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At a Glance...
Top Stories
Global Car Sales Poised to Fall
U.S. Sales Predictions Continue to Slide
Car Loan Fears Clobber U.S. Auto Stocks
Auto Dealers' Profits Down 25 Percent in 2007-08
Manheim Says Economy Batters Used-Car Sales, Too
NADA/ATD Successful in Effort to Exempt Auxiliary Power Units from Federal Excise Tax
Tata to Shift Production of Minicar After Protests
Company Retrofits Hybrid Priuses to Plug In, Using a Second Battery
NADA Update
Coming Up: Another Virtual Seminar on the Red Flags Rule
Player Slots for Pre-Convention Charity Golf Tournament Filling Up
Two New Legal Compliance Publications Now Available Online
STAR Answers Dealers' Questions About Internet Access Methods
Save Up to $760 on Select ThinkPad Notebooks
Top Stories
Global Car Sales Poised to Fall

Forecaster Sees a Slow Recovery in the U.S., Slump at Worst Level in Two Decades
Global auto sales are expected to decline this year for the first time since 2001, mainly as a result of profound slumps in the U.S. and Europe, according to forecasting firm Global Insight Inc. Growth in vehicle sales is not expected to resume until 2010, promising to leave lots of new car models sitting on dealer lots. The company now expects world-wide vehicle sales to fall about 1% this year to roughly 69.55 million cars and light trucks... It sees global vehicle sales edging up in 2009 to about 70 million, but that is down 3.7 million vehicles from its previous forecast. In the U.S., where the financial crisis is most acute, Global Insight expects a slow recovery. The firm is predicting 2008 U.S. auto sales to total about 13.6 million cars and light trucks, a low not seen in almost two decades.
Source:  The Wall Street Journal (Subscription required.)

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U.S. Sales Predictions Continue to Slide

J.D. Power says 13.6 million; Global Insight says 13.8 million
DETROIT -- J.D. Power and Associates is cutting its 2008 light-vehicle sales forecast from 14.2 million to 13.6 million. For 2009, J.D. Power now expects U.S. light-vehicle sales of 13.2 million, down from 14.3 million. Earlier today, Global Insight (USA) Inc. said U.S. light-vehicle sales probably will fall to 13.8 million units this year and then fall even more, to around 13.4 million, in 2009. “Clearly, this is not a U.S. issue alone,” said Nigel Griffiths, Global Insight group managing director of global forecasting. “We are moving from a liquidity crisis to an insolvency crisis right now. There is increasing evidence that this has affected the real economy, and as we see the automotive industry as the heart of the real economy, we are really taking a hit now,” he said.
Source:  Automotive News (Subscription required.)

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Car Loan Fears Clobber U.S. Auto Stocks

Ford, GM hit record lows as investors panic
U.S. auto stocks sank to historic lows Wednesday, as investor fears about credit availability and the weakening global economy combined to produce a stunning sell-off of Ford Motor Co., General Motors Corp. and dozens of other auto stocks. Aside from the acerbic U.S. economy, which the Conference Board predicts will further contract through the first half of 2009, fears that consumers cannot get auto loans to buy Detroit's cars and trucks seem to have reached a fever pitch. But several car dealers, such as James Seavitt, owner of Village Ford in Dearborn, complained to the Free Press in recent days that there is now a growing perception in the market that virtually nobody can get financed for a new car or truck. Several dealers said this fear is grossly exaggerated and causing an irrational drop-off in showroom traffic and confidence.
Source:  Detroit Free Press

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Auto Dealers' Profits Down 25 Percent in 2007-08

Auto dealer profits from new-vehicle sales have declined 25 percent in the 2007-08 period, [according to a Santa Monica-based automotive information Web site.] ...among the more than 20,000 dealerships nationwide, 30 percent are now selling fewer than 55 vehicles a month. Seventy percent of U.S. dealers have seen a drop in profit margin, and of those, 28 percent saw a decline of more than 50 percent over the past year...
Source:  Sacramento Bee

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Manheim Says Economy Batters Used-Car Sales, Too

This year, used-vehicle sales by franchised dealerships haven’t fallen as much as new-vehicle sales have. But the nation’s largest auto auction company says economic uncertainty continues to afflict both types of sales. Between January and September, retail used-vehicle sales by franchised dealerships declined 4 percent from the year-ago period, said Tom Webb, chief economist at Manheim. The corresponding drop in new-vehicle sales was about 12 percent, Webb said. Webb says he expects credit standards to remain tight. Citing data from the Federal Reserve Board, Webb said that in July, 67 percent of banks reported tightening their lending standards. That is up from 44 percent in April, he said.
Source:  Automotive News (Subscription required.)

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NADA/ATD Successful in Effort to Exempt Auxiliary Power Units from Federal Excise Tax

WASHINGTON -- The National Automobile Dealers Association and American Truck Dealers led a successful effort to exempt Auxiliary Power Units (APUs) from the 12 percent federal excise tax (FET). The repeal of the tax on APUs was signed into law last Friday by President Bush. APUs, which allow truck drivers resting off-highway to turn off their main engines, save considerable fuel and reduce emissions. "APUs provide both sound environmental and cost-saving benefits," said Gary Gibson, ATD chairman. "Eliminating a tax on these fuel-saving devices makes good common sense." The new law applies to sales or installations of APUs after Oct. 3, 2008. Therefore, dealers are no longer required to collect the FET on APUs effective Oct. 4, 2008. "This legislation will benefit the many truck dealers who have been increasingly burdened with this collection issue as the demand for APUs has increased," Gibson added. In 2007, the Internal Revenue Service directed truck dealers to begin collecting a federal excise tax on APUs.

[Editor's Note: For a copy of the provision, contact Mary Jo Eustice, NADA senior legislative representative at meustice@nada.org. For additional information on this issue, contact Jim Westlake, ATD executive director at jwestlake@nada.org or Paul Metrey, NADA director of regulatory affairs at pmetrey@nada.org.]

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Tata to Shift Production of Minicar After Protests

NEW DELHI -- Tata Motors Ltd. is shifting production of the world's cheapest car to the western state of Gujarat, in a move that shows how Indian states are vying for investment despite grass-roots resistance to some big industrial projects. Tata Chairman Ratan Tata said Tuesday that the company had acquired 1,100 acres of land near Gujarat's business capital, Ahmedabad, and would relocate equipment from a failed West Bengal project to build the main production plant for its 623cc Nano minicar. "We lost a lot of time, unfortunately, but I think we can set out to do what we need to do on Guajarati soil," [Mr. Tata said.]
Source:  The Wall Street Journal (Subscription required.)

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Company Retrofits Hybrid Priuses to Plug In, Using a Second Battery

RALEIGH, N.C. -- In a windowless workshop near a county landfill, a small Raleigh company has spent the past year trying to solve the nation's energy crisis one car at a time. The cluttered Advanced Vehicle Research Center garage, tucked in an office park, can accommodate two Toyota Priuses. In less than four hours, the mechanics at the garage can outfit a Prius with a second battery pack. It emerges as a hybrid that can plug into a wall outlet to recharge like a cell phone. The result: A car that breaks a once-unimaginable fuel efficiency barrier and delivers 100 miles per gallon.
Source:  Detroit Free Press

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NADA Update
Coming Up: Another Virtual Seminar on the Red Flags Rule

Due to the unprecedented demand—so far, more than 1,100 individuals and dealer groups have logged on to NADA’s Red Flags seminars—we are offering another virtual seminar on what you need to do by Nov. 1, 2008 to comply with the new FTC Red Flags Rule. The seminar will be repeated on Monday, Oct. 20 from 1-3 p.m. EST.

Like past sessions, the seminar will be presented live and online, and invite participation by attendees. Participants are encouraged to ask questions, which will be answered by presenters, Bert Rasmussen, author of NADA’s A Dealer Guide to the FTC Red Flags and Address Discrepancy Rules: Protecting Against Identity Theft, and Paul Metrey, NADA director of regulatory affairs. The seminar will address what you need to do by Nov. 1, 2008 to comply with the Red Flags Rule, such as:

  • Preliminary risk assessment
  • Construction of a written Identity Theft Prevention program
  • Knowing the indicators of identity theft (Red Flags) and how to detect and respond to them
  • Training requirements
  • Service provider oversight
  • Involvement of dealership’s board of directors

Dealers, general managers, CFOs, controllers, finance managers, sales managers, IT managers and outside compliance professionals are encouraged to attend. The fee is $199 per computer connection. Be sure to have your copy of A Dealer Guide to the FTC Red Flags and Address Discrepancy Rules: Protecting Against Identity Theft at hand during the seminar. To register online, go to www.nada.org/seminars, or call (800) 248-6232, Ext. 7273. To order A Dealer Guide to the FTC Red Flags and Address Discrepancy Rules: Protecting Against Identity Theft, go to www.nada.org/RedFlags.

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Player Slots for Pre-Convention Charity Golf Tournament Filling Up

Registrations for the "Dealers for Charity" golf tournament in New Orleans are starting to roll in, reports Lin Peacock, vice president of NADA Insurance. The tournament, hosted by NADA’s hole-in-one insurance partner, ACECO, is slated for Friday, Jan. 23, 2009 before the opening of the NADA Convention and Exposition. Proceeds from the event will benefit the Brees Dream Foundation, a charitable organization founded by New Orleans Saints quarterback Drew Brees. The tournament will be held at TPC Louisiana, the only PGA Tour course in the state. The event is open exclusively to NADA members. Registration fees are $300 per player. Participation is limited to the first 144 golfers who sign up. The registration deadline is Nov. 9. Visit www.ACECOinsurance.com and click on the "Dealers for Charity" logo to sign up.

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Two New Legal Compliance Publications Now Available Online

NADA has finalized two new publications aimed at helping dealers comply with several new federal legal requirements. All members will receive a free printed copy of A Dealer Guide to the FTC Affiliate Marketing Rule (L51) and Electronic Disclosure Rules for Dealership Online Commerce (L52) via mail. NADA Management Education is also making these two publications available immediately, in PDF form, free to members upon request.

The FTC’s Affiliate Marketing Rule specifies when certain credit-related information received from a company’s affiliates may be used for marketing purposes. The guide covering this new rule defines key terms, explains the new rule’s relationship to existing information-sharing restrictions under the Fair Credit Reporting Act, and provides examples of the notices required under the new rule.

The Federal Reserve Board’s Electronic Disclosure Rules affect dealers who currently engage in certain online activities (such as advertising leases online, advertising credit online, or providing access to/accepting online credit applications), or envision doing so in the future. This publication explains the rules, discusses amendments to certain regulations—including Regulations B, M, and Z—and provides context and compliance considerations.

Members may obtain a free PDF copy of each publication by sending an email to me@nada.org with their requests and member identification numbers.

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STAR Answers Dealers' Questions About Internet Access Methods

 

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to to help dealers evaluate their Internet Access Methods. Visit STAR's Dealer Infrastructure Guidelines (DIG) publication for more information. To answer the question "How do I make sure I get a business-grade connection?" click here.

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Save Up to $760 on Select ThinkPad Notebooks

NADA members can save in three ways:

  • Instant savings with discounted Web pricing
  • Save even more with your NADA discount
  • Enter eCoupon USXFALLSAVINGS at checkout

To take advantage of this offer, visit www.nada.org/Technology/PCPurchaseProgram/ (member login required), click www.lenovo.com/shop/deals/nada, then click "Special Offers," or call (800) 426-7235, Option 1, Ext. 4838. Enter eCoupon USXFALLSAVINGS at checkout. Free ground shipping is available on all Web orders.

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Featured Video
 

Registration for the NADA convention in New Orleans Jan. 24-27 is now open. Click here to see just how much progress New Orleans has made since Katrina.
More Video Highlights
Quotable
 
"... there is now a growing perception in the market that virtually nobody can get financed for a new car or truck. Several dealers said this fear is grossly exaggerated and causing an irrational drop-off in showroom traffic and confidence."

   
-- Detroit Free Press, Oct. 9


"We are moving from a liquidity crisis to an insolvency crisis right now. There is increasing evidence that this has affected the real economy, and as we see the automotive industry as the heart of the real economy, we are really taking a hit now." 

    -- Nigel Griffiths, Global Insight group managing director of global forecasting, referring to the company's report that suggests a continued slide in auto sales, Automotive News, Oct. 9
Video Highlights
 


NADA-TV Reports on the Launch of the 'Green Checkup' Campaign. Pictured above is NADA Chairman Annette Sykora with Colorado Gov. Bill Ritter at a news conference in Denver.


NADA's New Orleans Project: Lusher Charter School
NADA's Return to New Orleans
NADA and 'SeeMore's Playhouse' Promote Child Passenger Safety Month in September


Click here for more NADA-TV reports.

 
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