Twice now in roughly the past month, the Consumer Financial Protection Bureau largely became the conversation topic when a collection of dealers gathered, and raucous sounds filled a hotel venue.
In September, a fire alarm triggered a brief evacuation as a CFPB representative was in the midst of a segment during the National Policy Conference hosted by the National Independent Automobile Dealers Association. Then earlier this week during the Fall BHPH Conference orchestrated by the National Alliance of Buy-Here, Pay-Here Dealers, noise began to echo inside the hotel venue literally just hours after a razor-thin vote margin in the U.S. Senate squashed the CFPB’s rule to ban arbitration.
A few minutes after the collection of BHPH dealers and industry service providers cheered when NIADA’s Steve Jordan — who was moderating a panel discussion about regulatory developments and relayed the Senate vote implications — hotel staff nearby began using equipment that emanated noise similar to when a forklift or large truck is moving in reverse.
Because he had to pause for a moment since nothing else could be heard, the ever-clever Jordan quipped, “That’s not a panic alarm. That’s the CFPB backing up and taking stock of their position,” drawing a round of laughter as the equipment noise suddenly stopped.
If the CFPB representative who attended NABD’s event was in the room at the time, that individual likely wasn’t smiling about the situation. Vice President Pence broke a 50-50 Senate deadlock on Tuesday night about the time Game 1 of the World Series concluded — giving the industry a victory some leaders might contend would surpass the Los Angeles Dodgers taking the opener of the Fall Classic.
For NIADA and NABD member dealers, the policy momentum their organizations are generating is undeniable. While the efforts NIADA, NABD or the alphabet soup of industry lobbying establishments undeniably had some kind of impact on the CFPB arbitration rule stoppage, another concrete development clearly shows the political horsepower the independent dealership community is revving.
On Oct. 17, NIADA hosted Speaker of the House Paul Ryan for an exclusive business roundtable discussion in Fort Worth, Texas. To me, what’s even more notable about NIADA having a session with the lawmaker who is third in line to the White House should the president and vice president become unable to serve, I learned it was Ryan’s office who reached out to the dealer organization to coordinate a meeting while the lawmaker was in the Lone Star State.
Again, think about it. One of the five most powerful U.S. politicians sought out the organization that tries to speak for an operator who might have five cars or 500 vehicles in inventory with a portfolio of $10,000 or $100 million.
“We left the meeting very hopeful and encouraged,” Jordan said.
Another key component: The roundtable that drew more than 50 attendees didn’t include “dead air,” according to comments shared with me about the 60-minute session. During this week’s BHPH Conference, NABD’s Ken Shilson touched on the likely reason why dealers could conduct a productive conversation with the Speaker of the House about complicated topics. One example was comprehensive tax reform where some proposals would eliminate the net interest expense deduction — something crucial to dealers who rely on financing for the acquisition of inventory and other operating expenses.
“Regulatory protection starts with education,” Shilson told attendees at NABD’s event. “Get the necessary education so you know how to play the game properly and to do the right thing.”
Coming up in November is Used Car Week in Palm Springs, Calif. During Pre-Owned Con, Auto Fin Con, Repo Con and the National Remarketing Conference, discussions and references about the CFPB are likely to happen several times. I’ve already warned my AuSM teammates that if they suddenly hear unusual noises that they not be alarmed. It’s likely just an industry leader mentioning how the used-car space took another step forward with regard to regulation.
Nick Zulovich, who is senior editor of BHPH Report and SubPrime Auto Finance News, can be reached at [email protected]