New Colorado Law Protects, Clarifies Dealership Rights

Last Wednesday, Senate Bill 265, which clarifies and re-enforces current auto dealership protections, was signed into law in Colorado.

According to F&I Magazine, the new law will update dealership protections passed in 2009, 2010, and 2011. These protections included limiting manufacturer-mandated renovations as well as giving dealerships the right of first refusal in the case of a manufacturer filing bankruptcy, closing a location, and then opening a new franchise in the area.

The biggest problem that dealerships ran into when reinforcing the new protections was manufacturers claiming that the laws didn’t apply to franchise agreements signed before the law was passed. Dealerships that ran into this problem often didn’t want to cause more trouble with the manufacturer, so they didn’t speak up. Fortunately, a few spoke up including Don Hicks, CEO of Shortline Auto Group, and they prompted the bill’s introduction.

One of the bill’s sponsors Colo. Sen. David Balmer praised Governor Hicklenlooper for signing it into law, stating, “Now Colorado will lead the country in protecting the free-enterprise rights of auto dealers and their car-buying customers.”

Want to learn more about how Special Finance Group can work for your dealership? Go to today to learn more about the Complete Special Finance Solution, and connect with Special Finance Group on Facebook, Twitter, and LinkedIn!

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CFPB to Oversee Car Dealerships In New Year

It has been 3 years since the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law. Now in 2013, the Consumer Financial Protection Bureau (CFPB) is taking a more active role in overseeing auto loans and car dealerships.

In a few short years, the CFPB has taken on credit card companies, the big 3 credit bureaus, and predatory lenders. They have informed the public of consumer protection laws and issued rules to protect homeowners from foreclosure. As they turn their focus to the auto industry, though, some people in the industry are jumping to conclusions, imagining regulators breathing down their necks and slapping dealerships with fines every time someone forgets to dot an “i” or cross a “t.”

In response to these concerns, the CFPB has reached out to dealership groups and even sent out a representative Richard Hackett to the National Automobile Dealers Assn. convention in Orlando, Fl. At the convention, Hackett explained that the CFPB expects some human error in dealerships, but their main goal is to spot patterns of non-compliance in dealerships. The CFPB is trying to strike the right balance of alleviating fears while also letting dealerships know that they aren’t going anywhere. Dealerships will need to learn to work with the CFPB and stay current on consumer laws and regulations. As long as they are willing to take those steps, there is no need to worry.

As part of the Complete Special Finance Solution, Special Finance Group works with their associated dealerships to keep the special finance reps current on all new consumer protection laws. Compliance is more important than ever, and having the Complete Special Finance Solution gives your special finance department yet another advantage over the competition.

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Why Generation Y Isn’t Buying Cars (And How to Change It)

Once upon a time, not that long ago, young drivers couldn’t wait to get their first car. They would anxiously await their 16th birthday, hoping for a car in the driveway with a giant bow so they could throw a tantrum because it was the wrong color. Nowadays, Generation Y is turning out to be significantly less interested in cars, and it is showing in car sales numbers. In 2001, car buyers under 35 made up 24.4 percent of sales, nearly a quarter of sales. In 2010, only 9 years later, that percentage has dropped by almost half to 12.7 percent.

Why aren’t young drivers buying new cars? Some people say that young people once used cars as a form of self-expression and individuality, but other outlets like Facebook and Twitter are a cheaper way to achieve that. Others point to the rising popularity of Zipcars or other car-sharing services, and they claim that car companies don’t know how to appeal to a young generation.

All of these opinions are almost completely wrong. Facebook is not stealing away car sales. Nobody ever got to work driving a Tweet, and if someone honestly believes that young people bought cars to express themselves, their opinion isn’t exactly well-informed. Having a means of transportation is a necessity, and blaming low car sales amongst young people on social media is laughable. Car-sharing is the only factor worth taking into consideration amongst these ideas, and car-sharing is certainly not the only reason why young drivers are not buying new cars. Young people are not buying new cars for the same reason why young people are renting instead of buying an apartment or house. Generation Y is still recovering from the toxic combination of a poor job market and student loan debt, and in their minds, buying a new car is a luxury, not a necessity.

How can dealerships get past a young driver’s hesitant nature and tap into this market? The answer is simple: used cars. Used cars are more economical and will not lose their value as quickly as new vehicles. If more dealerships encouraged young car shoppers to check out their lower-cost used inventory, they would move a lot more inventory and renew an interest in young drivers to stop by a dealership in the first place. Car dealerships don’t need to do battle with Facebook or do anything out of the ordinary. Young people still need cars, and dealerships can still sell cars so long as they understand the challenges facing Generation Y.

If your dealership is looking to attract more car buyers of all ages, learn more about Special Finance Group’s Complete Special Finance Solution here. Also, you can learn more about Special Finance Group by liking Special Finance Group on Facebook, following Special Finance Group on Twitter, and following Special Finance Group on LinkedIn.