DETROIT and ALEXANDRIA, Va. -

Two major dealer associations reiterated their concerns about what’s happening in Washington, D.C., nowadays, beyond the solution lawmakers hammered out earlier this week to end the partial government shutdown and lift the debt ceiling.

First, David Westcott, current chairman of the National Automobile Dealers Association, warned that the Consumer Financial Protection Bureau’s lack of transparency and unresponsiveness to Congress could end up hurting consumers by increasing the cost of auto loans.

“The CFPB is pursuing a policy that could weaken competition in auto lending and result in higher credit costs for millions of consumers,” Westcott said in remarks to the Automotive Press Association in Detroit earlier this week.

Westcott also called the dealer franchise network the “most efficient, cost-effective and competitive way of selling and servicing vehicles anywhere in the world.”

The franchised dealer from Burlington, N.C., repeated inquiries made by lawmakers about how the bureau is evaluating what’s a good business practice and what isn’t.

“More and more members of Congress are questioning the CFPB's so-called ‘fair lending guidance’ that seeks to eliminate dealer-negotiated financing and replace it with a flat fee method of compensation where dealers are not allowed to discount the financing they offer,” Westcott said.

Westcott went on to say pressure from the CFPB to force finance sources into adopting flat fees would eliminate a dealer's ability to “meet or beat” a given rate, and could increase the cost of credit for millions of consumers.

“When it comes to indirect lending, dealers are ‘price discounters.’ We don't understand how removing 17,546 price discounters from the marketplace is a good thing for consumers,” he said. “And we don't see how tampering with a $783 billion auto lending market — that's working effectively and efficiently — is a good thing for consumers, either.”

Westcott wrapped up his commentary by describing the entire situation as “not a small matter,” reiterating how vital it is for people who can afford a vehicle to be able to secure one.

“It’s not helpful when a government agency claims that an entire market needs to be restructured but provides no evidence to support that assertion,” Westcott said.

“For many Americans, car ownership is the key to getting a job and economic advancement. From our perspective, there is no question that every customer deserves fair and equal treatment,” he continued.

“Our goal is to meet the transportation needs of all of our customers in an open and honest manner. And this includes working so that consumers can continue to have access to affordable credit,” Westcott went on to say.

Westcott’s complete remarks at the event can be found here.

AIADA Applauds Congressional Support of International Industry

Meanwhile, the American International Automobile Dealers Association cheered a letter orchestrated by Rep. Alan Nunnelee, a Republican from Mississippi, and Rep. Pete Gallego, a Democrat from Texas, highlighting the substantial investment made by Japanese automakers in the United States.

The letter, which was signed by 79 members of Congress, was sent to President Obama earlier this week in support of the Japanese OEMs that are creating new jobs and driving economic growth and innovation in America.

“This letter to the president is a timely reminder of just how significant an investment Japanese automakers are making in our country, and in the next generation of Americans,” AIADA president Cody Lusk said.

“In addition to the facilities they build, the jobs they create, and the quality products they produce, their dealers are also making positive contributions in communities from coast to coast,” Lusk continued.

AIADA pointed out that approximately two-thirds of Japanese brand vehicles sold in the United States are built in U.S. manufacturing facilities that represent a $47.1 billion investment in more than 29 plants. Those production facilities provide 76,000 American jobs.

Separately, the dealer networks of Japanese auto manufacturers number more than 5,300 franchises and directly employ more than 315,000 Americans.

Gallego and Nunnelee explained why they authored the letter to President Barack Obama.

The lawmakers insisted that traditionally when the administration negotiates free trade agreements such as the Trans-Pacific Partnership (TPP), various stakeholders actively and publicly advocate their positions amid the complexities of the issue.

“We didn’t want the positive message of foreign direct investment to get lost in the debate,” Nunnelee said. “We wanted to remind the president of the significant contributions these automakers and dealers make to our nation’s economy each day.

“In Mississippi alone, Japanese automotive investment has created thousands of jobs,” Nunnelee added.

Gallego went on to say that, “America has a proud history of promoting policies that encourage multi-national corporations to invest billions of dollars in our economy.

“U.S. workers have been the chief beneficiaries of that investment, including the 2,500 people in San Antonio who are building and selling new vehicles,” he continued.

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