No Public Rallying Around Dealers

DETROIT – Dealer competitiveness aids consumers and protects their rights, National Automobile Dealers Assn. Chairman Bill Fox contends, but he isn’t expecting public rallies supporting auto retailers.

In a speech entitled “Keep Auto Retailing Affordable for Car Buyers,” he tells of his trade group’s efforts in Washington to fight policy decisions that threaten to increase vehicle costs and hit car buyers in the pocket book.

Asked during a subsequent Q&A session why there isn’t a public groundswell supporting NADA’s government lobbying, Fox says, “it’s an individual thing.”

Consumer groups won’t publicly back NADA’s pro-consumer efforts, but individual members benefit when they buy a car, Fox tells the Automotive Press Assn. here.

NADA spokesman Charles Cyrill later tells WardsAuto Americans support NADA through representative government. He notes 147 House of Representative members – 86 Republicans and 61 Democrats – cosponsor House bill 1737.

The proposed legislation, among other things, would require the Consumer Finance Protection Bureau “to study the true impact on consumers before issuing new guidance,” Fox says.

The CFPB has pushed to change the way dealers are compensated for serving as middlemen between lenders and car buyers. A traditional part of dealer-assisted financing is for dealers to add to the percentage rate of a loan. The CFPB has prodded lenders to switch to a flat-fee system or something similar.

Fox argues that would hurt customers.

“Actions in Washington are taking away our customers’ right to benefit from the dealer-franchise system, especially rules governing dealer-assisted financing,” he says. “When you are paying $30,000 for a car, you should have every possible financing advantage.”

Fierce competition among dealers enhances that cause, he says. “Washington shouldn’t be in the business of denying consumers these rights, or taking away these advantages. But that’s exactly what’s happening.”

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