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Monday, Nov. 17, 2008 RSSSEND TO A FRIENDPRINT
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Top Stories
Auto Dealers: The Economic Engine of Main Street
Auto Aid Debate Heats Up
Dealers Lobby for Bailout
White House Refines Position on Auto Industry Help
Opinion: A Bridge for the Carmakers
Automakers Offer Big Incentives to Spur Sales
Opinion: The High Cost of GM's Death
NADA Update
NADA to Host Webinar on New Do-Not-Call Rules
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
Auto Dealers: The Economic Engine of Main Street

McLEAN, Va. -- In a full-page ad published in today's edition of USA Today, the National Automobile Dealers Association (NADA) is urging the American public not to lose sight of the economic engine on Main Street: the nation's 20,000 new-car and -truck dealers. "Up to now, much of the discussion about a rescue plan for the automakers has focused on the Detroit Three: GM, Ford and Chrysler," NADA Chairman Annette Sykora said in the letter. "For generations, the nation’s auto dealers have been the bellwether for the U.S. economy – accounting for almost 20 percent of all retail activity in the country, generating billions of dollars in state and local tax revenue." Sykora said, "Congress must act to restore stability to the auto industry as an important first step. Auto retailing is part of the solution to solving the economic crisis that we’re now facing. The economic engine of the auto industry can help get this economy running on all cylinders again. The federal government is already helping Wall Street. Now it’s time to help Main Street." The Open Letter also appeared in the Sunday edition of the Boston Globe, and it's likely to appear in other newspapers around the country this week. Click here to view the full-page ad.
Source:  NADA Newswire

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Auto Aid Debate Heats Up

Senate takes up $25B in loans today; industry pressured for concessions
WASHINGTON -- As U.S. lawmakers start debating today whether to grant Detroit's automakers $25 billion in loans to tide them over a critical stretch, the car companies and the United Auto Workers union are coming under intense pressure to make concessions in exchange for the help. Senate Majority Leader Harry Reid, D-Nev., is scheduled to introduce legislation today that would provide $25 billion from the $700 billion Wall Street bailout package for the struggling automakers. On Sunday, Sen. Carl Levin said the top executives of Detroit's carmakers should consider resigning, if necessary, to convince Congress to approve up to $25 billion in emergency loans. "I'd be happy to tell (General Motors Corp. CEO) Rick Wagoner that he ought to consider resigning if that is the difference between getting this kind of support and not," Levin, a Detroit Democrat, said on the NBC News show "Meet the Press." Levin's aides said afterward that he made the comments in response to questions and that he wasn't advocating that any auto executives step down.
Source:  The Detroit News

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Dealers Lobby for Bailout

As Congress considers $25 billion in emergency loans to the Detroit 3 this week, the companies are deploying one of their most potent lobbying weapons: their dealers. The dealers hope to sway Republican lawmakers on key congressional committees who have expressed opposition -- or at least coolness -- to the loan proposal. But they concede their efforts face big obstacles. Late last week, Gary Brown, a Cadillac and Chevrolet dealer in Louisville, Ky., was planning to call his homestate senator, Republican Mitch McConnell, to lobby for the loans. Brown described himself as a registered Republican, albeit one who doesn’t always follow the party line. But he said he doubted his lobbying would pay off. Since President George Bush has expressed reluctance to sign loan legislation, Brown questioned whether McConnell, the Senate Republican leader, would be willing to take a contrary view. Last week, GM urged its roughly 7,000 U.S. dealers and its employees to lobby Congress for federal loans.
Source:  Automotive News (Subscription required.)

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White House Refines Position on Auto Industry Help

WASHINGTON – The Bush White House stressed Monday that it supports help for the struggling auto industry, but believes it should not be taken from the $700 billion financial system rescue program. As lawmakers were returning to a lame duck session to focus on the troubled industry, President Bush's chief spokeswoman issued a statement saying the administration "does not want U.S. automakers to fail." Press secretary Dana Perino complained that reporting on the White House's statements on this issue has involved "attempts to shorthand the administration's position." Perino's early morning statement also made clear, however, that the administration steadfastly opposes drawing funds from the bailout plan to help Detroit. She said the $25 billion that Democrats favor taking from the rescue plan should come, instead, from a Department of Energy program previously approved to develop fuel-efficient vehicles.
Source:  Associated Press

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Opinion: A Bridge for the Carmakers
by Jeffrey D. Sachs

The Future Is in Sight. They Just Need Help Getting There.
A government-supported restructuring of the auto industry is urgently needed for our economic and energy security. If the Bush administration allows the auto industry to collapse, it will compound the panic that started with the bankruptcy of Lehman Brothers. Washington should seize the opportunity to begin a new era of U.S. technological leadership in the global auto industry, starting with an immediate loan. First, this is an opportunity to embark on a major industry restructuring to position the United States to lead the world in producing cars that get 100 miles or more per gallon. Second, the sudden closure of an automaker would be catastrophic, possibly pushing our economy from recession to depression. Because of the impact on parts suppliers, the shutdown of one company would imperil domestic production across the board, and the jobs at risk include not only the 1 million in vehicle assembly and parts but millions more that would be caught in the resulting cascade of failures. Third, any restructuring under Chapter 11 bankruptcy rules would be a death knell. Yes, in some industries, Chapter 11 can provide breathing space. For the automakers, however, it would accelerate the collapse of consumer demand and the mass bankruptcy of parts manufacturers. Consumers choose vehicles in part on their expectation of the long-term health of the companies that make them, which they rely on for parts, service and resale values. The industry does not need a shakeout but a change of technology for long-term energy and climate security. In this environment, the normal market test of consumer demand can't be used to judge which industries should survive. We are experiencing the steepest temporary decline in consumer spending since the Depression. We face an unprecedented financial calamity, energy crisis and environmental threat. A vibrant, growing U.S. automobile industry should play an essential role in solving all three.
Source:  The Washington Post

[Editor's Note: Jeffrey D. Sachs is director of the Earth Institute at Columbia University and the author of "Common Wealth: Economics for a Crowded Planet."]

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Automakers Offer Big Incentives to Spur Sales

DETROIT — This is a miserable time to be selling cars, as the billions of dollars in losses gushing from the Detroit automakers show, but it may be the best opportunity ever to buy one. Automakers are throwing cash rebates at would-be shoppers who have been scared off by the troubled economy and tighter credit. “We’ve never gone this deep before,” said Paul Walser, co-owner of the Walser Automotive Group, which sells 13 brands at nine dealerships around Minneapolis. “We’re going to be losing money on these things,” he said, “but it just costs us too much to keep vehicles that are $30,000 or $40,000 in our inventory for six months.” The National Automobile Dealers Association says 667 dealerships closed from January to October. Its chief economist, Paul Taylor, said the full-year total for 2008 may reach 900, and that 2009 could see even more casualties. The average dealership has not made money from new car sales since 2005, he said. One slight positive is that more customers are coming into dealers’ service and parts departments. “As people make a choice to defer a new car purchase,” Mr. Taylor said, “that means they’re going to drive the old one further, and that creates parts business.”
Source:  The New York Times

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Opinion: The High Cost of GM's Death
by Keith Crain and Peter Brown

If Congress thinks a bailout of General Motors is expensive, consider the cost of a GM failure. GM’s 100,000 American jobs will die. Health care for a million Americans will be lost or at risk. Hundreds of GM’s 1,300 suppliers will die. Their collapse could take down Ford Motor Co. and Chrysler LLC, perhaps even North American transplants. Dealerships in every county of America will close. The government will face more people unemployed, without health insurance and even without pensions. Criticize Detroit 3 executives all you want. But the issue today is not whether GM should have closed Buick years ago, been tougher with the UAW or supported higher fuel economy standards. The collapse of credit has crushed the American car market, dried up revenues for the Detroit 3 and highlighted their weaknesses. But Ford, which borrowed big two years ago and thus has more cash today, may skip a bailout and the strings attached. Cerberus, which bought Chrysler last year, doesn’t deserve money. Government cash might help sell Chrysler to a strategic owner. GM’s top management may need to go. Government-as-shareholder deserves a big voice. The Detroit 3 CEOs had better tell Congress this week what sacrifices they are prepared to make. But the stark fact remains: Absent a bailout, GM dies, and with it much of manufacturing in America. Congress needs to do the right thing -- now.
Source:  Automotive News (Subscription required.)

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NADA Update
NADA to Host Webinar on New Do-Not-Call Rules

Many new and amended federal telemarketing regulations have been issued since the National Do-Not-Call Rules were established in 2003, and dealers who haven’t kept up risk the possibility of very costly litigation. While not all of these mandates have received widespread press coverage, they deserve dealers’ utmost attention as they affect dealers’ ability to advertise their products and services by phone, fax and email.

To help dealers and managers comply with these regulations, NADA is hosting a virtual seminar next month presented by Erica McMahon, chief of the FCC’s consumer policy division, and moderated by Paul Metrey, NADA’s director of regulatory affairs.

The speakers will highlight many of the well-known and lesser-known telemarketing requirements that have been imposed since the 2003 Do-Not-Call Rules took effect. The seminar will cover regulations governing telephone solicitations, commercial emails and fax advertisements, and will allow time for questions. All dealership personnel and service providers who are involved in marketing to consumers or businesses are encouraged to attend.

Changes in Telemarketing Regulations Since the National Do-Not-Call Rules Took Effect will be held Dec. 9 from 1–3 p.m. EST. The fee for this seminar is $199 per computer connection. Additional attendees can participate on the same connection for no additional cost. For more information on this virtual seminar and other upcoming seminars, visit www.nada.org/seminars or call (800) 252-6232, ext. 2.

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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
 
"Up to now, much of the discussion about a rescue plan for the automakers has focused on the Detroit Three: GM, Ford and Chrysler. But it's important not to lose sight of the economic engine of Main Street: the nation's 20,000 new car and truck dealers."

   
-- NADA Chairman Annette Sykora in an Open Letter published in today's edition of USA Today, NADA Newswire, Nov. 17


"I'd be happy to tell (General Motors Corp. CEO) Rick Wagoner that he ought to consider resigning if that is the difference between getting this kind of support and not."

   
-- Sen. Carl Levin, a Detroit Democrat, said on NBC's "Meet the Press" favoring resignation of the Detroit automakers' top executives if necessary to convince Congress to approve up to $25 billion in emergency loans, The Detroit News, Nov. 17


"In this environment, the normal market test of consumer demand can't be used to judge which industries should survive."

   
-- Jeffrey D. Sachs, director of the Earth Institute at Columbia University, arguing in favor of government supported restructuring of the auto industry, The Washington Post, Nov. 17


"... the stark fact remains: Absent a bailout, GM dies, and with it much of manufacturing in America. Congress needs to do the right thing -- now."

   
-- Keith Crain and Peter Brown in a front page editorial in this week's edition of Automotive News, Nov. 17
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.