arlene Clements arlene.clements@dominiondms.com (858) 693-3684 (See ad page 40) Eide Bailly LLP Natalie Hood nhood@eidebailly.com (801) 456.5237 Federated Insurance Joel Rothmann jtrothmann@fedins.com (415) 860-4407 First Interstate Bank Billings Steven Bergene steven.bergene@fib.com (406) 255-5164 Fullpath Sean Hopper sean.hopper@fullpath.com (216) 242-1320 It Starts With Me Craig Linke craig-linke@itstartswithme.com (866) 932-6467 Junkermier Clark Campanella Stevens PC Jake Carter jake.carter@jccscpa.com (406) 862-2597 Moss Adams spo.sharedservices@mossadams.com (509) 747-2600 PartsEdge Kaylee Felio kaylee.felio@partsedge.com (619) 820-8189 US Bank Dealer Services Robert Lampson robert.lampson@usbank.com (253) 209-6585 Valley Bank of Helena Rosslyn Duncan rduncan@valleybankhelena.com (406) 495-2500 Whitehall’s Alpine Distributing Cliff White cliff@alpinebg.com (800) 916-1957 Winn-Marion Companies Eirik Anderson EirikAnderson@winn-marion.com (406) 860-6301 2023 MTADA ASSOCIATE MEMBERS 7
MTADA OFFICE STAFF EXECUTIVE COMMITTEE Bruce Knudsen Executive Vice President bknudsen@mtada.com Cell: (406) 461-7680 Office: (406) 442-1233 Jillian Nash Communications Manager jnash@mtada.com Cell: (253) 561-2889 Office: (406) 442-1233 Debbie Jean Office Manager/Insurance Coordinator/ Bookkeeper bkkpr@mtada.com Cell: (406) 461-6333 Office: (406) 442-1233 Erick Anderson Placer Motors Chairman Wade Rehbein Rehbein Ford President Eric Henricksen Don Aadsen Ford President-Elect Don Kaltschmidt Don “K” Whitefish NADA Director Peder Billion Billion Auto Group Vice President 8
Eric Henricksen Don Aadsen Ford District 1 Wade Rehbein Rehbein Ford District 2 Erick Anderson Placer Motors District 3 Jackson Bell Bell Motor Co. District 4 Aaron Jones Courtesy Ford District 5 BOARD OF DIRECTORS Don Kaltschmidt Don K Whitefish Rob DeMarois DeMarois Buick GMC Eric Henricksen Don Aadsen Ford Peder Billion Billion Auto Group District 6 James Johnson High Plains Motors, Inc. District 7 Jason Davis Archie Cochrane Ford District 8 Shane Morinville Lithia Ford of Missoula Group Dealership Director Josh Soares GMC Billings Next Gen Don Kaltschmidt Don “K” Whitefish NADA Director INSURANCE TRUST Bill Underriner Underriner Motors Chairman James Johnson High Plains Motors, Inc. Executive Member Erick Anderson Placer Motors Executive Member Craig Tilleman Tilleman Motor Co. 9
NEW BOARD MEMBER SPOTLIGHT Peter Billion Billion Auto Group Peder Billion Peder was born in Bozeman, Montana, in 1983 and is the youngest of three children. Since he was five years old, he wanted to be a car dealer just like his father, Joe Billion, Founder of J.C. Billion, Inc. On weekends, Peder would go to the dealership with his father to “check things over” and learn about the auto business. He graduated from Bozeman High School and then went on to receive his Bachelor of Arts in Business Administration from Johnson Whales University in Providence, Rhode Island. After college, Peder worked for two years in the automotive industry at dealerships other than his family’s to gain a different perspective on dealership sales and service operations. In December 2007, he returned to Bozeman and began working as a Service Adviser at J.C. Billion, Inc. Within six months, was promoted to the Parts and Service Director at the Billion Auto Group. By 2017, Peder was named Vice President of the company, and in 2018, when his father retired, Peder was named as the President of Billion Auto Group. Jason Davis Archie Cochrane Ford Jason Davis Jason is a seasoned automotive industry professional with over 35 years of experience across various sectors, including parts, service, sales, commercial fleet, body shops, finance and general management. Throughout his career, Jason has had the privilege of working with renowned car brands such as Ford Motor Company, Porsche, Jaguar, Aston Martin and Lotus, earning him a reputation for excellence in the field. His impressive track record is reflected in the numerous national awards he has received for his outstanding achievements in sales, service, finance and customer satisfaction. Recognized for his unwavering commitment to providing exceptional experiences to customers, Jason has consistently surpassed industry standards. Relocating to Billings, Montana, in 2017, Jason embraced the opportunity to bring his wealth of expertise to a new setting. He is deeply passionate about automobiles, be it cars, trucks, motorcycles, or airplanes. His love for racing, travel, food and wine further enriches his wellrounded perspective on life and the automotive world. Embracing the great outdoors, Jason cherishes spending quality time with his family and exploring the scenic beauty of Montana. In addition to his professional achievements, Jason remains actively engaged in the industry by participating in NCM 20 groups and has lent his insight as a former member of Ford Motor Company's Dealer Advisory Board for Fixed Operations. He strongly believes in giving back to the community and has volunteered with organizations such as the Children's Heart Foundation and other local charities in Montana. Jason also demonstrates his commitment to education and training by offering valuable training and opportunities for growth at Archie Cochrane Ford. Jackson Bell Bell Motor Co. Jackson Bell Jackson was born and raised in Cut Bank, MT. His family has been in the car business there since 1935. He is a fourth-generation Chevrolet dealer; Jackson’s great-grandfather started the business after he came west from Minnesota. He went to college at MSU-Bozeman and graduated with a Bachelor’s degree in political science in 2005. Shortly after graduation, Jackson moved back to Cut Bank and began working at the dealership to fill in for his mother, who wanted to be done working full-time. In 2014, he completed the NADA Dealer Academy but it wasn’t until his father abruptly retired in 2019 that he assumed the role of Dealer. Jackson was married to Brianne in 2016 and had their first child in 2017 (Quinn, 5) and then a boy in 2019 (Owen, 3). Jackson spends most of his time with family and at the store, but any chance he gets to be outside, he takes advantage. He tries to hunt as much as he can in the fall and has recently taken up flying as a hobby. 10
2023 MTADA ENDORSED PARTNERS ADS of Montana Mark Nania markm@adsfi.com (406) 581-7778 (See ad page 24) American Fidelity Assurance Kyle Clemons kyle.clemons@americanfidelity.com (800) 662-1113 Armatus Jordan Jankowski jordanj@dealeruplift.com (888) 365-2197 Assurant Darren Murray Darren.Murray@assurant.com (800) 447-7828 (See ad page 47) Blue Cross Blue Shield Erin Huffman Erin_Huffman@bcbsmt.com (See ad page 33) Canalise Consulting Jacquelyn Gomes jgomes@jacqccg.com (406) 465-7077 ComplyAuto Sherryl Nens sherryl@complyauto.com (661) 210-3453 (See ad page 45) Delta Dental Insurance Company Brittany Chandler bchandler@deltadental.org (800) 521-2651 Montana State Fund Ethan Heverly EHeverly@mt.gov (406) 495-5426 (See ad page 41) MVD Express Mickey Flynn mickey.flynn@mvdexpress.com (406) 290-8573 (See ad page 48) NADA Retirement Chad Bice cbice@nada.org (303) 912-1125 PayneWest Insurance Sean McCutcheon smccutcheon@paynewest.com (406) 457-2136 Payroc Mike Peterson michael.peterson@payrocsales.com (406) 548-5345 (See ad page 17) Smith Law Firm Jim Sewell jim.sewell@smithlawmt.com (406) 442-2980 Vitu Kelly Raines kraines@vitu.com (406) 285-8280 (See ad page 3) 11
12 CONSUMER LOSES SUIT vs. MONTANA DEALER A February 2022 decision by the Montana Supreme Court upheld a Summary Judgment Order by Hon. Mike Menahan, First Judicial District Judge in Helena, in favor of Lithia Motors, dismissing a consumer lawsuit brought over the installation of a replacement engine in an eight-year-old Subaru Legacy with 100,000 miles on the odometer. On September 12, 2017, Lee purchased a used 2008 Subaru Legacy from Lithia. At the time of purchase, the vehicle was eight years old and had almost 100,000 miles on it. Lee also purchased a twoyear extended service agreement on the vehicle from First Extended Service Corporation (FESC) to cover the cost of any unexpected repairs to the vehicle. In November 2017, Lee began experiencing problems with the engine. He took the vehicle back to Lithia for repair. FESC paid the service department to rebuild a portion of the vehicle’s engine pursuant to its extended service contract. The engine continued to experience issues following this repair, and Lee took the vehicle back to Lithia. Lithia recommended a full engine replacement with a remanufactured engine. FESC approved payment for the replacement engine under Lee’s extended service agreement. Lee initially declined FESC’s offer to have the engine replaced. The remanufactured engine had already been delivered to Lithia, so Lithia had to pay over $1,000 to have the remanufactured engine returned. Lee then filed suit. After Lithia’s counsel inquired as to why Lee had declined the benefits of his extended service agreement with FESC, Lee changed his mind and agreed to allow FESC to pay for the installation of a remanufactured engine. An appointment to install the new engine was scheduled. As the date approached, Lee’s counsel advised Lithia that Lee was also experiencing issues with the vehicle’s clutch. Lithia’s counsel telephoned Lee’s counsel to discuss a settlement agreement. During this call, Lithia offered to have its service department replace the clutch on Lee’s vehicle at Lithia’s expense in exchange for a release of Lee’s claims against Lithia. Lee’s attorney sent a one-line email to Lithia’s counsel stating as follows: “Mr. Lee will accept the offer to have the clutch replaced in exchange for settling all his claims against Lithia.” Later that day, Lithia’s counsel sent a reply email stating that this was “great news” and scheduled the repair work for the clutch. In his reply, Lithia’s counsel also promised to send a more formal release for Lee to sign at a later date. Lithia installed the remanufactured engine for which FESC paid and replaced the clutch at its own expense. The total cost to FESC to replace the engine was $7,352.06, and the cost to Lithia to replace the Subaru’s clutch was $1,293.99. After the clutch was replaced and the remanufactured engine installed, Lee continued to drive the Subaru for nine more months and 17,349 miles. He then took it back to Lithia, claiming the new engine had many issues. Lithia’s inspection revealed no significant issues with the vehicle. Lee ultimately traded in the Subaru to Lithia for a new Jeep Compass at a discounted price. LEGAL UPDATE R. J. “JIM” SEWELL, JR. MTADA GENERAL COUNSEL
Lithia won the case because Lee’s counsel stated in writing that Lee accepted the offer, Lithia’s counsel accepted as well, and Lithia then performed all its obligations ... After purchasing the Jeep, Lee went back to Court demanding $11,000.00 in damages and $4,500.00 in attorney fees. Lithia asked the Court for Summary Judgment dismissing the case because it had already been settled. Judge Menahan granted Lithia’s motion on the grounds that the November 2018 email correspondence between the parties’ counsel formed a valid settlement agreement which barred Lee’s continued litigation of his misrepresentation and MCPA claims against Lithia. The Supreme Court held that it did not matter that Lee had not signed the formal release sent by Lithia, concluding “[i]t is established case law that an unconditional acceptance may bind parties in a settlement agreement, even without a detailed agreement.” In particular, the court noted the clear similarities between Lee’s case and the controlling case of Hetherington v. Ford Motor Co., 257 Mont. 395, 399, 849 P.2d 1039, 1042 (1993), which held that the failure to execute a formal settlement agreement did not bar the formation of a valid agreement when shorter written correspondence between two parties where one party agreed to release all legal claims in exchange for payment from the other party constituted an “unconditional” offer and acceptance. While it would have been better to get the settlement agreement signed before the repairs were undertaken, Lithia won the case because Lee’s counsel stated in writing that Lee accepted the offer, Lithia’s counsel accepted as well, and Lithia then performed all its obligations, so the settlement was complete — the correct result. magauctions.com See You in Butte! McCONKEY AUCTION GROUP IS HONORED TO SPONSOR THE MTADA’S 109th ANNUAL FAMILY CONVENTION When it comes to buying and selling inventory, we’re ready to meet you where you are – whether it’s in our lanes or online. In the meantime, we’ll see you in Butte August 24th – 27th! 13
I am happy to report back on our recent legislative success that will benefit the dealers of Montana. I would like to give a special thank you to our team: Scott Reichner our Contract Lobbyist, Jim Sewell and Craig Charlton, our Attorneys, Bruce Knudsen our Executive Vice President, our Legislative Committee our Board and of course the dealers of Montana. It was definitely a team sport. Certainly a job well done. MTADA’s successful legislative program for the 2023 Session, sponsored by Sen. Barry Usher, just concluded with a celebratory signing by Governor Gianforte. Senate Bill 411, as passed and signed by the Governor, addresses the following issues. Update to Data Privacy Law MTADA was successful in seeing a data privacy and protection statute enacted into law in the 2019 Session as Mont. Code Ann. §30-11-717, 718 and 719. The existing law was similar to AZ, but not identical. The AZ law was upheld by the 9th Circuit Court of Appeals. SB 411 revised the Montana statutes to mirror the provisions of the approved AZ law. Pg. 1 to pg. 4, line 3. Update the Definition of “Motor Vehicle” The definition of Motor Vehicle was revised to include motorboats. Personal watercraft (i.e. jet skis) were already included in the definition, and it appeared omitting motorboats may have been an oversight. The effect of this amendment is to give motorboat dealers the same statutory protections afforded to jet ski dealers. Pg. 18, line 17. By Don Kaltschmidt Legislative Committee Chairman MTADA 2023 MTADA LEGISLATIVE SUMMARY 14
Written Franchise Agreement Required Mont. Code Ann. § 61-4-202(3) does not specifically state that the motor vehicle manufacturer and dealer will enter into a written franchise agreement although industry practice requires it and other provisions of the code seem to assume that the franchise agreement be in writing. See, for example, Mont. Code Ann. § 61-4-204. SB 411 updates the code to make it clear that a written franchise agreement is required by adding subsection (e) to § 61-4-202(3). Pg. 20, lines 2-8. Limitation on Manufacturer’s Ability To Limit Dealer’s Choice of Vendors As you are all aware, many automotive manufacturers are embarking on a course of conduct to inject themselves into the retail relationship between the dealer and his customer by requiring the dealer to use a manufacturer’s handpicked data management firm — always more expensive — and excluding the dealer’s historic free choice to pick the provider that offers the required services and the best price. Mont. Code Ann. § 61-4-208(1)(a)(v) already prohibits such conduct by manufacturers in the acquisition of goods or services generally. SB 411 amends the code section to make it clear that the prohibition also includes interfering with the motor vehicle dealer’s choice of data management system or digital retail platform and prohibits the manufacturer from withholding any benefit including monetary incentives and vehicle allocation. Pg. 21, lines 15-23. Limitation on Manufacturer’s Ability To Involve Itself in the Retail Sale of Motor Vehicles. The “Agency Model.” As noted above, many automotive manufacturers embarked on a course of conduct to inject themselves into the retail relationship between the dealer and their customer. This initiative is generally referred to as the “Agency Model.” The Agency Model moves sales of new automobiles from several dealerships around the state to a single seller — the manufacturer. The Agency Model proposed by the manufacturers is an attempt by the manufacturers to: • Eliminate inventory on the dealer’s sales lots for customers to shop. • Eliminate the financing options customers have at a local dealership and/or bank and force customers to accept factory financing. • Eliminate negotiation on trade-in vehicles. • Eliminate competition between dealers on after-sales benefits like oil changes, repairs and other related services. The idea that the Agency Model will be good for dealers or consumers is a myth. If permitted by law, the agency model would likely be the beginning of the end of new car dealerships. Following the lead of the Commonwealth of Virginia, SB 411 makes revisions to Title 61, Chapter 4, the provisions of the Montana code that deal with motor vehicle dealers and manufactures to keep the manufacturers out of the retail business and prohibit coercion or retaliation by the manufacturers against dealers who don’t go along. Here is a summary of the changes in Mont. Code Ann. § 61-4-208 enacted: • Prohibiting threat to or denial of incentive payments to compel dealers to go along. Pg. 22, line 11. • Taking into account the manufacturer’s ability to supply adequate vehicles to the dealer when setting the dealer’s minimum sales requirements. Pg. 23, line 1. • Prohibiting amendment of the franchise agreement under threat to withhold incentive payments. Pg. 23, line 22. • Prohibiting the manufacturer from selling vehicles via a website. Pg. 23, line 26. • Prohibiting the manufacturer from retaining ownership of or consigning vehicles until delivery to the consumer. Pg. 24, line 1 and line 9. • Prohibiting the manufacturer from negotiating the terms of sale with a retail customer. Pg. 24, line 17. • Prohibiting the manufacturer from unilaterally changing the franchise agreement, including a dealer’s area of responsibility, requiring notice of a proposed amendment, giving the affected dealers the right to request mediation and protest the proposed action and setting standards for review. Pg. 24, line 25 continuing on pgs. 25 and 26. The revisions will apply to all presently existing or subsequent systems of distribution of motor vehicles, including all existing franchise agreements except to the extent that such application would impair valid contractual agreements in violation of the State or Federal Constitution. SB 411 became effective on passage and approval. To read SB 411, scan the QR code. http://laws.leg.mt.gov/legprd/ LAW0203W%24BSRV.ActionQuery?P_ SESS=20231&P_BLTP_BILL_TYP_ CD=SB&P_BILL_NO=411&P_BILL_ DFT_NO=&P_CHPT_NO=&Z_ ACTION=Find&P_ENTY_ID_SEQ2=&P_ SBJT_SBJ_CD=&P_ENTY_ID_SEQ= 15
DIGITAL DEALER TITLING IS YOUR NEW GO-TO FOR DTO Wouldn’t it be great to just ditch a traditional title and go completely digital? What about using an Motor Vehicle Record (MVR) as the source of truth — an E-Title? And what if one simplified form provided all the necessary information needed for Digital Dealer Titling — the MV212? It’s all real and it’s here, now. Developed in conjunction with Montana MVD, read on as to how Digital Dealer Titling is a game changer for your dealership. The Problem: Time is Money and We’ve Got Cars to Sell. One of the main things that can grind a vehicle sale to a halt is getting a transferable title in hand. When your dealership acquires a vehicle through a trade-in, what do you do when the seller doesn’t have a vehicle title on hand? In order to resell that vehicle, you must have a transferable title in hand. When the seller has a title on hand, the process is easy. But you know all too well the heartache and delays when no such chain of custody exists. The process begins by trying to piece together an accurate chain of custody, submitting (or walking the deal) to MVD and waiting. The short story: it’s all time-consuming. Let’s commiserate for a moment and talk about the chain of custody. So, your customer who traded in the vehicle has no title and is long gone — hopefully in the new car that they purchased. But they left you with no title — maybe some other proof of ownership. Before you can get anything over to MVD, you have to rebuild the chain of ownership. This has the potential to be tedious and troublesome because sometimes you need additional information, but the seller is unavailable. When your dealership has to rebuild the chain of custody, the clock is already ticking. And you want to get that car back on your lot to sell it, but you are stuck. Now for the second part: the actual submission to MVD. Finally, you have the necessary documents and you are ready to apply for a new title in your dealership’s name. So you do that by either mailing the application and paperwork in or, more likely, sending a runner to your nearby MVD office. And then you wait. It’s not like the State of Montana and MVD are not busy; it’s just you know that these things take time. And you are still waiting. Once all is said and done, maybe you’re days, weeks or months away from getting the title. And you know all too well that time equals money. Remember, every day you’re paying for the space on your lot while that vehicle just sits there. Let’s do some math. Based on national standards and averages, that vehicle sitting on your lot waiting to be titled costs at least $15.54 per day. Once you factor in the overhead from space on your lot and staff, the cost per day rises. As you all know too well, time equals money. By Vitu 16
Continued on page 18 The Solution: E-Titling for Dealers. Ah, yes — Vitu has been talking about this for a long time, right? For nearly a year and a half (or more), we’ve heard John Brueggeman discuss this new way to DTO with a completely digital process that takes days, not weeks or months. So, what is it? Enter Digital Dealer E-Titling. In a nutshell, E-Titling uses the MVR as a replacement for an actual title for a given vehicle. When you think about it, the MVR is the record of truth when talking about who actually owns the vehicle. As such, it’s the new way to procure a title in your dealership’s name. The end result is the same, it’s just the process is completely digital and takes a lot less time. How Does it Work? When your dealership has a vehicle that you need titled in your name, you simply submit all required documentation digitally through Vitu. These documents include but are not limited to: • Image of the original title front and back or Motor Vehicle Record • Bill of Sale from consumer to dealer • POA, if applicable • Lien Release When you can’t actually get the original or a replacement title, take advantage of E-Titling where an MVR is used in place of a title, helping to speed up and simplify the process. Once your dealership completes the digital submission using Vitu, our Montana audit team reviews everything and makes sure it is all accurate. Once everything is confirmed and looking good, the title work is then sent electronically to the state where a final approval takes place. Accept payments anywhere, anytime while saving money. Process payments with MTADA’s preferred vendor and... Save up to 70% on your processing costs! Reach out to learn more. Mike Peterson michael.peterson@payrocsales.com 406.548.5345 Best-in-class Products & Services Electronic Processing Mobile Processing Point Of Sale Systems 17
The following business day, all approved titles are printed. Once all titles have been printed, they are then shipped out overnight to your dealership, which by the next business day has a completed digital dealer title that they can now use to sell the vehicle. The whole transaction can take just days from start to finish — if everything is correct. Plan ahead for any errors or weekends and holidays. Regardless, your dealership is looking at a much faster turnaround time than the average six or more weeks that you’re used to. The Little Things to Make Your Life Easier. As mentioned above, E-Titling involves using a MVR in place of a title, helping to speed up and simplify the process. This helps eliminate the need to get a replacement title when it has been lost by the consumer. E-Titling recently went into effect on February 14th, 2023. And, there’s a new, all-in-one form titled the MV212 — the Electronic Vehicle/ Vessel Transfer Form. This secure, controlled form is only available digitally and built into the process within Vitu. What’s so cool about a form? The MV212 combines the Bill of Sale, Power of Attorney and Transfer sections of other separate forms into one. This eliminates the need to obtain these documents separately. Lastly, do you need to get a signature from your customer, but they are already on the road enjoying their new vehicle and long gone? Using Vitu’s Digital Signature feature allows you to get any missing signatures quickly, securely and with minimal interruption to your customers by digitally signing on their phone. Why Did Vitu Develop Digital Dealer E-Titling? Digital Dealer E-Titling was created in 2022 to serve Montana dealers by saving time and money throughout the vehicle titling process. Montana’s MVD (and even other state DMVs) often take upwards of six or more weeks to process a title. When your dealership is sitting on these vehicles waiting for their paperwork to process, you are losing large amounts of revenue. Knowing this, Vitu reached out to the State of Montana, presented them with the issue and offered them a partnership with a solution. Montana has since become the first fully digital titling state for Digital Dealer E-Titling and continues to build that technology going forward. Big changes are here for Big Sky Country. Montana, it’s you who are pioneering and setting the standards for the rest of the nation. To learn more visit vitu.com. ... it’s you who are pioneering and setting the standards for the rest of the nation. Continued from page 17 18
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NADA ACADEMY G R A D U A T E S The NADA Academy program prepares current and future dealership leaders to operate a successful and profitable automotive business while examining the latest in industry trends and technology. The program includes either six one-week classroom sessions or six month-long live online sessions, once or twice a week, over the course of a year. Sessions are taught by industry experts, with hands-on practical application in each area of the dealership. We recently talked to a few local NADA Academy Graduates and learned more about them, their thoughts on the Academy, and their key takeaways. The following are excerpts from our conversations. DAN CLOWES Title: GSM/Partner Company: Taylors Auto Max GMC Nissan NADA Academy Graduation Date: May 2021 — NADA Graduating Class 364 How did you get into the industry? I have been in the auto industry since 2002. I went to Montana State University from 1998 to 2002 and graduated with a degree in history. After graduating, I couldn’t find a job in my field. The big joke is that I come from a family of engineers — my dad and my sister are graduates of Stanford — and I was supposed to follow suit. I have always been a people person and had a knack for sales, so I answered a classified ad and started working at the Yellowstone GMC Buick Pontiac dealership. From there, I worked at Ressler Motors and then moved to Zurich Insurance Group, where I specialized in automotive dealers. While working at Zurich, I met the Taylor family — they were one of my clients. They asked me to come and work for them, and as part of bringing me on, they agreed to sponsor me at the NADA Academy. I ended up going to work for them in 2019. Why did you decide to attend the NADA Academy? I have always been a proponent of career education, and attending the NADA Academy has always been a goal of mine. To me, the NADA Academy provides a master’s degree for the auto industry and gives a higher level of education you can’t get in day-to-day work. Before the NADA Academy, I felt like I knew the sales side of the business pretty well, but I’d never turned a wrench or changed oil in my life. Yet, 60% of our employees operate in that Fixed OPS department. And, if you’re going to try to manage, lead or mentor, and don’t have the background or the experience, the only way to get that knowledge is through something like the NADA Academy. You’ll find that, in a lot of dealerships, owners generally have come up through one of two sides: the sales side or the service side. And the comprehensive education program that NADA Academy provides teaches dealers the skills that are needed to be successful — leadership, how you read your financial statement, new and used cars, parts, service and more. Please share one of the key takeaways you learned from the NADA Academy. There are many takeaways, so it is hard to choose just one. I benefited a lot from the six-week leadership class. We learned how to motivate employees and get them going — how you fire them up, not fire them. Another big takeaway is that you really need to pay attention. Running a dealership is like running four, uniquely-operating small businesses encased in one. The parts department must be completely viable and profitable 100% on its own as does service, new car sales and used car sales. We learned to watch them all for their own KPI metrics. The academy teaches just how robust the business is and how many details there are to manage at the highest level, from the person who’s washing cars to the one who’s selling them all the way up to the employee running the financial statement. Do you have any advice for your peers that might be considering going to the NADA Academy? I would highly recommend the academy to all those looking to improve their skillset. The material reviewed is critical to producing well-rounded, full-store operators and can speed up the learning curve to manage departments outside your own professional experience and background. 20
CHAD NOTBOHM Title: General Manager Company: Notbohm Motors NADA Academy Graduation Date: October 2022 — NADA Graduating Class 393 How did you get into the industry? Back in the good ‘ol days, my father was a band and choir teacher. After some years, he realized he couldn’t make much money teaching. In 1984, he approached a couple of friends from church and purchased their Chevrolet store from them. They were advanced in years, and it was a perfect time for them to retire and help with the transition — working with my family. I was 10 at the time, and I often went to work with him. I would clean the shop and the showroom and would work on little things that needed to be done. There were eight employees at the dealership who taught me about parts, service, selling and much more. My interest in the industry took off from there and I never left. I attended North Dakota State University (NDSU) in Fargo, ND, and received a degree in business. I worked at Gateway Chevrolet during that time in the parts department and was promoted to Service Manager. Then in 1995, they weren’t renewing franchise agreements in small towns. My father had the option to close the dealership or move. He found an opportunity in Miles City, MT, and moved. In the summer of 1999, my father asked me to come home because the business was growing and he needed help. I worked as a Service Manager until about eight or nine years ago. At that point, I became General Manager as my father wanted to start slowing down and move toward retirement. Why did you decide to attend the NADA Academy? We started with the Dealer Group when I was Service Manager. We then branched off and added a Fixed Ops Group. Now active in two 20 Groups, the group moderators always asked me, “Have you been through the Dealer Academy yet?” I hadn’t. I wasn’t big on traveling and being that far away from my young family at the time. Then COVID hit and I heard that they were doing the Academy online; I jumped at that opportunity. Please share one of the key takeaways you learned from the NADA Academy. There are so many takeaways, but I think the biggest thing was learning in-depth about the different parts of the dealership. I knew a lot about the dealership, but the approach the instructors took got really deep into many things — from financials in the back office to the financial statement plus different ways to look at service or parts. I learned so much. Do you have any advice for your peers that might be considering going to the NADA Academy? Go when you are ready. If you are being pushed to go, make sure you feel you have enough dealership experience and it’s the right time in your life to go. I’m glad that I waited as long as I did. My work experience from years at the dealership and my understanding of the industry allowed me to jump in with both feet at the Academy. I was ready to learn and I retained more. I think it made for a better experience. MIKE SCHNEIDER Title: Owner Company: Jim Taylor Motors NADA Academy Graduation Date: August 2019 — NADA Graduating Class 361 How did you get into the industry? I grew up in the car industry. My dad ran a few stores when I was young. I remember when I was in the 4th grade, my dad had a bad experience with an employee at a Ford store. I told myself then that I wanted to own a Ford store someday and do better. That experience stuck with me, and I made ownership my goal. I had to figure out a way to become an owner, and my partner from my last company knew that. We had been good friends, and he knew that Jim Taylor of Jim Taylor Motors was looking to retire and didn’t have a solid succession plan for the store in Fort Benton, MT. My friend helped Jim and me connect. I got along great with Jim, and we figured out a way for me to buy him out and take over the dealership. Why did you decide to attend the NADA Academy? Two weeks after I took over and began running Jim Taylor Motors, the service director quit. I had come from the sales side of the business, and I knew the metrics of service, but my depth of knowledge in parts and service was not where it needed to be. I decided that the quickest way to gain the depth of knowledge needed was to enroll in the NADA Academy. That was a decision I will never regret. The NADA Academy really helped and gave me the tools and understanding that have carried me to where I am today. Please share one of the key takeaways you learned from the NADA Academy. It is difficult to say there’s just one, that diminishes the million other things I learned while attending. 21
Personally, I think the service and parts training was hugely beneficial. Not to take anything away from anything from service classes, but they really did a knockout job teaching parts. Also, when it came to understanding income, I had a decent grasp of that prior to attending the Academy, but I definitely added some depth of knowledge on the accounting side. Overall, anything I was lacking, the Academy provided it for me in one way or another. They did a really good job. It’s a great training program. Do you have any advice for your peers that might be considering going to the NADA Academy? I would definitely say, just from my personal experience, opt for the in-person. When I started the Academy, it was in-person, and due to COVID, classes were moved online. The Academy does a good job with virtual classes, but the in-person allows you to learn a lot from the people you’re in the class with. The connections you make with other people are priceless and can benefit you for a lifetime. The other thing would be, if you’re going to go, go. If you’re not ready to learn, if someone’s forcing you to go, don’t go. Not to generalize, but as an example, if you’re a generational person and it’s your parents making you go, you’re probably not ready. If you’re ready and you’re asking to go, and you’ll be telling your parents or the principal that you want to attend the NADA Academy. It’s one of those things you’re going to get as much as you want out of it, so be ready. KEVIN KALTSCHMIDT Title: General Manager Company: Don “K” Whitefish NADA Academy Graduation Date: March 2023 – Graduating Class 401 How did you get into the industry? I’m a second-generation dealer. I started in the industry when I was eight years old, picking up cigarette butts off the sales lot for $2.00 an hour. I spent a lot of my time after school and summers working at the dealership. After high school, I joined the Marine Corps and then attended college at the University of Montana (UM) in Missoula. During college, I spent my summers working in various positions at the dealership and have been full-time for the past eight years. I have worked at almost every position and every department. We are on our fourth expansion in a short amount of time, and I am looking forward to learning more and growing with the company. Why did you decide to attend the NADA Academy? I had been told by 20 Group members and other people in the industry that attending the NADA Academy was the best decision they ever made. They were right. I learned more from the Academy than from my four-year business degree because of the specific and relevant information that was taught. For me, it was important to wait until I was ready so I could get the most out of it. So, it was never really a question of if, but when I was ready. I started attending the Academy two years ago, and then COVID hit. I paused my participation and ended up going back when in-person was available again. I graduated this past March. Please share one of the key takeaways you learned from the NADA Academy. I have a very long list. After each class, I had about 15-plus things that I wanted to implement at my store. I think I learned the most during service week, even though I had been working in service for a long time. Understanding service department metrics and what to be looking for was eye-opening. Overall, the relationships I’ve made from attending the Academy will benefit me for a lifetime. Class 401 had Fixed Ops Directors, an HR Manager, a Controller, Finance Directors, General Sales Managers, Dealers and other job titles as well; there were also some second-generation like me — a very good mix of different people with different skill sets. We learned as much from each other as we did from the instructors. There was a lot of power of the room. Do you have any advice for your peers that might be considering going to the NADA Academy? It’s a big investment of time and money, but it will definitely be a net positive. I encourage anyone to go, no matter their age. I think there are a lot of people that haven’t gone that are older than myself — I’m 35. There seems to be a kind of resistance of thinking I don’t need this, or I know enough. No matter how young or old you are, the Academy is a huge benefit to you and your business. Throughout the yearlong learning process, there’s no way you can’t find things that need to be improved on and get ideas to implement. If nothing else, it’s an opportunity to evaluate your business in every department. Attending the NADA Academy is like getting a master’s degree in automotive dealership management. But compared to attending college, the Academy costs a lot less money and takes a lot less time. 22
ANTHONY MICHLIG Title: Platform Manager Company: Butte Auto Group NADA Graduation Date: November 2021 — Graduating Class 379 How did you get into the industry? After studying business communications in Western Montana, I took my first job as a salesperson at a local Chevrolet dealership. I immediately knew that I was in the right business! I moved on to larger dealer groups in multiple cities and excelled in sales, finance and desking. I learned each position and gravitated toward the entire operation versus one position. I have always been good with people and loved new cars, so it was a match! I became the Platform Manager for Butte Auto Group in 2019 and haven’t looked back! Why did you decide to attend the NADA Academy? I have always sought to learn from successful peers in our industry, and the NADA Academy is an organization that has taken decades of industry experience that far outweighs what any single organization or 20 Group could offer. I manage four new car dealerships, and I needed a blueprint for success. I am a leader that promotes the “always learning” motto within my organizations. When any employee seeks more knowledge, I always facilitate it happening, and this opportunity for me was no different. The Academy would became my master’s class for successfully running four dealerships. Please share one of the key takeaways you learned from the academy. While specific takeaways from the academy may vary depending on the individual and their role within the industry, one takeaway for me from NADA Academy is a deep understanding of the fundamentals and best practices of running a successful automotive dealership. They key in on customer-centricity. The program emphasizes the significance of building and maintaining strong relationships with customers, understanding their needs and preferences, and providing exceptional customer service. I also really enjoyed the information and tools that emphasized the importance of continuous improvement and adapting to changes in the industry. I learned about emerging trends, technology advancements and evolving customer expectations. The Academy provided insights into strategies for staying competitive in a rapidly changing market and managing various aspects of dealership operations, including sales, marketing, finance, parts and service. Do you have any advice for your peers that might be considering going to the NADA Academy? Any time I seek to learn and grow in the industry, I set clear goals. Whether it’s improving your skills in a particular area or gaining a comprehensive understanding of dealership operations, having clear goals will help you make the most of your time at the academy. I strive to be open-minded to what I do not know instead of closing myself off to new information. I would also attempt to be fully engaged. There are many opportunities in workshops, discussions and networking opportunities to connect with industry professionals and learn from their insights. What really cemented what I was learning was applying the knowledge and skills in real time! 23
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