Volume 115, No. 3 January 29, 2018

Curtain set to rise on 2018 With automakers buoyed nium Lakeside Garages. On tain rises Feb. 8 with the by three straight years of those days only, parking rates Midwest Automotive Me- 17 million-plus new-vehicle there are $18 for 12 hours dia Association breakfast, U.S. sales, expect them to with validation, which will be featuring keynote speaker raise the bar for the coming provided upon shuttle exit. Thomas Doll, president 10-day Chicago Auto Show, The 2018 version of Chi- and chief executive of Feb. 10-19. cagoAutoShow.com is fully of America. Hours Actually, that’s not quite functional for all devices — later, Hinrich Woebcken, right. The show actually is a are free with a paid adult. desktop, tablet and mobile CEO of ’s three-legged stool: the two- Parking in two of McCor- — allowing users the same North America Region day Media Preview; First mick Place’s three lots, Lots experience whether they are and president and CEO Look for Charity (see ar- A and C, costs $23; in Lot B, at home, work or on the go. of Volkswagen Group of ticle below), and the show’s it costs $15. At 6 p.m. daily, The CATA has arranged America, Inc., will be the 10 public days that follow. the rate at all three lots drops for free high-speed WiFi at guest speaker at the Eco- Buy tickets online, print to $10. the show, to allow attendees nomic Club of Chicago ’em out at home and avoid Special parking rates also to share their experiences Luncheon, a monthly gath- the box office lines. Tickets will be offered Saturdays, through social media, the ering which in February is are $13 for adults; $7 for se- Sundays, and Presidents Day, show website, and the offi- held at McCormick Place niors aged 62 and older and Feb. 19, with free roundtrip cial Chicago Auto Show app. for the auto show. for children ages 7 to 12; shuttle bus service from the Media Preview About 3,500 registered and children 6 and younger Millennium Park and Millen- The Media Preview cur- See Auto Show, Page 4

Auto show gala aiming to raise $3 million for 18 area nonprofits Eighteen Chicago area charities will see the hundreds of new vehicles on the automakers in their displays. benefit from about $3 million expected display amid an elegance not present Benefactors in attendance also have to be raised by the black-tie gala held when about 1 million people converge the chance to win one of two 2018 in conjunction with the 2018 Chicago on McCormick Place during the auto Ford vehicles: an Expedition or a Mus- Auto Show in February. Now in its 27th show’s 10-day consumer run, Feb. 10- tang GT Convertible. year, First Look for Charity is held the 19. Tickets are $275 each and can be evening before the auto show opens to About 10,000 attendees at the charity purchased at www.firstlookforcharity. the public. gala will be treated to hors d’oeuvres; org. Ticket proceeds can be directed to The coming “First Look” event, on champagne, wine, beer and soft drinks; benefit any or all of the charities, and Feb. 9, gives benefactors the chance to and special entertainment presented by $223 is tax-deductible. 2 CATA Bulletin January 29, 2018

Dealerships must change to meet In Memoriam web-savvy consumer expectations Jerold A. “Jerry” Borg, who owned a Dealers must streamline the in-dealership car-buying namesake Pontiac dealership in Down- experience and change to allow web-savvy consumers to ers Grove from 1963 to 1995, died Jan. complete one or more steps of the purchase process online, 14 at age 92. according to Cox Automotive’s “Future of Digital Retail An Iowa native, Mr. Borg served as Study,” released Jan. 14. a pilot in the U.S. Navy during World Sandy Schwartz, president of Cox Automotive, said the War II and was a graduate of the Uni- survival of OEMs is contingent on car dealers who must versity of Dubuque, where he lettered invest in technology and processes to bring the car-buying in basketball and track and was inducted as a member of process more in line with consumer expectations. the university’s athletic Hall of Fame. While operating “Think about what needs to get better today in car buy- Borg Pontiac, he served on the CATA board of directors ing,” he said. “Unless things change drastically, those OEMs from 1986 to 1989. are not going to survive without the car dealer and the eco- Mr. Borg was a longtime member of Knox Presbyte- system that is out there today. That dealer is really impor- rian Church and Cress Creek Country Club, both in Na- tant. perville; and Bear’s Paw Country Club, in Naples, Florida. “We are focused on the long-term and we are very, very He was a founder of the Indian Boundary YMCA in focused on the short-term: what’s going on today and how Downers Grove, was instrumental in establishing Samari- we can make the buying experience faster, less expensive for tan Interfaith Counseling Center in Naperville and was the dealer.” active with the Boys & Girls Clubs of Downers Grove. But not only will the car-buying process change, so will He enjoyed playing golf and held a private pilot license. car ownership once autonomous car technology is perfected Survivors include Corrine, his wife of 68 years; daugh- and vehicle- and ride-sharing continue to grow in popularity, ters Karen and Linda; a son, David; nine grandchildren; Schwartz said. and 11 great-grandchildren. Visitation is 2-6 p.m. Jan. 28 Positioning for the future at Friedrich-Jones Funeral Home & Cremation Services, That’s why Cox Automotive is working with technology 44 S. Mill St., Naperville, followed by a celebration of his and companies that will position it to help its dealer and life at 12 p.m. Jan. 29 at Knox Presbyterian Church, 1105 OEM customers now and in the future, he added. Catalpa Ln., Naperville. Though fleet ownership won’t change the absolute num- In lieu of flowers, memorials appreciated to Knox ber of vehicles in use, it will have “massive implications” Presbyterian Church, (630) 355-8181, or the Alzheimer’s for industry players, predicts Grace Huang, Cox Automotive Association, (800) 272-3900. president of inventory solutions. “First, it’s the dealer,” Huang said. “It’s no longer just sell and lease. It’s sell, lease and subscribe. Those dealers will also No more old Buyers Guide become the fleet owners of the future. For OEMs, it’s not As of Jan. 27, the previous version of the Buyer’s Guide just selling the cars direct to the customer anymore. It’s also cannot be used. The rule surrounding the current version going back to what they did with rental cars in the past and took effect Jan, 28, 2017, but the Federal Trade Commission owning that fleet and being that fleet provider. gave dealers a one-year grace period to draw down their in- “And last, it’s the lender. They’ll no longer be lending di- ventories of the old version. rect to the consumer, but they’ll be lending to the new fleet owners in the U.S., whoever they may be. So, lots of massive The CATA Bulletin is produced by the implications.” Chicago Automobile Trade Association The Future of Digital Retail Study is based on responses 18W200 Butterfield Rd. Oakbrook Terrace, IL 60181-4810 from 2,550 car shoppers who said they plan to buy a car The CATA Bulletin is distributed via blast email every other Friday within 12 months. It revealed that the biggest gripe consum- except during the Chicago Auto Show, when it is not produced. Listings of items for sale are subject to the approval of the CATA. ers have about the in-dealership, car-buying experience is Candidates for employment must submit a full resume to the Editor. that it takes too long — about three hours for the average Review past editions dating to 1998 or search by subject at buyer. www.cata.info/publication/bulletins. And fully half of that time is devoted to negotiating fi- David E. Sloan President, Publisher nancial details, such as vehicle price, financing, trade-in value Erik K. Higgins Editor, Director of Dealer Affairs and accessories, the study reported. January 29, 2018 CATA Bulletin 3

A new year at the NADA By Mark Scarpelli, Chairman ship business model. dealers. Nat’l Automobile Dealers Assn. However, the work never ceases. Finally, the fight to defend our I am extremely proud of the The NADA is pushing ahead so that franchise system will never end. The thousands of franchised auto deal- we have a secure and stable industry NADA has embraced a dynamic ap- ers across the nation. Despite an into the future. The newest challenges proach, and we have pushed newer ever-changing landscape in our retail have come in the form of legislation social media platforms to spread the business, we closed out 2017 with 17 to regulate self-driving vehicles, and we news about the benefits of the fran- million new-car and -truck sales. We are continuing to advocate legislation chise system — especially in times of are looking toward 2018 with opti- that explicitly preserves state vehicle dire need. The 2017 hurricanes and mism and confidence. licensing and franchise laws. And as we California wildfires ravaged homes, We saw many challenges to the navigate the Trump Administration, we businesses and families. But the amaz- dealer business over the past year are staying on top of tax reform and ing network of dealers who quickly and, thanks to the passion and hard critical issues that will affect our opera- stepped up to help fellow dealer fami- work I’ve seen around me, we are tions, such as LIFO and the estate tax. lies in their darkest hours, has made in much better standing for 2018. I We have worked harder than ever lasting impacts on thousands of our am proud to say that we have been to build stronger relationships with employees. I’m proud that together successful in our efforts to prevent our manufacturers. I have made it my we have raised millions of dollars for elimination of dealer discretion and priority to address the negative impact the NADA Emergency Relief Fund— consumer discounts in auto financing. of stair-step programs head-on. During funds that are still being distributed We rightly advocated for our custom- my chairmanship, the NADA has had today. ers and Washington heard us loud many meetings with OEMs to share I cannot say this enough: I’m so and clear. the results of our landmark study that proud to be an auto dealer. And I’m The NADA’s alternative policy highlights the importance of transpar- proud of the work we’ve done to ensures fair credit compliance and ency, trust, loyalty and commitment to power this industry for more than a also preserves the ability of dealers our brands. century. We have stood the test of to offer discounts to our customers. Dealers are in resounding agreement time, and we are ready to tackle the We also successfully fought attempts that factory efforts should help our cus- next 100 years. to ground all used vehicles at the tomers and our businesses, not harm I hope to see you all in Las Vegas dealership with open recalls — again them. You can be sure the NADA will for the 2018 NADA Show, where we standing with our customers and pre- continue to expand this platform so will ring in our 101st year as your na- venting Washington from imposing that dealers and OEMs work symbioti- tional association and your strongest a costly trade-in tax on consumers. cally, as we should. It was my privilege ally. I wish you and your employees a And most recently we preserved 100- to address this very issue in front of prosperous 2018! percent deductibility on floor plan the automotive press in Detroit last Mark Scarpelli is a and interest, a cornerstone of the dealer- October as an advocate for my fellow dealer in Antioch, Ill.

Trump looks to lower mpg rules but more EVs, hybrids on the way Automakers are expecting the Trump Administration to that the coming proposed rule would be released March 30 propose lightening fuel economy standards in late March, and would cover model years 2022 through 2025. potentially making it easier to keep selling more trucks and “It will be a proposal that will stimulate dialogue, robust SUVs, which carry fatter profits. listening to the data and the stakeholders that should inform But even if the National Highway Traffic Safety Adminis- a decision before we go to a final rule stage,” she said. tration eases the standards, as expected, automakers will keep The auto industry has lobbied Trump to revisit the fuel- investing in battery and fuel-cell technology to lessen the economy standards because persistently low gas prices are automobile’s dependence on the internal combustion engine driving consumer demand for pickup trucks and SUVs, which because large markets such as Europe and China continue to get poorer gas mileage than small and hybrid passenger cars. establish CO2-reducing regulations, and future White House Trucks, SUVs and crossovers account for about two-thirds administrations and Congresses likely will move to reinstate of new-vehicle sales, compared with one-third going to two- tougher rules. and four-door passenger cars. Acting NHTSA Administrator Heidi King said this month 4 CATA Bulletin January 29, 2018

Member-discounted tickets to 2018 auto show on sale now Tickets and vouchers that admit the holder to the 2018 day Discount voucher. The former, which costs CATA Chicago Auto Show free or at a reduced price can be or- members $600 for 100 tickets, admits the holder to the dered by CATA members using the order form posted at auto show free, without a box-office wait. The Weekday www.CATA.info. Discount voucher costs members $100 for 100 and admits The passes promote goodwill with customers and even the holder for $7 during the week. can help persuade a prospect to close a deal. Two kinds of Regular admission is $13. A minimum 100 passes must passes are available, General Admission ticket and Week- be requested with either order.

Auto Show Telemundo and WGN. Unemployment claims deflected Continued from Page 1 Initial broadcasts of the media and an additional specials will be 4:30 p.m. Feb. One hundred forty-six employers is 3.225 percent, 1,500 invited bloggers, digital 10 (Telemundo), 6 p.m. Feb. CATA dealer members re- or about $418 annually per influencers and shouters will 10 (ABC and WGN), and ported a combined 1,302 employee ($447 in 2017). be on hand for the two-day 10:30 p.m. Feb. 11 (CBS). All unemployment claims during The rate continues to inch Media Preview, to report on the specials will be repeated the fourth quarter of 2017 down from 2007, as the Il- an anticipated 20 new-vehi- during the show’s 10-day to Sedgwick Claims Manage- linois economy continues to cle introductions. run. ment Services, Inc., which improve. Public show Special days this year in- has been serving CATA deal- “The unemployment tax The automakers are get- clude: ers under various names since is really the only controllable ting creative with their dis- Women’s Day, Tuesday, 1979. The company’s efforts tax in business, in that it’s ex- plays; they’re so much more Feb. 13. Women admitted saved those dealers a total of perience-driven,” said Paul than cars on carpet! This for $7. Manufacturers pres- $1,327,596 in benefit charges Schardt of Sedgwick. An ex- year, attendees again have the ent special women-oriented by contesting the claims. employee’s claim affects the chance to test-drive vehicles programming on the pur- By comparison, there were employer’s tax rate for three — at the indoor test tracks chase and lease of cars and 331 unemployment claims at years. and in outdoor ride-and- maintenance. member dealerships during For new enrollees, client drives — interact with the Chicago Auto Show the year’s first quarter. fees amount to $2.85 per em- latest technology and safety Food Drive, Feb. 14-16. Sedgwick, Inc. monitors ployee, per fiscal quarter. For features, and participate in Show patrons who bring any unemployment claims the fee, Sedgwick monitors new, engaging activations. three cans of food receive against its clients and con- all unemployment claims; This year’s show boasts a voucher for a $7 adult ad- tests all unwarranted claims files any appeals; prepares three indoor test tracks mission. All canned food will and charges. The company employer witnesses for hear- among the , Kia and be donated to A Safe Haven counts about 235 CATA ings, as necessary; represents brands, and six out- Foundation. dealers among its clients. the client at any hearings; door test drive opportunities Hispanic Heritage Day, Claims that can be protest- verifies the benefit charge by , Ford, Kia, Maz- Friday, Feb. 16. Since 2007, ed and subsequently denied statements; and confirms the da, Subaru and Volkswagen. Telemundo has partnered help minimize an employer’s client’s unemployment tax Expect plenty of televi- with the Chicago Auto Show unemployment tax rate. The rate. sion coverage of the nation’s to present special events, in- rate can vary between 0.525 For more information and largest auto show. Locally, cluding autograph signings percent and 6.925 percent of information on how to retain in addition to intermittent and music performances. each employee’s first $12,960 Sedgwick’s unemployment “throws” to reporters on Family Day, Monday, in earnings. services, call Bruce Kijewski the show floor, watch special Feb. 19. Family-friendly The 2018 average unem- at (773) 824-4322 or email programming from four Chi- events with fun games, prizes ployment tax rate & new him at Bruce.Kijewski@ cago TV stations: ABC, CBS, and entertainment. employer rate for Illinois Sedgwick.com.

Newsletter The CATA Bulletin takes a one-issue break on Feb. 12, in deference on hiatus to the Chicago Auto Show. The next edition is Feb. 26.