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Yahoo
10-07-2025
- Automotive
- Yahoo
Sunset of EV tax credit isn't deterring dealerships
With close to 140,000 electric vehicles on dealership lots across the country, it's arguably poor timing for the new federal budget eliminating tax credits to help sell those vehicles. And yet, dealers are not panicking. Many are disappointed that the $7,500 new-EV tax credit and the $4,000 used-EV tax credit will end after Sept. 30. Sales declines likely will follow, they said, at least in the short term. But dealers remain optimistic that long-term demand will still drive EV sales. Here come the EV blowout sales as U.S. tax credit expires, inventories languish 'They're very resilient. They find a way to move product, so they will do that,' Tim Jackson, former CEO of the Colorado Automobile Dealers Association, which operates in a state with high EV adoption, said of dealers. 'It's just a matter of how many maneuvers they have to go through, or manipulations, to still be fluid.' Nearly 140,000 EVs remained on dealership lots as of June 27, according to the National Automobile Dealers Association. Cox Automotive tracked 103,435 new-EV sales and 36,609 used-EV sales in May, roughly on a par with the NADA numbers. Jackson said consumers hoping to use the tax credits while they are still available will likely buy many of them. 'There's going to be a big run on those EVs on the lots now,' Jackson said. 'My message to dealers that I've talked to in the last week or so is find a way to fill your lots with EVs … but [sales are] going to slow way down' at the end of September. That predicted slowdown could have started a lot sooner. Anticipating Congress and Republican President Donald Trump were likely to eliminate the tax credits, NADA focused on trying to ensure the industry had lead time before the incentives stopped. Sign up to get the Automotive News Service & Parts weekly newsletter covering the world of dealership parts, service and collision departments. That way, dealers could adjust their business ahead of the expiration date and customers weren't confused by the credit change. 'NADA certainly was trying to make sure that there was a reasonable phase-out period,' Paul Metrey, NADA executive vice president for public policy, said July 7. For example, some lawmakers proposed ending at least one EV tax credit 30 days after the bill became law. The final version of the legislation leaves the tax credits for new, used and commercial EVs in place through Sept. 30. 'I think we made a good case,' Ivette Rivera, NADA senior vice president for legislative affairs, said July 7. Liza Borches, president and CEO of Carter Myers Automotive in Charlottesville, Va., said the federal EV tax credit was not intended to be permanent. 'It's worth noting that this incentive was never meant to last forever,' she told Automotive News by email. 'The idea was to help the industry get to a scale where production costs could come down and compete with gas-powered vehicles.' 'Still,' she said, 'having more time and predictability before it expired would have given automakers a better chance to adjust their production plans and pricing.' Companies including online used-vehicle retailer CarMax are encouraging customers to take advantage of the tax credits before they expire. After that, CarMax expects shoppers will still want EVs but some will focus more on pricing than they did with the incentives. 'Used-EV tax credits have been an important incentive for those most focused on affordability,' CarMax said. 'Without the tax incentive, some consumers may opt to delay purchasing an EV. For others, the absence of tax credits may lead them to remain in the market but be more inclined to explore EVs at a higher price point than those vehicles that qualified for the tax credit.' CarMax said consumers will consider the 'lower maintenance costs, environmental benefits and technological advancements' of EVs as well as access to charging stations. A Carvana spokesperson said the company has experienced growing interest from consumers who want EVs or plug-in hybrids. The end of tax credits could shift Carvana's vehicle selection as customers search for their best and most affordable options, the spokesperson said. Expectations are that EVs will remain part of the mix. 'We continue to see strong interest in this category among our customers,' the spokesperson said. For now, dealers don't envision any doomsday scenarios. 'You've got this army of folks out there that absolutely love their EVs and they're vocal about it, and so [that's a] real positive for everyone involved,' said Alex Lawrence, owner of used-vehicle dealership EV Auto in Bountiful, Utah, and supporter of a more gradual wind-down of the credits. 'I think you're still going to see … adoption increase, but it's going to be a lumpy line.' Jeremy Beaver, CEO of Del Grande Dealer Group in San Jose, Calif., said he is optimistic about the long-term demand for EVs in Northern California. He said drivers there continue to show strong interest in EVs, but the lack of tax credits will hurt. 'Incentives like these play a critical role in making EVs more accessible to consumers,' he said via email. 'We are concerned that without this federal support, demand may soften — particularly among price-sensitive buyers.' Beaver said his dealership group will continue monitoring how its manufacturing partners (Subaru, Kia, Ford, Hyundai and Honda among them) and California officials respond. 'We're committed to working quickly to identify solutions that keep EVs attractive and attainable for our guests,' he said. 'Our team is preparing for a dynamic period ahead and will continue to prioritize education, affordability and transparency as this transition unfolds.' Joe Jackson, general sales manager at Bowman Chevrolet in Clarkston, Mich., said it is 'a little disappointing' the EV tax credits are being eliminated. They have helped grow adoption and develop a loyal and enthusiastic client base among his customers and employees, he said. Bowman's percentage of sales involving EVs grew to 20 percent over the last year, with many transactions including leases. He expects interest in the vehicles will continue, and leasing will be a dominant element. 'We are a lease-heavy market, and EVs are a lease-heavy vehicle; I expect the leasing to weather this a little bit better than the purchases,' Jackson said. EV sales may dip but won't crash, and manufactures won't abandon or drastically curtail their EV production, he said. 'They're committed to these vehicles and they're still going to have to move them,' he said. 'You'll continue to have to have these vehicles move at the rates the market will bear, and we'll see what that means.' Borches said the tax credits' end will have a 'real impact' at Carter Myers. 'In the short term, we'll likely see a rush of customers trying to buy before the deadline, and we're planning marketing campaigns to help them take advantage while they still can,' she said. 'After that, demand will probably soften for at least six months as the market recalibrates and we'll adjust our inventory accordingly.' Carter Myers will be working closely with manufacturers to push for additional incentives, lease programs or other support to help keep EVs affordable. Customer outreach also will continue. 'Even without the federal credit, we're committed to educating customers about all the other benefits, including lower fuel and maintenance costs and the positive impact on the environment,' Borches said. Over time, EV momentum will continue with the advance of better technology and a stronger charging network, she said. Dealerships can nurture customer interest during the transition. 'As dealers,' Borches said, 'our job is to be proactive, transparent and ready to help customers navigate this shift.' Automotive News reporters Mary Corey and John Huetter contributed to this story. Sign in to access your portfolio
Yahoo
07-07-2025
- Automotive
- Yahoo
How to spot auto loan fraud: 5 scams to watch out for
Scammers prey on innocent consumers who are in the market for a reliable, affordable used vehicle. After you purchase a car, you may become a target for car loan scams by the dealership or outside scammers. Always thoroughly read loan paperwork before signing off. Watch for fees and add-ons. If you're targeted, you can report the fraud, but reclaiming your money isn't guaranteed. Scammers often target car owners who need to catch up on their payments and want to avoid having their cars repossessed. Other types of scams happen at the dealership or when buying used through a private seller. Either way, these schemes can be costly, or even worse, leave you empty-handed. With a previous FTC rule designed to help consumers currently paused, it's worth familiarizing yourself with the red flags to minimize the chances of falling victim to a scam. With a yo-yo financing scam, a dealer will lead you to believe the financing is final. It may accept your trade-in and down payment before allowing you to leave the lot. Days or even weeks later, the dealer will call and say the financing fell through. To keep the vehicle, you must come back and sign a new contract, typically with less favorable terms. Sometimes, the dealership has already sold the traded-in vehicle, leaving you to choose between higher rates or no car. These scams often target consumers with fewer financing options because they have bad credit or no credit profile. Yo-yo financing is illegal in every state, says Paul D. Metrey, executive vice president for public policy with the National Automobile Dealers Association. But tactics like conditional sales and spot deliveries, in which you can take your car home before the loan is finalized, are perfectly legal. However, the CARS Rule includes language to protect consumers from yo-yo financing traps by forbidding dealers from misrepresenting transactions as final. How to avoid To avoid a yo-yo scam, you should get an auto loan before visiting the dealership. You may receive a better interest rate through a bank, credit union or online lender. Plus, walking in with financing already locked down gives you additional negotiation power. Car loan modification scams promise to lower your auto loan payments for a steep fee. Scammers typically ask to be paid upfront or request unusual forms of payment, such as a money transfer or gift card. Unlike a legitimate lender, these scammers often do not check your credit score. They may also pressure you to sign a contract. 'The scams are similar to mortgage loan modification scams, with the scammers telling customers that they could stop their car from being repossessed and that they could lower their payments,' says Gregory Ashe, senior staff attorney with the Bureau of Consumer Protection at the Federal Trade Commission. With a car loan modification scam, the scammer will 'negotiate' on your behalf to lower your rate — and may ask you to make car payments to them rather than your lender. However, you should only negotiate terms directly with your lender's customer service team. According to Ashe, a lender may extend your loan term or defer some payments, but they are unlikely to negotiate interest rates. Check out our best auto refinance loans if you're interested in changing your car loan interest rate. How to avoid The FTC recommends contacting your lender directly to discuss car loan modification options as soon as you realize you will have trouble making your car payment. Ignore any too-good-to-be-true promises of lowered car payments from suspicious companies. Negative equity, also known as being upside-down on your auto loan, occurs when you owe more on your car than it is worth. The FTC has taken administrative action against multiple dealers for Truth in Lending Act violations regarding how those dealers handled negative equity. The dealers did not clearly explain to consumers that though they offered to 'pay off' the balance due on a trade-in, they actually took the negative equity and applied it to the borrower's new car loan balance. Some customers complained that they didn't know this until after signing their new auto financing paperwork. 'Consumers need to carefully read the paperwork before they sign it, because it doesn't matter what's said. It matters what's in writing,' Ashe says. 'If you don't understand something, then don't sign it.' How to avoid When you review your loan documents, check to make sure the price is what you agreed to pay. If there are additional costs, ask the finance manager at the dealership to explain them to you. Your trade-in should be treated as a separate transaction. You can choose to roll over negative equity into a new loan, but the dealer needs to clarify how that will affect your loan. Dealers may pressure you to purchase additional products and services when you buy a car. These might include: An extended warranty. Gap insurance. Rustproofing. Tire rotation and service contracts. While some of these items can be useful, many are not. The dealer's primary goal is to get you to spend more. You are under no obligation to agree to add-ons. If an option interests you, try to negotiate the price and remember, if it's added to the loan, you're paying interest on it. The new CARS Rule should make this process easier. Dealers will be required to get your 'express, informed consent' before any additional charges for products or services are added to your bill. However, dealers may try to buck this rule, so stay wary. How to avoid Research what is being offered and see what you can do yourself or get done at a shop elsewhere. You can often get the services or options at a lower price and better quality without wrapping them into your loan. There are several tell-tale signs of a used car scam. For starters, if the price point of a vehicle is far below the market value, what seems like the deal of a lifetime is likely a play to steal your hard-earned money. Here are some other red flags to look out for. Pushy sellers They rush you to make a decision, supposedly because the seller is on a tight timeline. Payment needs to be quick, and in the form of cash, a gift card or other untraceable method of transferring money. Once you do so, contact stops, and there's no way to recoup your funds. Vehicle identification number (VIN) issues Scammers often attempt to sell vehicles with outstanding liens, indicating a balance owed. They may also swap the VIN plate on the dashboard after a major incident, like a flood, theft or total loss, to mask the true history of the vehicle. Either way, you end up without an actual vehicle or a headache once you pay. Fake photos Duplicate listings are also common when dealing with scammers. A quick online search could easily reveal several listings of the car you're considering, each with varying price points and points of contact. How to avoid used car scams Perform a VIN search and an online reverse image search, then test drive the vehicle and confirm the seller's identity. Steer clear if the seller is in a rush and claims they plan to relocate soon, requests upfront payment or demands payment quickly. When buying a car, review your loan contract and ask the sales representative to clarify any questions you may have. But if you feel like you're being taken advantage of, you have options. Move on. There are plenty of dealers, both online and in-person, that offer similar vehicles. Back out if the dealer won't answer your question or pressures you to sign. File a grievance. You can also report a complaint to the Consumer Financial Protection Bureau (CFPB) if you believe the dealer is engaged in shady practices. If you've already made what you believe is a fraudulent purchase, the FTC outlines steps you can take depending on the information the scammer has. Be sure to: Report the incident. Use the guidance found on the FTC's website to report the fraud and determine your next steps from there. Seek legal counsel. After filing a report with the FTC, contact your state attorney general to notify them of the scam and learn more about your options. Unfortunately, it may be challenging to recover your money after paying for a loan modification. But you may have some recourse if you were the victim of a predatory dealership. When shopping for a car, ask clarifying questions and review every document you are asked to sign. The best defense against red flags is taking your business elsewhere. If you're having trouble paying your loan, the best thing to do is talk to your lender directly. Car loan modification scammers target vulnerable buyers who have poor credit or who are late on their payments. If it sounds too good to be true, then it probably is. Lenders will often be willing to work with you if you show that you're making an honest effort to continue making payments.
Daily Maverick
10-06-2025
- Automotive
- Daily Maverick
Built for export, boxed in at home — SA vehicle sector calls for decisive action
While May brought a surge in local car sales according to the National Automobile Dealers Association's latest reporting, a sharp contraction in exports and rising global tariff tensions have pushed South Africa's automotive industry to a crossroads. South Africa's automotive industry may have enjoyed a high-revving May in local markets, but the road ahead is looking increasingly precarious. Local vehicle sales surged 22% year-on-year, according to the latest Automotive Business Council (Naamsa) data, yet exports dropped 14.6% overall, with passenger vehicle exports plummeting by nearly 35%. The African Growth and Opportunity Act (Agoa), a long-standing US trade programme that allows duty-free access for eligible African exports – including South African vehicles – faces renewed uncertainty under the Trump administration. With the White House pushing for reciprocal tariffs and stricter eligibility reviews, South Africa's preferential access could be one executive decision away from suspension. Speaking to Daily Maverick, Nada's vice-chairperson Thembinkosi Pantsi painted a picture of both resilience and distress. 'We're adapting, we're consolidating, and we're innovating to survive,' he said, referring to the shift toward multi-brand dealerships and used vehicle expansion. 'But make no mistake – we are nearing a cliff edge.'The automotive sector value chain in its entirety supports around 110,000 jobs, according to data from Naamsa, Stats SA and trade union data, with countless families relying on those employed in the sector to put food on the table. The industry – if you include both manufacturing and sales – contributed 5.3% to our GDP in 2023, and is the single largest manufacturing sector. Local sales surge, but export markets faltering While May saw strong domestic demand – driven partly by an influx of East Asian vehicle imports – it also underscored a growing contradiction: consumers want affordability, but the domestic industrial base relies on export volume to remain viable. 'We are seeing more Chinese brands enter the market with cost-effective models,' said Pantsi. 'This is good for consumer access, but doesn't help the thousands employed in export-geared manufacturing.' Volkswagen SA chairperson and managing director Martina Biene echoed the sentiment during her keynote address at Nada Connect in March of this year. 'Sometimes, as a local manufacturer, we don't feel as valued as we should be,' she said. 'There's a lot of investment here – jobs, skills, community development – but little relief from systemic pressures.' Biene disclosed that VW SA had spent more than R130-million on diesel generators to cope with load shedding. 'Every day I run them, it's R1.6-million in cost. That goes straight into the vehicle price,' she said. Add port congestion, road freight insecurity and policy drift, and 'you get a toxic mix,' she warned. What this means for you If global trade shocks persist and local manufacturing continues to contract, thousands of jobs across the auto value chain could be lost. Consumers may benefit from cheaper import options, but the broader consequences – shrinking local industry, fewer employment opportunities and weakened export competitiveness – pose a long-term economic risk. The off-and-on again Trumpian promise – tariffs Trump's revived steel and aluminium tariffs have reignited fears of a protectionist spiral. Pantsi warned that such moves could 'compound local challenges' and further disrupt trade patterns. 'Tariffs don't only raise costs. They erode investor and consumer confidence,' he said. 'We need urgent interventions – rebates, subsidies and export duty relief.' Biene concurred, calling for incentives over protectionism. 'We contribute massively to GDP and jobs. But sometimes it feels like the government is dazzled by short-term imports at the expense of long-term industrial strategy.' She said Agoa's uncertainty was more than symbolic. 'Agoa isn't a given,' Biene warned. 'If we lose that access, it's not just a dent in our balance sheets – it's a question of whether we keep local production viable.' Pricing inaction For every vehicle exported, dozens of suppliers – from tyre producers to seat manufacturers – depend on consistent output. A dip in export volumes, Pantsi noted, ripples across the entire automotive value chain. 'The automotive industry is the second-largest contributor to GDP after mining. If we allow it to shrink, the consequences will be systemic,' he said. Beyond the 110,000 people the sector employs directly, it supports hundreds of thousands more through components, logistics and retail. Both Pantsi and Biene urged the government to move past platitudes. 'We need a granular, not generic, state response,' said Pantsi. 'Targeted logistics reform. Decisive Agoa diplomacy. Training institutions revived. It's the details that matter now.' The sector at a T-junction Despite strong local sales buoyed by competitively priced imports, the export decline is a red flag. 'We have the infrastructure, the people, the expertise,' Pantsi said. 'What we lack is policy certainty and logistical coherence.' Biene was blunter: 'We're here for the long haul. But we can't keep pouring money into diesel and delays. The government needs to decide if it wants this sector to thrive – or merely survive.' DM.
Daily Mail
29-04-2025
- Automotive
- Daily Mail
BREAKING NEWS Trump makes yet another tariffs U-turn this time for the auto industry
President Donald Trump will sign an executive order Tuesday to relax some of his 25 percent tariffs on cars and their parts, the White House said. It's the latest significant reversal from the White House, following American automakers' consistent complaints that import taxes threatened to harm domestic manufacturers. But don't expect the tariff relief to help consumer wallets, analysts said. Details around the reversal remain sparse. But automakers and independent analysts have said the tariffs will raise prices, reduce sales, and make US production less competitive worldwide. White House press secretary Karoline Leavitt said at a Tuesday briefing that Trump would sign the order later in the day but declined to provide details on the order. Treasury Secretary Scott Bessent, who joined Leavitt at the White House briefing, said the goal was to enable automakers to create more domestic manufacturing jobs. 'President Trump has had meetings with both domestic and foreign auto producers, and he´s committed to bringing back auto production to the US,' Bessent said. 'So we want to give the automakers a path to do that, quickly, efficiently and create as many jobs as possible.' Car industry analysts told that the tariff u-turn won't have an impact for drivers in the market for a new vehicle. 'For consumers, business as usual,' Erin Keating, the senior director of economics and industry insights, said. 'While the proposed changes are a signal of Trumps willingness to take industry input into consideration when implementing tariffs, they don't materially change the cost implications and of course have not been declared officially.' Keating suggests that shoppers hoping to grab a new set of wheels should make their purchase as soon as possible to avoid paying the added costs from tariffs. She suggested consumers remain flexible on vehicle size, color, and trim. 'There is a tariff-free sales event happening right now,' Mike Stanton, the president and CEO of the National Automobile Dealers Association (NADA), said during a conference at this April's New York International Auto Show. 'If you're part of [a group of interested EV buyers], do it now.' Meanwhile, automakers are expressing relief in public after the Trump administration pulls back from some of its tariff policies. Automakers in the US asked the administration to reconsider their tariff policies This is another massive change to Trump's core economic policy Stellantis Chairman John Elkann said in a statement that the company appreciates the president's tariff relief measures. 'While we further assess the impact of the tariff policies on our North American operations, we look forward to our continued collaboration with the US Administration to strengthen a competitive American auto industry and stimulate exports,' he said. But behind the scenes, auto execs are far less diplomatic. This marks the third major tariff shift automakers have had to react to this year. The companies initially dealt with surprising Canadian and Mexican import taxes in February and again in March. Neither move had been teased on the campaign trail, catching many executives surprised by the massive policy shifts. Then, he slapped the auto industry with its own 25 percent tariff after the industry was already working through the implications of steel and aluminum taxes. Automaker executives told that the singling out of their industry has put them at a major disadvantage. Executives told that the policy whiplash has left them at a disadvantage — and that it's making one of their biggest challenges even harder: .
Business Journals
23-04-2025
- Automotive
- Business Journals
Auto dealers face uncertainty amid tariff shifts
By submitting your information you are agreeing to our Privacy Policy and User Agreement . Veteran San Antonio auto group executive says the industry's new reality is the great unknown. Economic instability has made it tough for the auto dealership industry to predict consumer demand with much certainty. The White House's ever-shifting tariff policies have compounded the problem, making it tough even for established operators to know when and how to pivot. 'When tariffs were first announced, I had anticipated providing a list to the public of vehicles affected and those that were not. However, it didn't take long to find out that information would not be useful to anyone,' April Ancira, vice president and managing partner for the Ancira Auto Group, told me in an exclusive interview. GET TO KNOW YOUR CITY Find Local Events Near You Connect with a community of local professionals. Explore All Events Within days after President Donald Trump signed an executive order in early February to impose tariffs on imports from Canada, Mexico and China, the National Automobile Dealers Association warned of the potential impact. 'New-car affordability is a persistent challenge for consumers and dealers alike,' NADA President and CEO Mike Stanton said. 'Tariffs on U.S. trading partners, who are vital to our automotive supply chains, would make it harder for average Americans to afford the new vehicles of their choice. It is our hope that we can address many of our nation's challenges without the use of tariffs that would so significantly impact the U.S. auto industry, jobs and consumers.' Don't miss the latest San Antonio business headlines! Sign up here for SABJ newsletters and make sure to download the app. Others in the industry, including the American International Automobile Dealers Association, have raised red flags in more recent days. As of April 3, U.S. auto manufacturers were set to face a 25% tariff on imported passenger vehicles, light trucks and auto parts. Ancira said some automakers, including General Motors, had indicated they would eat the added costs as long as they could. Since then, the Trump Administration has announced a 90-day pause on the rollout of those tariffs. 'The manufacturers are trying to wade through this but the uncertainty is what is making it difficult,' Ancira said, noting that auto dealers face a similar plight. 'We don't really have a new reality to settle into.' Amid the uncertainties, some dealers are rethinking their inventory strategies, stocking up on new and used vehicles to meet heightened demand ahead of expected price increases. It's a bit of a gamble, though. If the tariffs are dropped, some dealers may have too much inventory on hand and will have to absorb higher interest fees. 'The most important thing for us right now is inventory management, which is no easy feat considering we are not 100% sure about what everyone's tariff exposure will be and for how long,' Ancira said. Law Firms by Women Partners No. of women partners locally Rank Prior Rank Business name 1 1 Langley & Banack Inc. 2 2 Dykema 3 3 Jackson Walker LLP View this list
