CADA Initiatives: The Bigger Picture

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Autosphere is pleased to share with you Todd Bourgon’s exclusive interview with John White, President & CEO of the Canadian Automobile Dealers Association (CADA).

The CADA is working on issues that will affect the day-to-day lives of dealers in Ontario, and across Canada.

While this page is normally dedicated to matters that concern dealers in the province of Ontario, this time around we’re taking a look at the bigger picture. A recent conversation with John White, President & CEO of the Canadian Automobile Dealers Association (CADA) gives us all an idea of the kind of challenges facing the dealership community, from coast to coast.

Of all the initiatives the CADA is spearheading, White says that the following four are a top priority right now:

Recall Legislation: Recalls have always been voluntary in Canada, White explains, but that’s about to change as the government is currently working on new legislation. “There is recall legislation in the United States,” he explains, “and we at CADA want to ensure that recall legislation in Canada does a couple of things. First that it’s aligned as closely as possible with US legislation;there must be a provision in that legislation for adequate compensation to our dealers. Second, that there is compensation in place when our dealers are faced with massive stop sales. So we are putting proposals and submissions in front of the government right now.”

Bank Act: The Bank Act is currently under review. It was initially going to be changed or reviewed because it expires in 2017, but that has been extended to 2019. “We are working with government to ensure that our position is well known,” White explains, “and that our position as it pertains to the banks and vehicle leasing is consistent with the past. In other words, we don’t think banks should get involved in automobile leasing.”

Taxation: The big issue right now is that the CRA is assessing dealers for HST on insurance products that they may have sold. “We’re working with government because there’s an inconsistent treatment in terms of what the government has already done with regards to financial income, which is HST exempt,” White explains. “So we’re working with our dealers and with government to make sure there is consistency with the legislation.”

Environment: The major concern here is that the provinces are taking different approaches to the environment, more specifically electric vehicles. “There’s no cohesive national policy,” White says. “The government has just announced a carbon tax approach, and we’re still trying to figure out what that means. But clearly there is a better role for the federal government to be working with the provinces to try to be coordinating similar legislation across the board.

“So there’s a bit of a disconnect there between what the provinces and what the feds are doing. Some provinces want hard targets for our dealers, and that’s an issue. Ontario has not, Quebec has, and BC has gone to a ‘scrapage and reimbursement’ type program.

“Our position is that if governments are going to do anything, they should be trying to get older, more polluting vehicles off the road, and replacing them with more technologically advanced and environmentally friendly vehicles regardless of whether they’re EVs, hybrids or cleaner gasoline-powered engines. That’s our national position.”

Timeline for answers

Working with government on these types of initiatives is a lengthy process, which means the CADA is going to be working on these files, on behalf of dealers, for years, in some cases.

“The Bank Act question won’t be answered until 2019,” White says. “The banks haven’t shown their hand yet as to what they want to do. Recall legislation should be completed in 2017, and the taxation file, well, we’re going to fight that hard and see where it goes. It can take a year or two. We don’t know.”

I should point out, as well, that the CADA isn’t alone in this fight. We’re working hard to support them on a number of fronts. “I have to give credit to the TADA on the taxation file,” White says. “They have really stepped up to make it a high profile matter. We are working with the TADA in close partnership on that file. And when it comes to the environment file, the TADA has their own challenges dealing with Ontario. All we can do is try to support them.”

What dealers need to know

As all these matters are worked out, what should dealers keep in mind? “In terms of the environmental file, things are moving really fast,” White says. “It’s something that’s on the radar of the Trudeau government, and it’s something that dealers need to be aware of. It’s going to be an issue for dealers who have franchises with manufacturers that are perhaps not as advanced as others with EVs, hybrids or plug-in hybrid vehicles. So clearly this is something they need to stay on top of with their manufacturers.

“In terms of recall legislation, I think it’s positive. The CADA supports recall legislation because it helps to level the playing field, and that’s good for our dealers.

“On the bank act, it’s hard to say which way the government will go. Dealers have made it clear that they support the status quo, and they need to let us fight the fight.”

Dealers who would like more information can log onto the CADA website: cada.ca.

Wrote by: Todd Bourgon is the Executive Director of the Trillium Automobile Dealers Association (TADA).

Categories : Dealerships


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