Associations Automotive Volume 9 Issue 2

Texas Independent Automobile Dealers Association – Continuing to Drive the State’s Economy

February 25, 2022

Texas Independent Automobile Dealers Association

Continuing to Drive the State’s Economy

Business View Magazine profiles Texas Independent Automobile Dealers Association (TIADA) for our focus on the U.S. Auto Industry

Since 1944, the Texas Independent Automobile Dealers Association (TIADA) has been the only statewide organization representing independent automobile dealers across Texas. During the association’s early years, growth and engagement depended exclusively on grassroots participation. Today, TIADA has developed a respected voice at the Capitol and enhanced its membership through a variety of programs and services.

The association depends on a moderate political approach and works closely with members of both parties to safeguard the independent automobile dealers’ interests. Perhaps no marker better demonstrates the growth of the association than the most recent TIADA Conference & Expo. The annual event in 2021 was highlighted by a speaking appearance by Governor Greg Abbott, who spoke about the importance of used automobile businesses to the state’s overall economy.

Executive Director, Jeff Martin

Economic Picture

Representing, informing, and educating independent automobile dealers is TIADA’s guiding purpose. The industry contributes significantly to the Texas economy. Texas used automobile industry represents a market size of $14.7 billion (up from $10.4 billion in 2011). Texas represents 9.6% of the total used car market in the United States, which is not surprising since Texas ranks second in the nation in automobile registrations annually.

There are over 14,000 used car dealerships in Texas, and they employ tens of thousands of Texans. In addition to direct employment, used automobile dealers hire a variety of workers in delivery, transportation, parts, and services, among many other professionals. “The industry is an essential part of the Texas economy. Our members provide transportation that allows people to get to school, the grocery store, the hospital, and work,” said TIADA Executive Director Jeff Martin. There are nearly 17 million licensed drivers in Texas, and most of them drive to work.

TIADA’s membership includes the big dealers like CarMax, DriveTime, and Vroom, as well as the smaller dealers who sell five to ten vehicles per month and employ between one and fifteen staff members. These dealers rely on the association for its efforts in advocacy, compliance, and education, among other things.

2021 was a difficult year for independent car dealers in Texas and across the country. Dealerships everywhere are facing an unprecedented inventory shortage. With new car production falling far behind demand, franchise dealerships are hanging on to units they would otherwise have put up for auction in previous years. For independent dealers, this means travelling further than ever before to find automobiles that are more expensive and not always in the best condition.

To compound the problem, dealers are spending huge amounts of money on make-ready costs, which include transportation fees, repairs, and reconditioning. Parts and labour are simply more expensive than they were before the pandemic. Dealerships are also facing a labour shortage, and many business owners are struggling to hire and retain quality employees. Many of these dealers have begun implementing creative hiring policies to mitigate the problem, but this is not necessarily possible for all dealers. Until the supply chain interruptions are corrected, it is impossible to predict when (and if) conditions for dealers will return to normal.

TIADA offers a litany of benefits for its members, including its compliance consultation service, educational programs and seminars, governmental advocacy, and a certified pre-owned vehicle program. The association publishes a monthly magazine, Texas Dealer, and hosts an annual conference and expo that brings together dealers, vendors, legislators, and industry experts from all over the country.

TIADA’s Recent Legislative Victories

One of the most important things the association does is to ensure dealers have a voice in the laws and regulations impacting their industry. “TIADA works year-round to build relationships with state officials from both parties to educate them on the used car business. Our biggest fear is a law passing that has some unintended consequence and creates some overly burdensome regulations,” said Martin. “We are lucky to have such active members who understand the importance of building relationships with policymakers in their communities Texas has a great business environment, but our dealers know they have to be good stewards of the industry or that can change.”

The passage of the Texas Legislature’s Fair Tax Bill in 1993 was a major win for the association. This bill removed a requirement that dealers who finance vehicles in-house for their customers pay the entire motor vehicle sales tax at the time of transfer. While this was significant for many car dealers, it also allowed dealers to extend credit to more customers. In 1999, TIADA championed HB1707, which removed the requirement that a licensed car dealer provides proof of liability insurance for the buyer when a title is transferred. This piece of legislation made it much easier for dealers to handle title transfers.

More recently, in 2009, TIADA supported the establishment of the Texas Department of Motor Vehicles and ensured that a board position would be reserved in this agency for an independent automobile dealer. Previously, motor vehicle regulation fell under the control of the Texas Department of Transportation. In 2013, TIADA helped to enact an anti-curbstone bill that has protected dealers and consumers from unlicensed activity.

The legislative efforts that TIADA engages in are one of the most important aspects of what makes the association so important for the independent automobile industry in Texas. The association recognizes how important safeguarding small businesses is to maintaining a stable economy and allowing business owners to keep their doors open.

Texas Independent Automobile Dealers Association

Annual Conference and Educational Programs

Every year, TIADA hosts a conference and expo to bring together independent automobile dealers, legislators, thought leaders, and vendors that have a stake in the industry. 2021 was the association’s largest and most successful conference, with over 300 dealers in attendance. The conference and expo is an exciting and significant occasion. Several hundred professionals gather to discuss the many important topics affecting independent automobile dealers across the state and country, including operations, dealership management, special finance and retail, technological developments, and compliance. Dealers also attend keynote addresses from well-known speakers. In 2021, these included marketing legend Roy Spence (who invented the famous slogan, “Don’t Mess with Texas”) and Governor Greg Abbott.

TIADA also owns and operates Texas Dealer Education, offering the state’s first training programs approved by the Texas Department of Motor Vehicles (in both English and Spanish). Over 10,000 dealers have been educated by Texas Dealer Education’s pre-licensing and renewal education courses. The dealer education courses have helped thousands of dealers learn about the industry and what it takes to succeed. The association offers additional educational courses throughout the year through its TIADA Dealer Academy. These courses are part of a professional development program that educates dealers on issues ranging from compliance, dealer finance, and tax strategies.

“Our members are very proud of what they do and the role they play in their communities. Our goal is to simply build an association that helps them be better car dealers, whatever that takes,” said Martin. TIADA represents its members and ensures these small businesses have a voice across the state. Perhaps more importantly, the association represents an industry that gets Texans to work and keeps the state economy running.