• DigitalDealer-horizontal-Logo
  • ATTEND LAS VEGAS
    • Attendee
      • Registration & Pricing
      • Agenda At-A-Glance
      • Exhibitor List/Floor Plan
      • Sponsor List
      • Hotel & Travel
      • Hosted Dealer Program
      • FAQ
      • Mobile App
    • Exhibitor
      • Exhibit/Sponsor
      • Advertising Opportunities
      • Exhibitor Resources
      • Exhibitor Tips
    • Education
      • Overview
      • Show Schedule
  • ABOUT
    • Conference Overview
    • Best Of Awards
    • Become a Speaker
    • Press Inquiries
    • Partnership Programs
    • Health & Safety
    • Contact Us
    • Get Updates
  • RESOURCES
    • Webinars
    • Downloads
  • NEWS
    • Auto Retail News
    • Digital Editions
    • Press Releases
    • Submit Editorial
    • Subscribe
  • .
  • ATTEND LAS VEGAS
    • Attendee
      • Registration & Pricing
      • Agenda At-A-Glance
      • Exhibitor List/Floor Plan
      • Sponsor List
      • Hotel & Travel
      • Hosted Dealer Program
      • FAQ
      • Mobile App
    • Exhibitor
      • Exhibit/Sponsor
      • Advertising Opportunities
      • Exhibitor Resources
      • Exhibitor Tips
    • Education
      • Overview
      • Show Schedule
  • ABOUT
    • Conference Overview
    • Best Of Awards
    • Become a Speaker
    • Press Inquiries
    • Partnership Programs
    • Health & Safety
    • Get Updates
  • RESOURCES
    • Webinars
    • Downloads
  • NEWS
    • Auto Retail News
    • Digital Editions
    • Press Releases
    • Submit Editorial
    • Subscribe

DealerPoint: May 21-23, 2024
Conference & Expo:
October 8-10, 2024

REGISTER NOW EXHIBIT / INQUIRE
Q

NEWS:

Dealer Ops & Leadership | Trending Industry News
April 19, 2022

A Little Less Talk and a Lot More Action

Posts:
Dealer Ops & Leadership | Trending Industry News
April 19, 2022

A Little Less Talk and a Lot More Action

By Sean Reyes, Chief Marketing Officer, Recall Masters

Today’s automotive climate is undergoing quite of bit of turmoil. Between chip shortages leading to decreased new car inventory and used car prices skyrocketing for dealers and consumers, dealers still have to fight for every dollar they earn. In doing so, they are forced to gravitate to used vehicles out of necessity.

The lack of new car inventory isn’t all bad news for dealerships. Due to older vehicles in the market for a longer time, shop capacity is maxed out. Service departments are working overtime to service their customers while also reconditioning used inventory as quickly as possible to ready these vehicles for sale. Walk into any service department today and you’re going to witness the frantic pace technicians have to operate in. While on pace for another year of record-breaking revenue, service department staff are overwhelmed, which can lead to pushing open recalls to the back of the pile with a disclosure and promise to fix.

Off-brand dealers are in a harder spot as they have to rely on a competing dealership to fix any recalls, which results in a disclosure to the buyer and instructions to take their newly purchased vehicle to the branded dealership to get the recall fixed. It’s not the best introduction to a new customer, but vehicle safety comes first and it’s the right thing to do. It’s also the smartest thing to do, as your dealership is still legally liable under state product liability laws for selling any new or used car with an open recall. Recall disclosures only protect your dealership from state lemon laws, not product liability laws.

While it’s good news that recall completion percentages increased last year, the problem is an increasing number of recalls are announced daily. And the crux of the matter is that, as of right now, no law prohibits the sale of a used vehicle with an open safety recall.

Well, that could be about to change: Enter Jason Levine. Levine once held the position of executive director at the Center for Auto Safety. He left to become the acting director of the Office of Communications at the U.S. Consumer Product Safety Commission. He is an active voice in support of banning the sale of used cars with open safety recalls to consumers. His new position allows him even further authority and a voice in motivating the government to make this happen.

NBC News out of Washington reports that even the U.S. Government currently sells hundreds of vehicles with open safety recalls to a mostly uninformed public. The General Services Administration (GSA) has auction houses across the country where consumers can purchase cars directly. According to the NBC report, the GSA is simply offering disclosure to buyers. This appears to be in opposition to the recall compliance efforts manufacturers and dealers and currently encouraged to execute to ensure vehicles are safe to drive. Jason Levine was interviewed and stated, “Disclosure doesn’t fix the danger … generally speaking, when the government is selling you something, even if they’re disclosing it, there’s a general perception that it can’t be too dangerous.”

NBC News further reported that auction houses are selling hundreds of vehicles with serious open safety recalls which place drivers at risk. The National Highway Traffic Safety Administration (NHTSA) and the GSA are both government agencies. The former is charged with issuing safety recall notices and pushing manufacturers and dealers to increase recall compliance, while the latter is responsible for selling vehicles that are out of commission. It would seem that their current actions are at odds with their stated mission. Levine even called the GSA’s action of selling used vehicles with open safety recalls hypocritical.
Dealers are currently stuck between a rock and a hard place. There isn’t enough new inventory to sell at the moment. They have to sell used vehicles to keep the lights on. Used car inventory needs to turnover fast and dealers may not have the luxury of waiting for an open safety recall repair. That assumes “safety” is a “luxury”, which it is not. If our industry uses the current lack of inventory as an excuse to sell dangerous vehicles to consumers, then expect consumer backlash when inventory levels are restored.

That being said, legislation is floating around that will prevent the sale of used cars with open safety recalls. With proponents of this legislation now elevated into offices that directly influence policy, my guess is that we’re going to see this legislation move at a much faster pace. And dealers will have to figure out a way to adapt while still maintaining profitability.

Dealer Ops & Leadership•Trending Industry News

SHARE

Share on Email
Share on Linkedin
Share on Facebook
Share on Pinterest
Share on Twitter
← Previous Article Next Article →
Posts Dealer/GM News

Nearly 4,000 Car Dealers Ask President Biden to Slow Down EV Push

Car dealers are asking President Joe Biden to “tap the brakes” in his administration’s electric vehicle (EV) push. A total of 3,882 franchised car dealers the U.S., calling themselves the EV Voice of the Customer, published the letter on No
Posts Data & Analytics

Digital Retailing Continues to Grow at Auto Dealerships

A recent report found car dealers offering consumers the ability to do a deal online has grown to 40% in the last year—but an urgent need to cutdown on repetitive steps happening in the showroom. Nearly all car dealers currently using digital retai
Posts Dealer/GM News

Nearly 4,000 Car Dealers Ask President Biden to Slow Down EV Push

Car dealers are asking President Joe Biden to “tap the brakes” in his administration’s electric vehicle (EV) push. A total of 3,882 franchised car dealers the U.S., calling themselves the EV Voice of the Customer, published the letter on No
Posts Dealer/GM News

Ciocca Agrees to Purchase 10 More Pennsylvania Dealerships

The Ciocca Dealership group is growing its holdings in Pennsylvania. The agreement has Ciocca purchasing Apple Automotive, the automotive division of York County, Pa- based Stewart Companies. Terms of the deal was not disclosed, with the final transa
Posts Dealer/GM News

Mercedes Launches First Charging Hub in U.S.

Mercedes-Benz is offering a change to the way Americans charge their vehicles in the same way Starbucks altered the routine of getting a cup of coffee. Mercedes, in a joint venture with MN8 Energy to launch a network of premium electric vehicle (EV)
Posts Digital DealerEveryone

Digital Dealer Unveils New Branding & Announces Launch of DealerPoint, Offering Targeted Networking and Driving Innovation

Digital Dealer has revealed its new branding and announced the launch of DealerPoint, a dynamic addition to its event portfolio.   This unveiling of the refreshed logos marks a symbolic step forward for Digital Dealer, aligning with its commitment
Posts Dealer/GM News

Hyundai Dealers Will Be the First to Sell Cars Through Amazon Platforms

Amazon is getting into the (virtual) car dealership business. At the Los Angeles Auto Show Nov. 16, the Seattle-based online behemoth announced auto dealers for the first time will be able to sell vehicles on Amazon’s U.S. store in 2024—with Hyun
Posts General

GM Workers Approve Union Contract; Ford, Stellantis on Pace to Pass

Despite concerns that resulted in a closer than expected vote, General Motors (GM) union workers approved the deal negotiated by United Auto Workers (UAW) union. The deal was supported by roughly 54% of the more than 34,700 autoworkers at GM who vot

NEWSLETTER

SUBSCRIBE

DEALER MAGAZINE

Dealer Magazine March/April 2023 Issue Featuring an Interview with NADA 2023 Chairman
MAGAZINE

Explore All Our Brands

FOLLOW US ON

  • Follow
  • Follow
  • Follow
  • Follow
  • Follow
© 2023 Emerald X, LLC. All Rights Reserved.

ABOUT    CAREERS    AUTHORIZED SERVICE PROVIDERS   DO NOT SELL MY PERSONAL INFORMATION   TERMS OF USE   PRIVACY POLICY