Vermont Legislature SmartTranscripts:

[Matt Walker (Chair)]: And we are live again here on what are we? Wednesday, is it? 02/11/2026, in house committee on transportation. Taking a little pause from our We were able to squeeze this piece in. And as we're doing the RPCs, we're going back to look at January sales data and car update and what's happening out there with our because we're so interested because it immediately turns and looks at purchasing news, but also some economic indicators and a whole lot of other stuff. Reporting wise for the Automotive Dealers Association, we'll have Matt in for some info and some discussion and questions and what's happening out there in the market. Welcome back to the committee. What's been going on?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Thank you, Chair Walker. For the record, Matt Cota with the firm Meadow Hill representing a couple of different clients with intersections here, most specifically the Vermont Vehicle and Automotive Distributors Association, but also Vermont Transportation Energy Network and Vermont Retail and Grocers Association, which represents gas and lead sellers in Vermont retail. I wish I had some better news for you. I do not. Just to recap, 2025 was not as good as 2024. In terms of used vehicle sales, they were down 11%. New vehicle sales was down 8%. We do year over year, at the twelve months of 2024, the twelve months of 2025. If you look at what were sold in 2024 versus 2025, all of the four leading powertrains all went down. Gasoline, BEVs, PHVs, HEVs was the only one to gain market share over prior year. HEVs are the conventional hybrids, no plug. But you're gonna get ten, fifteen, sometimes 20 miles per gallon more than a conventionalized vehicle, internal combustion engine vehicle, because while it's braking and moving, it's regenerating the battery that's on board. So those increased, but gasoline vehicles, BEVs, and plug in hybrid vehicles declined in 2025 when compared to 2024. If you look at the twenty four month chart, can you see it on your screen there? Anything? No. Yeah, January's bad. January's a hard month. A hard month to sell cars. It's cold. We just got over Christmas in terms of money available, and no one really likes to go car shopping when it's in the teens and below.

[Matt Walker (Chair)]: Is it particularly bad weather this year?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: And the bad weather, it all contributes to it. But if you look at January 2020 it's not great. And those are new vehicles. Used vehicles, similar story in terms of January. And then if you look at BVs, battery electric vehicles, those sales dropped off more precipitously in January 2026. Okay. Matt? No? Yeah. Sorry.

[Phil Pouech (Ranking Member)]: A little behind. So you you showed in the beginning just used vehicles registered and new vehicles registered. And that is strictly, you're getting that data just from registrations.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: That's a really good point.

[Phil Pouech (Ranking Member)]: Are you getting it from what your dealer said they sold or just from registration?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: I should have done that explainer. Thank you for pointing that out to me. This data comes from a contract that we have with a third party vendor called Experian. They're not the only one out there, but the one that we have. And what they track is vehicles that are purchased and registered in Vermont. So it could have been purchased in Florida and registered in Vermont, could have been purchased in New Hampshire, registered in Vermont, but it is tracking the vehicles. Now, we also can look at vehicles that are sold in Vermont from a Vermont dealer. However, some of those vehicles might be registered in New Hampshire or registered in Massachusetts or so on and so forth. Ran the numbers Mike Smith, who works with me at the Vermont Auto Dealers Association we ran the numbers both ways to determine if there were some anomalies there. And we found that generally about the same. And we thought the better metric will be consistent and what matters, I think, to a lot of people is what is actually on, has a green plate. And so when we look at these numbers purchased and registered, whether it's EVs or used cars or new vehicles, we don't know for certain which state it came from, but we do know for certain that it has a green plate attached to it and that they paid their registration fee to state of Vermont.

[Phil Pouech (Ranking Member)]: Is there and I'm not trying to dig up dirt or anything like that, but is there any data at all that you have of a reduction in people actually who drive in the state, haven't got their car registered or haven't got their, you know, there's always a few and that's, you know, for whatever reasons. But the only data that says that that's increased since the pandemic or any of that?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: In terms of vehicle registrations?

[Phil Pouech (Ranking Member)]: Yeah. People are driving, but they register it. It's not presently registered up to date. Oh, it's fine. Oh. Yeah. Or yeah.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: I have that data. I can tell you that you are asking very similar questions to what are being asked two floors down in Senate Transportation Committee because we can track inspection data. Inspections have dropped off 16%. 100,000 fewer cars inspected. Does that mean we have 100,000 fewer cars? Well, a good way to correlate that would be, do we have 100,000 fewer registrations? One would assume maybe you skipped the inspection, but you do need your car registered. Maybe you don't do either. But those are really important data points that I don't personally have right now. But I think smart people are looking for it. Okay. Thanks. Okay, so that's just the twenty four months of new, used, and EVs. Used vehicles, when we just isolate the month and I'll just do this quick. I think it's important. We just isolate the month. January have gone down. Not unexpected. Right after Christmas, it's cold. Used vehicle sales have gone up. That is more of a if this continues this trend, it tells me a couple of things. One is what used cars are. Yes, two thirds of sales are used cars. The fact that they're outpacing new cars means that, from an affordability perspective, that's seen as a value.

[Phil Pouech (Ranking Member)]: So do we know of those used vehicles? Are they mainly battery electric or some kind

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: of hybrid? They are mostly gasoline. I have a slide that shows that. Your top 10 new models, when you look at those, those are just in January, just isolate January. Five of the 10 are trucks. So two of them are wagons, and three of them are crossovers or SUVs. Those are new vehicles. But yes, when you look at used vehicles, here's your top 10 used vehicles. Subaru always does well in used vehicles, but you've got three trucks there. Two. Yes. No. One, two, three. Yeah. Three trucks. On EVs, our EV sales, only 180 in the first month of the year, PEVs and PHEVs. And that's the results there.

[Matt Walker (Chair)]: I have a question on that. Your members' inventory on their lots and whatnot, if that's what's Has that been adjusted, is that starting to build up, or is the kind of inventory of electric vehicle options with are they bringing less in now, or backing up on the law? As

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: you can imagine, it varies greatly for manufacturing. I don't have any specific data at all. I'm going to say it absolutely does vary per franchisee. But we can look at this slide, which shows where we are in January. These are new vehicles purchased and registered in Vermont. And it bears out what we saw in 2025, which is gas electric hybrids continue to be the second most popular powertrain. These are no plugs, but higher mile per gallon than standard gasoline. I'll transfer you.

[Phil Pouech (Ranking Member)]: Yeah. And I know you've mentioned this before, how sales, new sales, primarily, I guess, are really impacted certainly by people's pocketbook time of year maybe, but by incentives. So different car manufacturers might have incentives and sometimes they don't. How much of that? And I'm not saying the difference, overall impacting what people are buying, I guess.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Certainly incentives, manufacturers incentives, government incentives are all part of that too, as is financing.

[Phil Pouech (Ranking Member)]: Yes. The lease, we talked about that. I think there was a big program for electric vehicle leasing, very inexpensive at one point a year ago or so.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: If you think of the industries that cling on to every word the Fed says when they're talking about interest rate, sure, we have people in the real estate business, sure, bankers, but also car dealers. Because what that interest rate is, the lower the interest rate is, the easier it is to purchase a new car. But yeah, all those play a role. And they vary. I'm sorry, don't have any specific answers. But they absolutely do play a role, whether it's manufacturers' incentives, rebates for various powertrains, or financing incentives, which are usually driven by the manufacturer, those financing incentives.

[Mollie S. Burke (Member)]: So just on that, Representative Pouech's question, regarding financing, can you speak to just a quick snapshot on financing of cars now versus the last couple of years? Was it born down?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Yes. Fortunately, I did not bring that slide. However, I might be able to find it and send it to you. But EVs, what we saw over the last year is that the manufacturers' incentives to lease EVs were very profitable, to the point where I believe I might have to phone a friend over here but we were over 70% of EVs, most cash, bank, or lease. 70% was EVs, whereas that number was well below 50 for all internal combustion engine vehicles. So I don't know. I'd be very interested in finding out what the trend line looks like in 2026. I just don't have that data yet. Can tell you, though, that Vermont dealers across the country, given this ramp up that we've seen, and now we've may have plateaued into electric vehicles, that there's been significant investment in Vermont alone. Corey, to the economic survey, you can find at vermontdrive.com, nearly $15,000,000 the last couple of years have been invested in just upgrades to the facilities in Vermont in order to accommodate electric vehicles. I know the last time I was here, there was a question about dealerships that offer charging. And I can say that threefour of the dealers, new car dealers, have entered into a partnership with Drive Electric and Efficiency Vermont, receive rebates, funding, either consulting funds or funds for actual capital expenditures, to invest in electric vehicle charging. And I think the number is larger than that because you can't really sell an electric vehicle if you don't have a charger to get it ready to get out the door. And even if it's a level two, at least there's some sort of I know a lot of used car dealerships that have level 2s because obviously they're affordable than a level three, a fast charger. But there's been significant investment by these companies. And some I asked around. I don't have scientific data or anecdotal data, but one of the questions that you asked Representative White last time which is, are they available to the public? And it just runs the Gamma. There are some that have said, yep, we made it available to public for free since the beginning, and it still is so. Others have said, nope, we only do that for customers of ours. Others have put in a paywall, put in a charging system. So it is available, but it comes with a cost because, yes, they've spent $15,000,000 getting ready for this transformation. But according to a national study found in automotive news, a majority, more than 50% of dealers who have made investments in EVs have not regained their investment. Now, that mean they'll never regain it? No, they could. But I think there are some who are paying for charging infrastructure. They paid for the charging infrastructure. Now they have people charging. They see at least an opportunity to cut some of their costs because they're paying the electric bill by charging. Not all do that, but some have started to. Is

[Mollie S. Burke (Member)]: that connected to just the of increased or the reality that EVs are less expensive to maintain. Mean, dealers make a significant portion of their income from ongoing maintenance services. So if EVs are more affordable for folks who have access to them, then dealers are making less money off of them, but those customers are saving money in the long term?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Well, the EVs have not hurt the business model for car dealers. Yes, they don't do as many oil changes on an EV or any, but these cars still need maintenance. They still need battery replacements. They still need brakes. They still need lights. They still need inspections. They still need tires. So the type of work is changing, but the amount of work and remuneration for doing that work is largely the same. I don't know the answer. That's a good question. I don't know the answer. Can look it up. I know they're expensive too. And sometimes, if it's a new car and the battery, it may be covered by a warranty too. And that warranty work is obviously part of the service that New Cardio provides. Okay. Thank you. Yeah,

[Mollie S. Burke (Member)]: I'm just wondering if you know, just maybe anecdotally, what what is the warranty for a battery on an EV? That seems like it's pretty you know, that's the nuts and bolts of the whole thing. Right? So does that, you know, three, four years, is it mileage based? How does that

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: That's a great question. I don't know the answer to it, but something that I could find and absolutely circulate with the committee. So in terms of I'm happy to go back to cars, but there's the nexus here, the nexus between this transformation and how we are going to power our vehicles over the next fifty years, which will slowly or quickly transition to less gasoline powered vehicles, but also the network that has existed for one hundred years of convenience stores and gas stations that provide this service. And Drive Electric does a great job of their charging map, but you can see facilities built in the last five years that have the square footage, that have the footprint, are absolutely investing in charging. This is Maplefields. Sicero Valley in Berlin. Same thing in St. Albans. They've made significant investments into electric vehicle charging infrastructure, which they charge for. But it's something that's important to them. This is the new Summit properties, the barn in Richmond. Over there in the corner there is their level three chargers, fast chargers. And it is absolutely part of Summit, Tom Fralli's business model, which is to build clean facilities with hot foods that people can go park, get their lunch, get their dinner, get their breakfast, get their gas, get their charge. Is the feature of convenience. It's a beautiful facility, as is the Berlin facility. But not every gas station can do this. You certainly can't do it. The one right next to the Capitol Plaza, you can barely park a fuel truck there in order to deliver the fuel, never mind have have multiple spots available for EV charging. But where you can, this is the future of convenience, the future of motor fuel and electric vehicle charging. That said, when we look at, I know you've seen these slides other ways, it's the same data. It all comes from the Vermont DMV, which collects on the twenty fifth of the month, the gasoline sales and diesel sales. And we're at one point two percent 2025 year over year, 3.2% down below the ten year average. The biggest drop in sales of gasoline occurred in 2020 during the global pandemic. Diesel sales have been remarkably steady, but they're still on the decline. Oftentimes we get asked, okay, well, does By the way, all this is at our website as well, but what's the tax? You've probably seen this several different ways. This is how we present it to the public and to members, which is every quarter. This number is adjusted this quarter. It's $0.50 a gallon. If you add up the gasoline excise tax, the motor fuel transportation infrastructure assessment fee, the motor fuel tax assessment fee, the $01 PDLF, and the federal excise tax. And then diesel remains constant throughout the year. We're paying zero five zero dollars a gallon on gas. We're paying $0.564 on diesel. I often get asked too about a local option tax or ways that we can track gallons sold in particular towns or counties. And I say we have amazingly robust and transparent ways to look at every gallon sold. I can tell you how many gallons were brought in any particular month going back twenty years. What I can't tell you is where it was ultimately purchased and consumed. So the way it works in Vermont is that, yes, there are nearly 500 stores selling gasoline, tanks, registered tanks, which gas is dispensed. That comes from the Department of Environmental Conservation. And we know that two eighty million gallons and change are sold every year. The way that it's tracked is who owns title of that motor fuel the moment it crosses into Vermont. We don't have a pipeline. We don't have a sea terminal. All of our fuel comes in by rail car or it comes in by truck, a 9,000 gallon tanker truck. Whether it's coming from Quebec, New York, Massachusetts or New Hampshire, whoever holds title of it when it crosses over into the Green Mountain State is the one that pays the tax on that. So, for instance, if R. L. Valley or if Stewart's or if Global, if they bring in a gallon of gasoline, it may come in from New York, but it might be dropped in Bennington or Bells Falls or White River Junction. You don't know exactly where that gallon is dispensed before it's dispensed to the ultimate user. And that's a challenge I often get asked by my friends at the NRC and the environmental groups who want to track town by town, county by county, how we're doing in terms of reducing consumption of fossil fuels. I say we have an amazing amount of data that's all available. I put it on our website, you can find it on the DMV website. Certainly not proprietary. However, what we don't know is where it ultimately goes, because that's how we track gallons, which makes it challenging if you wanted to implement policies to tax certain gallons sold in certain municipalities. Yeah, we had some discussions about local option tax and could it be applied?

[Phil Pouech (Ranking Member)]: You know, I think the bottom line was right now, you know, there's nothing really in place to do that. Is this pretty much how other states or other New England states do it when it enters Massachusetts or enters that that's where they clock that gas stands? Or do some people actually do it right at the pump?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: I am only aware of my region, New England, Northeast Region, and that's how it's done. It could be different in Nebraska, but I don't.

[Phil Pouech (Ranking Member)]: So pretty much all in New England, they measure how much gasoline is consumed based on what's brought in with the assumption it's all consumed.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Yes. Well, I shouldn't be so glib. When I say it holds title when it crosses the border, if it crosses the border and then is dispensed into an underground tank. If it's going from Albany to West Lebanon, no, it's not taxed by Vermont. Beanon Drive.

[Matt Walker (Chair)]: True. So just to when they deliver to a station, that price that that station, if it's an independent whatnot, it's an own story, but that includes delivered with taxes of all things, and they but they sell it at the pump. In fact, they collect that money when they paid for it. They already paid the tax, guess, you know what I'm saying. It's included in the delivered price.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Exactly. But the tank owner or the owner of the tanks and the pumps in the store may not necessarily be the entity that is paying the tax to the state Of Vermont. So we have over 400 retail establishments, but we have far less taxpayers. The reason why is that if I own a country store, I can't afford to buy a tanker truck and staff it. I have to outsource that. If I'm going to outsource it, I'm certainly going to outsource the hassle of filling out the tax forms on the twenty fifth of the month.

[Matt Walker (Chair)]: Whatever I pay, I pay all of the taxes, etcetera. Then I put up my price on my spot and take whatever I don't know what the number is, but whatever it is, $0.06 $8.00 $1.00 per gallon in their tank. But it's all the tax that belongs to them. Pay.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Yeah, the wholesale price plus transport plus tax. And then everything you charge above that goes to operations Is and

[Matt Walker (Chair)]: that a little different?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Well, a rack price would be when you drive up to the terminal rack and put in the fuel, that is often referred to as the rack price, which you need a 9,000 gallon tanker truck and a Class eight tractor in order to get that, can't pull into your car. Ms. Burke?

[Mollie S. Burke (Member)]: Yeah, regarding what other states do, according to Chris Rutland, New York State has county level gas taxes in addition to state gas taxes. The distributors pay the state level taxes just like everyone, but the retailers have to pay the county level taxes. So, it's, you know, the county government, and that's different. At least, like they've all set up a new tax type, they were gonna do it in the municipal.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: That's good information, Representative Burke. I'm curious if it's a percentage or if it's a cents on gallon.

[Mollie S. Burke (Member)]: I don't know. Just kept that in. I wonder

[Phil Pouech (Ranking Member)]: if distributors get how the tax is paid. Do they have to report, I don't know, to environmental group or because they have underground tanks, how much fuel they use? Is there any other place where they have to report, you know, monthly or yearly? There's how many gallons went in my tank and out my tank.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: So when it comes to the tax, that's Department of Motor Vehicle, then that is fuel coming into Vermont, not necessarily fuel deposited into a tank. When it comes to the tanks, that is done by the agency Natural Resources Department of Environmental Conservation, the tank division, a woman named Anna Boruchowski, who runs that program. And she's there to make sure that every tank is inspected. And there is a small in fact, there's legislation being proposed downstairs that would split all dealers between small dealers and large dealers, or small tank owners versus large tank owners, in order to raise the deductible for the petroleum cleanup fund for larger tank owners versus small. So yes, she has all that information.

[Phil Pouech (Ranking Member)]: So does that information include how many gallons, let's say, year comes out of a particular registered tank?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: I don't know if she has it yearly. I think she might I'd have to check with her. I don't want to speak on her behalf. I use the DMV data because DMV audits are real. You miss and these are bonded and licensed dealers. These dealers, you can't just sneak into Vermont with a tanker of gasoline without getting caught eventually.

[Mollie S. Burke (Member)]: Thanks. Anybody else?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: You have more for us? That's

[Matt Walker (Chair)]: all I got. All represent Pouech always got one more. Yeah. And we count on them for that.

[Phil Pouech (Ranking Member)]: Still go back.

[Matt Walker (Chair)]: Count on for

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: that. Any of

[Phil Pouech (Ranking Member)]: the group you associate with the dealers, car dealers, the fuel dealers, do they raise concerns about lack of funds for VTrans, for road maintenance and all that? Are they, I mean, obviously we are here. Do they raise that concern and all that, hey, if the roads aren't maintained, then maybe we won't sell cars or maybe you sell more if they're not maintained. Are you taking a position? Does your group take a position at all about the, I'll say, lack of funds or the funding situation?

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: I can say, generally speaking, the organizations or the individuals I work with are supporters of the Keyser bill that would return funds from the purchase and use tax back to where it belongs to the transportation fund. I can say that very generally. And yeah, I don't think there's any it's my bias, but don't think there's any group out there that thinks our roads are perfect and nothing else needs to be done. I think people understand the dilemma you all are facing.

[Phil Pouech (Ranking Member)]: Okay. That's official recommendation from your group or just if you ask them Which one? Yeah, okay, that's good. Thank you.

[Matt Cota (Meadow Hill; Vermont Vehicle and Automotive Distributors Association)]: Thank you.

[Matt Walker (Chair)]: All right, thank you very much for coming back in and sharing the data.