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Tuesday, Nov. 18, 2008 RSSSEND TO A FRIENDPRINT
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NADA Demands Action on Auto Stabilization Package in Lame-Duck Session to Help Main Street
Chrysler Dealers, Local Officials to Lobby for Auto Aid
Blitz Starts for Big 3 Aid as Reid Introduces Bill to Tap Into $700 Billion Bailout
Auto Companies Would Get Swift Aid Under Senate Bill
Stalemate Dims Prospects for $25 Billion Auto Bailout
Chairman Fights for G.M.'s Future and His Reputation
GM Delays Dealer Incentive Payments While Seeking Aid
Ford Cuts Subsidies for Dealer Closings
Ford to Slash Mazda Stake to Raise Cash
Honda Concerned About Industry Stability
Will Detroit's Cash Crisis Kill the Electric Car?
Opinion: Don't Forget American Automakers' History of Goodwill
NADA Update
NADA to Host Virtual Seminar on Changes to Telemarketing 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
NADA Demands Action on Auto Stabilization Package in Lame-Duck Session to Help Main Street

NADA urges dealers and employees to contact Senate Republicans and other members of Congress immediately
WASHINGTON – The National Automobile Dealers Association (NADA) is mobilizing a nationwide, grassroots effort urging members of Congress to support an economic stabilization package for the automobile industry. "Members of Congress, especially Republicans in the Senate, need to hear directly from dealers and their employees that stabilizing the auto industry is not just about the domestic automakers," says David Regan, NADA vice president of legislative affairs. "We need prompt congressional action on an automobile stabilization package that recognizes the important role that dealers play in the economy and helps car buyers on Main Street."

NADA is urging dealers and dealership employees to emphasize the following points:

  • Failure of an automaker is not a viable option. Consumers, when buying a car, are making an expensive purchase and therefore want and need the long-term relationship (service, parts and warranty) that only a dealer can provide.
  • Policymakers should take into account the crucial role that automakers' "captive" finance companies play in providing dealers access to credit so that they can both finance the wholesale purchase of vehicles and facilitate affordable consumer purchases.
  • The legislation (S. 3684) should include the temporary deductibility of sales tax and interest on auto loans. A family would save $1,553 on a $25,000 car. This proposal, “The Auto Ownership Tax Assistance Amendment” (proposed by Sens. Mikulski of Maryland and Kit Bond of Missouri and Rep. Bill Pascrell of New Jersey) would help generate showroom traffic, restore consumer confidence and stabilize the auto industry.

NADA members can locate their members of Congress by contacting the Capitol switchboard at (202) 224-3121. If you have additional questions, contact NADA’s Legislative Affairs Office at (800) 563-1556.
Source:  NADA Newswire

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Chrysler Dealers, Local Officials to Lobby for Auto Aid

About 30 Chrysler LLC dealers were en route to Washington [yesterday] on a 72-hour mission to lobby support for government assistance for Detroit's Big Three automakers. Chrysler spokesman Stuart Schorr said meetings have been set up with state representatives and senators with the 30 dealers descending on the Hill from about 20 different states. While in Washington, "we'll meet with anyone who will listen," said Jim Arrigo, co-chair of the Chrysler dealer council and owner of two dealerships in Florida. "I think we can change the minds of those who say, 'let them go bankrupt.'" The grassroots lobby effort came out of a conference call in which dealers talked about the dire situation of the industry and the need to have their voice heard. Chrysler President Jim Press and head of sales Steve Landry were on the call and offered to help them orchestrate a walk up on Capitol Hill. "We asked to be here," Arrigo said. "We weren't solicited. "Without help, we will not be there tomorrow to sell cars and be part of our communities," Arrigo said...
Source:  The Detroit News

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Blitz Starts for Big 3 Aid as Reid Introduces Bill to Tap Into $700 Billion Bailout

Senate debate starts; use of $700B bailout hits opposition; House plan also differs on loan oversight
WASHINGTON -- House and Senate Democrats unveiled competing bills Monday that would give the auto industry $25 billion in aid by mid-December as Detroit's Big Three automakers stepped up efforts to win over skeptics. The House and Senate bills would have financial aid flowing to the companies from the $700 billion Wall Street rescue package, but the House measure would be tougher on automakers. The government would get stock warrants or debt equal to 15 percent of the amount borrowed by the auto company under the Senate bill; the House would require 20 percent of the value of the loans and would not accept debt. Executives would be eligible for bonuses if they made $250,000 or less in the Senate bill; it's $200,000 or less in the House. The House bill also calls for an oversight board with more power than outlined in the Senate bill. The Senate bill would require automakers and suppliers to submit a detailed plan on how they would use the funds; the House bill calls for short-term and long-term plans to be submitted by March that include how they would meet new fuel-efficiency requirements that were part of the 2007 energy bill. "(W)e think it essential that loans be linked to significant progress in the ability of the companies to eventually market energy-efficient cars with broad public appeal," Rep. Barney Frank (D-Mass.), the Financial Services Committee chairman, said in a statement Monday night.
Source:  The Detroit News

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Auto Companies Would Get Swift Aid Under Senate Bill

WASHINGTON -- Auto companies would be able to receive emergency aid within a month under a Senate proposal for a $25 billion loan package that circulated here late Monday. If enacted, the bill would direct the Treasury secretary to accept loan applications from companies three days after it becomes law and would require a decision on the applicant's eligibility within 15 days. Disbursement of funds would have to occur within the following seven days. The bill, introduced today by Senate Majority Leader Harry Reid, D-Nev., does place some conditions on loans -- but not as severe as some lawmakers have called for. A test vote could come as early as Wednesday in the Senate.
Source:  Automotive News (Subscription required.)

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Stalemate Dims Prospects for $25 Billion Auto Bailout

WASHINGTON – Prospects dimmed Monday for enactment of a $25 billion bailout for the faltering auto industry before year's end, as congressional Democrats and the Bush administration seemed headed for a stalemate. Senate Democrats said they would press ahead with their plan to carve out a portion of the $700 billion Wall Street bailout to pay for the loans, but aides in both parties and lobbyists tracking the plan acknowledged they did not currently have the votes to do so. The White House and congressional Republicans insist that the automaker bailout money instead come from redirecting a separate $25 billion loan program approved by Congress to help the industry develop more fuel-efficient vehicles. In addition ... the administration has told top lawmakers it does not plan to ask for the second half of that huge fund that Congress approved this fall to aid the financial industry, congressional officials said Monday. President-elect Barack Obama said he believes aid for the auto industry is needed but that it should be provided as part of a long-term plan — not simply as a blank check. "For the auto industry to completely collapse would be a disaster in this kind of environment," Obama said in a "60 Minutes" interview aired Sunday night on CBS. "So my hope is that over the course of the next week, between the White House and Congress, the discussions are shaped around providing assistance but making sure that that assistance is conditioned on labor, management, suppliers, lenders, all of the stakeholders coming together with a plan — what does a sustainable U.S. auto industry look like?"
Source:  Associated Press

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Chairman Fights for G.M.'s Future and His Reputation

DETROIT — Rick Wagoner cannot afford to leave Washington this week without at least $10 billion in federal aid to keep General Motors in business. But a major question for Mr. Wagoner, G.M.’s chief executive for the last eight years, is whether he will return to Detroit with his job as well. While the heads of the Ford Motor Company, Chrysler and the United Automobile Workers are scheduled to also testify before Congress on Tuesday and Wednesday, it is Mr. Wagoner and his company that have become the lightning rods of the debate over whether Detroit should get a bailout. A spokesman for G.M., Tony Cervone, said Monday that the G.M. board remains supportive of Mr. Wagoner, who became G.M. chief in 2000 and added the chairman’s title three years later.
Source:  The New York Times

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GM Delays Dealer Incentive Payments While Seeking Aid

General Motors Corp., seeking low-interest federal loans to stave off financial collapse, said it will delay reimbursing U.S. dealers for sales incentives by about two weeks to preserve dwindling cash. The move postpones payments to almost 6,500 dealers even as the largest U.S. automaker urges them to lobby Congress for the $25 billion industry bailout bill that Senate Democrats began debating yesterday. GM said it won't disclose the savings. "It is indicative of the impact that low liquidity has on this company," Rebecca Lindland, an analyst with IHS Global Insight Inc. in Lexington, Massachusetts, said in an interview. "This could really hamstring dealerships from getting more inventory, making payroll. It's a very serious action." Holding onto the money gave GM a third example to show lawmakers in its efforts to boost cash. The company said the 2007 labor accord has trimmed annual costs by $500 million and that Suzuki Motor Corp. would buy back GM's 3 percent stake. GM's U.S. dealers paid about $3,409 in incentives for each car and truck in October, when the company sold 168,719 vehicles, according to research firm Autodata Corp. of Woodcliff Lake, New Jersey. At that rate, Detroit-based GM would have spent $575 million. GM doesn't announce incentive spending. 
Source:  Bloomberg

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Ford Cuts Subsidies for Dealer Closings

DETROIT — After Ford Motor Co. finishes this year's round of subsidized dealership closings, it will sharply curtail funding for such deals, said sources with knowledge of the plan. This fall, Ford told dealers involved in consolidation or closure talks that they had until the end of October to decide whether to go forward with arrangements under discussion, company spokeswoman Marisa Bradley said. "We had a significant amount of deals pending," Bradley said. "If we were to close these out by the end of the year, we needed to give them a deadline." Ford executives want to speed up dealership closures because market conditions have deteriorated dramatically since spring.
Source:  Automotive News (Subscription required.)

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Ford to Slash Mazda Stake to Raise Cash

TOKYO -- Ford Motor Co. is slashing its stake in Japan's Mazda Motor Corp. by nearly two-thirds, joining other struggling U.S. automakers in selling prized assets to stay afloat. Ford, which owns 33.4 percent of Mazda, will sell about a 20 percent stake, the companies said in a separate statements. The sale would net Ford some 52 billion yen ($540 million) based on the closing price of Mazda's shares Tuesday.
Source:  Associated Press

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Honda Concerned About Industry Stability

Automaker declines to take position on bailout
GREENSBURG, Ind. -- Honda officials said today they are very concerned about the stability of the automotive industry and the condition of the economy as the company held a dedication of new assembly plant in Greensburg, Ind. “Honda Manufacturing of Indiana has begun operation at a very challenging time. We face a difficult economy and increasing competition,” Honda Motor Co. President and CEO Takeo Fukui said during the event. “But at Honda, we have always understood that challenging times represent opportunity – if we continue to create new value for our customers.” While Fukui did not comment on efforts by the Big 3 to lobby Congress for financial assistance, other Honda officials said the company said it monitoring those talks carefully and said Honda is very concerned about the impact any disruption of production could have on automotive suppliers. “Honda would support measures that would maintain the short and long term viability and stability of the automotive industry,” said Jeffrey Smith, Honda’s vice president of corporate affairs.
Source:  Detroit Free Press

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Will Detroit's Cash Crisis Kill the Electric Car?

LOS ANGELES -- Call it an economic and environmental murder mystery in the making: Will a cash-strapped Detroit kill the electric car -- again? Stung by an association with gas-guzzling SUVs and pushed to the brink of failure by plunging sales, U.S. automakers have been touting efforts to roll out more fuel-efficient small cars, gas-saving technology and gas-free electric vehicles. The star of that marketing show has been the Chevy Volt, a rechargeable car that General Motors Corp is designing to run 40 miles on battery power, meaning some commuters would never need to fill up with gas. But with its cash dwindling and U.S. auto sales crashing to 25-year lows, GM has joined Ford Motor Co and Chrysler LLC in seeking $25 billion in federal handouts, which are under consideration this week by the U.S. Congress. That has critics concerned that a meltdown for Detroit could delay the rollout of green cars like the Volt. Others see a chance to prod GM and rivals to move faster as a condition of providing funding the industry says it needs to survive.
Source:  Reuters

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Opinion: Don't Forget American Automakers' History of Goodwill
by Warren Brown

NEW YORK -- It is easy to laugh at the stumbling, homegrown industrial giants of the Midwest in this bastion of urbanity and sophistication that makes money the old-fashioned way -- changing it from one hand to another, often at profitable interest rates; and then running to the federal government for help when the elaborate Ponzi scheme of lending, borrowing and insuring comes crashing down. The truth, all things considered, is that Detroit has done reasonably well. You can blame GM and the other members of the American Three for guessing wrong on gas-electrics; but it is wrong to accuse them of deliberate malfeasance in pursuit of fuel-efficient technologies -- an alleged crime for which critics here and elsewhere wish to punish them by allowing them to sink into fiscal oblivion in the current global recession. The truth is that the American Three have contributed much to the development of alternative fuels and alternative-propulsion technologies -- those employing the gas-electric hybrid approach, as well as those making efficient use of fuels such as cellulosic ethanol and hydrogen, as well as compressed natural gas and liquefied propane. The American companies, including small independents such as Tesla, can and will do more. But they will need a country and a government to support them in those endeavors, just as many of their foreign rivals have received and continue to receive aid from their respective governments.
Source:  The Washington Post

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NADA Update
NADA to Host Virtual Seminar on Changes to Telemarketing 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
 
 
NADA Chairman Annette Sykora at a press conference with U.S. Sen. Barbara Mikulski. Click here for the NADA-TV report.


More Video Highlights

Quotable
 
"Consumers, when buying a car, are making an expensive purchase and therefore want and need the long-term relationship (service, parts and warranty) that only a dealer can provide."

   
-- NADA Statement reminding Congress of the essential role of dealers in their communities, NADA Newswire, Nov. 18


"(W)e think it essential that loans be linked to significant progress in the ability of the companies to eventually market energy-efficient cars with broad public appeal."

    -- Rep. Barney Frank (D-Mass.), House Financial Services Committee chairman, insisting that automakers include how they would meet new fuel-efficiency requirements before receiving federal loans, The Detroit News, Nov. 18


"So my hope is that over the course of the next week, between the White House and Congress, the discussions are shaped around providing assistance but making sure that that assistance is conditioned on labor, management, suppliers, lenders, all of the stakeholders coming together with a plan — what does a sustainable U.S. auto industry look like?"

   
-- President-elect Barack Obama, who believes aid for the auto industry is needed but that it should be provided as part of a long-term plan — not simply as a blank check, Associated Press, Nov. 18


"Without help, we will not be there tomorrow to sell cars and be part of our communities." 

    -- Jim Arrigo, co-chair of the Chrysler dealer council and owner of two dealerships in Florida, referring to Chrysler dealers' efforts to lobby Congress for auto aid, The Detroit News, Nov. 18


"This could really hamstring dealerships from getting more inventory, making payroll. It's a very serious action."

   
-- Rebecca Lindland, an analyst with IHS Global Insight Inc. in Lexington, Mass., referring to GM delaying dealer incentive payments, Bloomberg, Nov. 18


"One of the biggest issues facing General Motors is our liquidity." 

    -- GM's sales chief, Mark LaNeve, in a letter to dealers announcing that the company will withhold reimbursements for vehicle incentives for two weeks to help cash flow, Bloomberg, Nov. 18


"The truth is that the American Three have contributed much to the development of alternative fuels and alternative-propulsion technologies... The American companies ... can and will do more. But they will need a country and a government to support them in those endeavors, just as many of their foreign rivals have received and continue to receive aid from their respective governments." 

    -- Washington Post columnist Warren Brown, Nov. 16
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
 

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.


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.