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Thursday, Nov. 13, 2008 RSSSEND TO A FRIENDPRINT
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Top Stories
NADA Backs Consumer Tax Breaks for Auto Sales
Treasury Redefines Its Rescue Program
Failure of Auto Industry Could Set Off Catastrophe
House Leaders Propose Federal Stake in Automakers
GM Asks Dealers to Lobby for Additional Auto Loans
Lobbyists Swarm the Treasury for Piece of Bailout Pie
Obama May Name Auto Czar
The Inside Story: Ford's Roadmap for Survival
Committed to Community: Warm Gift from Car Dealers
NADA Update
Convention Updates Headed to Member Mailboxes
STAR Answers Dealers' Questions About Content Filtering Systems
NADA Members Can Save on Lenovo's ThinkPad Notebooks
Top Stories
NADA Backs Consumer Tax Breaks for Auto Sales

Sen. Mikulski Introduces Tax Deduction Bill to Put Economy 'Back on its Wheels'
BETHESDA, Md. -- The National Automobile Dealers Association (NADA) supports proposed legislation announced Wednesday by U.S. Sen. Barbara Mikulski, D-Md., which seeks to stimulate the struggling economy by boosting retail automobile sales. At a news conference in a suburban Maryland dealership, Sen. Mikulski proposed granting a tax incentive for consumers who purchase a new car or truck. New vehicle owners would be able to temporarily deduct sales and excise taxes as well as interest on auto loans from their income taxes. "It's simple, it's targeted and it's timely," Mikulski said of her proposed bill. Also speaking at the news conference, NADA Chairman Annette Sykora pointed out that auto sales are in a free fall. "We must restore consumer confidence. This legislation would provide the right kind of incentives to jump-start auto sales," Sykora said. “Now is the time for Congress and the White House to implement a stimulus package that is focused on ‘Main Street.’” Sykora noted that since auto sales make up almost one-fifth of the nation’s retail economy, a boost in new vehicle sales could help lead an economic recovery. "Congress and the President must consider leveraging the incredible economic engine of the automobile industry to help our struggling economy," added Sykora. The "Auto Ownership Tax Assistance Amendment" would make interest payments on car loans temporarily tax deductible for the remainder of 2008 through the end of 2009. Next week, Congress, during a possible lame duck session, may consider a second stimulus package. Prior to the 1986 tax reforms, taxpayers were able to deduct auto, credit card and other types of debt from their annual tax bill.
Source:  NADA Newswire

[Editor's Note: NADA's Legislative Office encourages all dealers to reach out to their senators and representatives and urge them to support the “Mikulski-Bond Auto Ownership Tax Assistance Amendment.” NADA strongly supports Sen. Mikulski’s amendment to boost retail auto sales and other measures, which is cosponsored by Missouri Sen. Kit Bond (R). For information on the provision, click here.]

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Treasury Redefines Its Rescue Program

Plan to Buy Distressed Assets Is Abandoned In Favor of Aid to Loosen Consumer Credit
Treasury Secretary Henry M. Paulson Jr. announced a series of moves yesterday that redefine the federal government's $700 billion rescue plan for the financial industry in order to tackle what he called a dire situation in the consumer credit markets. In recasting the program, the Treasury no longer plans to buy troubled assets from financial firms, the idea initially presented to the country, but instead will offer aid to banks and other firms that issue student, auto and credit card loans in part by jump-starting the market that provides financing for these companies. "This market ... has for all practical purposes ground to a halt," Paulson said at a news briefing. "Today, the illiquidity in this sector is raising the cost and reducing the availability of car loans, student loans and credit cards. This is creating a heavy burden on the American people and reducing the number of jobs in our economy." The volume of car loans, for example, declined 6 percent in the third quarter compared with the corresponding period last year, according to the Federal Reserve. Average interest rates on car loans almost doubled from July to September -- the most recent month for which data are available -- and borrowers were required to make much larger down payments, an average of $2,000 more down on a $20,000 car. If the Treasury's new initiative succeeds in increasing the availability of consumer credit, it would probably give a huge boost to the nation's automakers by ensuring that car buyers could find loans.
Source:  The Washington Post

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Failure of Auto Industry Could Set Off Catastrophe

DETROIT -- Advocates for the nation's automakers are warning that the collapse of the Big Three -- or even just General Motors -- could set off a catastrophic chain reaction in the economy, eliminating up to 3 million jobs and depriving governments of more than $150 billion in tax revenue. Even if just GM collapsed, the failure could bring down the other two companies -- and even the U.S. operations of foreign automakers -- as parts suppliers run out of money and shut down. Automakers say bankruptcy protection is not an option because people would be reluctant to make long-term car and truck purchases from companies that might not last the life of their vehicles. But [Sen. Jeff Sessions, an Alabama Republican] and others say Chapter 11 might be a better option than government loans. Airlines, Sessions said, have reorganized through bankruptcy, and the auto industry could do the same, protected from creditors and lawsuits while companies work to become profitable.
Source:  Associated Press

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House Leaders Propose Federal Stake in Automakers

Congressional Democrats are pushing legislation to send $25 billion in emergency loans to the beleaguered auto industry in exchange for a government ownership stake in the Big Three car companies. House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.) hope for quick passage of the auto bailout during a postelection session that begins Monday. Legislation being drafted by Rep. Barney Frank, chairman of the House Financial Services Committee, and Sen. Carl M. Levin (D-Mich.) would dip into the $700 billion Wall Street rescue money, approved by Congress last month, for the auto aid.
Source:  USA TODAY

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GM Asks Dealers to Lobby for Additional Auto Loans

General Motors Corp. asked all its U.S. dealers on Wednesday to urge the Congress to approve an additional loan package to help the automaker deal with its liquidity crisis, dealers briefed on the matter said. GM U.S. sales chief Mark LaNeve told dealers to call their representatives and senators to ask them to support GM and the auto industry, saying 3 million jobs are at risk if the industry does not receive urgent government funding. "As we're in the midst of the deepest crisis our industry has ever faced, GM's priority is on seeking support from various U.S. government agencies and congressional leaders," LaNeve said in a letter to dealers obtained by Reuters.
Source:  Reuters

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Lobbyists Swarm the Treasury for Piece of Bailout Pie

WASHINGTON — When the government said it would spend $700 billion to rescue the nation’s financial industry, it seemed to be an ocean of money. But after one of the biggest lobbying free-for-alls in memory, it suddenly looks like a dwindling pool. Of the initial $350 billion that Congress freed up, out of the $700 billion in bailout money contained in the law that passed last month, the Treasury Department has committed all but $60 billion. President-elect Barack Obama has added his voice by proposing that the struggling automakers get federal aid, which could mean giving them access to the fund — something the Treasury secretary, Henry M. Paulson Jr., has resisted. Using much the same rationale, the National Automobile Dealers Association is pleading that car dealers get consideration, too. As the automakers have pushed for federal help, the trade groups for car dealerships and even boat dealerships are pressing their own cases. They argue that showrooms are feeling a squeeze between higher borrowing costs to finance their inventory and slowing consumer sales to move it out the door. On Friday, the automobile dealers sent Mr. Paulson a letter urging him to keep them in mind. “A well-capitalized, financially sound dealer network is essential to the success of every automobile manufacturer,” wrote Annette Sykora, a car dealer in Slaton, Tex., and the chairwoman of the National Automobile Dealers Association. “Any government intervention should include provisions to preserve the viability of dealers.”
Source:  The New York Times

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Obama May Name Auto Czar

President-elect Barack Obama has raised the idea of appointing a so-called "auto czar" to oversee emergency federal aid to automakers, exact tough corporate reforms and ensure taxpayers earn a return on any investment in the auto industry. The Obama transition team hasn't identified who the car czar would be, but the president-elect has three auto advisers. They are economic adviser Jason Furman, Georgetown University law professor Dan Tarullo and Joshua Steiner, a former Clinton Treasury official, but none of them have emerged as the point person on autos yet. Michigan Gov. Jennifer Granholm and former Michigan Congressman David Bonior also are advising Obama on the troubled auto industry.
Source:  The Detroit News

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The Inside Story: Ford's Roadmap for Survival

DEARBORN -- For the last six weeks, Ford Motor Co.'s top executives met almost daily to craft a plan to keep the company solvent in the face of the worst financial crisis in decades. With gasoline prices falling, some argued that Ford should abandon its costly plan to retool North American truck factories to produce smaller, more fuel-efficient cars from Europe. Others pushed to curtail future investment in key products like the F-150 pickup that have seen sales drop off dramatically in recent years. Global product development chief Derrick Kuzak -- backed by [CEO Alan] Mulally -- countered: "We're only going to be in business if we create products that people really do want and value," Mulally told The Detroit News in an exclusive interview Tuesday. "This is the essence of creating a viable Ford."
Source:  The Detroit News

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Committed to Community: Warm Gift from Car Dealers

The Auto Dealers CARing for Kids Foundation announced yesterday the donation of [more than 8,000] coats to 80 organizations, including social-service agencies, homeless shelters and YMCAs throughout the region. Kevin Mazzucola, executive director of the foundation made up of 210 auto dealers, hailed the "Driving Away the Cold" program as a way to help children in winter. Mazzucola said that the charity, which was established in 2003, bought 1,000 coats in June and July and that the dealers pledged to add one coat to that amount with each car they sold during October. He said 8,325 coats were donated last month. "It's a necessity people sometimes take for granted," Mazzucola said.
Source:  Philadelphia Inquirer

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NADA Update
Convention Updates Headed to Member Mailboxes

NADA members will begin receiving the much-anticipated update for the 2009 NADA Convention & Exposition in the mail this week. The update includes details about workshops, franchise meetings and much more planned for the annual event, which takes place Jan. 24-27 in New Orleans. Many new workshops have been added to the program, including sessions on improving cash flow, combating the credit crunch, and tactics for driving customers back to the store. The popular "Lifeline to Profit$" workshop will be offered twice--Friday, Jan. 23 and Tuesday, Jan. 27--to help dealers through tough times. “You’ll be amazed how much we have packed into this convention,” says Stephen Pitt, NADA vice president of conventions & expositions. To register for the NADA convention, visit www.nada.org/convention before Dec. 5.

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STAR Answers Dealers' Questions About Content Filtering Systems

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers evaluate their Dealership Security. Visit STAR's Dealer Infrastructure Guidelines (DIG) publication for more information. To learn if you should choose a hardware or software content filtering system click here.

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NADA Members Can Save on Lenovo's ThinkPad Notebooks

Lenovo's ThinkPad SL notebook built for small businesses with legendary ThinkPad reliability, plus advanced wireless and multimedia features, starts at only $450 with eCoupon USXTHANKSGIVING for a limited time. To take advantage of these savings, visit NADA's PC Purchase Program online (member log-in required), click www.lenovo.com/shop/deals/nada, then click Special Offers, or call (800) 426-7235, Option 1, Ext. 4838. Enter eCoupon USXTHANKSGIVING 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 open. Click here to see just how much progress New Orleans has made since Katrina.


More Video Highlights

Quotable
 
"It's simple, it's targeted, it's timely..."

   
-- Maryland Democratic Sen. Barbara A. Mikulski referring to a bill she plans to introduce next week aimed at providing consumers with a tax break if they buy a new passenger vehicle now through the end of 2009, The Baltimore Sun, Nov. 13


"Now is the time for Congress and the White House to implement a stimulus package that is focused on 'Main Street.'"

   
-- NADA Chairman Annette Sykora in remarks at a press conference Wednesday with U.S. Sen. Barbara A. Mikulski in support of a consumer tax break to spur auto sales, NADA Newswire, Nov. 12


"A well-capitalized, financially sound dealer network is essential to the success of every automobile manufacturer. Any government intervention should include provisions to preserve the viability of dealers."

    -- Annette Sykora, a car dealer in Slaton, Tex., and NADA chairwoman, in a letter to Treasury Secretary Henry Paulson, The New York Times, Nov. 12


"As we're in the midst of the deepest crisis our industry has ever faced, GM's priority is on seeking support from various U.S. government agencies and congressional leaders." 

    -- GM U.S. sales chief Mark LaNeve in a letter to dealers urging them to lobby for additional auto loans, Reuters, Nov. 12
NADA Convention 2009
 
  
Convention Workshops Keyed to Today’s Economy

Now more than ever, dealers need to learn how to survive in tough times. In that spirit, workshops planned for the NADA Convention & Exposition in New Orleans Jan. 24-27 will focus on recession-proof business operations. NADA Headlines will spotlight three convention workshops each week.

(1) The ABCs of Privacy and Data Security Rules Affecting Dealers

(2) Managing for Profitability: Tracking and Measuring Media Value in the Online Age

(3) "On Board": Hire the Right Employees and Create an Orientation Process to Keep Them

ABC's of Privacy speaker Kathryn Ratté of the Federal Trade Commission (FTC) will discuss the requirements of the Privacy Rule and Safeguards Rule, and how the FTC enforces them. She will also provide an overview of dealers' responsibilities outlined under the FACT Act, including Red Flags Rule compliance.

Media Value will feature David Kain of Kain Automotive and Dennis Galbraith of Cars.com, discussing how to measure and manage the effectiveness of media dollars in the online age. Participants will learn what they need to track to determine their true media ROI—allowing them to manage their marketing mix for optimal results.

On Board speakers Robert Bekken of the Bekken Law Group and Mike Poskey of ZeroRisk HR, Inc. will analyze each stage of the hiring and orientation process, revealing best practices for hiring professionals, reducing turnover and increasing the productivity of new employees.

Join us in New Orleans at the NADA convention 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.

 
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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.