Making sure the dealer’s voice is heard in Ottawa is one of the main mandates of the Canadian Automobile Dealers Association (CADA).
So John White’s first year as CADA president will be a meaty one as two major pieces of automotive related legislation are set to be hammered home soon, both of which will significantly impact the Canadian dealer body.
Currently before the Senate is a bill that proposes to give power to the Ministry of Transportation to make automakers recall vehicles that have safety defects, just as the Secretary of Transportation can order recalls to take place in the United States.
“We want to ensure that if recall legislation is rolled out in Canada, that there are various protections for our dealers,” says White.
He adds that the association is looking for similar protections to those in the U.S. legislation, namely some compensation that recognizes the burden dealers face when they can’t sell inventory with outstanding recalls, and the disruption and displacement that can happen in service business when dealers are asked to make service bays and techs available for large-volume recalls.
Banks want in
The other big legislative piece coming is the Bank Act Review for March 2019. The year-and-a-half consultation process by the Ministry of Finance gets under way in less than a month.
Banks will once again ask to be allowed to enter the vehicle leasing business, which is something they are prohibited from doing now by the current Bank Act.
“Our position is still the same as it was under the last review. We want to ensure that from the dealer’s perspective, that the status quo is maintained,” says White.
Although not a legislative piece, the other government file CADA is keeping a close eye on is a pending Canada Revenue Agency (CRA) ruling about the money that dealers receive from insurance companies when dealers facilitate the sale of insurance products in the business office. Currently insurance is viewed as a financial service and therefore is tax exempt; the revenue generated by dealerships in this transaction has not been taxable. But the CRA is taking another look at the transaction.
Two years ago CADA received a “favourable” ruling on the revenues generated from arranging finance contracts; they remained tax-exempt. CADA is looking for more of the same with the pending ruling on insurance products.
“We want to make sure the tax treatments there are consistent,” notes White.
Working with stakeholders
Meetings are a workday staple for someone in the top staff position in an association that represents provincial and regional associations who in turn combine to represent the owners and managers of Canada’s 3,200-plus new-vehicle dealership points.
That’s a fair number of stakeholders who need to be heard from and consulted with. No surprise then either, to hear White characterize his management style as collaborative. “I’m somebody who likes to seek out ideas and input.”
But a long and successful career on the other side of the dealer/OEM fence, most significantly with stints at the helm of Volkswagen Canada and Volkswagen Australia, are proof that he knows a thing or two about all aspects of leadership. “Yes, CADA has lots of stakeholders but sometimes you will need to make a decision and hold firm.”
He characterizes the overall tone of current dealer-factory relations as good, though with some qualifiers.
“What’s helping factory relations is that there has never been a better time to buy a car.
“Are there files we’re working on? Yes. Will I tell you about those? No. But for the most part, relations are quite positive.”
Another main CADA mandate is to provide training and other member services, and one of White’s priorities this year is to have all manufacturers recognize a new pilot program at the Automotive Business School of Canada at Georgian College in Barrie, Ont.
The ABSC program is designed for working professionals to upgrade their skills so they can reach higher levels of dealer management.
For dealerships with manufacturers who don’t recognize the program, it means attending a similar program with the National Automobile Dealers Association (NADA) in the United States.