Dear Members and Friends,

I hope this issue of California New Car Dealer Quarterly finds you well as we navigate the evolving landscape of California’s automotive industry. I want to bring your attention to a recent development prompting discussions at the state and national levels and raising concerns within our community.

As many of you may be aware, Hyundai has announced a partnership with Amazon to sell vehicles via a digital storefront, allowing buyers to complete the entire car shopping and buying process via the Amazon platform. While innovation and adaptation are crucial in our industry, the potential impact of this offering needs to be critically evaluated.

With this development, I want to reassure you that CNCDA is actively engaged in understanding the nuances of this program. Anthony Bento, CNCDA’s Chief Legal Officer, and I attended the launch of the pilot program at the LA Auto Show last month, and we are committed to learning more about its intricacies. Our proactive approach is to get the information needed to navigate this development and act on behalf of our members at the legal, regulatory or state and federal government levels to ensure your business is safeguarded.

Hyundai’s collaboration with Amazon raises significant legal and process questions, with few answers yet available. Recently, CNCDA met with Hyundai’s Chief Marketing Officer (alongside NADA and other Auto Trade Association Executives nationwide) to ask program, logistical, legal and simple process questions. Unfortunately, very few concrete answers were offered, thus proving the intricacies of the program haven’t been fully vetted or tested. This potentially creates an incredibly confusing (and potentially illegal) vehicle purchasing process. As our association protects the interests of our members, we will engage in continued conversations surrounding these major uncertainties and implications.

Let’s not forget dealers provide a comprehensive car-buying experience, with expert guidance on a range of features that consumers can readily access (which Prime delivery teams cannot replicate). The speed, convenience and education of getting features customers desire are better facilitated at a local dealership, where our members have established trust and rapport with their customers.

We also anticipate return and warranty issues being a major source of confusion for customers with this new online purchasing process. The complexities of navigating concerns through a digital platform will present major challenges for consumers, highlighting the value of the in-person support and guidance that local dealerships expertly provide.

CNCDA’s mission is to promote and advocate for the protection of our dealers. Last year, we successfully championed AB 473, a franchise bill designed to prevent manufacturers from circumventing their own franchised partners. This legislative victory ensures that our dealers are protected from potentially unfavorable practices by manufacturers.

Moving forward, we will keep our members informed, leverage the protections afforded by AB 473 and work diligently to safeguard the interests of our members. Thank you for your continued trust and commitment to CNCDA. We will navigate these challenges together, emerging stronger and more resilient as an association.

Cheers,
Brian Maas
President, CNCDA