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Dogs can’t bark and sniff at the same time. The timing of your “YES” marker tells him it's being QUIET that earns the treat. When you’ve got each one responding to QUIET by himself, then try together. That’s harder because they egg each other on.
Now try it separately in the car and then together. This may require driving around the block a few times looking for dogs. This method doesn’t use punishment to correct the barking, but teaches an alternative behavior. If they don’t fight over toys or food, you could also try distracting them with food toys in the car.
Terry, Paws Prof