Dealer Insights - September/October 2011 - Dealer Digest
Repeal of the expansion of Form 1099 reporting
Most auto dealerships, like other small businesses, were cringing at the idea that Form 1099 reporting was being expanded to generally include any payments made to vendors in 2012 or later that exceeded $600 in a calendar year. Imagine having to file a 1099 for every parts supplier, auto broker and so on that you do business with!
Relax — you no longer need to wring your hands. On April 14 President Obama signed into law the much-anticipated Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011. The act repeals the expansion of Form 1099 reporting brought in under 2010’s Patient Protection and Affordable Care Act and Small Business Jobs Act.
Auto loan financing eases up
More auto loan opportunities are surfacing for subprime customers, although the availability of loans for this market is far from what it was before the credit crisis.
Dan Berce, CEO of GM Financial, recently told the Automotive Press Association that the credit market in general — including customers with good credit scores — is recovering hand-in-hand with the auto industry. “The environment today is the best I’ve ever seen for auto financing.”
But the subprime market isn’t faring as well. Penetration of the subprime market currently has an industry average of 5%, compared to the double-digit figures it claimed before the credit crisis hit three years ago, Berce said.
Some automakers, including GM, are targeting customers with lower credit scores. Since GM purchased the formerly independent AmeriCredit (a subprime lender) in November 2010 — renaming it GM Financial — GM’s penetration of the subprime market has reportedly risen from 4% to 6%.
Look what’s up in sales innovations down under
When it comes to customer service, it would be hard to top what Mini is doing in New Zealand. Once a potential customer expresses interest in a vehicle on the company website or Facebook page, a “mobile” salesperson can bring a demo directly to the customer’s home or office, give a demonstration and let him or her take a test drive.
Alternatively, shoppers can visit the mobile Mini Garage, which has a small cafe and interactive kiosks. It’s similar in appearance to a slick auto show booth, but it’s designed for outdoor mobility.
And once a customer’s new car arrives, it can be delivered directly to the customer — there’s nothing like door-to-door service. What exceptional customer service gestures does your dealership extend?
Dealer Insights - September/October 2011