MSADA, One McKinley Square, Sixth Floor, Boston, MA 02109 FIRST CLASS MAIL MASSACHUSETTS US POSTAGE PAID BOSTON, MA PERMIT NO. 216 AUTODEALER March 2010 • Vol. 23, No. 3 The official publication of the Massachusetts State Automobile Dealers Association, Inc DEALER OF THE YEAR Rick INSIDE: •NADA Convention •Toyota Damage Mastria Continues MASSACHUSETTS AUTODEALER The official publication of the Massachusetts State Automobile Dealers Association, Inc STAFF DIRECTOry Robert O’Koniewski, Esq. Executive Vice President [email protected] TABLE OF CONTENTS Irene Varao Director of Administration [email protected] Tricia White 4 FROM THE PRESIDENT: The Damage Continues Accounting and Membership Manager [email protected] 6 POLITICAL ACTION: No Lifeline Yet Sam Poikail Information Technology & 8 COVER STORY: Membership Information Manager [email protected] Rick Mastria – Dealer of the Year Tom Nash Editorial Coordinator 12 ACCOUNTING: Vehicle Service [email protected] Karen Kast-McBride Contracts Administrative Coordinator [email protected] 13 LEGAL: Beware of Manufacturers Nicole Ventosi Bearing Gifts Administrative Assistant [email protected] 14 NADA Convention Report Subscriptions provided annually to Massachusetts dealers. All address changes 19 TRUCK CORNER: Deconstructing the Alphabet Soup should be submitted to: MSADA by e-mail: [email protected] 20 NEWS From Around the Horn Postmaster: Send address change to: 25 NADA UPDATE: Customer Safety Testimony One McKinley Square, Sixth Floor Boston, MA 02109 Auto Dealer is published by the Massachusetts State Automobile Dealers Association, Inc. to provide information about the Bay State auto retail industry and news of MSADA and its membership. www.msada.org Massachusetts Auto Dealer MARCH 2010 4 from the PRESIDENT by James G. Boyle, President, MSADA The Damage Continues As the media hypes Toyota’s woes, dealers suffer W hile Toyota dealers continue to work with customers in Eventually, these instances of “The Runaway Prius” will be the wake of the recent recalls, a new twist has been added that debunked. In the meantime, we’re caught between allegations makes the exaggeration displayed in the media in the past few and the fact that the words “driver error” will get us nowhere. months seem tame. Toyota has taken these hits on the nose so far, refusing to do A California Prius driver needed police help to stop his car what Audi did so many years ago and suggest the drivers after it allegedly accelerated uncontrollably, leading the media could be at fault. We all learned from that mistake, and, to start speculating that the acceleration concerns reported in unfortunately, that is exactly the trap Toyota finds itself in at other Toyota models were beginning anew. this moment. And we’re caught in the middle. The story remained virtually unchallenged until Toyota spokesman Mike Michels briefed reporters a week later, saying, “There are significant inconsistencies between the Thoughts on the NADA Convention account of March 8 and the findings of this investigation.” Along with MSADA Executive Vice President Robert The Prius in question, during tests by Toyota officials, was O’Koniewski, I travelled with TIME Massachusetts Dealer of found to have brakes that were ground down. After putting in the Year Rick Mastria to Orlando last month to both celebrate new brakes, repeated testing found no runaway acceleration. his nomination for the magazine’s national dealer of the year While we ourselves shouldn’t jump to conclusion, it’s also award and the NADA Annual Convention. worth noting that a TV station in San Diego reported the driver What I found there was encouraging. Certainly, attendance has a debt of $700,000 – and hadn’t made a payment on the car was up. The mood seemed correspondingly more upbeat, and in question for months. the prediction from most (dealers and manufacturer reps) Meanwhile, there is the story of the driver who ran into a wall seemed to be that we will see much better numbers this year. in New York. Initially, the report was a 56-year-old woman The speeches by both incoming and outgoing NADA found her Prius accelerating by itself, leaving her driveway Presidents summed up the atmosphere well. Last year was the and crashing into a stone wall, deploying the airbags. toughest most of us have ever seen. But we didn’t get into this What wasn’t reported was that the woman driving the car business to worry about the past – we will always look ahead. was not the owner, but the owner’s housekeeper. She was That’s what makes us one of the most important business asked to drive a car she had no experience driving. The facts communities in this country. aren’t all out yet, but they will be. As we know, Priuses log Our profile of our Massachusetts Dealer of the Year appears the first five seconds before and the five seconds after airbags on page 8 of this magazine, and you will find more NADA deploy, which they did in this case. coverage on page 14. MARCH 2010 Massachusetts Auto Dealer www.msada.org MSADA 5 Eventually, these cases of ‘The “Runaway Prius’ will be debunked. MSADA BOARD In the meantime, we’re caught Barnstable County Gary Beard, Dick Beard Chevrolet Berkshire County between allegations and the fact [Open] Bristol County that the words ‘driver error’ will Shawn O’Hara, O’Hara Mazda Essex County William DeLuca, Woodworth Motors get us nowhere. Ann Regan Flynn, Regan Ford, Inc. Franklin County Steven Lorenz, Don Lorenz, Inc. New Associate” Members Hampden County Jack Sarat, Jr., Sarat Ford We recently brought Proshred, Responselogix and Schlossberg & Hampshire County Associates, LLC into our Associate Member fold. As always, I encourage [Open] you to consider our Associate Members when searching for services, Middlesex County including: James Boyle, Tuck’s Trucks Chris Connolly Jr., Herb Connolly Motors ADESA Boston Murtha Cullina, LLP Scott Dube, Bill Dube Hyundai ADP Dealer Services Nancy Phillips Associates, Inc. Norfolk County Albin, Randall & Bennett NEAD Insurance Trust Jack Madden, Jr., Jack Madden Ford AutoRaptor (RAL) O’Brien Riley & Ryan P.C. Charles Tufankjian, Toyota Scion of Braintree AutoTrader.com O’Connor & Drew P.C. Plymouth County Blum, Shapiro & Co.PC Proshred [Open] Boston Globe Protective Suffolk County Carlin Charron & Rosen, LLP Reynolds & Reynolds Robert Boch, Expressway Toyota CVR R. L. Tennant Insurance Agency Worcester County DealerTrack, Inc. Resource Management Group Joel Baker, Baker Cadillac Downey & Company Robinson, Donovan, Madden & Medium/Heavy-Duty Truck Dealer F & I Coach Barry, P.C. Director-at-Large F & I Resources Samet & Company, PC [Open] First Extended Service Corp. Schlossberg & Associates, P.C. Immediate Past President Greenwood Distributors, LTD Security First Insurance Group Dana S. Goodfield, Dana Automotive Key National Bank Sentry Insurance Company NADA Director Leader Auto Resource, Inc Southern Auto Auction Raymond Ciccolo, Village Auto Group Lynnway Auto Auction Target Dealer Services M & T Credit Corporation TD Bank OFFICERS McCarter & English Wiggin & Nourie, P.A. President, James G. Boyle Mid State Insurance Agency Zurich American Insurance Vice President, Scott Dube Mintz Levin Company Treasurer, Jack Madden, Jr. Clerk, Chris Connolly, Jr. www.msada.org Massachusetts Auto Dealer MARCH 2010 6 Political ACTION No Lifeline Yet by Robert O’Koniewski, Esq. MSADA Executive Vice President Will Your Business Ever See Any 20,000 employees across the state. Collectively that would make us one of the largest private em- Relief on Health Care Costs? ployers in the Commonwealth. However, due to Quick quiz – What are the following numbers: the manner in which rates are set by the health 12-13-19-7-22? (Hint – they are not the next insurance companies, our members do not have winning lottery picks or the combination to the the collective negotiation power that such a large office safe.) employer would have. Instead, our member deal- Answer - They are the last five years of av- ers’ health insurance costs are higher and the erage increases that small business retailers like yearly increases much steeper than those expe- dealers have faced on their health insurance pre- rienced by large employers or those in the pub- miums since the passage of the Massachusetts lic sector in the GIC system through the state or health reform law in 2006. municipal set-up. The cumulative five-year increase of 73% has Furthermore, this past week, the U.S. House led to an average family premium of $16,322 with of Representatives passed the much-publicized a $3,800 family deductible and an average single health care reform legislation, and it was quick- premium of $6,252 with a $1,400 deductible. ly signed by the president. In all the discourse Unfortunately, as you know too well, an av- thrown around by supporters and opponents, erage 15% annual increase is unsustainable, re- what often gets lost are the details and what it gardless of the economic conditions or the suc- means for those of us down in the weeds battling cess of your business. these issues in the legislative process and on the To address this issue, your MSADA has started account ledger. It is too soon to tell what the new to work with other business lobbying groups such federal law means for small businesses and their as the Retailers Association of Massachusetts to employees. We are working on deciphering what push for passage of legislation here in Massachu- the new law will mean for Massachusetts insur- setts that would give members in associations ance carriers, small businesses, and the insured. like ours strength in numbers. Last week, the How the current Massachusetts mandates get Joint Committee on Finacial Services reported reconciled with the new federal rules will take the bill out favorably. The legislation would al- some time to work through. One thing is clear low association members to be grouped together – small businesses like your dealerships need into a small business health plan in an effort to definite relief from the out-of-control insurance strengthen negotiations with one or more carriers premium hikes.