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Top Stories
Opinion: California Emission Plan Must be Rejected
Fla. Law: Automakers Can't Force Dealer Upgrades
Dealer Profits are a Concern
Opinion: Turn Fuel Economy Hardship into Opportunity
Hybrids Recoup Higher Cost in Less Time
Hyundai Calls Off U.S. Truck Plan
At Daimler, Sales Follow the World’s Oil Riches
Renault Seen Investing up to $1 Billion in Electric Car
VW, Sanyo to Develop Lithium-ion Battery
Opinion: Why Pump Prices Need to Stay High
Automotive Retailing Today Announces New Chairman
NADA Update
Director Nominations Mailed to NADA Members
Looking for a Competitive Edge? Check Out NADA's Used-Vehicle Seminar
NADA Insurance Launches New Site for Hole-in-One Insurance
NADA to Provide Members with Free Red Flags Educational Guide
STAR Answers Dealers' Questions About Internet Content Filtering
Save Up to 35 Percent on ThinkPad Notebooks Through May 19
Top Stories
Opinion: California Emission Plan Must be Rejected

Minnesota has been on the forefront of embracing new alternatives in energy and environmental issues based upon the needs of Minnesotans. Now, the Legislature is considering adopting a state-imposed vehicle emissions law tougher than federal standards and determined by the California Air Resources Board. This is a poor idea for two basic reasons. First, Minnesota is unique in its own needs and desires. If the Legislature adopts the California emissions regulations, Minnesota emissions law would be determined by a powerful 11-member California Air Resources Board. If tighter regulation was determined by this California board, Minnesota would be required by law to follow suit, even if the tighter regulation wasn’t needed in Minnesota or even was detrimental to the state. There is no way Minnesota should ever cede any control on such an important issue to another state — especially California. Second, imposing California emissions regulations in Minnesota would impose economic harm to the auto dealer sector and the ethanol industry. Our state’s auto dealers historically sell more trucks and SUVs due to the unique needs of Minnesota weather. Adopting the California standards would reduce the number of trucks and SUVs Minnesota dealers could sell in order to help the industry to meet fleet average mileage rules, regardless of the customer’s needs. The Legislature should reject the California emission proposal at this time. It should never cede such control to an out-of-state body, especially California where regulations are imposed regardless of cost or benefit factors.
Source: West Central Tribune

Fla. Law: Automakers Can't Force Dealer Upgrades

A bill awaiting the Florida governor's signature would limit how far manufacturers can go to force auto dealers to upgrade their stores. The state's already dealer-friendly franchise laws also would be bolstered in areas such as warranty payouts, incentives, exports and fraud. The legislation “turns the tables and prevents manufacturers from using their 800-pound gorilla status against dealers,” said Alex Kurkin, a Miami lawyer who helped draft the bill. The measure also would require automakers to pay retail customer rates for warranty labor and parts. Florida dealers have complained that some manufacturers bully dealers into building showrooms. Dealers also have complained about unfair warranty payout procedures. Both houses of Florida's Legislature unanimously passed the bill last week. Gov. Charlie Crist is expected to sign the legislation. Manufacturer-backed lobbying organizations mounted a last-ditch effort to get Crist to veto the bill.
Source: Automotive News (Subscription required.)

Dealer Profits are a Concern

During Ford Motor Co.'s annual meeting, Ford shareholder Gordon Diehl of Setauket, N.Y., told Ford CEO Alan Mulally that he had visited several Ford dealerships in his area and he wasn't impressed. "Much to my dismay," he said, "the quality of the dealerships ranged anywhere from very poor to mediocre at best, and I was just wondering what you're doing ... to improve the standards of these dealerships." Mulally said that a key element of the company's plan was to improve the profitability of dealerships by improving the number of sales per store. "It's a very high priority for us," he said. "Our dealer network is tremendous but we have overcapacity." Mulally said the company was working to consolidate stores, but declined to reveal the company's targets. He said that Ford needs to reduce dealerships so Ford stores aren't competing with each other but with rival brands.
Source: Detroit Free Press

Opinion: Turn Fuel Economy Hardship into Opportunity
by U.S. Rep. Joe Knollenberg

Some in Washington, including President Bush, have continued to push more and more stringent corporate average fuel economy (CAFE) standards onto the Big Three automakers and their suppliers. Though our Michigan delegation has succeeded in controlling these job-killing efforts, some real damage has still been inflicted. Raising the fuel economy standard to 35 miles per gallon by 2020 represents an $85 billion unfunded mandate sent from Washington directly to the Big Three -- on top of their research and development costs. And it comes at a time when the carmakers are fighting tooth-and-nail to make their turnaround plans succeed. But when they are saddled with billions of dollars in new costs and a stringent timeline to achieve dramatic product line changes, they do deserve a partnership from Washington, not just a callous mandate. The federal government must play a logical and substantive role in transforming its new regulations into automotive and engineering reality. But Michigan can transform this latest challenge set before it into even more. We should take this hardship and turn it into opportunity. We should maximize this transformational moment, and in doing so, make Detroit the world leader in automotive innovation.
Source: The Detroit News

[Editor's Note: U.S. Rep. Joe Knollenberg, R-Mich., is a senior member of the U.S. House of Representatives.]

Hybrids Recoup Higher Cost in Less Time

Rising fuel prices and competition among a proliferation of gasoline-electric hybrids have sliced the payback period for hybrids to two or three years in some cases, instead of five years or more that made hybrids harder to justify at lower fuel prices. At the same time, increasing interest in hybrids is driving their prices up and eroding their fuel cost-saving benefits. An analysis for USA TODAY by auto-price consultant Edmunds.com shows that the difference between a Toyota Camry hybrid and a similarly equipped gasoline Camry was $889 Friday, up from $850 a week ago. Assuming 15,000 miles a year, Edmunds figures just 1.7 years for the Camry hybrid's fuel savings to offset the car's higher price — slightly longer than 1.6 years when the price difference was less a week earlier. Besides Camry hybrid and Toyota Prius, there are hybrid versions of Honda Civic, Nissan Altima and Chevrolet Malibu, among others, and an array of SUVs. Not all hybrids make sense. At current fuel prices, the Toyota Highlander hybrid takes 12.7 years to break even; the Saturn Aura, 24.3 years, Edmunds says. And the $106,000 Lexus LS600h hybrid, compared with the gasoline LS460L — 102.6 years.
Source: USA TODAY

Hyundai Calls Off U.S. Truck Plan

Hyundai Motor Co. called off a plan to produce pickup trucks in the U.S., in reaction to a shift by American car buyers away from trucks to smaller vehicles, a person familiar with the matter said. Hyundai had planned to build midsize trucks at a new factory of its subsidiary Kia Motors Corp. in the southeastern state of Georgia. The South Korean auto maker is now considering manufacturing Hyundai passenger cars at the Kia plant amid growing U.S. consumer preference for smaller and lighter vehicles. Hyundai's decision is the latest sign of turmoil in the truck business in the U.S. Sales of pickups and large sport-utility vehicles have been falling for the past few years amid high fuel prices ...
Source: The Wall Street Journal

At Daimler, Sales Follow the World’s Oil Riches

Daimler AG, the maker of Mercedes-Benz automobiles, will deal with slowing auto sales in the United States in part by shifting sales to Russia, China and the Middle East, says Dieter Zetsche, Daimler’s chief executive. And the company, based in Stuttgart, Germany, expects to be the first to introduce a car with a lithium ion battery, the technology that is seen as crucial to creating all-electric vehicles, he says. Mr. Zetsche was previously based in Detroit as head of Chrysler, then owned by Daimler, before the Germans decided to sell majority control to private equity investors. Most recently, Daimler reported a 32 percent decline in earnings in the first quarter of this year largely because the value of its remaining 19.9 percent stake in Chrysler fell.
Source: The New York Times (Registration required.)

Renault Seen Investing up to $1 Billion in Electric Car

TEL AVIV -- The head of an Israeli-backed electric car project estimated on Sunday that its partner, the Renault-Nissan alliance, would likely invest $500 million to $1 billion in the swappable-battery electric cars. "This is the cost for a three-year car program," Shai Agassi, the founder and chief executive of California-based Project Better Place, said on the sidelines of a news conference to introduce the electric car prototype. Renault and Nissan signed a deal with Better Place in January to begin mass producing electric cars as a part of a project to develop alternative energy sources and slash oil dependency. Better Place will build the first electric grids in Israel and Denmark, with initial deployment slated for 2010. Denmark's DONG Energy recently signed a letter of intent with Better Place to introduce the electric cars to the Scandinavian country, where the batteries will be charged using wind power. A few dozen cars will be available in Israel later in 2008, mainly for demonstration. Renault will provide Better Place with vehicles while Nissan, through its joint venture with NEC, has created a lithium-ion battery pack. The project will also use batteries made by A123 Systems.
Source: Reuters

VW, Sanyo to Develop Lithium-ion Battery

TOKYO -- German carmaker Volkswagen and Japan's Sanyo Electric Co will jointly develop a lithium-ion battery to be used in hybrid and electric cars, the Nikkei financial daily reported on Sunday. Volkswagen will aim to start importing and using the battery in its hybrid and electric cars by 2012, the Nikkei said. The move comes after plans by Nissan Motor Co and NEC Corp to start mass-producing lithium-ion batteries, considered more environmentally friendly than nickel-hydrogen ones. Sanyo makes nickel-hydrogen batteries that can be recharged repeatedly and the batteries will be used by Volkswagen and subsidiary Audi AG in the Volkswagen group's first hybrid model to be rolled out as early as next year.
Source: Reuters

Opinion: Why Pump Prices Need to Stay High

A tax on fossil fuels will cut greenhouse gases – as Sweden has done since 1991.
Driving less? More than two-thirds of car owners already are. It's a natural reflex to $50-$70 tank fill-ups. But US drivers may also know it's time to pay a price to curb global warming. That may be one reason they reject the campaign stunt of urging a holiday for the federal gas tax. US politicians can't have it both ways. Most seek the type of solutions for climate change that would raise energy costs, yet they are now trying to prevent the very kind of high pump prices that help drive conservation and green technology. Next year, Democrats in Congress plan to pass antiglobal-warming measures that are sure to drive up consumer costs. Rather than prevent $4-a-gallon gas now, legislators should welcome it. One courageous lawmaker, John Dingell (D), who heads the House energy panel, even proposes a 50-cent hike in the gas tax. World oil markets are doing the US a favor by imposing a form of tax that challenges energy profligacy and disregard for the planet's future. A gas price threshold has now been reached to influence behavior. SUV sales are down. Mass transit ridership and carpooling are up. More people want to live closer to work. What do these lifestyle-altering trends signal? That Congress must impose a "carbon" tax on fossil-fuel use, from electric utilities to home furnaces to gas-guzzling vehicles. Such a tax is a better tool than the alternative favored in Congress: a "cap and trade" system that would force only industries to curb greenhouse gases while allowing cleaner companies to sell permits to more polluting ones. The system is complex, inflexible, and easily abused.
Source: The Christian Science Monitor

Automotive Retailing Today Announces New Chairman

Automotive Retailing Today (ART), a coalition of major automobile manufacturers and dealer organizations, installed William H. Bradshaw of Greer, S.C. as its new chairman during its April board meeting. Bradshaw succeeds Carter Myers of Charlottesville, Va., who has served as chairman since 2006. Bradshaw brings three decades of experience and leadership to the role of ART chairman. He is a past chairman of the National Automobile Dealers Association, a past president of the Greer Dealers Association and the Greenville Dealers Motor Mile Association and is a member of the board of the South Carolina Dealers Association. He is president of Bradshaw Automotive Group, operating Chevrolet, Cadillac, Pontiac, Buick, GMC, and HUMMER franchises in Greer, S.C.; Honda, Acura, Infiniti and Saturn franchises in Greenville, S.C.; and Saturn franchises in Spartanburg, S.C. and Asheville, N.C. "ART is an established resource for journalists and is recognized as a source of unbiased industry data,” noted Bradshaw.  “I look forward to building on the impressive foundation that’s been established over the last ten years.  ART’s work benefits the entire auto industry by creating a better understanding of our retailing operations and attracting qualified people to dealership careers.”
Source:  Automotive Retailing Today

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NADA Update
Director Nominations Mailed to NADA Members
Ballots for nominating members to serve as NADA directors have been mailed to members in Arizona, Northern California, Southern California, Colorado, Connecticut, Hawaii, Idaho, Illinois, Iowa, Massachusetts, Minnesota, Mississippi, Metropolitan New York, New York State, Ohio, Eastern Pennsylvania, South Carolina, South Dakota, Metropolitan Washington, DC and West Virginia. All ballots should be returned postmarked by May 30. If two or more nominees receive at least 10 percent of the votes and agree to seek election, ballots will be mailed June 27 to be returned postmarked by July 18. Directors elected will take office on Jan. 27, 2009 at the convention in New Orleans.
Looking for a Competitive Edge? Check Out NADA's Used-Vehicle Seminar

NADA 20 Group consultant Steve Emery will present "Used-Vehicle Department Profit Accelerator," held May 21–22 in St. Louis, Mo. The seminar will explain the crucial elements of running a profitable used-vehicle operation, such as purchasing and managing inventory, reconditioning, financing, marketing and advertising, maintaining a business plan and more.

The 1½-day seminar will be held at the Hilton Ballpark Hotel. For more information, including member and non-member fees, visit www.nada.org/seminars. Dealers, general managers, used-vehicle managers and sales managers are encouraged to attend.

Want to log on from your own dealership? Take a look at NADA's upcoming Web-based seminars:

  • How to Prepare and Interpret a Cash Flow Statement (Steve Lane, May 13)
  • How to Drive Traffic in a Tough Market (Ron Wheeler, May 22)
  • Using All the Tools in Your F&I Toolbox (Ron Reahard, June 3)
  • Totally Trucks: Best Practices in Cost and Expense Management and Reduction (ATD) (Keith Ely, June 11)
  • Increasing Collision Repair Sales (Robert Rick, June 12)
  • Managing Fixed Operations from the General Manager's Desk (Randy Brenckman, June 24)

The fee for each virtual seminar is $199 per computer connection. Additional attendees can participate from the same connection at no additional cost.

For more information on upcoming seminars, visit www.nada.org/seminars or call 1-800-248-6232, ext. 7061.

NADA Insurance Launches New Site for Hole-in-One Insurance

NADA Insurance announced the launch of a new Web site for its hole-in-one insurance program, ACECO. The redesigned site includes new graphics, improved interactivity, navigation and FAQ page. The new site can be accessed by visiting www.nadainsurance.com and clicking on “NADA Hole-in-One.”

“We redesigned the site to make it even easier for members to find the information they need about our hole-in-one insurance program,” said NADA Insurance Vice President Lin Peacock. “ACECO offers very competitive premiums combined with excellent service. I strongly encourage dealers who sponsor golf tournaments to give us a try.”

ACECO guarantees a 24-hour turnaround on all their no-obligation quotes. Visit www.nadainsurance.com today to obtain a quote for your next golf tournament sponsorship.

NADA to Provide Members with Free Red Flags Educational Guide

Dealers and other creditors and financial institutions must comply with the FTC Red Flags Rule by Nov. 1, 2008. To assist dealers with this new requirement, NADA will mail to its members a free educational guide by August 1, 2008 that will explain dealers' responsibilities under the new rule and provide a template to assist dealers in preparing the required written Identity Theft Prevention Program. Additional information will be available from fee-based Webinars that NADA will conduct from 1-3 p.m. EST on August 26, 2008 and Sept. 23, 2008. (Registration information will be announced soon.)

STAR Answers Dealers' Questions About Internet Content Filtering

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers evaluate Internet Content Filtering. To learn what is recommended for general maintenance of a hardware based system, click here. To download STAR's Dealer Infrastructure Guidelines (DIG), click here.

Save Up to 35 Percent on ThinkPad Notebooks Through May 19

NADA members can save in three ways:

  • Instant savings with discounted Web pricing
  • Save even more with your NADA discount
  • Enter eCoupon USXSAVE4SPRING at checkout

Visit NADA's PC Purchase Program online (member log-in required), then click on www.lenovo.com/shop/deals/nada or call 800.426.7235, Option 1, Ext. 4838 to take advantage of these savings.  Enter eCoupon USXSAVE4SPRING at checkout. Free ground shipping is available on all Web orders.

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Quotable
 
 

"The [Minnesota] Legislature should reject the California emission proposal at this time. It should never cede such control to an out-of-state body, especially California where regulations are imposed regardless of cost or benefit factors."

    -- West Central Tribune (Opinion),  May 10


"This approach, which the Big Three have enthusiastically endorsed, sets the stage for Michigan to make the most of the bad CAFE situation. To be cliché, it takes the CAFE lemons and makes new economy lemonade."

    -- U.S. Rep. Joe Knollenberg referring to his plan that will create a partnership between the federal government and the auto industry to raise fuel economy, The Detroit News (Opinion), May 9


"It’s very promising. In only the third month after introduction, the United States market has become the third largest market for Smart in the world. We sold 3,500 units in the first three months, starting toward the end of January. The only limiting factor is the supply."


    -- Dieter Zetsche, Daimler AG chief executive, referring to the sales success of Smart car, which is just eight feet long and gets more than 40 miles per gallon, The New York Times, May 10

Video Reports
 
NADA Data and Used Car Guide Show Decline in SUV and Truck Values.  [Source: WUSA-TV, Washington, DC]

 NADA data supports declining used vehicle values 

 NADA/USA Today Innovation Award Goes to "Green" Dealership in Vermont.
 NADA Convention Heads to New Orleans in 2009.
 NADA Foundation Contributes to Canine Companions for Independence.
 2008 Convention Highlights

 
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