Dealer Regulation | American International Automobile Dealers

Federal regulations have an astounding impact on the ability of dealers to compete and survive. Whether combatting overbearing financial regulations that threaten dealers’ economic viability from the CFPB, addressing new labor rules by the NLRB, or preserving fair arbitration rules for dealers, AIADA is the voice of dealers throughout the federal government.

AIADA opposes federal financial regulatory overreach.

AIADA has combatted efforts by the Consumer Financial Protection Bureau (CFPB) to place additional restraints on dealers, including the restriction of dealer lending discretion. In response to these CFPB efforts, AIADA has worked with the National Automobile Dealers Association to strengthen a dealer’s ability to comply with fair credit laws through the NADA Fair Credit Compliance and Policy Program, and urged accountability for the CFPB.

AIADA supports fair labor policy.

The National Labor Relations Board (NLRB) has issued a slew of decisions in recent years aimed at restricting employers’ right to due process. AIADA supports a level playing field for both employers and employees which allows employees to have a full understanding of both sides of the issue before making a unionization decision.

AIADA supports the auto dealer franchise system.

The franchise system is an important part of the auto industry’s overall success. The working relationship between dealers and manufacturers that exists has been carefully crafted across the country and the franchise laws help maintain balance. International nameplate automobile dealers have a powerful, positive impact coast-to-coast on their neighborhoods, cities, and states. Dealerships are the heart of the auto industry. They are committed to serving their communities and are more than a place to shop for and buy a new vehicle; they are employers, sources of charitable giving, tax bases, and service centers. Auto dealers also provide consumer safety through recall and, warranty service.

Our Work on Dealer Regulation

The CFPB and Regulatory Overreach

Labor

Other Issues

6 Steps to Adopting the NADA Fair Credit Compliance Program

In January 2014 AIADA, along with the National Automobile Dealers Association and the National Association of Minority Automobile Dealers released to their members the Fair Credit Compliance Policy & Program. A dealership interested in adopting the program in order to better comply with fair credit laws, should complete the following steps.

1. Create a Fair Credit Policy that states the dealership’s strong commitment to fair credit compliance and consider prominently posting the policy where it can be viewed by both consumers and employees.

2. Create a Fair Credit Compliance Program as described in Steps 3-6 that carries out the Fair Credit Policy. The dealership’s leadership must review and formally adopt the Program.

3. Identify who and what is covered by the Program and the purpose of the Program.

4. Appoint a Program Coordinator (PC) to develop and oversee the Program. The PC should have the necessary time, expertise, and seniority to perform this function.

5. Direct the PC to establish the dealership’s pre-set Standard Dealer Participation Rate (SDPR) and provide that the dealership will only deviate from the SDPR if an allowable business reason exists to include a lower amount of dealer participation in the offer of credit.

- Identify the allowable businesses reasons when the dealership may deviate from the SDPR, such as the need to satisfy a customer’s monthly budget constraint. There are seven reasons that are contained in the DOJ’s 2007 consent orders.

- Require each dealership employee who makes a credit offer to record the SDPR, the final dealer participation rate, and if the two differ, the allowable business reason for deviating from the SDPR.

- Ensure that the PC or his or her designee reviews the form to ensure it was properly completed.

6. Establish the training, oversight, and reporting tasks that the PC must complete to ensure the Program is faithfully executed.

Dealers on Dealer Regulation

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