For optimal viewing through your web browser or PDA, click here.

SPONSORED BY
 
NADA.org
Monday, Oct. 20, 2008 RSSSEND TO A FRIENDPRINT
Home | AdvocacyAffiliates | Convention | Jobs | Programs | Publications | Training | Services
At a Glance...
Top Stories
GM Lacks Investors to Fund Deal with Chrysler
GM is Confident it Can Manage Chrysler Brands
Chrysler, GM Deal Confronts Obstacles
With GMAC Out, Banks Trickle In
GM Sends Hummer Sales Book to Potential Buyers
Opinion: Just Put Up a 'For Sale' Sign
NADA Update
Coming Up Monday: Virtual Seminar on 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
HP Offers NADA Members Small Business 'Smart Deals'
Top Stories
GM Lacks Investors to Fund Deal with Chrysler

General Motors Corp.'s hopes of buying longtime rival Chrysler LLC are floundering because the auto maker remains unable to secure the financing necessary for the deal, say people familiar with the matter. In recent days GM, its lenders, and Chrysler owner Cerberus Capital Management, have been trying to woo investors with a pitch about the transaction. Outside money is needed to fund the cost-cutting -- especially buyouts and severance packages for tens of thousands of hourly and salaried employees. Credit markets remain extremely tight, and a number of lenders are fearful of the complexity and scale of combining two industrial giants amid an economic downturn. If investors continue to shun the deal, its proponents could take their case to the U.S. government, arguing that a merger is vital to the survival of the nation's domestic auto industry.
Source:  The Wall Street Journal (Subscription required.)

[back to top]

GM is Confident it Can Manage Chrysler Brands

As General Motors Corp. executives work on what a possible merger with Chrysler LLC would look like, they apparently are not discouraged by the idea of adding more brands or dealers to the automaker's business, key factors that analysts have been criticizing. If a merger is consummated, Chrysler's brands would become just like Chevrolet, Pontiac and Buick, people familiar with the situation tell the Free Press. Conflicting brands could be dealt with in a few years after this industry turmoil has passed, one of these people added. "It's extremely expensive," [Lincoln Merrihew, an industry analyst with TNS Automotive] said of merging auto companies. "You're buying out dealers, you're merging brands, you're paying the staff to go away, white-collar, blue-collar. It's a short-term expense with a long-term gain." He expects that a merged GM-Chrysler would work to consolidate its dealer body over time. GM has 6,500 U.S. dealers.
Source:  Detroit Free Press

[back to top]

Chrysler, GM Deal Confronts Obstacles

Federal regulators, dealers and UAW could try to delay or prevent merger of Detroit rivals
...Cerberus Capital Management LP wants to rid itself of Chrysler as soon as possible, and key players at would-be buyer General Motors Corp. are embracing the urgency. But getting a deal done won't be easy, even if the two automakers agree. A GM-Chrysler tie-up could face significant regulatory roadblocks, lawsuits, congressional hearings and protests by the United Auto Workers. It would face a review of up to a year by either the Federal Trade Commission or the Justice Department, said Ted Bolema, a former antitrust attorney with the Justice Department and a Central Michigan University law professor. The FTC has reviewed auto mergers in recent decades, including the 1998 purchase of Chrysler Corp. by Daimler-Benz. A GM-Chrysler deal, however, would have more overlap of product lines and dealerships and could take longer to sort out.
Source:  The Detroit News

[back to top]

With GMAC Out, Banks Trickle In

But loan money is elusive for shoppers with less-than-sparkling credit
After GMAC Financial Services' broad retreat last week from auto lending, General Motors dealers were trying to plug the gap with banks, credit unions and independent finance companies. GMAC said it would lend money only to consumers with credit scores of 700 or above — low-risk prime customers — and raise rates, too. The changes disqualify up to three-fourths of some dealers' shoppers. Dealer Bob Maguire, former chairman of the National Automobile Dealers Association, says GMAC's minimum 700 credit score disqualifies three out of four of his customers. And its standard rates would scare away the rest of them. GMAC's retreat is difficult for many small and mid-sized dealers who send most of their business to the captive.
Source:  Automotive News (Subscription required.)

[back to top]

GM Sends Hummer Sales Book to Potential Buyers

DETROIT -- General Motors Corp. has sent a sales prospectus for Hummer to potential bidders as it scrambles to shore up its cash amid a sharp downturn in global auto sales. GM spokeswoman Joanne Krell said the automaker was moving toward a resolution of the Hummer sale process "as quickly as practical." But she also said the company had no timetable for completion of any deal and could still keep the brand. Hummer sales have plunged 47 percent through September and two dozen Hummer dealers have closed their doors in the United States this year.
Source:  Reuters

[back to top]

Opinion: Just Put Up a 'For Sale' Sign
by Keith Crain

Stephen Feinberg, head of Cerberus Capital Management LP, has been losing an amount of money beyond even his worst imagination. [Cerberus] didn't know how ill-equipped they were to run an automobile company. Combining Chrysler and General Motors might be one of the worst ideas that anyone has come up with in a long time. Chrysler probably makes sense to a few potential buyers. Certainly the Chinese would appreciate the dealer network and the Jeep brand, not to mention the other vehicles in the portfolio. And few could deny that the talent at Chrysler is quite remarkable. And there is a tantalizing appeal for Carlos Ghosn, who desperately wants to have the third leg of his global car company in North America to go along with Renault and Nissan. One thing remains certain. Chrysler is once again in play. Chrysler employees and dealers deserve to have an owner that will be around for a while and can nurture them. There is a popular slogan in Washington and on Wall Street: "Too big to fail." I hope that applies to the domestic automobile business, but I doubt it.
Source:  Automotive News (Subscription required.)

[back to top]

NADA Update
Coming Up Monday: Virtual Seminar on 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.

[back to top]

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.

[back to top]

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.

[back to top]

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.

[back to top]

HP Offers NADA Members Small Business 'Smart Deals'

NADA members can save up to 30 percent on HP's dc5750 desktop PCs or $791 on HP's Compaq 2710p. This offer is valid on call-in orders only. To take advantage of this offer, call (800) 888-0365 and mention passcode "NAD1." To see more "Smart Deals," visit NADA's PC Purchase Program online at www.nada.org/Technology/PCpurchaseprogram (member login required), then click on www.hp.com/go/promos/nad1 then "Smart Deals" on left navigation bar.

[back to top]

 
Featured Video
 

Registration for the NADA convention in New Orleans Jan. 24-27 is open. Click here to see just how much progress New Orleans has made since Katrina.


More Video Highlights

Quotable
 
"It's extremely expensive," merging auto companies. "You're buying out dealers, you're merging brands, you're paying the staff to go away, white-collar, blue-collar. It's a short-term expense with a long-term gain."

   
-- Lincoln Merrihew, an industry analyst with TNS Automotive, referring to potential roadblocks in GM and Chrysler's quest to merge, Detroit Free Press, Oct. 19


"Chrysler employees and dealers deserve to have an owner that will be around for a while and can nurture them."

    -- Keith Crain, referring to the proposed merger of Chrysler and General Motors as one of the worst ideas that anyone has come up with in a long time, Automotive News, Oct. 20
NADA Convention 2009
 
  
Convention Workshops Keyed to Today’s Economy

Now more than ever, dealers need to meet, talk and learn how to survive in tough times. In that spirit, workshops planned for NADA’s upcoming convention in New Orleans will focus on recession-proof business operations. NADA Headlines will spotlight three convention workshops each week.

(1) Single-Point Dealerships can Survive and Thrive in Today’s Market 
(2) Five Sure-fire Techniques to Increase Special Finance Volume and Profit
(3) Improving Attitudes, Efficiency and Communication in the Dealership

Survive and Thrive speakers Chip Maher and Steve Risso, both of NADA 20 Group, will demonstrate how to substantially improve performance in a shrinking market economy. Learn how to adapt and thrive through rightsizing and performance tracking.

Special Finance will feature Mike Tamas of American Financial and Automotive, who will explain how to turn a prospect into a satisfied customer while increasing gross profit.

Improving Attitudes will feature Art Niemann, Sr., of Art Niemann and Company. He will outline specific ways to implement four “absolutes” for achieving sales success: integrity, positive outlook, meaningful relationships and open communication.

Join us in New Orleans at the 2009 NADA Convention and Exposition Jan. 24–27. Click here to register.

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


Click here for more NADA-TV reports.

 
Search Back Issues | Unsubscribe/Manage your subscription | email us
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.