Automobile Dealers – Do You Really Have a Right to Refuse New Vehicles?

According to a recent article in the NY Times:

The Chrysler Group said Monday that it had not yet accounted for tens of thousands of cars in its inventory numbers, which are already considered high by industry standards. Chrysler said it had routinely excluded these vehicles, worth billions of dollars, from its tally of unsold cars and trucks because they had not yet been assigned to a specific dealer or ordered by a customer. (New York Times, October 24, 2006)

When I began learning about the automotive industry, dealers and manufacturers had a name for manufactured, but unordered vehicles. That name was: “sales bank.” The “sales bank” is a practice that the manufacturers allege they abandoned after being ravaged by the system during the oil crises of the 1970s.

By the early 1980s, when the dust settled, Automotive News was running stories like:

Ernest D’Agostino of Rhode Island filed suit, in the U.S. District Court against Chrysler Corporation, alleging Chrysler terminated his franchise because he refused to buy “gas guzzlers” — large cars with low gas mileage. A federal court jury found against Chrysler and Chrysler, in an unreported case, appealed. Chrysler agreed to drop its appeal and paid D’Agostino a settlement (Automotive News, October 1982); and

Fred Drendall, of Drendall Lincoln-Mercury/Pontiac sued Ford Motor Company alleging that when he attempted to cancel orders he was intimidated by Ford spokesmen and when he bowed to the pressure and ordered the vehicles, the high flooring costs forced him to refinance his dealership. He was eventually was terminated and suffered a heart attack. (Automotive News, December 1982).

Those were hard times in the car business.

Today, most Sales and Service Agreements have provisions such as the following:

2. (D) STOCKS. The dealer shall maintain stocks of current models of such lines or series of VEHICLES, of an assortment and in quantities as are in accordance with Company GUIDES therefor, or adequate to meet the Dealer’s share of current and anticipated demand for VEHICLES in the DEALER’S LOCALITY. The Dealer’s maintenance of VEHICLE stocks shall be subject to the Company’s filling the Dealer’s orders therefor. (Ford Motor Company, Mercury Sales and Service Agreement, Standard Provisions.)

Most states, however, have Dealer Day in Court Acts with provisions such as:

Art. 4413(36), SUBCHAPTER E. PROHIBITIONS. Sec 5.02. Manufacturers; Distributors; Representatives. (b) It is unlawful for any manufacturer, distributor, or representative to: (1) Require or attempt to require any dealer to order, accept delivery or pay anything of value, directly or indirectly, for any motor vehicle, appliance, part, accessory or any other commodity unless voluntarily ordered or contracted for by such dealer. (Texas Motor Vehicle Commission Code)

It shall be unlawful and a violation of this code for any manufacturer, manufacturer branch, distributor, or distributor branch licensed under this code to coerce or attempt to coerce any dealer in this state: (a) To order or accept delivery of any motor vehicle, part or accessory thereof, appliance, equipment or any other commodity not required by law which shall not have been voluntarily ordered by the dealer. (Section 11713.2 California Vehicle Code)

In addition to state laws, the National Dealer Day in Court Act also proscribes manufacturer and distributors from coercing a dealer into accepting “automobile, parts, accessories, or supplies which the dealer does not need, want or feel the market is able to absorb.” 1956 U.S.Code.Cong. & Admin.News, page 4603.

But, the law is always a two-edged sword and there is generally a fine line drawn between actions that are proper and actions that are improper. For example, it has long been settled that a dealer’s refusal to take all of the manufacturer’s line of vehicles, choosing instead to sell a competitor’s models, is grounds for termination. See, for example: Randy’s Studebaker Sales, Inc. v. Nissan Motor Corporation, 533 F.2d 510 (10th Cir. 1976), at 515.

Consequently, prior to deciding whether to accept or reject delivery of vehicles, a dealer should check with a competent automotive attorney, that is familiar with the laws in the jurisdiction where the vehicles are to be delivered, with respect to his or her particular circumstances.

Note: This article is not intended to provide legal advice, nor should it be interpreted as so doing.

Video Surveillance For Car Dealerships

Car dealerships have expensive inventory, which makes them susceptible to theft. As such, video surveillance is a much need security measure for car dealerships. Vehicles depending on the make and model can run from a few thousand dollars to a few hundred thousand dollars. Many dealerships keep their inventory right out on their parking lots. This is a high level of exposure. The more prestigious the automobile the more susceptible it is to theft.

The Benefits Of Dealership Video Surveillance

Preventing Theft
Video surveillance cameras that are placed in different areas around lots help prevent thieves from stealing vehicles. They can also help identify car thieves.

Track Customers
Tracking customer’s habits can be valuable marketing data. If you combine the video with analytics, you can use this data to improve your profit potential.

Protect Building, Employees, And Customers
Surveillance cameras help to free up your employees. It allows them to perform other duties though it should not replace general vigilance.

Future Integration
Some larger dealerships may want to consider integration. A networked security system that uses internet protocol cameras or IP cameras are essential to any integration. An integrated security system at a dealership may include integrating the following:

. employee ID card timekeeping system
. security systems like doors, locks and car alarms
. building heating and air conditioning systems

Some Inherit Risks Of Video Surveillance

Privacy
Respecting privacy is important when implementing security measures. Be careful to only install security cameras in public places such a s the showroom or car lots. Refrain from placing video cameras in bathrooms or back rooms where people expect a certain measure of privacy.

Damage
Always monitor the condition of your surveillance cameras. A broken camera leaves you exposed. How do you know the thief didn’t break it? Simply having a camera up as a threat doesn’t guarantee the inventory is safe from theft. In this economy, thieves have become more daring. You don’t want to over rely on your video surveillance cameras either. They are meant to enhance security.

At Quick Cash Auto, a cash for car business in Long Island, New York, surveillance video led to the returning of some inventory of their own that was stolen from the lot. In broad daylight, a car thief found a way to sneak into the dealership’s office, where cameras were installed, and somehow lifted the keys to a Mercedes parked right outside on the lot. To make a long story short, the key theft was caught on video and it aired that evening on the Channel 12 News. The next day Quick Cash Auto received an anonymous phone call perhaps from the car thief himself stating the car was being returned and was parked right in the nearby area. Being on video must’ve scared him stiff because he returned the Mercedes the very next day!

Sometimes a determined car thief is a hard thing to beat but surveillance cameras can be an invaluable safety measure. It certainly was for Quick Cash Auto. The owner is making further upgrades to ensure the rest of the office is secure 100% of the time.

How the Recession Has Shifted People to Have Their Possessions Repaired Rather Than Buying New

Many Americans were happy to say good riddance to the year 2009 and look forward to a better one economically and financially in the year 2010. With the difficulties of losing jobs, receiving lower pay, and difficulties paying the bills during this recession, a lot of people have had to learn how to live more frugally and differently than they were used to living before the economy took a turn for the worse. One way they have chosen to be more resourceful is by using things longer and having certain items repaired like their computer from a computer repair shop rather than buying a new item when something breaks. This article will look into some of the things people are choosing to get repaired in this tough economy.

Some of the things that people are choosing to get fixed are the large items that typically they would have gotten fixed first, rather than purchasing new just like before the recession. This would include a lot of high priced appliances such as a furnace or home air conditioner, refrigerator or clothing washer and dryer. Because these items cost thousands of dollars, typically to buy new, many people are willing to pay the service fee to have it fixed to avoid having to put down all of the money it would cost to replace it.

Another category where people are choosing to get things repaired are with electronics. There are so many high tech electronics available now and many of them are multi-faceted, that they are sure to have problems at some point. Because the majority of people are not very technically capable themselves to figure out when something does not work correctly, they need to find the help of someone who deals with repairing those kind of items. For example, you may have an expensive touch screen laptop computer that all of the sudden goes blank. Instead of paying a couple of thousand dollars to get a new one, many people now seek out a computer repairman to fix it.

Because of the economy, even smaller electronics are finding themselves at repair shops whereas as the younger generation in the past would have just thrown it out when it broke and got the newer, latest gadget. Things like I-pods and video game components are now being taken to professionals that know how to fix them for a much smaller fee than it would have been to replace it. Resale shops for small electronics are also seeing an increased business as are the people that repair these smaller items.

The automobile industry has also seen a shift with people and their cars. Americans are hanging on to their cars longer and maintaining them and fixing them instead of getting the newest vehicle on the lot. This has hurt the car industry incredibly but has increased business for automotive shops that do repairs and maintenance of cars. They are also keeping things on their cars longer too, like tires and having them rotated instead of purchasing new ones.