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At a Glance...
Top Stories
In Race for Market Share, GM Tries to Hold Off Toyota
Chrysler Shows $300 Million Loss Through April; Plant to Close
Consumer Reports Examines Consumer Response to Fuel Prices
BMW Calls CAFE Plan 'Not Feasible'
Ford Looks to Maintain F-150's Vitality
Hardest-To-Get Cars
Opinion: Need is Great, but Energy Policy Lacking
NADA Update
NADA Offers Consumer Tips to Avoid Flooded Vehicles
Nomination Ballots for NADA Director from Kansas due July 18
Runoff Election to be Held for NADA Director from N. Calif.
Applications for NADA's Executive Education Program due July 16
NADA and EPA to Recognize Energy Star Efficient Dealerships
STAR Answers Dealers' Questions About Wireless Networks
Lenovo Offers NADA Members Savings on ThinkPad Notebooks
Top Stories
In Race for Market Share, GM Tries to Hold Off Toyota

General Motors Corp. is on the brink of losing its position as the top-selling car maker in the U.S. to Toyota Motor Corp... More American consumers are forgoing the purchase of trucks and sport-utility vehicles... That shift has created an opening for Toyota, whose American product line is skewed toward compact cars, to grab market share from GM. In May, Toyota's share of the U.S. market was a hair's breadth shy of GM's: 18.4 percent compared with 19.1 percent for GM, according to Autodata Corp. With June's data, the gap may narrow even more. J.D. Power & Associates predicted Friday an 18.7 percent share for Toyota, while GM's would be 19.2 percent for June U.S. sales. GM isn't giving up without a fight... The company rolled out massive incentives to entice buyers during the final week of June, when sales generally are heaviest. Toyota already has pulled even with GM in global vehicle sales, and becoming the top auto maker in the U.S. could raise the specter of nationalist backlash that the company has been trying to combat since the 1980s. Toyota has been building up political capital in the U.S. by constructing facilities in eight states, employing 36,600 people around the country and spending heavily on lobbying efforts in Washington. It, too, has been hurt by the drop in truck sales.
Source:  The Wall Street Journal (Subscription required.)

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Chrysler Shows $300 Million Loss Through April; Plant to Close

Chrysler LLC, closing plants as U.S. sales tumble, had an operating loss of about $300 million in the first four months of the year, less than projected by owner Cerberus Capital Management LP, according to documents provided to investors. Cerberus had forecast a deficit of about $700 million, according to the report, presented at a June 12 meeting of the private-equity firm's financiers. The analysis preceded today's announcement that Chrysler will shutter a minivan factory and reduce production of pickup trucks because of declining sales. Figures showing Chrysler is exceeding some of its owner's expectations follow growing questions about the third-largest U.S. automaker's health. "We'd assumed several years of operating losses for Chrysler," said Timothy Price, a partner of Cerberus, who declined to discuss details in a phone interview. "They're ahead of their plan, and doing a good job despite one of the most adverse economic environments in our lifetime." Chrysler ... said today it will close its St. Louis-area minivan plant by the end of October and scale back to one shift of production at its nearby Dodge Ram truck plant by Sept. 2.
Source:  Bloomberg

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Consumer Reports Examines Consumer Response to Fuel Prices

NEW YORK — When it comes to fuel prices, the line has already been crossed for some Americans, Consumer Reports suggested in its latest Auto Pulse Survey. In response, consumers are prepared to make drastic changes in their vehicle-buying behavior, as gas prices have risen 38 percent since mid-February, according to the Energy Information Administration. For instance, more than three-fourths (79 percent) of shoppers plan to make their next purchase a vehicle with better fuel economy. Eighty percent said they have considered buying a diesel, flex-fuel or hybrid vehicle, compared with just 47 percent in 2007. And more than half (54 percent) claim they would pay more for better fuel economy. Breaking it down further, 37 percent of consumers intending to make a new-vehicle purchase are considering flex-fuel vehicles, while 32 percent and 30 percent are considering hybrids and diesel-powered vehicles, respectively. Interestingly enough, however, even though roughly 80 percent of shoppers desire better fuel efficiency, 69 percent said they prefer a vehicle that is the same size or larger than their current ride. "That said, literally no respondents wanted a much larger vehicle, suggesting automakers face an immense challenge getting new customers into full-sized pickup trucks and SUVs," officials indicated.
Source:  Auto Remarketing

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BMW Calls CAFE Plan 'Not Feasible'

WASHINGTON -- BMW of North America is calling on the Bush administration to create an alternative fuel economy program for companies that would be hardest hit by proposed new standards in the 2011-15 model years. The alternative would allow a company such as BMW to comply by raising the fuel efficiency of its products by 4.5 percent a year over the standards in effect in 2010, the automaker says in comments submitted to the National Highway Traffic Safety Administration. The administration, responding to a new federal law, has proposed sliding scales of targets for cars and trucks of different sizes, measured by vehicle footprint, which is roughly the area bounded by four wheels. Each automaker in effect would have its own unique standards to meet based on the mix of products of different sizes that it sells. For BMW that would mean its cars would need to average 37.7 mpg in 2015, compared to the industry average of 35.7. Its trucks would need to average 31.7 mpg, compared to an industry average of 28.6, according to preliminary rules issued in April. BMW, in its official comments, posted in the government’s regulatory docket, said the administration proposal as written “is not feasible” for its products. The administration promises to have final rules adopted by the end of the year.
Source:  Automotive News (Subscription required.)

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Ford Looks to Maintain F-150's Vitality

DETROIT -- For more than 30 years, Ford Motor Co.'s F-150 pickup truck has been the top-selling vehicle -- car or truck -- in America. Now, with gasoline at $4 a gallon, the auto maker is scrambling to find a way to ensure its franchise vehicle remains a force in the market. At the same time, Ford has started searching for answers to a question it never used to pay much attention to: exactly who drives big pickups and why. "The customers who are buying full-sized trucks today are different even from the buyers who were buying full-sized trucks in February," Jim Farley, Ford's group vice president for marketing and communications, said in an interview. A redesigned F-150 will be launched in the fall... The new F-150 follows the old "Built Ford Tough" formula, and the company is confident hard-core truck buyers like contractors and people with boats to tow will continue buying powerful, rugged trucks if gas prices level off or decline. But as part of its rethink of the truck market, Ford's marketing people are trying to find out if and how it can keep "personal use" buyers -- people who bought full-size pickups in the past but didn't really need all the capability of an F-150. Some are known as "Home Depot warriors" -- heavy do-it-yourselfers who often haul plywood for weekend projects. Others are suburban cowboys who never haul much cargo at all but just love the idea of driving a truck. "The F-series is going to remain one of the cornerstones of the Ford franchise," said George Pipas, Ford's sales analyst. But even when the economy recovers, Mr. Pipas said, many of the personal-use truck buyers for the F-150 "are gone forever." As a result, Ford is revamping its launch plan for the F-150, Mr. Farley said. The rollout was pushed back two months, to November from September, to give dealers time to unload a massive inventory of current-year models on their lots. Ford also is shifting the mix of F-150s it plans to build. It aims to build more basic models, which are typically ordered as work trucks, and fewer of the spiffed-out models favored by personal-use buyers.
Source:  The Wall Street Journal (Subscription required.)

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Hardest-To-Get Cars

Despite tough times for the auto industry in general, there are some car models--across a broad range of classes and sizes--that are so popular that auto manufacturers are selling them faster than they can build them. The range of hard-to-get vehicles is as diverse as consumer tastes and budgets in general. As expected, the most-wanted vehicle on our list is the fuel-sipping $21,500 Toyota Prius hybrid sedan that gets an Environmental Protection Agency (EPA) combined estimate of 46 mpg. No. 2 on the list? The not-so-expected gas-guzzling $74,700 Lexus LX Series full-size luxury SUV that gets a combined 14 mpg. Even though the premium SUV seems like an anomaly in a time when consumers are snapping up small cars, auto analysts are quick to note that there's still a demand for luxury vehicles and that the SUV market, while struggling, isn't dead. Furthermore, popular vehicles that undergo a redesign, like the Scion xD and the LX 570, often experience an initial surge in sales, says Tom Libby, senior director at J.D. Power and Associates.
Source:  Forbes.com

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Opinion: Need is Great, but Energy Policy Lacking
by Rob Libertore

U.S. plods along despite increases in gasoline, CAFE
For 30 years, three public policy issues have dominated auto industry debate: trade, health care and energy. But energy policy remains a central challenge to the industry and to American society. The auto industry is reeling from having misread the price of fuel and the change in consumer demand. Government must send clear fuel pricing signals for the future so the industry can make the right bets on product with its ever more limited resources. To do that, the next administration must generate the political will to strike a comprehensive energy deal on all fronts: production, conservation and alternatives. Undoubtedly, there will be calls for ratcheting up the 35 mpg number for combined car and truck fleets, and presidential candidates Barack Obama and John McCain promise an aggressive climate-change cap and trade system that could affect the industry on the manufacturing side and possibly the product side. But the big open question remains whether we will regulate fuel economy at the federal level, or let California dictate the standards for about the half of the market that has opted for California standards. That is a battle in which all participants in the industry, especially the auto dealers and manufacturers, have a big stake.
Source:  Automotive News (Subscription required.)

[Editor's Note: Rob Libertore is senior trans-Atlantic fellow of the German Marshall Fund of the United States. He formerly was head of external affairs and public policy for Chrysler and DaimlerChrysler.]

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NADA Update
NADA Offers Consumer Tips to Avoid Flooded Vehicles

The record-setting floods in the Midwest have left a large number of flood-damaged vehicles. NADA urges consumers, even in unaffected areas, to remain alert to the possibility that some individuals may attempt to sell or trade flood-damaged used vehicles in the months to come. “Through awareness and education, dealers and consumers can make sure severely damaged vehicles remain off of the nation’s roads,” says David Regan, NADA vice president of legislative affairs.

NADA offers 10 inspection tips -- available online in both English and Spanish -- that may be used to detect significant water damage. While these inspection suggestions will not detect flood damage in every case, they do provide some information that may help to protect consumers from purchasing a vehicle damaged by water or flood. Mechanics at dealerships or repair shops can also be helpful in inspecting used vehicles. Along with offering tips to consumers, NADA continues to urge insurers to publicly disclose the Vehicle Identification Numbers (VINs) of flooded and totaled vehicles on a more complete and timely basis, citing safety and consumer protection concerns. For more information about NADA’s campaign to permanently red flag flooded vehicles, visit www.nada.org/tld.

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Nomination Ballots for NADA Director from Kansas due July 18

Ballots for nominating members to serve as the NADA director from Kansas have been mailed to members in that state. Current director Dale Willey will be leaving the board effective Jan. 26, 2009. Nomination ballots must be returned postmarked by Friday, July 18. The newly-elected director, who takes office Jan. 27, will be announced at the 2009 NADA Convention & Exposition in New Orleans.

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Runoff Election to be Held for NADA Director from N. Calif.

Two nominees have received at least 10 percent of the votes for the position of NADA director from Northern California forcing a runoff election. Election ballots have been mailed to members in Northern California and are to be returned postmarked by Friday, July 18. The winner, who will serve a 3-year term beginning Jan. 27, will be announced at the 2009 NADA Convention & Exposition in New Orleans.

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Applications for NADA's Executive Education Program due July 16

Over the next three weeks, NADA will be accepting applications for the new Dealer Executive Education class scheduled to begin in September at Babson College. Applications must be submitted by July 16.

Babson is the leading provider of entrepreneurial executive education training in the U.S. It has been ranked No. 1 in entrepreneurship for 13 consecutive years by U.S. News & World Report. The customized six-module program focuses on leadership, management and entrepreneurship for the retail side of the automotive and truck industry. All six week-long classes are being held on campus at the Babson Executive Education Center in Wellesley, Mass., over a 16-month period.

Click here to enroll and find out more about the program or contact Dealer Academy Director Allan Jones at (703) 821-7210 or ajones@nada.org.

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

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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.

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STAR Answers Dealers' Questions About Wireless Networks

 

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers evaluate their wireless network. Visit STAR's Dealer Infrastructure Guidelines (DIG) publication. To learn "What version of wireless should I use?" click here.

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Lenovo Offers NADA Members Savings on ThinkPad Notebooks

 

NADA members can save up to $650 on ThinkPad notebooks by using the eCoupon USXSUMMERHEAT at checkout until July 29. To take advantage of the discount, visit NADA's PC Purchase Program Web site (member login required), then click on the link for Lenovo or call 1-800-426-7235, Option 1, Ext. 4838. Enter eCoupon USXSUMMERHEAT at checkout. Free ground shipping is available on all Web orders.

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Featured Video
 

Iowa Dealership Endures Extensive Flood Damage

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Quotable
 
"The big open question remains whether we will regulate fuel economy at the federal level, or let California dictate the standards for about the half of the market that has opted for California standards. That is a battle in which all participants in the industry, especially the auto dealers and manufacturers, have a big stake."

    -- Rob Libertore, senior trans-Atlantic fellow of the German Marshall Fund of the United States. He formerly was head of external affairs and public policy for Chrysler and DaimlerChrysler, Automotive News, June 30


"The customers who are buying full-sized trucks today are different even from the buyers who were buying full-sized trucks in February."

    -- Jim Farley, Ford's group vice president for marketing and communications, The Wall Street Journal, July 1


"The F-series is going to remain one of the cornerstones of the Ford franchise." But even when the economy recovers,  many of the personal-use truck buyers for the F-150 "are gone forever."

    -- George Pipas, Ford's sales analyst, The Wall Street Journal, July 1


"We'd assumed several years of operating losses for Chrysler. They're ahead of their plan, and doing a good job despite one of the most adverse economic environments in our lifetime."

    -- Timothy Price, a partner of Cerberus, Bloomberg, July 1

Video Highlights
 
 

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


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