October 2007

Federal Legislative Activity
With oil prices rising to record levels near $90 a barrel, it is no surprise that Energy related legislation is a main topic of discussion on Capitol Hill.

Vehicle Emissions
The White House disclosed recently its position to press ahead with plans to implement tough new vehicle tailpipe emissions, given its skepticism that Congress will pass an Energy Bill this year that increases fuel efficiency requirements.

CAFÉ Legislation
Automakers and environmentalists alike cite President Bush’s January 23rd State of the Union address and his call for improving the fuel efficiency of vehicles to help reduce gasoline consumption by 5 percent by 2017 as a driving force in pushing Congress to address fuel efficiency standards.  The Presidents plan assumes a 4 percent average annual increase in CAFÉ Standards, but he is opposed to Congress codifying that increase into law.

The House has passed a Bill that would keep the two vehicle types separate and increase overall fuel economy to between 32 and 35 mpg by 2022.  The Senate Bill, however, would eliminate the current separation between fuel economy standards for cars and light trucks, and boost their fleet average for both types of vehicles to 35 miles per gallon by 2020.  The President has indicated his intent to veto any legislation that includes the merging of car and truck standards.

Total Loss Disclosure
With the 2 year anniversary of hurricane Katrina here, along with the hurricane season being in full bloom and many flood damaged vehicles returning to the road, The Passenger Vehicle Loss Disclosure Act remains in the forefront.  While the dealer community and most consumer groups are in favor of the legislation, insurers remain opposed to Senate Bill 545 because they claim it does not clearly define “total loss” and that it would be expensive to maintain a database containing the required disclosures.

Federal Regulatory Developments

California Plans to Sue EPA

The State of California has indicated it plans to sue the Environmental Protection Agency for delaying a decision over whether to let the state aggressively reduce car and truck tailpipe emissions.  The lawsuits outcome could affect not only the California Law aimed at cutting greenhouse gases, but also the ability of other states to take similar actions creating state-by-state standards for tailpipe emissions.

2008 Fuel Economy Guides Available

The U.S. Department of Energy and the Environmental Protection Agency will distribute the 2008 model year Fuel Economy Guide this month providing consumers with information about fuel economy and the benefits of using more fuel-efficient vehicles.  This years guide contains fuel economy estimates based on updated EPA calculation methods.  Copies of the Guide will be available at the NIADA website.

Other Activity of Interest
In our Nations Capitol, the US Department of Health and Human Services said it may send its 67,000 employees detailed information about fuel-efficient American-made vehicles in the wake of a flap over a government newsletter that touted foreign-made automakers.  A spokesperson for the Agency said sharing the research with employees would demonstrate the Agency’s commitment to energy conservation and support of American automobile manufacturers.

Over at General Motors, GM has been working on a new product known as its OnStar Stolen Vehicle Slowdown, which will stop a stolen car in its tracks.  Once notified that a vehicle has been stolen, OnStar can send a signal to the car that will reduce the engines power, slowing the vehicle gradually. GM is scheduled to make this service available on 1.7 million vehicles in the 2009 model year.

Case of the Month

To begin, regarding the business you conduct on the Internet, I want you to ask yourself the following questions:  What am I doing?  Where am I doing it?  How am I doing it?  Who am I doing it with?  Take a moment to think about it, call a meeting if you like, but write down your answers.

Are you merely advertising vehicles, marketing the dealership, establishing a customer relationship, generating showroom traffic, qualifying a customer or are you actually trying to sell a vehicle?  Is it being done at the dealership, over the Internet or somewhere else?  Do you complete the paperwork entirely at the dealership, or are things done over the phone, in cyberspace and on your website?  More likely your answer will be you do a combination of things or, it depends.

Are you aware that there are often three separate parties, your Dealership, an Internet Provider and the Consumer, all which have different rights, responsibilities and obligations depending upon the relationship.  There is an Agreement between the dealership and the Internet provider, there may be an Agreement between the Internet provider and the consumer and there is the Agreement between your dealership and the consumer- it’s called the car deal.