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Top Stories
Senate Panel Votes to Overturn EPA on Calif. Waiver
Opinion: California Rule on Tailpipe Emissions is Bad Politics
NADA Hopeful for Second-Half Market Rebound
As Gas Prices Rise, So Does Cost of Small Used Cars
NADAGuides.com: Consumers Shift Towards Crossovers
Powering Up: Honda to Lease Fuel-cell Cars, Offer New Hybrids
Ethanol Vehicles for Post Office Burn More Gas, Get Fewer Miles
Ford to Slow Production of SUVs, Pickups
GM to Resume Output of Malibu After Workers Approve Contract
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 on Safeguarding Customer Information
Save on HP Desktops and Printers
Top Stories
Senate Panel Votes to Overturn EPA on Calif. Waiver

WASHINGTON -- A Senate panel voted narrowly Wednesday to overturn EPA's decision blocking California and more than a dozen other states from limiting greenhouse gas emissions from vehicles. The bill by Sen. Barbara Boxer (D-Calif.), chair of the Environment and Public Works Committee, passed her committee 10 to 9. In December, Environmental Protection Agency Administrator Stephen Johnson turned down California's request for a Clean Air Act waiver that would have allowed the state to require automakers to cut global warming emissions by 30 percent in new cars and light trucks by 2016. Boxer's bill would deem the waiver approved. However, Boxer told reporters that she wouldn't push for full Senate consideration of the legislation because President Bush would veto it anyway. Some senators who voted against the bill, including Carper, cited a new federal law raising fuel efficiency standards, arguing that the California waiver could undercut that measure. "A national standard makes more sense for vehicles, which, unlike smokestacks, do not stay within one state's jurisdiction," [said Sen. Tom Carper (D-Del.)]
Source: Associated Press

Opinion: California Rule on Tailpipe Emissions is Bad Politics
by Manny Lopez

California's elected officials desperately want to control the domestic auto industry but they're not interested in seriously considering the damage that will be done if their efforts are successful. Nine Senate Democrats and one Republican on Wednesday voted a bill out of committee that would grant California and 13 other states permission to set emissions rules that are stricter than the federal standards. Never mind that President Bush signed a bill in December that significantly increases fuel economy guidelines and was widely supported by both parties. Or that granting state-by-state rules would stifle innovation and put vehicles out of most people's price range. Fortunately, the lunacy hasn't overtaken everyone. "My concern is that by granting California's waiver, we unintentionally undercut the bipartisan agreement we came up with a year ago on CAFE," Sen. Tom Carper (D-Del.) said Wednesday..., making him the sole Democrat to vote against the waiver. "... A national standard makes more sense for vehicles." California politicians have been kicking Detroit around for some time and they're invigorated by a national media that blindly soaks up press releases from the office of U.S. House Speaker Nancy Pelosi, a California Democrat, or any of her colleagues. The nonsense isn't likely to stop and it likely will get worse, but there is a solution. Offer counter legislation that forces California to eliminate a third of its vehicles. Conservatively, there are more than 30 million registered vehicles in California. Let's get some legislation going that arbitrarily adjusts that number. Wipe 10 million California cars off the road. And do the same for the other 13 states tagging along. After all, if the goal is emissions reductions, the solutions should start at home.
Source:  The Detroit News

NADA Hopeful for Second-Half Market Rebound

MCLEAN, Va. — It's been no secret that as new-car sales have slid the last couple of years, and are projected to slip once again in 2008, more and more franchise dealers have looked to their used-car departments to boost store profitability. But a new development may be emerging — the growing importance of parts and service sales, along with sales of aftermarket parts and accessories, to spark additional revenue streams. That's according to Paul Taylor, chief economist of the National Automobile Dealers Association, who teamed with other members of NADA's industry analysis division to produce the just-released 2008 NADA Data Report. Regarding new-car sales, Taylor said he is cautiously optimistic that the automakers will find a way to spur activity on dealership lots in the second half of the year and overcome a sluggish market that he said is on pace to hit about 15 million units for 2008. Taylor said there are some encouraging signs in the housing market that may enable car shoppers to better afford that new-car purchase. He added that he will know more by the end of June as to how successful automakers may be for the final half of 2008.
Source:  Auto Remarketing

As Gas Prices Rise, So Does Cost of Small Used Cars

DETROIT -- The beige 2003 Honda Civic sat on Mike Haile's used car lot in Atlanta for only three days before he sold it for $8,200. And that was $300 more than the asking price. The car, with 62,000 miles on it and equipped with an automatic transmission, sunroof, air conditioning, side airbags and a compact disc player, is a perfect example of what Haile and other auto industry experts say is a consequence of nearly $4 per gallon gas: A run-up in the price of used small cars. "It's extremely high right now," Haile said. "The small cars are very hard to get right now. The cars that were $5,000 are now $7,000." In the past year, the average used small car price has gone up 2 percent, from $9,278 to $9,470, according to wholesale auto auction data collected by the National Automobile Dealers Association. The increases are in contrast to used full-size sport utility vehicles, whose prices have dropped $1,600 to $2,000 in the past year, said Paul Taylor, the NADA's chief economist. The swings are directly related to gasoline prices. For the past three years, small and midsize used car prices would rise with seasonal oil price increases, then drop when fuel prices moderated, Taylor said. But gas prices haven't dropped and continue to rise this year, which has kept the small-car trend going, Taylor said. "The important question is: Is this actually the end of that long-term 50-year trend, and are we headed for a period in which the real price of gasoline ... started an upward trend?" Taylor asked.
Source: Associated Press

NADAGuides.com: Consumers Shift Towards Crossovers

COSTA MESA, Calif. — As consumer interest in SUVs continued to dwindle in April, more and more shoppers turned their attention toward crossover utility vehicles, including the hybrid variety, suggested recent data from NADAguides.com. According to the analysis, consumer interest in SUVs during April fell 15.9 percent from the same period of 2007. Meanwhile, interest in crossovers climbed 14.8 percent. More specifically, hybrid CUVs were among the biggest attention grabbers for shoppers. For example, hybrids accounted for three of the top 10 crossovers showing the highest year-over-year increase in consumer interest. "The fact that three of the top 10 CUVs showing the greatest increase in interest were hybrids demonstrates that fuel efficiency is a serious concern," stated Tara Baukus Mello, senior writer and lead market analyst at NADAguides.com. Consumers are not only interested in the styling and handling characteristics of a CUV; they're also interested in saving money at the gas pump," she illustrated.
Source:  Auto Remarketing

Powering Up: Honda to Lease Fuel-cell Cars, Offer New Hybrids

Honda Motor Co., the first automaker to lease fuel-cell vehicles to U.S. consumers, plans to deliver at least 200 of the hydrogen-powered vehicles over the next three years. The company will start building FCX Clarity sedans in Japan next month, with leases beginning in the Los Angeles area in July. Some 50,000 people contacted the company through its Web site inquiring about the car since its November unveiling, and the first customers will be announced next month, the Tokyo-based automaker said. The Clarity ... reflects Honda's efforts to challenge the image Toyota Motor Corp. has created with the Prius hybrid as an environmental leader. "Honda designed an attractive product, but we're talking about a vehicle priced like a Bentley," said K.G. Duleep, managing director of Arlington, Va.-based Energy & Environmental Analysis Inc. "The economics of fuel cells are way out of line. Batteries look like a better option because costs should come down more quickly." But Honda also plans to raise sales of hybrid vehicles ninefold. 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.
Source: Bloomberg

Ethanol Vehicles for Post Office Burn More Gas, Get Fewer Miles

The U.S. Postal Service purchased more than 30,000 ethanol-capable trucks and minivans from 1999 to 2005, making it the biggest American buyer of alternative-fuel vehicles. Gasoline consumption jumped by more than 1.5 million gallons as a result. The trucks, derived from Ford Motor Co.'s Explorer sport- utility vehicle, had bigger engines than Jeeps from the former Chrysler Corp. they replaced. A Postal Service study found the new vehicles got as much as 29 percent fewer miles to the gallon. Mail carriers used the corn-based fuel in just 1,000 of them because there weren't enough places to buy it. "You're getting fewer miles per gallon, and it's costing us more," Walt O'Tormey, the Postal Service's Washington-based vice president of engineering, said in an interview. The agency may buy electric vehicles instead, he said. The experience shows how the U.S. push for crop-based fuels, already contributing to the highest rate of food inflation in 17 years, may not be achieving its goal of reducing gasoline consumption. Lawmakers are seeking caps on the use of biofuels after last year's 40 percent jump in world food prices, calling the U.S. policy flawed.
Source: Bloomberg

Ford to Slow Production of SUVs, Pickups

Ford Motor Co. will halt more pickup-truck and sport-utility vehicle production over the next two months, a sign that falling U.S. consumer demand for the vehicles still hasn't bottomed out. The auto maker's Wayne, Mich., truck-assembly plant, home to the Expedition and Navigator SUVs, will be shut from June 23 through July 28, a Ford spokeswoman said. The Louisville, Ky., truck plant, where Super Duty pickup trucks are assembled, will be cut to one shift during the first four weeks of June. General Motors Corp. and Chrysler LLC also are idling plants as all three auto makers try to keep unwanted products off dealer lots. Ford Chief Executive Alan Mulally said during the company's annual meeting on May 8 that Ford would continue taking cost-reduction actions in North America.
Source:  The Wall Street Journal (Subscription required.)

GM to Resume Output of Malibu After Workers Approve Contract

General Motors Corp. will resume production of the increasingly popular Chevrolet Malibu in Kansas today after workers approved a local contract, ending a 17-day strike. The resumption of production lets GM, the largest U.S. automaker, begin to replenish supplies lost during the walkout. The Malibu, a sedan, and Saturn Aura, also built at Fairfax, have increased U.S. sales a combined 33 percent through April while GM's total volume has declined 12 percent. On May 1, GM's U.S. dealers had a 36-day supply of Malibus, according to Automotive News. The trade publication said the average for all GM vehicles was 82 days. Analysts consider 60 days to be typical. A Michigan UAW local that makes GM's Buick Enclave and GMC Acadia sport-utility vehicles ended a 30-day walkout last week.
Source: Bloomberg

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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 on 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
 
"A national standard makes more sense for vehicles, which, unlike smokestacks, do not stay within one state's jurisdiction."

   
-- Sen. Tom Carper (D-Del.) following the Senate's vote yesterday to overturn EPA's decision to block California and more than a dozen other states from limiting greenhouse gas emissions from vehicles, Associated Press, May 22


"California's elected officials desperately want to control the domestic auto industry but they're not interested in seriously considering the damage that will be done if their efforts are successful. The game California's politicians -- from both parties -- are playing is purely about politics, not sound public policy."

-- Manny Lopez, auto editor and columnist, The Detroit News, (Opinion) May 22 


There are some encouraging signs in the housing market that may enable car shoppers to better afford that new-car purchase. 

    -- NADA Chief Economist Paul Taylor, Auto Remarketing, May 22 


"Honda designed an attractive product, but we're talking about a vehicle priced like a Bentley. The economics of fuel cells are way out of line. Batteries look like a better option because costs should come down more quickly."

    -- K.G. Duleep, managing director of Arlington, Va.-based Energy & Environmental Analysis Inc., Bloomberg, May 22 


"The fact that three of the top 10 CUVs showing the greatest increase in interest were hybrids demonstrates that fuel efficiency is a serious concern." 

    -- Tara Baukus Mello, senior writer and lead market analyst at NADAguides.com, Auto Remarketing, May 21

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 Chief Economist Paul Taylor Delivers '08 Sales Forecast. 
 
2008 Convention Highlights

 
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