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Archives for May 2011

BREAKING: DealerTrack to Acquire eCarList

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DealerTrack to Acquire eCarList

May 25, 2011 8:30 AM ET

Adds Innovative Vehicle Merchandising Solutions to Industry Leading Inventory Management Offering

LAKE SUCCESS, N.Y., May 25, 2011 /PRNewswire/ — DealerTrack AAX, Inc., a subsidiary of DealerTrack Holdings, Inc. TRAK, today announced that it has signed an agreement to acquire substantially all the assets of eCarList LLC, a leading provider of inventory management and merchandising solutions for automobile dealerships  The combination of DealerTrack’s current AAX inventory management solution with eCarList’s product suite of vehicle merchandising, pricing analytics and mobile inventory solutions will provide dealerships with a comprehensive vehicle management offering.  Len Critcher, president and chief executive officer of eCarList, along with the entire eCarList management team, will remain with the combined company.  The acquisition is expected to close in July, subject to customary closing conditions.

Mark F. O’Neil, chairman and chief executive officer of DealerTrack, commented, “We are extremely excited to announce this acquisition.  eCarList is one of the fastest-growing companies in the industry and is a leader in delivering innovative vehicle merchandising and management solutions for the automotive retail industry.”  O’Neil continued, “We believe the addition of eCarList will enable DealerTrack to expand its leading position as the industry’s most comprehensive suite of inventory management and merchandising solutions that leverages the best from each company.”

“We look forward to joining the DealerTrack family,” said Len Critcher. “The combination of DealerTrack AAX and eCarList will drive even more innovation to help dealerships generate additional vehicle interest and higher quality Internet and showroom traffic, all while maximizing overall deal profits.”

The financial impact of this acquisition to DealerTrack’s 2011 guidance will be given in conjunction with the release of DealerTrack’s results for the second quarter of 2011.

About DealerTrack (www.dealertrack.com)

DealerTrack’s intuitive and high-value software solutions and services enhance efficiency and profitability for all major segments of the retail automotive industry, including dealers, lenders, OEMs, agents and aftermarket providers.  DealerTrack, whose solution set for dealers is the industry’s most comprehensive, operates the largest online credit application network in the United States, connecting approximately 17,000 dealers with more than 1,000 lenders. DealerTrack’s Dealer Management System (DMS) provides dealers with easy-to-use tools and real-time data access to enhance their efficiency, while DealerTrack AAX delivers the inventory management tools and services needed to accelerate used-vehicle turn rates and help increase profits for dealers.  DealerTrack’s Sales and F&I solutions allow dealers to streamline the entire sales process as they structure deals from a single integrated platform.  Its Compliance solution helps dealers meet legal and regulatory requirements and protect their assets. DealerTrack also offers additional solutions for the automotive industry including electronic motor vehicle registration and titling applications, paper title storage, and digital document services. DealerTrack’s family of companies also includes data and consulting service providers ALG and Chrome Systems. For more information, visit www.dealertrack.com.

About eCarList (www.ecarlist.com)

Headquartered in Dallas, Texas, eCarList provides a full suite of inventory management and online marketing tools for the retail automotive industry enabling dealers to appraise, price, and merchandise vehicle inventory online in real-time.  eCarList’s services include inventory management, inventory distribution, vehicle appraisal and pricing tools, mobile software, dealership health reporting, CRM, custom web design, and digital marketing solutions via a fully integrated software as a service platform.  eCarList improves dealership productivity, inventory turn, sales, and profits for its clients by improving and simplifying the way in which inventory is managed, distributed, and viewed by consumers.

Safe Harbor for Forward-Looking and Cautionary Statements  

Statements in this press release regarding benefits to DealerTrack and its customers of the pending acquisition of eCarList and all other statements in this release other than the recitation of historical facts are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995).  These statements involve a number of risks, uncertainties and other factors that could cause actual results, performance or achievements of DealerTrack to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements.

Factors that might cause such a difference include: economic trends that affect the automotive retail industry or the indirect automotive financing industry including the number of new and used cars sold; reductions in auto dealerships; the impact of some vendors of software products for automotive dealers making it more difficult for DealerTrack’s customers to use DealerTrack’s solutions and services; security breaches, interruptions, failures and/or other errors involving DealerTrack’s systems or networks; the failure or inability to execute any element of DealerTrack’s business strategy, including selling additional products and services to existing and new customers; the integration of the eCarlist acquisition and the expected benefits; DealerTrack’s success in expanding its customer base and product and service offerings; and other risks listed in DealerTrack’s reports filed with the Securities and Exchange Commission (SEC), including its most recent Annual Report on Form 10-K.  These filings can be found on DealerTrack’s website at www.dealertrack.com and the SEC’s website at www.sec.gov. Forward-looking statements included herein speak only as of the date hereof and DealerTrack disclaims any obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances, except as required by law.

Originally published on DealerElite.net and ADM

NLRB Files Complaint Against Luxury Car Dealership For Unlawful Termination Over Employee’s FB Post

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On Friday, May 20, 2011, the National Labor Relations Board filed a complaint against a luxury car dealership in Lake Bluff, IL for “unlawfully discharging a car salesperson because of his Facebook posting concerning the dealership’s handling of a sales event which could impact his earnings.”

The complaint was filed out of the NLRB Office Region 13 Chicago. I contacted Regional Director James Barker who indicated that a formal press release will be issued in the next day or so in regards to this complaint.

I spoke with legal counsel for the dealership, James Hendricks, seeking more information about the case. While he couldn’t get too specific as they are taking this to trial, he was able to give me a brief summary of the facts regarding the case. When asked what the salesperson posted on Facebook that is involved in this complaint, Mr. Hendricks indicated to me that the salesperson posted a picture of an accident involving another salesperson while on a test drive with a customer that occurred at an adjacent dealership owned by the same company as the one he was employed by.

Mr. Hendricks’ position is that the employee in question was not terminated for that action (posting on Facebook) but for different reasons.

“We advise all of our dealer clients to have a social media policy in place that contains a disclaimer that nothing within their policy is meant to violate the employee’s section 7 rights under the National Labor Relations Act”, said Mr. Hendricks. Section 7 is the core of the NLRA as it defines protected activity including employees’ right to organize, take part in grievances, protests and strikes.

There is very little information available as of now but this is certainly something dealerships should be watching. The National Labor Relations Board has recently begun taking an active interest in employers in regards to terminations and disciplinary actions taken against employees, most recently including an April 27, 2011 settlement by the NLRB with build.com and a February 8, 2011 settlement with American Medical Response of Connecticut, Inc. both of which involved employees being terminated due to Facebook posts that were made. In both of those cases, it was determined by the NLRB that the activity was protected activity since the employees were discussing workplace conditions with fellow co-workers.

There have been plenty of cases in which terminations related to social media activity by employees were upheld by various legal entities. The fact that the NLRB seems to feel that this activity (posting photos of an accident that occurred at your workplace by a co-worker which involved a customer) is protected in some way will be something we need to watch. The trial date is set for July 21, 2011.

UPDATE: After breaking the news on this matter on Dealer magazine, new information was brought to my attention. I re-contacted the dealership’s attorney to clarify facts in this case. According to the attorney, the NLRB’s position is that the employee was terminated due to posting a comment on Facebook relating to what he considered poor quality food and beverages offered to dealership customers at a sales event, however, the dealership’s position is that the employee was terminated due to the posting of the photograph which I described earlier.

(Article mentioned by Dave Jamieson of the Huffington Post).

 

 

 

In The Trenches During The AutoTrader Acquisition Of VinSolutions

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As I’m sure you’re probably aware by now, AutoTrader announced Wednesday that they had reached an agreement to acquire VinSolutions.

I was in the unique position to actually be with most of the executive leadership and employees of VinSolutions when the news broke. I was also with HomeNet Automotive when the rumors started that AutoTrader was working to acquire HomeNet Automotive. I also came really close to working directly for AutoTrader as they attempted to recruit me and, ironically, I was actually at an event in Colorado that Chip Perry was in attendance when I was informed by the Autotrader recruiter that I was “not worthy” (their loss). I like to think that AutoTrader is following me around acquiring companies I work for simply because they actually want to “acquire” me. (That’s my story and I’m sticking to it.)

After my initial shock passed, as an employee of a media company, the investigative part of me started paying attention. What I expected to see was executive management in a celebratory mode making plans to roll around in the pile of money they must have just made. I expected phone calls being made and Internet leads being submitted for new Ferraris. I expected VinSolutions employees to be anxious about their future employment and having a feeling that this company, that they all were very proud to be a part of, was at an end. I saw none of that.

What I saw was quite the opposite. Executive management and VinSolutions employees were still talking to dealers. VinSolutions employees were excited. The entire team was customer focused, not acquisition focused. In fact, it really seemed as if VinSolutions had acquired AutoTrader rather than the opposite. They weren’t feeling as if this was the end, quite the contrary. They felt like this was the beginning. They were excited about the incredible resources and value now available to VinSolutions to make their product(s) bigger, better and faster than they ever were able to before.

What makes this acquisition a historic moment is that this is the first time in our industry’s history that a non-DMS company has acquired a company that does what VinSolutions does. VinSolutions wasn’t interested in being acquired by a DMS, because several trends inevitably happen: the acquired company immediately loses half their market share, but they also fall into this virtual black hole eventually disappearing never to be heard from again.  AutoTrader “could” make VinSolutions the hub of their operation powering and integrating with ALL of the AutoTrader/Cox owned properties acquired in recent history.

With all of the properties that AutoTrader owns, they are in the unique position to dominate the automotive market. All of these properties, prior to their AutoTrader acquisition, had stellar reputations within the industry and with their customers. AutoTrader “could” leverage these properties to offer an unprecedented value to their customers. Whether (and how) they do this is still up in the air.

Not discounting the incredible value and loyalty that current VinSolutions customers have, ultimately VinSolutions is more than just another company. In fact, the people DEFINE VinSolutions. Yes, they have innovative solutions and offer the power and convenience of a completely integrated solution to dealers. VinSolutions could easily be named “Mike-Sean-Matt-Kendall-Solutions,” but that would certainly be hard to create a marketing campaign for. Why? The reason is simple. Mike Dullea, Sean Stapleton, Kendall Billman and Matt Watson ARE VinSolutions. Without them, AutoTrader would now own air. I sincerely hope that AutoTrader recognizes this (if they don’t already) and just like a NFL team, these people were signed to 20-year contracts. If you buy the Colts, you make sure Peyton Manning is included in the deal. Yes, VinSolutions’ integrated dealer solution offers great value to their customers. They are continuously looking to improve the value VinSolutions offers to their customers. The dedication and passion that these people, along with the entire VinSolutions team define VinSolutions.

As I talked to VinSolutions’ dealers that are attending this event, their concern had nothing to do with money/price increases, etc. It was completely focused on how AutoTrader would change WHO VinSolutions IS, and who they are is the key to their success. Yes, there are other people who can be a CEO. Yes, there are other people that can run a sales team. Yes, there are other programmers. Yes, there are other people who can be the “website” guy. The fact is that there is NOBODY that can replace these people, perform with the passion, dedication and experience that they have and perform at the level that they do. Disregarding the standard “business as usual” statement, VinSolutions truly has a culture of family. That family makes them who they are.

In my eyes, AutoTrader didn’t acquire a company; they acquired the equivalent of the Justice League of America. Take away any member of that team; the Justice League ceases to exist. JLA without Superman isn’t the Justice League of America. What made the JLA the powerhouse that they were was the collective power that they all brought to the table.

Does the competition need to be worried, absolutely, but not because all of a sudden VinSolutions is now owned by AutoTrader, but because AutoTrader acquired Superman, Batman, the Flash and the Green Lantern and, most importantly, a family.

Originally published on DealerElite.net and ADM

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