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Top Stories
Detroit's Shrinking Sales Take a Toll on Dealerships
General Motors Seeks 33 Percent Gain for Dealership Service Business
U.S. Sales Plummeting, Chrysler's Chief Says
Low Sales Force Ford to Idle SUV Plant for 9 Weeks
Toyota Cuts Tundra Output Again as Truck Sales Slow
Chrysler Takes Aim at GM with Hybrid SUV Prices
GM to Build 100-Unit Plug-In Electric Fleet in 2009, Lutz Says
The Electric Car Lives
Have U.S. Drivers Reached Filling Point of No Return?
NADA Update
NADA, Energy Star to Recognize Energy Efficient Dealerships
Automotive News to Host 'Green Dealership' Webinar
Enroll Now for NADA's Executive Leadership Program
Dealers Urged to Apply for the 2008 ENERGY STAR for Small Business Award
Hire an AYES Intern Today
STAR Answers Dealers' Questions About PC Equipment
Go Green With HP ENERGY STARŪ Desktops
Top Stories
Detroit's Shrinking Sales Take a Toll on Dealerships

COLUMBUS, Ohio — In the glory days of Detroit carmakers in the 1960s, Leonard J. Immke Jr. used to sell 200 new Buicks a month from his vast downtown showroom here filled with gleaming Electras, Rivieras and Skylarks. Now, it takes Len Immke Buick at least a year to sell 200 new cars from its smaller location on the city’s blue-collar east side. In May, it sold 10. As Detroit automakers have undertaken painful overhauls in recent years, the impact has fallen most directly on the tens of thousands of factory workers who lost middle-class jobs. But the ranks are also thinning in the dealer networks built up during a time when General Motors, Ford Motor and Chrysler ruled the road, and companies like Toyota, Nissan and Honda were mere upstarts. More than 10,000 dealerships, nearly all of which sold American brands, have closed since 1970, according to the National [Automobile] Dealers Association. Last year, 430 called it quits, and the organization expects at least that many, but probably far more, to close in 2008, leaving about 20,000 of them nationwide. “The current climate is causing probably every dealer to take a look at their business and determine what the future holds,” said Annette Sykora, [NADA chairman] and owner of two large dealerships outside Lubbock, [Texas]. “They’re really gut-wrenching decisions. Dealerships in most communities are a cornerstone.” Like many American car dealerships, the history of Len Immke Buick is a family affair. The owner, Dave Lavelle, is a nephew of the founder, who died in 1991. But Mr. Lavelle, 57, worries that time may be running out on the business where he began working as a teenager. Buick does not sell any of the small, fuel-efficient cars whose sales have taken off amid $4-a-gallon gasoline. As his business prospered, Mr. Immke gave a friend, Dave Thomas, space in a building opposite the Buick store in 1969 and urged him to open a hamburger restaurant there so his staff could eat lunch nearby. (Mr. Thomas called it Wendy’s Old-Fashioned Hamburgers.)
Source: The New York Times (Registration required.)

General Motors Seeks 33 Percent Gain for Dealership Service Business

General Motors Corp., the largest U.S. automaker, is aiming to increase its dealers' vehicle service business by 33 percent as declining auto sales reduce showroom traffic. Car owners are more than twice as likely to go to chains such as Jiffy Lube instead of dealerships for regular maintenance, said Peter Lord, executive director of service operations at GM. About three of every 10 owners of GM vehicles visit franchised dealers for service, he said. "The first logical step would be to get just one more out of 10 to come back" for oil changes and other routine maintenance in the next five years, Lord said during a presentation to reporters today. GM is trying to sustain its retailers after eight straight years of declining U.S. auto sales.
Source:  Bloomberg

U.S. Sales Plummeting, Chrysler's Chief Says

Memo may signal cuts to come
After months of confident talk that Chrysler LLC anticipated the economic downturn better than other automakers, Chairman and Chief Executive Officer Bob Nardelli told employees Tuesday, in a memo obtained by the Free Press, that the last few months -- and this month in particular -- have been even worse than Chrysler anticipated. Industry-wide sales so far in June have been about 20 percent worse than Chrysler's expectations for the year, according to the memo. Nardelli didn't indicate or threaten any job or production cuts like those under way at rivals, but experts saw the message as an ominous sign that the privately held automaker may have to do more. When Chrysler announced plans to cut 12,000 jobs in November -- on top of 13,000 over three years -- executives were assuming Americans would buy fewer vehicles in 2008 than in any year in a decade, only about 15.5 million. Nardelli said that "conservative estimate" was pretty close for the first three months of the year. But sales were 7 percent to 8 percent below that rate in April and May. And so far in June, he said, J.D. Power and Associates and Citigroup are seeing a sales pace that is almost 20 percent lower -- only 12.5 million vehicles per year. Both GM and Ford are trying to adapt quickly to a U.S. automotive market suffering from declining volumes, as well as rapidly shifting consumer preferences away from profitable trucks in favor of cars and crossovers. In response, GM announced on June 3 plans to cut production by 700,000 trucks annually, or about 40 percent of its truck capacity, by idling four North American truck plants by mid-2010, among other cuts. And Ford, which already planned to build 280,000 to 350,000 fewer vehicles overall in North America this year, is now in the midst of reducing salaried-related costs by 15 percent by Aug. 1, including job cuts. Analysts expect Toyota Motor Corp. and Nissan Motor Co. to shift production from trucks to cars at plants that can handle both types of vehicles.
Source: Detroit Free Press

Low Sales Force Ford to Idle SUV Plant for 9 Weeks

DETROIT -- Sagging demand for large sport utility vehicles has forced Ford Motor Co. to close a Michigan factory for nine weeks starting June 23. The Michigan Truck Plant in Wayne, west of Detroit, makes the Lincoln Navigator and Ford Expedition. It will be idled until Aug. 25, Ford spokeswoman Angie Kozleski said Monday. Expedition sales are down 31 percent for the first five months of the year, and Navigator sales are off 22 percent, according to Autodata Corp. Ford had a 124-day supply of Navigators and a 100-day inventory of Expeditions, according to Ward's AutoInfoBank. Ford had previously announced that it would close the Michigan Truck Plant for five weeks during the summer, including the company's normal two-week summer shutdown in July. "We are going to do what we need to do to make sure our capacity is in line with demand," Kozleski said. The factory employs about 1,400 hourly workers. They will be laid off but get roughly 95 percent of their pay under their contract with the United Auto Workers. Ford Chief Executive Alan Mulally said last month that the U.S. market had rapidly shifted from trucks to cars because of $4 per gallon gasoline, and that Ford views the shift as permanent. The company plans to increase car production and decrease truck production, with specifics coming in July, he said. Responding to the same market conditions, General Motors Corp. said Monday that it is moving up the start of a third shift at its small-car plant in Lordstown, Ohio, that makes the Chevy Cobalt and Pontiac G5.
Source: Associated Press

Toyota Cuts Tundra Output Again as Truck Sales Slow

Toyota Motor Corp., the world's second-largest automaker, unveiled its second cut in U.S. production of Tundra pickups in four months as record gasoline prices slash demand for large trucks. Tundra daily production at the company's San Antonio and Princeton, Indiana, plants will be slowed, spokesman Mike Goss said in an interview, without providing details. Additionally, San Antonio's truck line will halt production for 14 days between now and the end of October, while the Princeton factory is cutting six scheduled production days between now and the end of August on its line that makes the Tundra and Sequoia sport- utility vehicle, Goss said. Toyota "is considering all kinds of options to make sure we're making the best use of all our production facilities," Goss said. There are no plans to concentrate all Tundra and Sequoia assembly at the San Antonio plant, Goss said. Tundra sales dropped 32 percent in May as U.S. customers shifted away from large pickups and SUVs to smaller, more fuel-efficient vehicles.
Source: Bloomberg

Chrysler Takes Aim at GM with Hybrid SUV Prices

DETROIT -- The market for hybrid full-size sport utility vehicles may be small, but Chrysler LLC is determined to get a piece of it, saying Tuesday that its new hybrids will be nearly $8,000 less than competitors from General Motors Corp. Chrysler said its 2009 Dodge Durango hybrid will have a suggested retail price of $45,340 while its 2009 Chrysler Aspen hybrid will start at $45,570. A comparable four-wheel-drive version of the 2008 Chevrolet Tahoe hybrid starts at $53,295, while the 2008 GMC Yukon hybrid starts at $52,855. Chrysler spokesman Nick Cappa said the hybrid Aspen will cost $3,550 more than a comparable model with a gas engine, while the Durango will cost $3,655 more. Hybrid buyers will be able to reduce that premium with a hybrid tax credit of $1,800, he said. The Durango and Aspen are Chrysler's first entries into the hybrid market and will go on sale in August. Chrysler said the hybrid SUVs get up to 20 miles per gallon and improve fuel economy by 40 percent in city driving and up to 25 percent overall. Chrysler's hybrid system was developed in a partnership with GM, Daimler AG's Mercedes-Benz and BMW AG, and it's the same system that's in the GM SUVs.
Source: Associated Press

GM to Build 100-Unit Plug-In Electric Fleet in 2009, Lutz Says

General Motors Corp. next year will begin building a test fleet of more than 100 Chevrolet Volts, the electric car that recharges at a wall outlet, the automaker's top product executive said. Tests of the lithium-ion batteries to run the Volt have been "very satisfactory" and "very encouraging," GM Vice Chairman Robert Lutz said in an interview [yesterday] in Seattle. Trial runs are now taking place with the technology installed on two older Chevrolet Malibu car bodies, he said. "The next stage of testing will be running everything in vehicles that actually look like the Volt," Lutz said. "We'll be testing those under all conditions."
Source:  Bloomberg

The Electric Car Lives

Backed by U.S. venture capital, Norwegian company Think is betting its Ox concept vehicle can prove the electric car's time has finally arrived
Clean, quiet, and relatively profitable to produce, electric vehicles have had a rough start in the U.S.: Five years after General Motors nixed its innovative EV1 electric car program, just a handful of automakers have committed to making and selling electric vehicles on a mass scale any time soon. Enter Think Global, a Norwegian upstart plotting a U.S. invasion via pint-size, affordable electric cars. Think has been selling gas-free, Lilliputian city cars in Europe and will start peddling them to fuel-crunched Americans in 2009. The company's newly formed North American division has high hopes for Think's existing models—and even higher ones for the upcoming Th!nk Ox, a concept unveiled at the Geneva International Motor Show earlier this year. An electrified people's car for the 21st century, the Ox is a preview of Think's next-generation production vehicle, due out in 2011. Roughly the size of a Toyota Prius, the Ox can travel between 125 and 155 miles before needing a recharge, and zips from zero to 60 miles per hour in about 8.5 seconds. Its lithium-ion batteries can be charged to 80 percent capacity in less than an hour, and slender solar panels integrated into the roof power the onboard electronics. Inside, the hatchback includes a bevy of high-tech gizmos such as GPS navigation, a mobile Internet connection, and a key fob that lets drivers customize the car's all-digital dashboard. Pricing has yet to be announced, but the company's current vehicles cost less than $25,000.
Source: BusinessWeek

Have U.S. Drivers Reached Filling Point of No Return?

It took some time, but Americans are responding to rising energy costs by driving smaller cars and cutting back on miles they log on the road. But why now, with gasoline fetching $4 a gallon, instead of a year ago, when it pushed past $3, or in 2004, when it pierced $2? Energy prices have climbed steadily for the past five years, but only recently have there been any real signs of conservation. "I think we've reached a tipping point," said University of California, San Diego, economist James Hamilton. "There are a lot of hard numbers that show that we've actually reached a point where people are responding." The volume of cars on U.S. roads began slipping in November below year-ago levels. The Federal Highway Administration's latest figures, for March, show U.S. drivers logged 11 billion fewer miles than a year earlier. That is a 4.3 percent drop and the biggest-ever year-over-year reduction in miles driven. A fall in gasoline prices might reverse the trend. But the last time the U.S. saw such a lasting decline in traffic volume was when gas prices surged in 1979. In the years that followed, the U.S. saw a reduction in energy consumption that wasn't reversed until the early 1990s.
Source: The Wall Street Journal (Subscription required.)

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NADA Update
NADA, Energy Star to Recognize Energy Efficient Dealerships

  

As part of NADA's Energy Stewardship Initiative, both NADA and EPA’s Energy Star program are eager to recognize dealerships that have met or exceeded the Energy Star Challenge by improving their energy efficiency by at least 10 percent.

NADA will award these “green” dealers with a certificate, a press release distributed to the dealership’s local media, and coverage on www.nada.org, as well as recognition at NADA’s annual Washington Conference in September.

If you have improved the energy efficiency of your dealership(s) by at least 10 percent and you can show us, please send an email to RegulatoryAffairs@nada.org. Candidates for recognition will be asked to submit their dealership’s energy information. For more on NADA’s partnership with Energy Star, visit www.nada.org/energystar.

Automotive News to Host 'Green Dealership' Webinar

Dealers are encouraged to participate in an online seminar hosted by Automotive News on June 24 at 1 p.m. EST. The focus of the seminar is environmentally friendly dealerships and how dealers are gaining an advantage by going green. Editor Dave Sedgwick will interview dealers who have gone green, and the experts that helped them. Joining Sedgwick will be Pat Lobb, owner of Pat Lobb Toyota of McKinney, Texas; Justin Doak of the U.S. Green Building Council; and Douglas Greenhaus, director of environmental health and safety for NADA.

Participants can post a question in advance by emailing asktheexpert@autonews.com with the subject line "Green Dealerships." To register for the Webinar, click here.

Enroll Now for NADA's Executive Leadership Program

Ranked No. 1 for Entrepreneurial Education
Applications are now being accepted for NADA's Dealer Executive Education program at Babson College, which meets at Babson's Wellesley, Mass., campus from Sept. 21-26. Launched in March, the program offers a six-part, 16-month curriculum designed to enhance the leadership skills of dealership employees. "Ideal candidates for the program are individuals who are in a position to effect change within the dealership," says Allan Jones, director of the NADA dealer academy. Instructors lead students through a series of interactive learning activities, including group activities, role-play and video. Students gain insight into leadership traits, decision-making processes, communication skills and "opportunity obsession" -- a term coined by Babson. "This is a lot more than just changing your dealership. This is about making myself a better leader," said Jared Hamilton of Henry Day Ford in Sandy, Utah. "If I become a more effective leader, I can ... articulate our dealership's vision." The program teaches you how to "think like an entrepreneur and how to think beyond the four walls of the dealership," said Matthew Haiken of Prestige Volvo in East Hanover, N.J.  Babson College has been ranked No. 1 in entrepreneurship for 13 consecutive years by U.S. News & World Report. For more information on NADA's Executive Education, visit www.DealerExecEd.org.

Click here to see why NADA's executive leadership program is No. 1 for executive education.

Dealers Urged to Apply for the 2008 ENERGY STAR for Small Business Award

The 2008 ENERGY STAR Small Business and Congregations Awards are open to any small business, congregation, or non-profit which has increased the energy efficiency of its facility through upgrades or energy-management improvements during the last two years. It can be a large project or small improvement in energy efficiency, a retrofit or new construction. In 2007, EPA’s ENERGY STAR program honored three dealerships: Pat Lobb Toyota of McKinney, Texas; Planet Subaru, Hanover, Mass.; and Sendell Motors, Inc., Greensburg, Pa. Each received an ENERGY STAR for Small Business Award, which recognized these dealerships as “examples of financial and environmental stewardship” for achieving greater energy efficiency at their facilities. To download an application, click here.

Hire an AYES Intern Today

More than 2,000 qualified students are available in the Automotive Youth Educational Systems (AYES) program, and all are available for summer internships. NADA is a long-time, active supporter of the AYES program, which is designed to help train young people as automotive technicians, and prepare them for careers at new-car and -truck dealerships. "NADA encourages dealers to participate with their local AYES-affiliated schools," said NADA Chairman Annette Sykora. "As a school to career partnership, it's a tremendous way to grow your own workforce. Hiring an AYES student also supports local schools and the community, and can increase the productivity of your dealership's service department." To find an AYES school near you, call (888) 339-AYES, e-mail info@ayes.org or visit http://maps.ayes.org. Additional information on AYES can also be found at at www.ayes.org.
Source: AYES

STAR Answers Dealers' Questions About PC Equipment

 

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers evaluate their PC Equipment.  Visit STAR's Dealer Infrastructure Guidelines (DIG) publication for more information. To learn "What is Key When Selecting Client Hardware?"  click here.

Go Green With HP ENERGY STARŪ Desktops

Save up to 44 percent on computer power consumption when you choose HP ENERGY STAR® qualified HP desktops with 80 PLUS® power supplies. Look for HP Compaq dc7800 Ultra Slim Desktop at www.nada.org/ProductsServices/PC+Purchase+Program/, click www.hp.com/go/promos/nad1 (member log-in required).

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Featured Video
 

Click Here to see why NADA's executive leadership program is No. 1 for executive education. 

More Video Highlights
Quotable
 
"The current climate is causing probably every dealer to take a look at their business and determine what the future holds. They're really gut-wrenching decisions. Dealerships in most communities are a cornerstone."

    -- Annette Sykora, NADA chairman and owner of two large dealerships outside Lubbock, Texas, referring to factory worker cuts, dealership consolidation and declining market share for Detroit's automakers, The New York Times, June 18


If J.D. Power's forecast for June -- an annualized rate of 12.5 million sales -- continues for long, it would be "Armageddon. Doomsday."

    -- Erich Merkle of IRN Inc., Detroit Free Press, June 18


"To keep that name going — and the reputation that goes with it — is very important to me. There's a lot more that goes on than just selling cars when you've been here for such a long time."

   
-- Dave Lavelle, owner of Len Immke Buick in Columbus, Ohio, fears what the demise of the dealership would mean for its annual classic car show that Mr. Immke started in 1982 to benefit the local Arthritis Foundation and for the dealership-sponsored golf tournament that raises money for diabetes research, The New York Times, June 18
Video Highlights
 
   

New Orleans is Back!


 NADA's New Orleans Project
 NADA's Return to New Orleans 
 NADA Chief Economist Forecasts a Challenging '08
Click here for more NADA-TV reports.
 
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