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Roadwork Ahead; Expect Delays

March 2007, F&I and Showroom - Feature

by Gregory Arroyo - Also by this author

With the National Automobile Dealers Association (NADA) Convention only three days away (at press time), it has been a bit of a scramble to get the March issue out the door. Happily, I can say we have one heck of an issue this month, with technology taking center stage.

Now, surveys say that using an editorial to talk about what’s inside the issue is a waste of the reader’s time. I guess I’ll have to agree, as Bobit Business Media pays a pretty penny to make sure its editors know what you readers want to … well … read. I guess I’m going to break the rules a bit this month, and I truly hope the read isn’t a total waste of time.

As I mentioned, technology is really leading the way this month, which is perfect timing as I head off to the NADA Convention. I’ll definitely have a full report in April. It’s also perfect timing after I received a couple of e-mails from our readers asking the magazine to get to the bottom of the computer security snags Automotive News reported Honda and Reynolds and Reynolds are experiencing.

Unfortunately, getting to the bottom of this issue isn’t going to happen anytime soon. For one, Honda is being tight lipped, and Reynolds and Reynolds promised to talk more about its plans at the NADA show.

To sum up what occurred, Honda Motor Co. — which is launching a daily parts ordering service for its 1,260 Honda and Acura dealers — asked its dealers last year to allow a software vendor to extract daily service parts orders. The automaker’s request, however, was in direct violation of Reynolds and Reynolds’ dealer contract rules, which prevents unsanctioned vendors from accessing Reynolds-designed dealer systems. And from reports, Reynolds isn’t going to budge. Other companies aren’t either.

Guys and gals, I have to tell you that the issue at hand is much bigger than Reynolds and Reynolds and Honda Motor Co. And truth be told, what’s happening is only the tip of the iceberg of what this industry faces, with dealerships across the nation being told Guys and gals, I have to tell you that the issue at hand is much bigger than Reynolds and Reynolds and Honda Motor Co. that a fully electronic dealership not only represents the future, but also the key to profitability. If anything, experts tout technology as another protective layer in today’s regulatory environment.

Well, that’s why we brought back Joan Shim, an F&I magazine alum, to check on Asbury Automotive’s venture toward a totally electronic F&I process. You might remember Shim. She held my post a couple of years ago. Not to steal her thunder, but, as you’ll read, automotive dealerships are leading the pace toward this fully electronic reality. Unfortunately, the pace dealerships are setting has overshot what lenders and states are ready to do. So give Shim’s story a look.

We don’t stop there, as we follow up Shim’s story with an article by Allan Stejskal, president of Open Secure Access Inc., a coalition of automotive retail dealers, and software and service providers. If you haven’t heard about the coalition, I suggest you visit its site (opensecureaccess.com) and check out who’s on board with what it’s doing. It aims to solve the very problem both Honda and Reynolds are experiencing by setting its own data security guidelines and a vendor certification program.

If you’re looking over the brochures you picked up from NADA regarding a new DMS, CRM or third party software tool, read Stejskal’s article before you make any decision. He provides a couple of questions you need to be asking your potential new vendor, some of which might keep you out of the situation some Honda and Acura dealers find themselves in these days.

As you might have noticed, I’m not about to take sides on the Honda and Reynolds deal. Journalists typically try to ride the fence, and this is truly an issue that requires an open mind. I personally think the issue is simply a sign of the times. Technology is certainly the wave of the future, but have we as an industry laid out the groundwork to make this all a reality? Or just maybe, all this rumbling between Honda and Reynolds means the groundwork is still being laid.

At the F&I Conference and Expo in November, industry insiders predicted that the industry was 12 to 24 months away from e-contracting being ubiquitous. Some are now saying that the timeframe given referred to how long it’ll take before we see any significant progress.

Roadwork ahead. Expect delays

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