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Wednesday, July 9, 2008 RSSSEND TO A FRIENDPRINT
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At a Glance...
Top Stories
Opinion: Dealers Are Resilient as Ever
GM Reassures Dealers Only Hummer Brand is for Sale
Toyota Sputters as Market Shifts
Chrysler and Dealers to Improve Internet Marketing Strategies
Ford Moves Steadily into Quick Lanes
With Sky High Gas Prices, Bigger Isn't Better
Government to Improve Crash Test Program
Designing Cars for Low-Carbon Chic
NADA Update
NADA Offers Consumer Tips to Avoid Flooded Vehicles
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
Nomination Ballots for NADA Director from Kansas due July 18
STAR Answers Dealers' Questions About Wireless Networks
Lenovo Offers NADA Members Savings on ThinkPad Notebooks
Top Stories
Opinion: Dealers Are Resilient as Ever
by Mac Gordon

Is a gloom-and-doom scenario really threatening to engulf the domestic Detroit Three? Hard-nosed auto “experts” have opined their Gloomy Gus forecasts, much to the dismay of veteran industry executives who can't begin to believe what they are reading. The doomsayers who wrote these stories are presumably too young to remember how the Big 3 survived crises far worse than the one gripping 100-year-old General Motors, 105-year-old Ford and 84-year-old Chrysler. Those auto companies did survive and, in so doing, kept alive a domestic auto industry in the face of perils like the Great Depression of the early 1930s, World War II and flat-out oil embargos of the 1970s and 1980s. What kept the Detroit 3 afloat, the cynics forget, were franchised dealers who know how to survive downturns. The situation, as dire as it may seem for domestic auto makers and their dealers, is far from disastrous. Admittedly, the Detroit 3 did lose sight of the small-vehicle market while they were focusing in the 1990s and early 2000s on high-profit fullsize SUVs and pickups. Numbers crunchers called the downdraft “scary.” But could anything be worse than no trucks at all, as in WWII, or cash-starved buyers as in the Great Depression of 1929-39? These days, Detroit 3 dealers are down but, far from out. They are resilient as always. Take it from an auto journalist who has covered this industry for 65 years, the Detroit 3 are not about to be swept into oblivion.
Source:  Ward's Dealer Business

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GM Reassures Dealers Only Hummer Brand is for Sale

Mark LaNeve, GM's vice president for North American sales and marketing, said [in an email to GM dealers] none of GM's brands other than Hummer were up for sale or being considered as candidates for closure, despite growing speculation to the contrary. "I have been asked by the media if other brands were undergoing a similar strategic review. My answer then and now was the same -- no," LaNeve said in his e-mail. LaNeve said GM's dealers would be among the first to know if plans changed for any of the company's eight auto brands. A GM spokesman said the message was meant to reassure the dealers. "What prompted the letter was all of this speculation that we might be looking to phase out or reassess some of our brands," GM spokesman Tom Wilkinson said. "A lot of dealers were concerned, so I think it was a very good thing for him to reassure dealers," said one dealer who received the e-mail from LaNeve.
Source:  Reuters

[Click here to read the letter GM sent to its dealers, The Wall Street Journal, July 9.]

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Toyota Sputters as Market Shifts

Like Big 3, automaker has too many trucks, too few cars
When U.S. auto sales slumped last month to their lowest levels in more than a decade, Toyota Motor Corp. suffered as much as anyone else. Unusual for the Japanese automaker, its U.S. sales tumbled 21.4 percent, even more than the overall market. As the manufacturer of the Corolla, Yaris and other popular small cars and the leading seller of hybrids, Toyota should have benefited from soaring fuel prices. Instead, its U.S. dealers found themselves stocked with Toyota and Lexus trucks they couldn't sell, and short of small, fuel-efficient cars. At a meeting last month in Salt Lake City, dealers pressed Toyota's top U.S. managers to explain why the carmaker renowned for its responsiveness and flexibility couldn't provide them with more small cars. The dramatic shifts in the U.S. auto market this year surprised Toyota, along with everyone else. "Toyota has a chance to rethink its global product strategy, invest in new technologies, come up with small cars that are fun to drive," [said Maryann Keller, an auto analyst who heads her own consulting firm, Maryann Keller & Associates in Stamford, Conn.]  "They're the only ones who have the money to make this transition fairly rapidly." Among dealers and analysts, there is talk that Toyota may announce plans to assemble gas-electric hybrids in the United States, retool one of its truck-assembly lines, or even establish a new, all-hybrid nameplate to emphasize its green credentials.
Source:  The Detroit News

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Chrysler and Dealers to Improve Internet Marketing Strategies

DETROIT — Chrysler LLC is changing the way it talks with customers via the Internet. In August, the company will announce major initiatives for the Internet that will be carried out this year. In the fourth quarter of 2007, [Deborah Meyer, Chrysler's chief marketing officer] formed a dealer Internet advisory panel. Her goal: Improve interaction between company and dealer Web sites to help Chrysler respond quickly to sales leads, tailor messages to individual customers and manage those relationships. Dodge dealer Wes Lutz, owner of Extreme Dodge-Hyundai in Jackson, Mich., and a member of Meyer's Internet panel, has served on the national dealer council, the dealer ad association and regional dealer boards. "I've got to tell you this panel is moving at light speed, faster than I've ever been on at Chrysler," says Lutz. "Deb Meyer is really moving this thing on." "The Dodge, Chrysler and Jeep dealers are embracing this. I've never seen a faster-moving dealer body," Meyer said in an interview in her suburban Detroit office. The object is to put Chrysler at the forefront of the industry in managing Internet-generated sales leads. Meyer hopes she can incorporate the best suggestions from the dealer panel and ideas from outside the company. She also is looking at other industries, including hospitality and financial services.
Source:  Automotive News (Subscription required.)

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Ford Moves Steadily into Quick Lanes

Automaker reaches 500 centers
You won't see Ford Motor Co.'s trademark blue oval prominently displayed in the company's fast-growing chain of Quick Lane Tire & Auto Centers, which provide a range of routine maintenance services, such as oil changes and tire replacements, with an eye toward speed and no-appointment convenience. The only hint that Ford even owns the centers -- which service all makes and models and are often in stand-alone facilities -- is that they are likely to be at or near a Ford dealership. But in the past four years, Ford has doubled the number of Quick Lane centers nationwide -- to 500 -- as the automaker and its dealers try to capture more of the profitable parts-and-service business. The Dearborn-based automaker last month opened more than two dozen stores through its existing network of more than 4,000 Ford and Lincoln-Mercury dealers. "We knew we needed to move more aggressively into retail service," Tom Suttles, Ford's Quick Lane business manager, said Tuesday. "There's a lot of opportunity here." The Quick Lane concept ... is similar to that of a Belle Tire, Jiffy Lube, Midas or even Wal-Mart, which is equipping most of its new stores with a Tire & Lube Express center. Suttles noted that consumers have generally disliked getting their car serviced at dealerships, where they have often had to make appointments and face long waits, among other aggravations. By contrast, Quick Lane emphasizes fast, competent service with convenient weekend and evening hours. No appointment is necessary.
Source:  Detroit Free Press

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With Sky High Gas Prices, Bigger Isn't Better

With gas costing more every day, the prices on big trucks and SUVs are dropping faster than the fuel gauge on a Chevy Suburban doing 80. Joseph Luiz IV, the owner of Custom-Tek Inc., a Dartmouth contracting company, says the "awesome incentives" being offered to buy trucks these days are tempting. "But with the housing market so shaky and the economy so bad, I just can't bring myself to spend money right now." That sentiment is ruling the truck business. The value of big vehicles — trucks like the Ford F250 or the Nissan Armada SUV — is in a free fall. They can carry 10 passengers or two tons of dirt or haul a trailer with four horses, but they do that while getting 8 or 9 miles to the gallon. With gasoline averaging $4.10 and diesel nearly a dollar more, buyers are turning away in droves. But the falling demand for trucks and SUVs is best seen in the used vehicle market, dealers say. The National Automobile Dealers Association tracks the new and used car market and issues an average price each month for used vehicle sales. The NADA comes up with an average price for a vehicle with 32,775 miles on the odometer. "Pickup trucks peaked at $15,036 in December," said Paul Taylor, chief economist for the NADA. "That price fell to $12,182 by June." SUVs are doing worse, from a peak of $17,284 in April 2007 to $12,592 last month. "By and large, the commercial demand for pickup trucks is supporting the price," Mr. Taylor said. "We aren't seeing that with SUVs."
Source:  New Bedford Standard Times

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Government to Improve Crash Test Program

Attention car shoppers: the government is upgrading its crash test program to offer better information about vehicle safety. The Bush administration outlined changes Tuesday to the government's safety ratings, which grade new vehicles on a scale of up to five stars. The new program will continue to assess passenger cars, pickup trucks, sport utility vehicles and vans on the five-star scale but will add an overall safety rating that combines scores from several crash tests. The new system, which will start in the 2010 model year, also will include new front-end tests and a test in which the vehicle strikes a pole sideways to simulate the wrapping of a vehicle around a tree. Female crash test dummies will be used to represent women and large children. "We're trading in the old program for a newer, more advanced model," said Transportation Secretary Mary Peters, who unveiled the changes at a Honda dealership in Vienna, Va.
Source:  Associated Press

[Editor’s Note: "This is a significant revamping of the government's crash testing program," said Douglas Greenhaus, NADA director of environmental, health and safety. "And NADA supports most of these program enhancements, such as a new crash avoidance program that will rate vehicles on the presence of select advanced technologies—specifically electronic stability control, forward collision warning and lane departure warning systems." But NADA remains concerned about measuring crashworthiness with a single metric that combines the star ratings from the front, side and rollover programs into a model-specific "Vehicle Safety Score." To address these concerns, NADA intends to fully participate in NHTSA's upcoming rulemaking process which will address how new safety information should be presented to the public.]

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Designing Cars for Low-Carbon Chic

PARIS — As governments seek to cut carbon emissions through regulation and consumers react to rising fuel prices, automakers and designers are mapping out a new generation of lighter, sleeker vehicles that could give a radical new look to urban streets. Gilles Vidal, designer of a recent “green” concept car, the C-Cactus, for the French automaker PSA Peugeot Citroën, said, “To make a real environmental effort, you need to work on all of the possible factors — materials, optimization of processes, simplifying, going back to essentials.” Students at Créapôle, a leading industry-sponsored design school in Paris, are among those working with manufacturers to develop new designs and technologies that could become auto industry standards. Guy Negre, a motor engineer and founder of MDI Enterprises, a company that studies new technologies and production concepts to reduce the environmental impact of carbon dioxide, invented a compressed-air engine in 1996. The engine emits one-third the carbon dioxide of conventional motors of the same size. Cold air, compressed in tanks to 300 times atmospheric pressure, is heated and fed into the cylinders of a piston engine. No combustion takes place, meaning there is no pollution, although the energy needed to compress the air may still come from polluting oil- or coal-burning power stations.
Source:  The New York Times

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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. Dealers and consumers -- through awareness and education -- can make sure severely damaged vehicles remain off of the nation's roads, says Ivette Rivera, NADA executive director 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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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

NADA is now 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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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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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

More Video Highlights
Quotable
 
"These days, Detroit 3 dealers are down but, far from out. They are resilient as always. Take it from an auto journalist who has covered this industry for 65 years, the Detroit 3 are not about to be swept into oblivion."

   
-- Mac Gordon, Ward's Dealer Business, July 1


"I have been asked by the media if other brands were undergoing a similar strategic review. My answer then and now was the same -- no."

    -- Mark LaNeve, GM's vice president for North American sales and marketing, responding to reports that GM might be looking to phase out or reassess some of its brands, Reuters, July 9


"Toyota has a chance to rethink its global product strategy, invest in new technologies, come up with small cars that are fun to drive. They're the only ones who have the money to make this transition fairly rapidly."

    -- Maryann Keller, an auto analyst who heads her own consulting firm, Maryann Keller & Associates in Stamford, Conn., The Detroit News, July 9 


"We knew we needed to move more aggressively into retail service. There's a lot of opportunity here."

    -- Tom Suttles, Ford's Quick Lane business manager, Detroit Free Press, July 9 


"I've got to tell you this panel is moving at light speed..."

   
-- Wes Lutz, owner of Extreme Dodge-Hyundai in Jackson, Mich., referring to Chrysler's dealer Internet advisory panel which is devising a new Internet advertising strategy, Automotive News, July 7
Video Highlights
 
 

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


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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.