NewsAugust 2018

inside

MADA Community Heroes Announcement

MN Primary Election Results

Surprise - It’s OSHA!

Scott Lambert, President • 200 Lothenbach Ave. • West St. Paul, MN 55118 • (651) 291-2400 • 1-800-652-9029 • FAX (651) 291-2894

visit www.mada.org

for details, registration and a complete list of Upcoming Events and

Training

MADA News

MADA Services Endorses Bellavia Blatt

upcoming events

To help our dealer members take advantage of the new warranty reimbursement provisions

in Minnesota law, MADA Services is pleased to announce Bellavia Blatt as the Association’s only endorsed provider of retail warranty reimbursement services. Bellavia Blatt is regarded as the pre-eminent authority for obtaining retail warranty parts and labor reimbursement in 40 states.

MADA members who take advantage of their services will be charged a low, flat fee that is generally recouped within the first month of receiving reimbursement at retail.

Recruitment and RetentionWest St. Paul

Certified TitleWest St. Paul

Warranty ReimbursementRoseville

Warranty ReimbursementSt. Cloud

Warranty ReimbursementBloomington

Warranty ReimbursementRochester

20sep

11sep

25sep

Bellavia Blatt... continued on page 3

Training News

Warranty Reimbursement SeminarsWith Bellavia Blatt on board, MADA is pleased to announce a series of seminars, “Maximizing Retail Warranty Reimbursement for Parts and Labor,” to walk dealers through the process of submitting new parts and labor rates to their manufacturer. Counsel from Bellavia Blatt will not only explain the process but also address dealer concerns and questions about the new law.

MADA will be hosting the seminar four times the last week of September. See the enclosed training flyer for details, or go online to register: mada.org/training

26sep

25sep

27sep

August 2018 / Page 2

MADA Services is pleased to welcome Kenzie Knapp to our team. Kenzie will be our Marketing Coordinator and work with both our Services’ team and GMADA for the Twin Cities Auto Show.Kenzie graduated from the

University Of Minnesota - Carlson School of Management and majored in Marketing and Entrepreneurial Management. While at the U, she was involved in Women in Business, Folk’s Photography Club, and a campus band.For fun, Kenzie enjoys burying herself in a good book (or Netflix show), working on DIY projects, and watching lots of Vikings and Gopher Football.

The Minnesota Automobile Dealers Association is a non-profit trade association dedicated to the progress of the retail auto

industry in Minnesota.Chair Michael Stanzak, Key Cadillac, Inc., Edina Vice Chair Peter Kolar, Kolar Toyota, Duluth Treasurer Steve Whitaker, Whitaker Buick GMC, Forest Lake Secretary Gary Thibert, Thibert Chevrolet & Buick, Red Lake Falls President Scott Lambert, MADA

200 Lothenbach Avenue • West St. Paul, MN 55118Metro: 651-291-2400 • Toll Free: 800-652-9029

FAX: 651-291-2894 • Web site: http://www.mada.org

The Minnesota Automobile Dealers Association (MADA) would like to recognize the generous spirit of our members by conferring the second annual “MADA Community Heroes Award” at the Main Event, our annual luncheon celebration of Minnesota’s retail motor vehicle industry on December 7, 2018.All nominees will be acknowledged at the Main Event, with the winning dealership receiving their award at the luncheon.To be considered, nominated dealerships must demonstrate strong contributions to the local community over the past 12 months. The Community Heroes Award will be given based on the overall community impact of the dealership’s contribution and the involvement of its store employees.To nominate a dealership, visit http://bit.ly/MADA_heroes

MADA News

Community Heroes Announcement

Services News

Welcome Kenzie Knapp

FRIDAY • 12•7•18

SAVE THE DATE

August 2018 / Page 3

The warranty specialists at Bellavia Blatt know how to identify the highest yielding qualifying sequential repair orders out of the thousands within a multi-month period. Most importantly, Bellavia Blatt has the legal expertise to navigate manufacturer policies and procedures and counter factory rebuttals, if there are any, with legal justifications that support whatever repairs your dealership has included or excluded from its rate submission.

To begin the relationship so your dealership can realize warranty reimbursement at retail, contact Chris Forgione at 516-873-3000.

Bellavia Blatt... continued from cover

Are you a franchised new auto dealership whose Garage Liability is coming up for renewal? Give us a chance to give you a quote! We have endorsed Arthur Gallagher to set up plans for our dealerships. Each plan is customized to fit the needs of the dealership. If they haven’t given you a call yet, give them a call. They are working with our trusted vendor for Workers’ Compensation and Bond Administration, Al Johnson of the Ensure Agency.To contact Arthur Gallagher to go over your insurance options, please contact Genevieve Cornish at 952-358-7507 or David Howard at 952-358-7523.

Insurance News

Insurance News

On August 14, Minnesotans turned out in record numbers to determine who will represent their parties for governor and other key races on the ballot in November. 902,119 people voted in the primary; the highest number of primary voters since 1982.Reaping the benefits were GOP-endorsed candidate Jeff Johnson, who beat former

Governor Tim Pawlenty 54 to 44% and will be the

Republican candidate in November. On the DFL side, Congressman Tim Walz will appear on the ballot after defeating the

endorsed candidate, State Representative

Erin Murphy, and current Attorney General Lori

Swanson with 42% of the vote.For Attorney General, last-minute accusations of domestic abuse didn’t prevent Congressman Keith Ellison from overtaking four DFL opponents with almost 50% of the vote. He will face off against former State Representative Doug Wardlow, who won with 46% of the vote and prevailed over two other GOP candidates.At the federal level, U.S. Senator Tina Smith handily fended off DFL challenger and former White House Ethics Counsel Richard Painter. In Congressional District 1, three-time GOP candidate Jim Hagedorn kept State Senator Carla Nelson at bay with over 60% of the vote. In Congressional District 8, Joe Radinovich, the former state representative and 2016 campaign manager for Congressman Rick Nolan, prevailed in a five-way DFL primary with 44% of the vote. He will face Republican Pete Stauber, a St. Louis County commissioner, in the General Election.

Political News

MN Primary Election Results: The Field is Set

visit us online at www.mada.org

August 2018 / Page 4

In a span of just 90 days, MNOSHA has performed

comprehensive inspections at six Minnesota car dealerships; two in Duluth, and one in Aitkin, Grand Rapids, Rochester, and Anoka. This signifies a major uptick in car dealership inspections and the most seen since 2015. The reason for the uptick is unknown. These inspections are at random, which means OSHA provides no notice before showing up at the dealership’s door. During the inspection, the OSHA inspectors have been spending significant time looking at required training records, OSHA

written plans and programs, and OSHA Form 300 and 300A’s. After reviewing all of this required documentation, the inspector is then performing a physical inspection of each department.MADA is monitoring the situation in partnership with its endorsed Environmental Health and Safety Compliance vendor, ComplyNet. If you have any questions or need help with your environmental health and safety program, please contact John Tracy at ComplyNet Corporation. John can be reached via email at john.tracy@complynet.com or by calling 651-457-4444.

Legal News

OSHA Inspections on the Rise

SAVE THE DATE

Attendee registration and housing opens October 2, 2017.

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19NADASHOW LAS VEGASMARCH 22-25, 2018

N A T I O N A L A U T O M O B I L E D E A L E R S A S S O C I A T I O N

N A T I O N A L A U T O M O B I L E D E A L E R S A S S O C I A T I O N

ATTENDEE REGISTRATION AND HOUSING IS NOW OPEN.

nadashow.org | #NADASHOWDRIVE YOUR DEALERSHIP INTO THE FUTURE.

SAN FRANCISCO

JANUARY 24-27

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August 2018 / Page 5

Minnesota New Retail Car and Light Truck RegistrationsMost Recent Two Months YTD thru June YTD Market Share

5/17 & 6/17 5/18 & 6/18* % change YTD '17 YTD '18 % change 2017 2018 changeIndustry Total 36,625 37,841 3.3% 103,959 103,511 -0.4%

Cars 9,926 8,166 -17.7% 27,402 21,389 -21.9% 26.4 20.7 -5.7Light Trucks 26,699 29,675 11.1% 76,557 82,122 7.3% 73.6 79.3 5.7

Japanese Brands 13,071 13,744 5.1% 36,620 36,123 -1.4% 35.2 34.9 -0.3Honda 3,661 3,940 7.6% 10,042 9,872 -1.7% 9.7 9.5 -0.2Nissan 1,813 1,677 -7.5% 5,463 4,557 -16.6% 5.3 4.4 -0.9Toyota 4,613 4,633 0.4% 12,305 12,057 -2.0% 11.8 11.6 -0.2Other 2,984 3,494 17.1% 8,810 9,637 9.4% 8.5 9.3 0.8

Domestic Brands 19,012 19,464 2.4% 54,884 54,626 -0.5% 52.8 52.8 0.0FCA (excl. FIAT) 5,023 5,141 2.3% 14,484 14,685 1.4% 13.9 14.2 0.3Ford 6,032 6,014 -0.3% 16,902 16,349 -3.3% 16.3 15.8 -0.5General Motors 7,916 8,212 3.7% 23,304 23,337 0.1% 22.4 22.5 0.1Other 41 97 136.6% 194 255 31.4% 0.2 0.2 0.0

European Brands 2,113 2,213 4.7% 6,186 6,385 3.2% 6.0 6.2 0.2BMW 427 386 -9.6% 1,313 1,202 -8.5% 1.3 1.2 -0.1Mercedes** 388 333 -14.2% 1,026 809 -21.2% 1.0 0.8 -0.2Volkswagen 997 1,099 10.2% 2,892 3,220 11.3% 2.8 3.1 0.3Other 301 395 31.2% 955 1,154 20.8% 0.9 1.1 0.2

Korean Brands 2,429 2,420 -0.4% 6,269 6,377 1.7% 6.0 6.2 0.2

5.7%

-1.3%

-12.2%

-20.8% -20.2%

-10.4%

0.8%6.2%

1.3%

-1.3%

0.7%

-1.9%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18*

% c

hang

e vs

. yea

r ear

lier

Last month in period

7.6%

7.3%

-12.1%

-21.9%

-50.0% -25.0% 0.0% 25.0% 50.0%

U.S.

State

Cars

Trucks

Minnesota Auto OutlookCovering the Minnesota automotive market Data thru June 2018

Released by:Minnesota AutomobileDealers Association

Data InformationAll data represents new vehicle retail registrations in Minnesota and excludes fleet and wholesale transactions. Reported registrations at the end of 2017 appear to be negatively impacted by implementation of the state’s new vehicle titling and registrations system (MNLARS). This has likely resulted in under-reporting of registrations during these months and has led to declines in year-over-year new vehicle registrations. Future data updates released by IHS Markit should address the apparent shortfall in reported registrations. Data Source: IHS Markit.

Percent Change in Three Month Moving Average of New Retail Registrations versus Same Period Year Earlier

The graph above provides a clear picture of the trending direction of the state market. It shows the year-over-year percent change in the three month moving average of new retail light vehicle registrations. The three month moving average is less erratic than monthly registrations, which can fluctuate due to such factors as the timing of manufacturer incentive programs, weather and title processing delays by governmental agencies.*Figures for June 2018 were estimated by Auto Outlook. Data Source: IHS Markit.

Percent Change in State and U.S. New Retail Light Vehicle Markets

YTD ‘18 thru June* vs. YTD ‘17

The graph above compares the change in new retail car and light truck registrations in both the state and U.S. markets. Figures for June, 2018 were estimated by Auto Outlook.Data Source: IHS Markit.

Domestic: GM (Buick, Cadillac, Chevrolet, GMC), Ford (Ford, Lincoln), Chrysler (Chrysler, Dodge, Jeep, Ram). Japanese: Toyota (Toyota, Lexus), Honda (Honda, Acura), Nissan (Nissan, Infiniti) European: VW (Audi, Bentley, Porsche, Volkswagen), BMW (BMW, Rolls Royce, MINI), MB (Mercedes Benz, smart), *Figures for June ‘18 estimated by Auto Outlook. ** IHS Markit is no longer receiving sales and finance data from Mercedes Benz. This information gave IHS the ability to record lease transactions based on location of lessee. Without the sales and finance data, many lease transactions are now recorded based on location of lessor. This has contributed to the reported decline in Mercedes registrations. Data Source: IHS Markit.

Reported registrations at the end of 2017 appear to be negatively impacted by implementation of the state’s new vehicle titling and registrations system (MNLARS). This has likely resulted in underreporting of registrations during these months and has led to declines in year-over-year new vehicle registrations. Future data updates released by IHS Markit should address the apparent shortfall in reported registrations.

August 2018 / Page 6

MinnesotaNew Retail Light Vehicle Registrations

Registrations Market share

YTD '17

thru June

YTD '18

thru June* % change

YTD '17

thru June

YTD '18

thru June*

TOTAL 103,959 103,511 0%

Acura 607 610 0% 0.6% 0.6%

Alfa Romeo 38 110 189% 0.0% 0.1%

Audi 933 930 0% 0.9% 0.9%

BMW 1,114 1,019 -9% 1.1% 1.0%

Buick 2,141 1,999 -7% 2.1% 1.9%

Cadillac 584 538 -8% 0.6% 0.5%

Chevrolet 16,484 16,606 1% 15.9% 16.0%

Chrysler 2,123 1,116 -47% 2.0% 1.1%

Dodge 2,530 2,194 -13% 2.4% 2.1%

FIAT 102 74 -27% 0.1% 0.1%

Ford 16,350 15,814 -3% 15.7% 15.3%

Genesis 52 50 -4% 0.1% 0.0%

GMC 4,095 4,194 2% 3.9% 4.1%

Honda 9,435 9,262 -2% 9.1% 8.9%

Hyundai 2,811 2,931 4% 2.7% 2.8%

Infiniti 392 355 -9% 0.4% 0.3%

Jaguar 109 97 -11% 0.1% 0.1%

Jeep 5,713 7,306 28% 5.5% 7.1%

Kia 3,406 3,396 0% 3.3% 3.3%

Land Rover 212 271 28% 0.2% 0.3%

Lexus 1,100 1,069 -3% 1.1% 1.0%

Lincoln 552 535 -3% 0.5% 0.5%

Maserati 29 33 14% 0.0% 0.0%

Mazda 2,372 2,660 12% 2.3% 2.6%

Mercedes** 1,014 808 -20% 1.0% 0.8%

MINI 199 182 -9% 0.2% 0.2%

Mitsubishi 996 1,015 2% 1.0% 1.0%

Nissan 5,071 4,202 -17% 4.9% 4.1%

Other 49 29 -41% 0.0% 0.0%

Porsche 180 196 9% 0.2% 0.2%

Ram 4,118 4,069 -1% 4.0% 3.9%

Subaru 5,439 5,960 10% 5.2% 5.8%

Tesla 184 252 37% 0.2% 0.2%

Toyota 11,205 10,988 -2% 10.8% 10.6%

Volkswagen 1,779 2,094 18% 1.7% 2.0%

Volvo 441 547 24% 0.4% 0.5%

0.0 5.0 10.0 15.0 20.0

Buick

Volkswagen

Dodge

Mazda

Hyundai

Kia

Ram

GMC

Nissan

Subaru

Jeep

Honda

Toyota

Ford

Chevrolet

2.1

1.7

2.4

2.3

2.7

3.3

4.0

3.9

4.9

5.2

5.5

9.1

10.8

15.7

15.9

1.9

2.0

2.1

2.6

2.8

3.3

3.9

4.1

4.1

5.8

7.1

8.9

10.6

15.3

16.0

Market Share

YTD '18thru June*

YTD '17thru June

Minnesota Auto Outlook Data thru June 2018

This report is sponsored by the Minnesota Automobile Dealers Association and pro-duced by Auto Outlook (800-206-0102). Auto Outlook, Inc. is not responsible for management decisions based on the content of Minnesota Auto Outlook. Copyright Auto Outlook, July 2018.

Reproduction, including photocopying of this publication in whole or in part, is pro-hibited without the express permission of Auto Outlook, Inc. Any material quoted must be attributed to Minnesota Auto Outlook, published by Auto Outlook, Inc. on behalf of the Minnesota Automobile Dealers Association and must also include the statement: “Data Source: IHS Markit.”

State Market Share for Top 15 Selling Brands YTD ‘18 thru June* vs. YTD ‘17

*Figures for June 2018 were estimated by Auto Outlook.

Data Source: IHS Markit.

Top ten brands shaded green. *Figures for June 2018 were estimated by Auto Out-look. ** IHS Markit is no longer receiving sales and finance data from Mercedes Benz. This information gave IHS the ability to record lease transactions based on location of lessee. Without the sales and finance data, many lease transactions are now recorded based on location of lessor. This has contributed to the reported decline in Mercedes registrations. Data Source: IHS Markit.

August 2018 / Page 7

Endorsed Service & Vendors

MADA Services sells a wide variety of products directly to the dealers including business forms, clothing and promotional items. For a full review of options, contact your sales representative at 651-291-2400 or go to www.mada.org

Check Guarantee/Credit Card Processing FIS / CertegyDealer Bond Program Ensure AgencyDisability Income Insurance & Section 125 Cafeteria Plans American Fidelity AssuranceEmployee Placement Hireology F&I Products Protective Fleet Fueling Program SuperAmericaGaragekeeper’s Insurance Arthur GallagherGroup Health Insurance Blue Cross Blue Shield of MN Delta Dental ReliaStar LifeHole-In-One Insurance Hole-In-One-USAOffice Supplies InnovativeOfficeSolutionsOnline Marketing Services Conversica Dealer 1-2-1 LotLinx PureInfluencer Purple CloudOSHA, EPA & DOT Compliance/Training ComplyNet CorporationPre-Paid Legal, Jim Gavin Identity Theft Shield & Pre-Paid Legal Services Uniforms and Linen Services AmeriPride Linen & Apparel ServicesWarranty Reimbursement Bellavia BlattWorkers Compensation Ensure Agency

Member News In August of 2017, Kade Vershey purchased Houston Ford in Pine River and recently changed the name to Kimber Creek Ford.The Rihm Kenworth Midway facility is now closed after opening its new facilities in South St. Paul and Coon Rapids.Shorewood RV Center in Anoka was purchased by Lazydays RV on August 7, and now will be Lazydays RV. This is Lazydays RV’s first acquisition as a public company with six dealerships located in Florida, Colorado, Arizona and now Minnesota.Morrie’s West End Lincoln celebrated their grand opening on July 25..Harry Brown’s Family Automotive in Faribault is celebrating 50 years in business. Congratulations on being a third-generation and locally-owned family business with 100 employees and seven franchises!

Have you been in business 50 Years? 100 years?

PLEASE JOIN OUR HONORARY CLUB!

If your dealership has been operating with a franchise for 50 continuous years within the same family, it would qualify for membership in MADA’s Half Century Club or for 100 continuous years, in MADA’s Century Club. We will honor these dealerships at the Main Event on Friday, December 7.

Please contact DeAnna Eckert if you think you qualify - deanna@mada.org.

August 2018 / Page 8Scott Lambert, President • 200 Lothenbach Ave. • West St. Paul, MN 55118 • (651) 291-2400 • 1-800-652-9029 • FAX (651) 291-2894

200 Lothenbach AvenueWest St. Paul, MN 55118

ADVOCACY • EXPERTISE • EDUCATION • COMMUNICATION

MADA NEWS • AUGUST 2018

FAQQ: I have a used car in my back lot that is not yet for sale. Does it need a Buyers Guide displayed?

A: Yes. You must display a Buyers Guide on every vehicle in your possession, even if it is not yet ready for sale. This includes recent trade-ins and purchases at auction that may still require inspection or detailing.A dealer in Missouri received two violations of the Buyers Guide law for two vehicles that had just been acquired from a dealer-only auction. The vehicles were parked in the back of the lot and awaiting preparation for sale. The FTC imposed a $1,000 fine per violation even though the vehicles were not “retail ready.” The FTC stated that because the cars were in the dealer’s possession and located on the dealer’s lot, a Buyers Guide should have been posted on each vehicle.

Upcoming ClassesRegister Today!

Register online at www.mada.org/training OR contact Alice Morse alice@mada.org

For Information on these classes or to register online go to www.mada.org/training

Title BasicsClass Options Date LocationWest St. Paul9:30 a.m. - 11:30 a.m.$199 per person

Tuesday, October 9, 2018

MADA Headquarters200 Lothenbach AveWest St. Paul, MN 55118

The Certified Title & Registration Program

Class Options Date LocationSales Tax9:00 a.m. - 10:00 a.m. $129 September 20, 2018

MADA Headquarters200 Lothenbach AveWest St. Paul, MN 55118

New to Fleet 10:30 a.m. - 12:30 p.m. $129 September 20, 2018

Minnesota Titles and Transfers1:00 p.m. - 3:00 p.m. $129 September 20, 2018

Recruitment and Retention Series: Building and Executing your Recruitment Strategy

Class Options Date Location

West St. Paul9:00 a.m. - 11:00 a.m.$199 per person, $179 for additional attendees from same rooftop

Tuesday, September 11, 2018

MADA Headquarters200 Lothenbach AveWest St. Paul, MN 55118

Maximizing Retail Warranty Reimbursement for Parts and Labor

Class Options Date LocationRoseville 10:00 a.m. - 11:30 a.m. $129 per person, $89 additional attendees from same rooftop

Tuesday, September 25, 2018

Radisson Hotel Roseville2540 N. Cleveland Ave.Roseville, MN 55113

St. Cloud 2:30 p.m. - 4:00 p.m. $129 per person, $89 additional attendees from same rooftop

Tuesday, September 25, 2018

AmericInn by Wyndham4385 Clearwater RoadSt. Cloud, MN 56301

Bloomington 2:00 p.m. - 3:30 p.m. $129 per person, $89 additional attendees from same rooftop

Wednesday, September 26, 2018

Residence Inn by Marriott3400 Edinborough WayEdina, MN 55435

Rochester 10:00 a.m. - 11:30 a.m. $129 per person, $89 additional attendees from same rooftop

Thursday, September 27, 2018

Kahler Apache(Canadian Honker)1517 16th Street SWRochester, MN 55902

Recruitment and Retention Series: The Road to Employee Engagement and Customer Loyalty

Class Options Date Location

West St. Paul9:00 a.m. - 11:00 a.m.$199 per person, $179 for additional attendees from same rooftop

Wednesday, October 10, 2018

MADA Headquarters200 Lothenbach AveWest St. Paul, MN 55118

BEGINNING AUGUST 1, MINNESOTA DEALERS HAVE A STRONGER FRANCHISE LAW THAT WILL INCREASE REIMBURSEMENT RATES ON WARRANTY PARTS AND LABOR BY: • laying out a specific formula based on customer-pay repair

orders (RO’s) to help dealers determine their average percentage mark-up for warranty work;

• excluding specific non-warranty repairs, like routine maintenance, from the RO sample;

• preventing dealers from losing their mark-up when manufacturers offer low- or no-cost parts in the event of a recall; and

• prohibiting the manufacturers from denying or charging back warranty claims due to clerical errors.

To help dealers take advantage of the new law, MADA is pleased to announce a series of seminars, “Maximizing Retail Warranty Reimbursement for Parts and Labor,” to walk dealers through the process of submitting new parts and labor rates to their manufacturer. Counsel from Bellavia Blatt, MADA’s only endorsed provider of retail warranty reimbursement services, will not only explain the process but also address dealer concerns and questions about the new law.Offering 4 separate times/locations: • Tuesday, September 25 • Roseville • 10:00-11:30 a.m.• Tuesday, September 25 • St. Cloud • 2:30-4:00 p.m.• Wednesday, September 26 • Bloomington • 2:00-3:30 p.m.• Thursday, September 27 • Rochester • 10:00-11:30 a.m.

September 25 - Roseville*September 25 - St. CloudSeptember 26 - BloomingtonSeptember 27 - Rochester

Registration Fee $129, $89 for second or subsequent registrations from the same dealership or group. *The Roseville class will serve as an SPCC Shop Talk. SPCC members will receive complimentary admission to this class only.

For more information, please contact Alice Morse at

651-789-2956 or email alice@mada.org

Space is limited

REGISTER TODAY!

MAXIMIZING RETAIL WARRANTY REIMBURSEMENT FOR PARTS AND LABOR