Pub. 56 2015-2016 Issue 4

16 T he National Automobile Dealers Association submitted a well-documented, point-by-point answer to the FTC following their January 19, 2016 workshop examining, among other things, the validity of state dealer franchise laws. NADA Executive Vice President, Andrew D. Koblenz and Chief Economist, Steven Szakaly submitted factual information that countered the misguided rhetoric and innuendo that was replete throughout the testimony of academics, attorneys and even the FTC executive staff who vilified family-owned, community-based franchised dealers at every opportunity, without any factual basis for their spurious claims. The first half of the NADA letter follows, with the balance of Messrs. Koblenz and Szakaly’s comments to be published in the next issue of Dealers Choice Magazine. The letter in its entirety can be found at bit.ly/1swqSdy. Dear Secretary, The National Automobile Dealers Association (NADA) 1 submits the following comments in response to both (1) the Notice entitled “Auto Distribution: Current Issues and Future Trends/AFederal TradeCommissionWorkshop” (Notice) that the Federal TradeCommission (FTCorCommission) released in the above captioned matter 2 and (2) the workshop that was conducted in this matter on January 19, 2016 (Workshop). Introduction NADA has a long history of working with federal regulatory agencies, including the FTC, to promote improvements to the auto distribution system in the United States. Accord- ingly, NADA welcomes the opportunity to work with the Commission and members of the public to further advance these efforts in response to the FTC initiative announced in the Notice and carried out through theWorkshop. However, NADA strongly objects to what appears to be the imbal- anced and predetermined manner in which this project has proceeded to date.When undertaking inquiries into consumer markets, an independent agency of the government like the FTC should employ an approach that reflects an objective and impartial review of the subject at hand. Unfortunately, as explained below, the process that has been followed thus far does not appear to have comported with this imperative. We ask the FTC to address this shortcoming as it proceeds in this matter. Notwithstanding our process concerns, we wish to assist the Commission and the public in better understanding the reali- ties of the auto retailing marketplace and to help establish a fact-based record in this matter. To that end, in the balance of this submission, NADA provides a thorough set of com- ments on the U.S. auto franchise system and the questions that the FTC has asked about it. Among other things, these comments explain (1) how the auto franchise system benefits consumers, (2) the important role that the states play under NADA Responds to the Federal Trade Commission 1 NADA represents more than 16,000 franchised dealers in all 50 states who sell, lease, and finance the sale of new and used cars and trucks and engage in service, repair, and parts sales. Our members collectively employ over one million people nationwide. Most of our members are small businesses as defined by the Small Business Administration. 2 The notice can be found at http://1.usa.gov/24ljf5k.