TRUE CAR and ZAG Cyber Bandits, Parasites or Good for the Car Business?
Jim Ziegler asks...
I am hearing a lot of discussion about True Car and ZAG. I continually scratch my head and wonder if desperate dealers are doing the marketing limbo "How Low Can You Go?"
Are we so bad at what we do that we have to line up and pay vendors to lose money? AND, who is giving these people access to your data that is used against you?
Who owns these companies and what might be their ulterior motive? Sometimes I ask questions to which I already know the answer.
Am I wrong?
What do you think... JIM
Jim Ziegler's Guidance and Recommended Action Plan:
Ten Areas We Need to Concentrate on to Bring This Monster to It's Knees...
- Government investigation of ALL Data Aggregators taking consumer information from dealers' DMS. Sadly enough, dealers who do business with TrueCar are exposed to liability charges. Cut off all access to unecessary data, no matter who takes it from the dealers DMS and make it illegal to "resell identifiable consumer data" and "transactional data".
- Educate Your Fellow Dealers; If anyone takes financial transactional data, they expose the dealer that allowed it to violations, especially if it is passed on to other vendors or shared.
- Educate Consumers to what they're doing with their information...
a. You buy a car from a dealer, do you really want your personal information, and maybe even your financial information, passed along and sold and shared by "God knows who?"
b. These People Charge the Dealer $300 which the dealers have to build into the deal
c. Your Privacy and the Security of your Information could theoretically compromise your identity if you do business a company that takes data from the dealership. - Educate Investors and potential investors they could possibly be mislead if anyone is telling them this is a safe investment because of all of the dealers pushing back, associations pushing back, and government regulators in many states coming after TrueCar's business model as NOT compliant, in some cases they're saying it is Not Legal.
- AMEX, USAA and all of their affiliates do not want the bad consumer relations this push back is creating with their members and customers.
- Cancel your dealership's Affilation with TrueCar. Tell people with TrueCar certificates that YOU don't honor TrueCar and you feel the company is NOT reputable. Educate consumers as to perceived data exposure if they buy from a TrueCar dealer. Make sure that each consumer knows that using TrueCar actually increases their vehicle cost by $300 to $400.
- Make the dealers selling at huge losses take all of those deals. Big problem right now is too many Nissan Dealers and others are taking huge losers to get the factory money. The TrueCar reverse-auction business model will continually push those numbers down until the factory money is non-existent. Consumers need to hear from many dealers, "We don't do TrueCar"
- Keep calling your National and State Dealer Associations demanding they get involved and stay involved... No excuses.
- Get the Manufacturers into the game. If GM, Ford, Toyota, and other majors change the rules about how we advertise and do business to protect the dealers, we can cut off their ability to set pricing. So keep it up at every dealer meeting. Call your Dealer Council Members and protest to your factory reps. Tell the manufacturers, if they want showroom and facility improvements, we need the ability to make fair profits.
- Tell everyone you know. Educate other dealers and industry people. Watch the Painter interviews... I believe this is the first time a vendor has publicly announced they intend to bring down the dealers and hijack our business, taking our profits and starving us out with our own data. Painter has said manufacturers and dealers should go bankrupt and he, in his God-like way "will control distribution..."
When the TrueCar-Yahoo Deal kicks in we need to stand firm and "Just Say No" we don't honor TrueCar deals.
Read this article as a reference: http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20110831%2FFIN...
AND, if you doubt the mission... read this... http://www.zag.com/websiteASSETS/whitepapers/ZAG-WhitePaper3.pdf
Comment
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Comment by David T. Gould on January 9, 2012 at 3:06pm
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Virginia set the pace.
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Comment by Thomas A. Kelly on January 9, 2012 at 2:56pm
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It sounded like to me TC's "other" model is a play on words and that when the math is applied at the quarterly close, a mathematical adjustment brings it back to around 300 & 400 bucks/per unit...a gentleman at the table but not a council member pointed this out.....all of this to skirt a law and they saw through it!
Nice job Virginia DMV!
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Comment by James A. Ziegler on January 9, 2012 at 2:55pm
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Why is General Motors suddenly electing to send this reminder to their dealers?
"Current GM Dealer Agreement states (Article 5.1.4), “Dealer is not authorized by this Agreement to directly or indirectly sell Motor Vehicles to persons or parties (or their agents) engaged in the business of reselling, brokering (including but not limited to buying services) or wholesaling of Motor Vehicles. Nothing in this Article 5.1.4 is intended to restrict Dealer from selling Motor Vehicles to other General Motors dealers of the same Line-Make in the same country or territory”.
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In the beginning I thought we could create enough push-back to make them change their business model...NOW I am beginning to think we can bring them down totally. These are NOT decent people...at least that 's how I see it.
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This is the last 10 minutes of VA DMV which includes the vote.
http://www.youtube.com/watch?v=s7HrvDXvvVA&feature=player_detai...
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Comment by Michael Paulson on January 9, 2012 at 1:36pm
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"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."
Does this mean that TC is effectively out of business until March in Virginia? Back to USAA, etc. without a buying service for a significant amount of time in that state...and Colorado...
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Having trouble viewing this email? Click here 
Dear Dealer, 
Dealer Board Makes Determination Regarding TrueCar Pricing ModelToday 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.
Thank you.
Sincerely,
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Rejected TrueCar's attorney request for adding statement that they were working with Virginia authorities toward an amicable resolution as well. Not an impressive showing on behalf of TrueCar.
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Did I misinterpret it...OR Did the State of Virginia just declare that TrueCar is a broker...that their model is illegal...and did it appear to anyone else that their alternative plan was going to be rejected by the state as well. And The Virginia States Attorney Agreed ... is that the way you saw it too?
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Virginia Department of Motor vehicles Board was to discuss "Brokering" (TrueCar) at 9:30 BUT evidently their live feed went down just before. Did Painter and TrueCar people pull the plug when our backs were turned?
http://www.dmvnow.com/webdoc/media/video/live_event.asp
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