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Top Stories
GOP: Climate Bills Would Make $4 Gas Look Cheap
Opinion: Is This the Start of the Perfect Storm?
The Smaller the Better, Automakers are Finding
GM Puts Product Development on Hold
Flexible Manufacturing Lets Honda Produce the Fuel-efficient Cars Consumers Want
Toyota Will Add 2 All-new Hybrids Next Year
Lithium Ion Batteries Power Converted Priuses
Battery Leasing Could Help Ease Anxiety About Hybrids
ROI: Chrysler's Fuel Rebates Look Like a Deal
Auto Dealers Remodel, Use Aromas to Boost Service
NADA Update
ALERT: NADA Headlines' Subscription Lists Will be Updated Next Week
Enroll Now for NADA's Executive Education Program
NADA and EPA to Recognize Energy Star Efficient Dealerships
Automotive News to Host 'Green Dealership' Webinar
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
GOP: Climate Bills Would Make $4 Gas Look Cheap

WASHINGTON -- Lawmakers from auto and oil states warned today that climate change legislation would add to household energy costs and make Americans “long for the good old days of $4 gasoline.” The warnings came at the opening of a House subcommittee hearing on a variety of proposals that have been made to limit U.S. emissions of greenhouse gases. Rep. John Dingell (D-Mich.), chairman of the House Energy and Commerce Committee, said many more hearings will be needed, the latest strong signal that no measure will be enacted this year. But other lawmakers made clear that high energy prices and difficult economic conditions will make passage even more difficult than previously expected whenever the ultimate debate occurs. Most of the proposals would place a cap on overall emissions of gases that contribute to global warming, mainly carbon dioxide, a byproduct of burning fuel. Utilities, factories and other sources would buy and sell emission allowances, effectively putting a price tag on carbon. The EPA is expected to add to the ongoing debate with a report next week on steps it could take to control greenhouse gas emissions. It is expected to say that automakers could do better than the 35 mpg industrywide fuel economy standard enacted into law last December. Automakers and their allies ultimately supported the new standard -- about 40 percent higher than today -- but said it will be a challenge to meet.
Source:  Automotive News (Subscription required.)

Opinion: Is This the Start of the Perfect Storm?
by Keith Crain

Unless you have been hiding in a cave, you know about the skyrocketing fuel costs. In the past 30 to 60 days, there has been a huge impact on the sales of anything that doesn't get good mileage. We may not be sure what good mileage is these days, but consumers have a very good idea what bad mileage is, and they are shunning vehicles with that reputation. The interesting question is whether the national economy is in a recession — or maybe it's just the automotive sector. We are seeing more than just substitutions in the automotive sales numbers. Sure, high-mileage vehicles seem to be flying off dealership lots, but the industry isn't selling enough of them to offset the drop in low-mileage pickups and SUVs. Are consumers waiting for the storm to settle? Or are they worried about the economy and keeping their money in their pockets? Fuel costs are muddying up the economy, and the automotive sector and the nation are facing so many financial issues that it's hard to tell what's going on. We don't know the answer, but we sure have all the questions.
Source:  Automotive News (Subscription required.)

The Smaller the Better, Automakers are Finding

DETROIT — The demand for fuel-efficient small cars and hybrids is so fierce that automakers cannot produce them fast enough. Limited supply of some of the hottest models is taking its toll on an industry that has already suffered a 14 percent drop in unit sales in the United States this year. Analysts say that June sales are coming in at the lowest monthly rate in at least 15 years, partly because manufacturers have been unable to satisfy the surging demand for compact cars and hybrid models. Sales for the month so far are equal to an annualized selling rate of 12.5 million vehicles, according to the market research firm J. D. Power & Associates. With gasoline prices topping $4 a gallon, consumers are overwhelming dealerships with demand for the littlest vehicles in the showroom. [Tom] Libby, [J. D. Power’s chief industry analyst], said that the tiny Honda Fit is on a dealer’s lot an average of 11 days before it is sold, half the time of traditional quick sellers like the Cadillac CTS and Mercedes-Benz C300 luxury sedans. “These are amazingly low numbers for a car of this type,” he said. “If gas prices stay where they are, I think we’ll see this for quite a while.”
Source:  The New York Times

GM Puts Product Development on Hold

Bleak Truck Sales Force Auto Maker to Revisit Lineup's Fuel Efficiency
General Motors Corp. is re-evaluating several products it is considering launching sometime after the turn of the decade as it considers whether the lineup will match customer demand in an era of $4-a-gallon gasoline, the company said. The intensified strategy review began about two to three months ago after Frederick "Fritz" Henderson was named chief operating officer, and sales of GM's highest-profit trucks and sport-utility vehicles essentially collapsed, GM spokesman Steve Harris said. Mr. Harris said GM is slated to launch 18 cars and crossovers in the coming couple of years, and it is looking for opportunities to evaluate certain vehicle launches. GM spokesman Dee Allen said GM believes sales of full-size pickup trucks will rebound, but doubts sales of truck-based SUVs will approach the highs they hit earlier this decade. GM is giving serious thought to how it should approach the SUV segment, he said. To meet growing demand for fuel-sipping vehicles, GM is scouring its Asian operations -- including South Korea and China -- for small cars that could be shipped to the U.S. or eventually built there, and is exploring how quickly and broadly it can expand the range of plug-in electric vehicles it plans to introduce in late 2010, these people said. "It's like gripping the wheel and taking a hard left," said one automotive supplier executive briefed on the company's plan. "They know they can't afford to be behind anymore."
Source:  The Wall Street Journal (Subscription required.)

Flexible Manufacturing Lets Honda Produce the Fuel-efficient Cars Consumers Want

Victory Honda sold 94 Honda Civics in May at its Plymouth dealership, but sales manager Keith Friday expects that number will drop this month -- because he just doesn't have enough to sell. "We have about seven in stock right now," Friday said of the best-selling vehicle in America last month. At a time when rivals are struggling to cope with slumping demand and shifting tastes, Honda Motor Co. is thriving. Its fuel-efficient lineup that highlights small and midsize cars is well-suited to high fuel prices. And with consumer tastes changing quickly, Honda's flexible manufacturing system is perhaps best equipped to go with the flow. So while industry-wide sales have fallen 8.4 percent so far this year, Honda's U.S. sales are up 4.8 percent. The thrifty automaker says it is in the position it is today because it aggressively invested in flexible assembly technology rather than large trucks. Since 1998, Honda has invested $5.02 billion to increase production capacity and open new automotive plants in the United States. That does not include hundreds of millions invested in Canadian and nonautomotive operations, such as a South Carolina ATV plant. "We add capacity very judiciously," Mendel said. "Our goal is to always maintain 100 percent of our capacity."
Source:  Detroit Free Press

Toyota Will Add 2 All-new Hybrids Next Year

Lithium ion battery output to start next year
TOKYO — As $4-per-gallon gasoline drains Americans' wallets, Toyota Motor Corp. last week promised two new hybrid vehicles. The two hybrids — one badged a Toyota and the other a Lexus — will debut in January at the Detroit auto show and come in addition to the third-generation Prius, also due in 2009. Masatami Takimoto, executive vice president in charge of r&d, did not say when the two new vehicles are due in U.S. showrooms. But he said they will both run on nickel-metal hydride batteries, and the Toyota vehicle will be larger than the Prius.
Source:  Automotive News (Subscription required.)

Lithium Ion Batteries Power Converted Priuses

WASHINGTON — Toyota dealerships in four U.S. metropolitan areas are offering to convert customers' Priuses into plug-in hybrids, using technology from the battery maker A123 Systems. The arrangement provides the strongest indication yet that lithium ion battery technology is ready for mainstream automotive use. A123, of suburban Boston, is among the four battery companies General Motors is considering to supply the Chevrolet Volt. GM wants the plug-in hybrid car on the market in 2010. Lithium ion batteries are seen as key to electrification of the automobile. The industry is debating whether the batteries can withstand mass production and daily use by motorists. The Tesla Roadster, an all-electric $100,000 car that uses lithium ion batteries, is on sale. But it is widely viewed as an expensive exotic vehicle for a few enthusiasts. How many Prius owners will spend $10,000 to convert the cars to plug-in power is unknown. A123 wants Congress to provide a tax credit of $2,500 to $3,000 to Prius owners who make the conversion.
Source:  Automotive News (Subscription required.)

Battery Leasing Could Help Ease Anxiety About Hybrids

DETROIT — Greener cars that rely more on electricity than gasoline may also generate more consumer concern about the longevity of their costly, high-tech battery packs. Industry executives believe one way to quell such worries — and lower the initial price for such vehicles — may be to lease their batteries to buyers. Two companies are working on battery lease plans. Think Car USA plans to lease the batteries for its City electric car to go on sale next year. Project Better Place, a start-up with $200 million in funding from partners, is trying to create a system for consumers to "subscribe" to a service that offers recharging stations and battery exchange. "You would own the car. We would own the battery," says Joe Paluska, chief marketing officer for Better Place. Such business models could be how plug-in and even standard hybrids are marketed in coming years. Nissan is considering leasing batteries when their plug-in hybrid vehicles go on sale in 2012, says Larry Dominique, vice president of product planning. "To consumers, it becomes less of a worry" if they know they're not responsible for replacement costs if the battery fails.
Source:  USA Today

ROI: Chrysler's Fuel Rebates Look Like a Deal
by Brett Arends

As gasoline's over $4 a gallon, it's time to take another look at Chrysler's Let's Refuel America program. That's the promotion the car company launched earlier this spring. If you buy a new vehicle, they will provide you with plenty of gas at $2.99 a gallon over the next three years. The offer's good on vehicles bought until July 7. I took a look at this program1 soon after it was launched. Based on the fuel prices at the time, it didn't seem to stack up for most vehicles. Since then gasoline prices have risen a long way. You may not be in the mood – or financial position – to look at buying a new vehicle right now. Least of all a guzzler like a Jeep Grand Cherokee. But if you are, what is this program now worth? The answer is: Quite a lot. If today's fuel prices hold, this cheap gas could end up worth around a couple of thousand dollars.
Source:  The Wall Street Journal (Subscription required.)

Auto Dealers Remodel, Use Aromas to Boost Service

WARREN, Mich. -- A box that sends puffs of new car-scented air into his Chevrolet dealership's service lane is just one of the tricks Tim Colussy is using these days to entice buyers to come to his Pittsburgh-area dealership for servicing. Colussy Chevrolet in Bridgeville, Pa., also has repainted and sealed the floors, brightened the lights and added new signs and displays in its service area. In the customer waiting area, there's a new flat-screen TV, WiFi access, workstations and a coffee bar. It's hard to overestimate the importance of parts and service to dealers' profits. Dealerships typically get half their profits from service, with the rest coming from new and used car sales, according to Paul Taylor, chief economist with the National Automobile Dealers Association. But with new car sales plummeting ... dealers are racing to renovate body shops, add dedicated lanes for quick oil changes and compete more aggressively with independent repair shops and big chains. In a 2007 NADA survey, 29 percent of dealers said they recently had upgraded their service departments. "We don't have the warranty anymore as the trigger to bring someone in," Peter Lord, executive director of service operations at General Motors Corp., said during a recent event at a GM service center in the Detroit suburb of Warren. "Warranty repair is now the exception. It's the routine maintenance we have to be prepared for." Wes Lutz, owner of Extreme Dodge Hyundai in Jackson, said five to 10 years ago, 80 percent of his service business was in warranty repairs and 20 percent was in customer-paid repair work. Now, that has completely reversed, he said. "We really don't have any warranty issues anymore," he said. "We had to learn to adjust how we take care of customers."
Source:  The Associated Press

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NADA Update
ALERT: NADA Headlines' Subscription Lists Will be Updated Next Week

In order to comply with federal regulations governing broadcast emails, NADA will update its subscription lists next week. There is a possibility that your NADA Headlines' subscription may be accidentally terminated next week during this updating process.

If you find that you are no longer receiving NADA Headlines, there is a simple way to re-subscribe. Just click here to re-subscribe now and re-enter your email address. Then you will receive a confirmation email. To activate your subscription, be sure to click the link in that email.

Enroll Now for NADA's Executive Education 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.

NADA and EPA to Recognize Energy Star 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 or dealerships 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.

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
 
It's hard to overestimate the importance of parts and service to dealers' profits. Dealerships typically get half their profits from service, with the rest coming from new and used car sales.

   
-- Paul Taylor, chief economist with the National Automobile Dealers Association, Associated Press, June 19


The tiny Honda Fit is on a dealer's lot an average of 11 days before it is sold, half the time of traditional quick sellers like the Cadillac CTS and Mercedes-Benz C300 luxury sedans.

   
-- Tom Libby, J. D. Power's chief industry analyst, The New York Times, June 20


"Most of the Civics and hybrids are coming in already sold. Generally, right now people are waiting a couple of weeks or a couple of months for these vehicles."

   
-- John Rooney, the new-car sales manager at Pearson Honda in Richmond, Va., The New York Times, June 20


"This seismic shift in the marketplace has definitely taken us and everybody else by surprise."

   
-- George Pipas, Ford’s market analyst, The New York Times, June 20
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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NADA For more information on NADA, visit www.nada.org or contact NADA, 8400 Westpark Drive, McLean, VA 22102. This email may contain an advertisement of NADA products and services. Any opinions or statements contained herein do not necessarily reflect the views of NADA. Factual errors are the responsibility of the listed publication. If you are a franchised new-car or -truck dealer and would like to become a member of NADA, please visit the Join NADA section of www.nada.org. Questions or comments concerning NADA Headlines content may be directed to media@nada.org.