When is a sale not really a sale?
Automotive Practice Group leader and Los Angeles Managing Partner Aaron Jacoby was interviewed by Automotive News for a recent article, "When is a sale not really a sale?" The article discusses "punching" cars, the practice employed by auto dealers to report units as sold when they have not yet been sold. The sales numbers are inflated after dealers buy vehicles from their own inventory and convert then into testers or loaners in order to earn hefty bonuses. In the article, Aaron explains why this practice is problematic from a legal standpoint.
Aaron commented, "Punching cars is a program. It's a problem with inventory costs, and it's a problem with flooring costs. Nobody wants extra cost in the system, and dealers would rather have their unit sales correctly reflected."
To read the Automotive News article, click here.