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Top Stories
It's About 'Main Street,' Auto Dealers Say
Detroit 3 CEOS Make Headway in Senate Hearing
Auto Bailout Could be Tied to Gov't-Run Overhaul
Editorial: Invest in America
Help the Detroit 3 for the Sake of Banks
Chrysler Needs $4 Billion Now, Willing to Merge with GM
Jackson Warns of Fallout in Refusal
NADA Update
Pre-Registration for 2009 Convention Extended to Dec. 19
NADA to Members: Verify Contact Information to Stay Informed
NADA to Host Virtual Seminar Tuesday on Changes to Telemarketing Rules
STAR Answers Dealers' Questions About Hardware Based Systems
Top Stories
It's About 'Main Street,' Auto Dealers Say

 

James Fleming, president of the Connecticut Automotive Retailers Association, appears before a Senate panel Thursday with representatives from Chrysler, General Motors, Ford and the United Auto Workers.

WASHINGTON – Failure of the domestic automakers will put people out of work and hurt many towns and cities across the country that rely on retail auto sales, James Fleming, president of the Connecticut Automotive Retailers Association, told a Senate panel Thursday. Testifying on behalf of the National Automobile Dealers Association (NADA), Fleming warned that a bankruptcy of one of the Big 3 automakers will have a substantial impact on the viability of local economies. "We are not Wall Street or Detroit: We are Main Street." Fleming explained along side representatives from Chrysler, General Motors, Ford and the United Auto Workers. “This is about investing in the future of our small towns and businesses, in the economies and budgets of our state governments, and ultimately, in the overall welfare of our country.” (To read the full text of Fleming's testimony, click here.)

The hearing was the second attempt for the three automakers to make their case before the Senate Banking Committee. GM, Ford and Chrysler are seeking more than $34 billion in low-interest government loans in order to prevent them from going under. With retail auto sales accounting for more than one-fifth of the retail economy, any further drop in sales will leave states, cities and towns feeling the pinch of lost state and local tax revenue.

Fleming also noted that 25 dealers in his state have already closed their doors because of the weakened economy and the difficulty to obtain credit for both dealers to cover inventory costs and consumer loans.  Nationally, according to NADA, 700 dealers have closed this year alone, putting more than 20,000 people out of work. “The domestic auto industry hangs in the balance—and so do dealers and their local communities,” Fleming stressed.
Source:  NADA Newswire

[Editor's Note: Today the House Financial Services Committee will hold a second round of hearings with the domestic automakers. At last week’s House hearing, NADA Chairman Annette Sykora urged the committee to help stabilize the auto industry. She highlighted the important role that dealers play in the success or failure of an automaker and the direct impact that the nation’s almost 20,000 franchised automobile dealers have on local communities across America. To view today’s hearing live click here.]

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Detroit 3 CEOS Make Headway in Senate Hearing

WASHINGTON -- The Detroit 3 CEOs won a warmer reception in Congress [yesterday] than they did two weeks ago as Senate leaders said they were searching for ways to provide emergency aid. “I don’t think we want to walk away without trying to get something done,” Christopher Dodd (D-Conn.), said after chairing a six-hour Senate Banking Committee hearing on renewed requests from General Motors, Ford Motor Co. and Chrysler LLC for $34 billion in loans. Many committee members complimented the industry chiefs on the plans they presented for using federal aid and restructuring to become viable for the long term. But the senators also showed that they -- as well as the House and Bush administration -- remain far from a consensus on how to help. The House Financial Services Committee holds its next hearing [today.] [Yesterday’s] session offered more ideas on how to deal with the industry’s crisis. There was talk of creating a powerful board of trustees or auto “czar” to impose concessions on automakers, organized labor, lenders to the car companies and other stakeholders. An economist told the committee that the estimated $34 billion overall cost of the bailout cost could rise. Two weeks ago, the automakers had estimated they needed $25 billion. The industry may need $75 billion to $125 billion to avoid bankruptcy and the companies may well return asking for more money later if they get the $34 billion they want now, said Mark Zandi, chief economist of Moody's Economy.com.
Source:  Automotive News (Subscription required.)

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Auto Bailout Could be Tied to Gov't-Run Overhaul

WASHINGTON -- With several lawmakers in both parties pressing them to consider a pre-negotiated bankruptcy -- something they have consistently shunned -- members of Congress and the Big Three both were contemplating a government-run restructuring that would yield similar results, including massive downsizing and labor givebacks. U.S. auto executives were appearing before the House Financial Services Committee for the second time to outline their plans for staying afloat with a government infusion. The rescue, though, was facing fresh obstacles in Congress, with lawmakers still unconvinced they should support yet another bailout and congressional officials saying a leading proposal for helping the carmakers wouldn't come close to covering the cost. Congressional budget analysts said one leading proposal -- to use an already approved fund set aside for making cars environmentally efficient -- would provide just $7.5 billion -- a fraction of what General Motors Corp., Ford Motor Co. and Chrysler LLC say they need.
Source:  Associated Press

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Editorial: Invest in America
A Special Free Press Editorial

We have chronicled the U.S. auto industry since its birth, as Detroit became the world's Motor City, as cars and trucks changed the American culture and landscape, as assembly line jobs gave rise to the American middle class. Our journalists have reported the automakers' triumphs and exposed their troubles. We know this industry better than anyone. We also know that while a newspaper needs to inform, there are times when a newspaper needs to speak up for what's right. We know what automakers and autoworkers mean to this nation. We know what will happen if one of the auto companies is allowed to collapse. We know because this industry has been our story since it started. And we know that America needs this story to continue.

The loss of jobs, the devastated retirements, the massive loss of health care coverage, the sharp drop in local tax revenues, the closings of supplier and ancillary businesses — all would be calamitous in the best of times. More than 3 million jobs are at stake in the industry. General Motors, Ford and Chrysler are threaded in the fabric of businesses in every state across America. A failure of one or more of the automakers would deepen the country's worst recession in 27 years, and it could take decades to rebuild the nation's industrial base, which will atrophy like an unused limb without the muscle-flexing of Detroit's automakers. Remember, too, that Detroit helped rescue America as the Arsenal of Democracy in World War II and, through GM's no-interest loans, helped jump-start the battered economy after 9/11. Now, when our automakers and autoworkers need a hand up, will America really turn its back? The Detroit automakers are hemorrhaging cash to stay in business. Two of them are nearly drained, and the third is getting by on a transfusion. They can get well. They have shown how. But first they have to survive. And their survival is in America's best interests. You can help them. And if you don't, make no mistake: There will be bleeding throughout the land.
Source:  Detroit Free Press

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Help the Detroit 3 for the Sake of Banks

WASHINGTON -- A new and potentially powerful argument for rescuing America's automakers emerged Thursday on Capitol Hill: Let them fail, and the financial markets bailed out to the tune of $700 billion could be severely wounded. Why? Detroit's automakers -- General Motors Corp., Ford Motor Co. and Chrysler LLC -- and their suppliers have about $1 trillion worth of exposure in the financial markets by some estimates, and their collapse would send shock waves through the investment community. Investment firm J.P. Morgan said this month that GM, Ford and their financing arms account for up to 10% of the junk bond market -- investments that could be worth nothing should the companies fail. GM reported that the Detroit Three automakers account for about $700 billion of outstanding debt.
Source:  Detroit Free Press

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Chrysler Needs $4 Billion Now, Willing to Merge with GM

The CEOs of Chrysler LLC and General Motors Corp. said they would look at a forced merger if it were a condition of government financial assistance. The merger talk and admission from Chrysler CEO Robert Nardelli and GM CEO Rick Wagoner that they might not survive without immediate financial aid overshadowed Nardelli's testimony that Chrysler needs $4 billion to get through March 31, and that it would begin repaying its proposed $7 billion loan in 2012. "If in fact that's the criteria that means we get money to save Chrysler and the people who have worked there for 80 some years, I would do it," Nardelli said. Wagoner concurred. "I'd be very willing to look at it," he said, adding that he would consider it seriously, but would prefer to proceed in a manner that the United Auto Workers union would be comfortable with.
Source:  The Detroit News

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Jackson Warns of Fallout in Refusal

Activist says denial of fed loans would put cities in a downward spiral
DETROIT -- The Rev. Jesse Jackson said Thursday that denying a federal loan for the struggling Big Three automakers would be catastrophic for the nation's economy and send cities in a downward spiral. Jackson met with The Detroit News' editorial board for 45 minutes to outline his support for a loan for the industry. "It's not the Big Three. It's 4 million jobs," Jackson said on Thursday. Jackson called the treatment of the Big Three chiefs on Capitol Hill evidence of a "double standard," saying the bailout of Wall Street banks came without the kind of scrutiny aimed at the automotive companies.
Source:  The Detroit News

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NADA Update
Pre-Registration for 2009 Convention Extended to Dec. 19

Online registration for NADA's 2009 Convention & Exposition in New Orleans has been extended to Dec. 19. After Dec. 19, convention attendees must register onsite but may obtain housing through Experient until Dec. 23. Members and guests who haven’t already registered to attend the convention can do so online or by faxing a registration form to (703) 883-9480. Several New Orleans hotels already are sold out, so members are urged to register early to avoid being shut out of discounted housing. For more on NADA's 92nd annual convention, click here.

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NADA to Members: Verify Contact Information to Stay Informed

NADA's Membership Department is urging all association members to verify their contact information through a new online process available at www.nada.org/membership. Members who maintain a current email and mailing address ensure that they will continue to receive important and timely updates from NADA. The new online verification process also allows members to easily change their contact information. Members may also visit www.nada.org/subscribe to manage their subscriptions to NADA's member newsletters, including the daily e-newsletter NADA Headlines.

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NADA to Host Virtual Seminar Tuesday 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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STAR Answers Dealers' Questions About Hardware Based 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. To learn "What is recommended for general maintenance of hardware based systems?" click here.

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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
 
"I don't think we want to walk away without trying to get something done."

   
-- Christopher Dodd (D-Conn.), after chairing a six-hour Senate Banking Committee hearing on renewed requests from General Motors, Ford Motor Co. and Chrysler LLC for $34 billion in loans, Automotive News, Dec. 5


"Remember, too, that Detroit helped rescue America as the Arsenal of Democracy in World War II and, through GM's no-interest loans, helped jump-start the battered economy after 9/11. Now, when our automakers and autoworkers need a hand up, will America really turn its back? The Detroit automakers are hemorrhaging cash to stay in business. Two of them are nearly drained, and the third is getting by on a transfusion. They can get well. They have shown how. But first they have to survive. And their survival is in America's best interests. You can help them. And if you don't, make no mistake: There will be bleeding throughout the land."

    -- Detroit Free Press editorial, Dec. 5
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) Developing Strategies for Innovation and Growth

(2) “Happy Days,” “Family Feud,” or “Survivor”: Which Best Describes Your Estate and Succession?

(3) How to Convert Lost Opportunities and Increase Closing Ratios of Online Leads

Strategies speaker Jay Rao of Babson College will discuss innovation as a key to organic growth within the dealership. Participants will learn how dealers and managers can benefit from sharpening their focus on organizational innovation and the entrepreneurial mindset.

Happy Days speakers Hugh Roberts and Ricci Victorio of The Rawls Group will provide participants with practical solutions for resolving estate and succession-planning issues. Participants will examine actual case histories and learn how to avoid unnecessary tax issues and family disputes.

Online Leads speakers Peter Martin and Irish Carroll of Cactus Sky Communications, Inc. will provide insight on communicating with customers online, responding to leads and inquiries, and increasing and maximizing closing ratios. Participants will learn best practices for establishing online relationships with customers.

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

Video Highlights
 

'NBC Nightly News with Brian Williams' reports: "Demise of a local car dealership leaves a big dent."




 
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


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.