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At a Glance...
Top Stories
California Exhaust Bill Fought
California Fuel Law to Benefit Some Foreign Automakers
Honda Sets Target to Raise Hybrid Sales by Ninefold
Opinion: Inertia Foils Efforts to Curb Fuel Use
Industry Groups and Foes Unite on Title Washing
Ford Continues Cost-Cutting After 1st-Quarter Profit
Russian Revolution: The World's Hottest Auto Market
NADA Update
NADA Insurance Announces Partnership for Hole-in-One Program
NADA Provides Guidance on Reaching Subprime Customers
NADA's Consulting Tosses Dealers a Lifeline
STAR Answers Dealers' Questions About Safeguarding Customer Information
Save on HP Desktops and Printers
Top Stories
California Exhaust Bill Fought

WASHINGTON -- A bill to allow California and 13 other states to impose a 30-percent reduction in tailpipe emissions won't become law this year, predicted the head of the trade group representing Detroit's Big Three automakers, Toyota Motor Corp. and others. Dave McCurdy, president and CEO of the Alliance of Automobile Manufacturers told reporters that a bill to overturn the Environmental Protection Agency's Dec. 19 decision to deny California a waiver under the Clean Air Act has no chance of passing. "It won't get through the Senate," McCurdy said, adding that senators on the committee have been told that even if it's supported there, "it's not going to see the floor." California wants to require passenger cars to average 43.7 mpg and light trucks 26.6 mpg by 2016, a much tougher standard than what Congress mandated last December, when it passed the first overhaul of the nation's passenger car efficiency requirements since 1975. Sen. Barbara Boxer (D-Calif.), chairwoman of the Senate Environment and Public Works committee, will bring up her bill, which is co-sponsored by 18 senators including the two Democratic presidential candidates, [today]. Automakers favor a national standard, arguing that allowing individual states to set their own limits would lead to a patchwork of requirements that could force automakers to stop selling some vehicles in some states because those standards could be so restrictive it would make it difficult to sell a wide range of vehicles.
Source:  The Detroit News

[Editor's Note: This morning, Sen. Boxer’s committee approved the California waiver bill by a 10 to nine vote.  Considering the narrow margin of the vote coupled with strong opposition from other senators, the possibility that the legislation will see further action on the senate floor is unlikely.]

California Fuel Law to Benefit Some Foreign Automakers

WASHINGTON -- A little-noticed provision of California's law setting tough limits on greenhouse gases from vehicles would exempt many foreign automakers from meeting the standards for years, a clause the industry said Monday would create unfair advantages. California's rules would boost fuel-economy standards on new vehicles, starting with the 2009 model year, to roughly 35 m.p.g. by 2016 and to more than 40 m.p.g. by 2020, depending on the mix of vehicles sold. All major U.S. automakers and the three largest Japanese firms have sued to block the law, claiming it would create a tangle of rules, rather than one national standard, and force some of them to make expensive changes to nearly all their vehicles. But under 2004 regulations from the California Air Resources Board, the ramp-up through 2016 would apply only to automakers who averaged sales of at least 60,000 vehicles in the state over 3 years. At current sales, that would mean Detroit's automakers and the three largest Japanese firms would have to meet the rules, but companies such as Volkswagen and Hyundai -- and perhaps BMW -- would not. The rules would also not apply to new competitors, such as upstart automakers from China or India that have plans for importing vehicles into the United States. After 2016, California rules suggest the limit would drop to 4,000 vehicles a year, but auto industry attorneys said the rules are not clear on that point. The air resources board did not return a call seeking comment. "They've created a huge loophole in their program," said Mark Kemmer, a spokesman for General Motors Corp. 
Source: Detroit Free Press

Honda Sets Target to Raise Hybrid Sales by Ninefold

Honda Motor Co., Japan's second- largest automaker, plans to raise sales of hybrid vehicles by ninefold as it adds new models to meet demand for more efficient cars amid higher fuel costs. The company aims to sell 500,000 gasoline-electric vehicles, compared with 55,400 units last year, President Takeo Fukui said at a press conference in Tokyo today. Honda will add a hybrid version of the Fit compact car by 2015, he said. "It's an aggressive move, as it will match Toyota's hybrid sales proportion," said Koji Endo, a senior analyst at Credit Suisse Securities (Japan) Ltd... "Development of cars that comply with tougher environmental standards is necessary for automakers."
Source:  Bloomberg

Opinion: Inertia Foils Efforts to Curb Fuel Use
by Joseph B. White

Forecasting future energy prices and demand is "like sitting around in 1994 and forecasting (demand for) Web browsers," [Silicon Valley venture capitalist John] Doerr said at the Wall Street Journal's ECO:nomics conference last week. Mr. Doerr would know. He and his company, Kleiner Perkins Caufield and Byers, had a front row seat ... during the Internet revolution created by the Netscape browser. In other words, no one knows whether Mr. Doerr and others in Silicon Valley's "clean tech" movement will succeed in their effort to do for the way we fuel cars what Netscape or Google did for the way we shop and collect information. But Mr. Doerr cautions that "changing consumer behavior is the key. We've only taken this issue to the head of Main Street. We haven't walked down Main Street." Within the next year or two, Americans are going to be pushed as never before to live without burning so much oil, particularly in their cars. The problem – made clear during presentations by an impressive cadre of business leaders, technology visionaries and politicians at this conference in Santa Barbara, Calif., – is one word: inertia. Inertia is a powerful force. If car makers and politicians sound reluctant to take it on, it's for good reason. Mr. Doerr and his Silicon Valley compatriots have found that with the right levers and sufficient persistence, big rocks can be made to roll down hill. Just don't expect it to happen in time to stop you from cursing the gas pump on your way to the beach on Memorial Day.
Source:  The Wall Street Journal

Industry Groups and Foes Unite on Title Washing

WASHINGTON -- Automakers, auto dealers and some of their harshest critics are teaming up against improper reselling of rebuilt wrecks and flood cars. In a joint letter today, industry and consumer groups asked the U.S. Department of Justice to make a priority of long-delayed rules that they say would make title-washing more difficult. The groups say regulations are needed to implement a national database of vehicle titling information, called for in a 1992 law. The database would link state motor vehicle bureaus. It would include vehicle identification numbers of severely damaged cars and trucks, provided by insurers and salvage yards. The groups also ask that the data be made available electronically to consumers. The letter to Attorney General Michael Mukasey was signed by the National Automobile Dealers Association, the Alliance of Automobile Manufacturers and the Association of International Automobile Manufacturers. Other industry signers include individual automakers and groups that represent used-vehicle dealers, auto auctions and recyclers. Also signing the letter were frequent industry critics, such as the Consumer Federation of America, Consumer Action, the National Consumers League, Consumers for Auto Reliability and Safety, and Public Citizen. Ivette Rivera, NADA’s executive director of legislative affairs, said NADA also seeks a federal law that would require insurers to disclose immediately when they declare a vehicle a total loss for any reason.
Source:  Automotive News (Subscription required.)

[Editor's NoteClick here to read the letter.]

Ford Continues Cost-Cutting After 1st-Quarter Profit

Ford Motor Co ... is continuing cost-cutting steps in Europe and North America after reporting its second quarterly profit in two years. The company's money-losing Volvo unit this week said it plans to cancel a shift at a plant in Sweden. That move came after Ford began buyouts at two U.S. factories and laid off workers this month at a Kentucky pickup truck factory. "Ford has to be aggressive," said Dennis Virag, president of Automotive Consulting Group in Ann Arbor, Michigan. "You can't say, 'Things are going well, let's keep on doing what we're doing.'" Ford ... posted a $100 million profit in the first quarter after analysts had forecast a loss. The automaker said it still expects to lose money this year while improving from last year's $2.7 billion deficit.
Source:  Bloomberg

Russian Revolution: The World's Hottest Auto Market

SHUSHARY, RUSSIA -- General Motors Corp.'s half-built plant on the muddy outskirts of St. Petersburg won't roll out its first vehicle until November, but the new Russian hires are already hard at work. Across the road, Toyota Motor Corp. is already rolling out Camrys at a new plant to tap surging demand in Russia for cars, while Ford Motor Co. is considering building its second Russian plant. "The market has grown at a much faster clip than we thought," said GM President Frederick Henderson. "We're seeing all of our global competition running hard in Russia." All around St. Petersburg, the world's major automakers are putting up factories. Hyundai Motor Co. will start building a plant next month, Nissan Motor Co. expects to open a $200 million factory next year, and Ford is expanding its $230 million plant for the third time in six years. Fueled by a surge in oil prices, Russia has turned into the hottest of the hot emerging markets -- countries where automakers that can supply the right models earn a lot of money, particularly in the early stages of the boom when demand is outstripping supply.
Source:  The Detroit News

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NADA Update
NADA Insurance Announces Partnership for Hole-in-One Program

NADA Insurance has announced that it has formed a partnership with the Pennsylvania Automotive Association (PAA) to be the exclusive provider of hole-in-one insurance for that group. About 1,200 PAA dealer members will obtain their insurance through ACECO, NADA Insurance’s hole-in-one program.

"At PAA, we are always looking for ways to enhance our benefits," said PAA Vice President Chief Operating Officer John Devlin. "ACECO offers our members affordable and convenient hole-in-one insurance, so the decision to go with them was easy."

NADA Insurance Vice President Lin Peacock said, "This partnership is a win-win for both parties. We look forward to servicing PAA with the same high level of service that we provide to NADA members."

Dealer groups and state auto associations interested in partnering with NADA for their hole-in-one insurance are encouraged to contact Peacock at lpeacock@nada.org.

NADA Provides Guidance on Reaching Subprime Customers

Damaged credit can happen to anyone. As many as three out of five auto consumers suffer from damaged credit. Dealers could be leaving a great deal of money on the table—perhaps hundreds of thousands of dollars a year in additional gross profit—if they ignore the subprime market.
 
That’s where a special finance operation comes in. Call it subprime, non-prime, secondary or special finance—this large and growing segment of the market needs dealers who are prepared to sell credit-challenged customers the vehicles they need at prices they can afford.

NADA Management Education’s new DVD, Creating a Special Finance Operation: Doing it Right, shows dealers how to be prepared. The four-segment training video, plus an information-packed study guide, is available for $169. Go to www.nada.org/specialfinance to see a preview, log in and order.

NADA's Consulting Tosses Dealers a Lifeline

NADA’s Lifeline Dealership Consulting provides dealers with an objective evaluation and advice on operations and performance. NADA 20 Group and NADA Dealer Academy consultants work with dealership management personnel to achieve specific goals determined by a telephone interview or a site visit.

On site, a NADA consultant would meet with department managers to develop remedial action plans. The consultant also provides managers with various tools to assist performance measurement and tracking, and develops a written report with recommendations for improvement.

"We consider NADA’s Lifeline Dealership Consulting an investment in our dealership," said Frankie Korschun, general manager of Frema Motors Inc. in Goldsboro, N.C. "I would highly recommend the program to anyone who needs an outside point of view." For more information, call NADA's Lifeline Dealership Consulting at 1-800-248-6232, ext. 4745.

STAR Answers Dealers' Questions About Safeguarding Customer Information

 

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers with Safeguarding Customer Information. Visit STAR's Dealer Infrastructure Guidelines (DIG) publication for more information. To learn what is recommended for Safeguarding Customer Information, click here.

Save on HP Desktops and Printers

HP is offering NADA members a free 17-inch diagonal wide screen flat panel monitor with select PC desktops. Members can save $200 instantly on HP Color LaserJet CP4005n and Color LaserJet CP4005dn. This special ends May 31, 2008. To take advantage of these savings, go to www.nada.org/ProductsServices/Technology, click on "PC Purchase Program," then click www.hp.com/go/promos/nad1 (member login required).

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Quotable
 
NADA also seeks a federal law that would require insurers to disclose immediately when they declare a vehicle a total loss for any reason.

    -- Ivette Rivera, executive director of NADA legislative affairs, Automotive News, May 20, referring to parallel efforts to address total-loss disclosure both through federal legislation and implementation of existing rules.


"They've created a huge loophole in their program."

   
-- Mark Kemmer, a spokesman for General Motors Corp, referring to greenhouse gas and fuel economy regulations from the California Air Resources Board that would exempt automakers that sell less than 60,000 in California and, therefore, would favor one automaker over the other, Detroit Free Press, May 21


"Development of cars that comply with tougher environmental standards is necessary for automakers."

   
-- Koji Endo, a senior analyst at Credit Suisse Securities (Japan) Ltd., referring to Honda's aggressive move to match Toyota in hybrid sales, Bloomberg, May 21


"Within the next year or two, Americans are going to be pushed as never before to live without burning so much oil, particularly in their cars. This is partly because all three presidential candidates support proposals to raise the price of emitting carbon -- a geeky way of saying gasoline to drive or using coal to power the house."

    -- Joe White, columnist and senior editor, The Wall Street Journal, (Opinion) May 19
Video Reports
 
Field of Dreams:  Auto Dealers Show Their Commitment to New Orleans

 NADA Foundation Donates $400,000 to Lusher School 

 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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