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TrueCar Latest Updates - the Ultimate TrueCar thread - Post your updates!

Discussion in '3rd Party Leads and Automotive Classifieds Website' started by Jeff Kershner, Jan 11, 2012.

  1. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    I thought I would start a thread where we can ALL contribute ANY and ALL TrueCar / ZAG / Scott Painter (related to TrueCar) updates moving forward.

    This will be better for keeping up the latest TrueCar / ZAG / Scott Painter news, organized in one post here on DealerRefresh. As a each state gets added to the list of banning TrueCar or as you hear new around TrueCar - POST IT HERE!

    To get started, I'll post the Original article that got all of this started...

    Dealers, wake up! Edmunds TMV and TrueCar Has Your Transactional Data

    Help out and contribute to this post!
  2. Jeff Kershner

    Jeff Kershner Founder Staff Member

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  3. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    Honda in fight with TrueCar.com over prices displayed online

    Honda has told its dealers that it won't give them advertising allowances if they offer vehicles below invoice on TrueCar.com.

    In another sign of the Internet's increasingly influential role in auto sales, dealers are in the middle of a fight between Honda and TrueCar.com over prices displayed online.

    American Honda Motor Co. has told its dealers that it won't give them advertising allowances if they offer vehicles below invoice on TrueCar, the fast-growing online auto sales service.

    The Japanese automaker believes that disclosing cut-rate prices damages its brand and makes its dealers compete with one another for buyers rather than with other automakers.

    Continue to read on the Chicago Times
  4. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    [​IMG]
    Dealer Board Makes Determination Regarding TrueCar Pricing Model
    Today the Motor Vehicle Dealer Board reviewed the TrueCar's current pricing structure based in part on referrals and sales.

    The Board made the determination that dealers who utilize TrueCar services and pay TrueCar based on the current pricing model are in violation of VA Code and face regulatory action including assessment of civil penalties and license suspension or revocation. Futher the Board cautioned dealers that until the Board has reviewed changes proposed by TrueCar, dealers are in jeopardy of further violations and penalties if the changes are deemed in violation of the law.

    The Board will be officially notifying dealers of it's decision today and will consider additional recommendations from the Board staff concerning TrueCar at its March meeting.

    http://forum.dealerrefresh.com/f46/va-dealers-using-truecar-violation-dealer-board-says-2361.html
  5. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    [​IMG]

    TrueCar Dealer Alert 1-4-12


    To: All Maryland Dealers

    From: Redacted

    Re: TrueCar/Zag

    Date: January 4, 2012

    It is the opinion of MADA that any vehicle referral program which requires a dealer to pay a fee only upon the sale of a vehicle violates Maryland's dealer licensing law. It is MADA's understanding that this is TrueCar/Zag's pricing structure.

    Maryland licensing law is very clear.
    • In order to be a licensed dealer you must have a physical location and to be a new car dealer you must have an unexpired franchise agreement for the vehicles you are selling.
    • Maryland law further states that you may not sell vehicles unless you are a licensed salesperson and in order to get a license, a salesperson must be employed by a licensed Maryland dealer.
    • Section 15-314(d) states that a dealer or an agent or an employee of a dealer may not do any vehicle sales business with or through any person who is required to be licensed under this title if he knows that the person is not licensed.
    These statutes have been upheld in court - Detroit Automotive Purchasing Service vs.Lee.

    Numerous attorney general opinions have stated that car buying/referral services are unauthorized to the extent that they receive or expect to receive a commission or other compensation for their referrals.

    MADA met with TrueCar/Zag officials at the June convention in Williamsburg and outlined our concerns that this payment method (dealer pays vendor only upon sale of vehicle) would be considered a commission paid to an unlicensed person for the sale of a vehicle which would put Maryland dealers in violation of the licensing law. We were told by TrueCar/Zag that changes were being made to the program; however, we are not aware of any changes as of this date.

    MADA recently met with MVA and we expect a bulletin from them in the near future confirming long standing case law and attorney generals' opinions.

    In conclusion MADA believes that any program in which the dealer pays on a per vehicle sales basis for a referral violates Maryland licensing law and would subject Maryland dealers to fines by MVA.

    Any questions you may have can be directed to Redacted or me in the Association's office (xxx-xxx-xxxx).

    ************************************************** **********************************
    All contact info removed
  6. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    California lays it out for dealers and TrueCar.

    This is one of the more detailed Executive Summaries I have read…


    CONCLUSION

    In the State of California, TrueCar is viewed as an autobroker and vehicles displayed and offered for sale on TrueCar websites are advertisements to the public and must comply with California law.

    According California to it appears that many facets of the TrueCar/Zag broker program fail to comply with California law and such non-compliance could expose both TrueCar and participating new motor vehicle dealers to legal liability and/or license action.




    [​IMG]


    In response to a large number of inquiries received from California dealer members, we requested outside legal counsel, Manning Leaver, Bruder & Berberich (who also authors the California Auto Dealer Advertising Law Manual), to research the occupational license status of TrueCar, Zag.com, Inc. and affiliates and opine on a variety of DMV licensing and advertising issues associated with the TrueCar program. Attached (after the jump) please find a copy of an Executive Summary of a Memorandum prepared by outside counsel.


    The Executive Summary identifies a number of problems with the TrueCar model that could expose participating dealers to legal and/or licensing liability. Dealers that participate in the TrueCar program, or other similar programs, should individually review such programs with your own legal counsel for legal compliance.
    Read the full Executive Summary after the jump…



    Read Full Posting on the blog >
  7. Jeff Kershner

    Jeff Kershner Founder Staff Member

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  8. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    Screen Shot 2012-01-11 at 12.48.52 AM.jpg

    Oklahoma Motor Vehicle Commission Requests That TrueCar/Zag Immediately Suspend Business


    At the Oklahoma Motor Vehicle Commission (OMVC) meeting today the Commission discussed the TrueCar and/or Zag business model. According to the TrueCar website, "TrueCar charges all participating dealers the exact same performance-based service fee." Similarly, Zag's website states, "Zag only charges when a sale is transacted." Receiving a fee from a dealer for a completed sale of a vehicle arranged through the TrueCar or Zag website appears to violate Oklahoma Statute 47 O.S. Section 579.1, which prohibits brokering.

    In addition to brokering, the Commission was concerned with several possible OMVC Advertising Rule violations, which include:


    • OAC 465:15-3-14(7) "The terms 'dealer's cost', 'invoice', 'invoice price', or other reference to the cost of the vehicle to the dealer shall not be used."

    • OAC 465:15-3-2(a) requires a stock number or disclosure of the number of vehicle available at the advertised price; and, requires that the vehicle be in possession of the dealer at the time the ad is placed, or may be obtained from the manufacturer or some other source, and this information is disclosed in the advertisement.

    • OAC 465:15-3-4 "Any advertisement of a 'Bait' or 'Bait and Switch' nature is prohibited." TrueCar's website acknowledges that, "At times, however, your selected color, options, or incentives will not be available at a dealership." This situation could lead to allegations of "bait and switch".


    BEWARE: Oklahoma dealers are subject to regulatory enforcement action by the Commission; and, if found to be in violation of OMVC laws or rules could result in fines up to $1000 per occurrence and/or suspension or revocation of license.

    In the letter going out today, the Commission requests that TrueCar/Zag immediately suspend business through Oklahoma dealers until the concerns are addressed and resolved to the satisfaction of the OMVC to fully comply with Oklahoma law.
  9. Eley Duke

    Eley Duke Active Member

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  10. yagoparamo

    yagoparamo Well-Known Member

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    This is good news for TrueCar. They can change the financial relationship with the dealer and stay in business. So this entire circus act is nothing but great advertisement for them.

    At the same time this is driving the spot light from the main issue--as denounced by Thibeau many times:

    Customer and transaction data as well as its use.
  11. Jerry Thibeau

    Jerry Thibeau New Member

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    They still need to go. If they survive, ALL dealers & manufacturers would be better off adopting one price shopping and making it about the value proposition of the dealership.
  12. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    Is this true?

    [h=3]TrueCar: Don’t get f’d by the dealer[/h] [h=2]Wednesday, January 11th, 2012[/h] TrueCar registers domains about getting f@%&ed by the car dealer.
    If there’s one site that has made waves in the retail auto business over the past few years it has to be TrueCar.


    Before TrueCar if you wanted to get negotiating leverage at the car dealer you had to just try to figure out how much the dealer paid for the car. But with TrueCar you find out what other people actually paid based on tax and loan records. It’s a slam dunk for negotiating a car purchase.


    Of course, when you disrupt a car dealer’s normal negotiating tactics you can really piss them off. The company has been getting a lot of exposure lately since it started providing leads to dealers where the dealers quote a firm price and TrueCar takes $300 for the sale. There was an article in the most recent Economist about how car manufacturers are warning dealers away from offering cut rate pricing on the service.


    What does this have to do with domain names? Well, take a look at these domain names TrueCar just registered:


    F*ckedbytheDealer.com
    F*ckedbytheDealer.net
    F*ckedbytheDealer.org

    This was found here and thanks to Jim

    TrueCar: Don’t get f’d by the dealer - Domain Name Wire
  13. Jeff Kershner

    Jeff Kershner Founder Staff Member

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    One of my favorite magazines The Economist published an article on TrueCars earlier this week...

    The TrueCar challenge

    A price-comparison website causes ructions in the motor trade

    AMERICANS looking for a new car nowadays often use online price-comparison sites such as AutoTrader, Edmunds and eBay to find the best deal. Most such sites charge dealers a small fee for passing on sales leads from shoppers who have submitted their details. TrueCar, a relative newcomer, does things differently. It charges dealers $300, but only when its introduction of a customer results in a sale, and it makes its dealers guarantee to honour their quotes, no excuses.

    TrueCar taps into data from state vehicle-registration offices, car-loan providers and other sources to compile what it says are the most accurate figures available for what motorists pay for the same car locally. This can be several hundred dollars less than the sticker price, and is often below “invoice”—the price that, according to the paperwork sent by the carmaker, represents the wholesale price the dealer paid. In fact dealers receive various rebates from carmakers, and make money from such things as loans and service contracts, so a modest profit is still possible… continue reading on The Economist
  14. ddavis

    ddavis Well-Known Member

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    One of my good friends, that is a GM with Group 1 Automotive, told me that the CEO said that none of their 143 dealerships are allowed to sign with TrueCar.
  15. Alex Snyder

    Alex Snyder Administrator Staff Member

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    Finally - somewhere to see it all in one shot. Nice work Jeff :thumbup:
  16. sweece

    sweece New Member

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    Hmm. Wonder why they think TrueCar owns these domains. WHOIS info says they're owned by MarkMonitor.com ("Protecting Brands In The Digital World") so I guess it's still possible...
  17. Jeremy Brown

    Jeremy Brown New Member

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    He guys just had a customer email me this and he told me I was fool for not signing up with Truecar. What do you think?

    Thanks for reaching out. TrueCar does not ask for your Social Security Number or personal credit information at any time. TrueCar provides consumers with free, transparent local pricing information about new cars and match consumers with Certified Dealers (Dealers that have been through our program and have agreed to honor the upfront pricing they provide to TrueCar customers) in their area offering a haggle-free buying experience for their vehicle of interest.


    In order to generate a Price Protection Certificate for a Certified Dealer, you need to submit your contact details (valid name, phone number, email and address) so the Certified Dealer can contact you to discuss the vehicle and has you in their system as a TrueCar customer (the dealer then knows that the customer is part of our program and therefore must honor the program pricing and customer service guidelines). This is the only information TrueCar asks of you. You can check out our Privacy Policy here.


    TrueCar has not been deemed illegal in PA or any other state. We are engaged in a dialogue with the regulators of several states, working to ensure that TrueCar’s business model will conform to each state’s different regulatory requirements. Nothing like TrueCar has ever existed; it is not an advertising company, a broker, or a lead generation company, but rather an Internet marketing company. Regulators are curious and feel obligated to scrutinize a new business model to ensure that it meets the needs of consumers and dealers and, of course, the laws and regulations of their state. That said, the business model is new and does not easily fit into the historic regulatory framework, which was developed prior to the advent of the Internet. We are committed to working with regulators to build a consensus that will allow TrueCar’s model to conform to the various state regulatory schemes.


    Please let me know if you have any additional questions or if I can help you with anything else.


    Have a great day!


    Kind regards.


    Bri Kapellas
  18. sweece

    sweece New Member

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    Rather, the business model clearly violates certain state advertising laws which apply to both print & web. I'd say that sort of compliance was probably an important thing to consider before pushing the product so much.

    This is obviously written by a PR person with no fault admitted whatsoever. Am I surprised? Nope.
    1 person likes this.
  19. bzweifel

    bzweifel New Member

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    False.




    If saying:

    "Regulators are curious and feel obligated to scrutinize a new business model to ensure that it meets the needs of consumers and dealers and, of course, the laws and regulations of their state."

    Is legal PR gargon for:

    "At it's January 9, 2012 meeting, the Virginia Motor Vehicle Dealer Board felt obligated to vote 10-0 that TrueCar was illegal."

    then yes, that statement might be accurate based on the added context.
    Here is the link to the entire MVDB ruling:
    http://mvdb.vipnet.org/pdfs/Guidance Memorandum (TrueCars) to All Dealers_1-11-2012.pdf

    Attached Files:

    2 people like this.
  20. yagoparamo

    yagoparamo Well-Known Member

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    Hey! They $200M from someone to make sh@#t up and keep the bunny running.

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