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

NADA.org
Monday, Dec. 8, 2008 RSSSEND TO A FRIENDPRINT
Home | AdvocacyAffiliates | Convention | Jobs | Programs | Publications | Training | Services
At a Glance...
Top Stories
Dealers Back Detroit 3 Aid...
Automakers Look to Consolidate Dealer Ranks
Automakers Face Costly Road to Cut Unpopular Brands
Race on to Finalize Auto Deal
Groups Activate Grassroots to Counter Bailout Fatigue
Major Issue in Big 3 Aid is Final Cost
Opinion: Keep Fingers Crossed for Auto Aid Package
NADA Update
NADA Offers Virtual Seminar to Help Dealers in 'Tough Times'
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
Dealers Back Detroit 3 Aid...

WASHINGTON — Sen. Christopher Dodd is one of Congress' financial experts. But last week, he conceded that he's just now learning how auto dealer floorplans work. The admission by Dodd, D-Conn., who heads the Senate Banking Committee, suggests the challenge that faces dealers and dealership groups. While they are lobbying hard for emergency federal loans to the Detroit 3, they worry that Washington is overlooking retailers' needs. Dealers don't want mandated reductions in the number of dealerships to be a condition of aid, the National Automobile Dealers Association says. And they don't want Congress to ignore their requests for incentives to boost showroom traffic. "Dealers are not part of the problem facing the automakers," said NADA Chairman Annette Sykora, a Texas dealer, as she lobbied on Capitol Hill last week. Nearly 150 dealers and state association executives are due here this week to press lawmakers on aid to the industry, including to retailers.
Source:  Automotive News (Subscription required.)

[back to top]

Automakers Look to Consolidate Dealer Ranks

General Motors and Ford have been working for years to reduce their ranks of dealers, but with vehicle sales at record lows and the industry seeking a financial bailout, both automakers now have billions of new reasons to renew their pushes to create smaller, more profitable, dealer bases. But while some experts say a thinning of the dealer population could help both dealers and automakers, it doesn't have the same cost-cutting effect as closing plants and cutting jobs. As part of its restructuring plan submitted to Congress this week, General Motors Corp. said it plans to reduce its dealer ranks by 1,750, or 27 percent, to 4,700 by 2012. Meanwhile, Ford Motor Co. said it expects to end this year with about 3,790 dealers, down 606, or 14 percent, from the end of 2005. John McEleney, the NADA's incoming chairman and the president of McEleney Autocenter in Clinton, Iowa, said that as independent business owners, dealers aren't the ones responsible for the current woes of the U.S. automakers. "We're not a cost to the manufacturers," he said. "We pay for our facilities, we pay for our people and we even pay for the manufacturer signs out front. If anything, we're a transfer of costs for the automakers."
Source:  Associated Press

[back to top]

Automakers Face Costly Road to Cut Unpopular Brands

The Frank Kent Hummer dealership -- complete with an indoor waterfall and a massive curved roof reminiscent of an aircraft hanger -- opened in Fort Worth in the spring of 2005 with hopes as high as the giant "H" that dominates its entrance. Three years later, General Motors wants to get rid of its lagging Hummer brand. But what's good for GM in this case may not be good for its 400 Hummer dealers, who have invested millions of dollars with the expectation of selling a line of new products for years to come. "To think they'd sell the franchise and leave the top 150 dealers hanging, I don't think they'll do that," said Will Churchill, co-owner of Frank Kent Motor Co., which paid to build the $3.5 million Hummer dealership to GM's specifications. "They'll do something to help minimize that blow." A report prepared by the Casesa Shapiro Group for the National Automobile Dealers Association says that the nation's roughly 20,700 dealers have $233.5 billion invested in their businesses, employing and training more than 1.1 million people and accounting for nearly 20 percent of all retail sales. "Far from being a burden to the manufacturer it represents, it supports the manufacturer's efforts by providing a vast distribution channel that allows for efficient flow of the manufacturer's product to the public at virtually no cost to the manufacturer," the report said.
Source:  The Washington Post

[back to top]

Race on to Finalize Auto Deal

Sen. Levin says backing from Bush, Obama is key to passage; Sen. Dodd calls for Wagoner to quit
WASHINGTON -- Lawmakers and the White House on Sunday raced to finalize $15 billion in short-term government loans for Detroit's Big Three automakers amid signs longer-term aid may require changes in top management, including the possible replacement of General Motors Corp. CEO Rick Wagoner. The Senate could vote on a bailout bill that could keep GM and Chrysler LLC from imminent collapse as early as Wednesday; the main hurdle seems to be convincing enough Senate Republicans to go along. Sen. Carl Levin, D-Detroit, said the key to passage will be getting President George W. Bush and President-elect Barack Obama to endorse the bill that could emerge today. Obama said he supported the idea of immediate assistance for automakers, with conditions. "Millions of people, directly or indirectly, are reliant on that industry, and so I don't think it's an option to simply allow it to collapse," Obama told NBC's "Meet the Press" in an interview shown Sunday. "What we have to do is to provide them with assistance, but that assistance is conditioned on them making significant adjustments. They're going to have to restructure, and all their stakeholders are going to have to restructure." More details emerged Sunday on tough restructuring conditions that would be attached to the money... Democratic aides said late Sunday that changes to a draft bill include banning carmakers who accept government aid from suing states trying to impose their own emissions limits. Detroit's Big Three and their foreign rivals have opposed state standards because of the complexity they would add to designing and building vehicles. Some lawmakers suggested the bill only stop automakers from using government funds to sue.
Source:  The Detroit News

[back to top]

Groups Activate Grassroots to Counter Bailout Fatigue

Even though the last auto plant in Anderson, Ind., closed in 2007, town leaders are hoping Congress will agree on an auto bailout [this] week. Hundreds of residents there receive pensions earned from their years spent making parts for General Motors, a legacy from the industry’s heyday, when the car company operated 30 plants and employed as many as 30,000 workers in the city. Anderson is one of several towns and small cities that are part of the Mayors Automotive Coalition. Created by the Ferguson Group from its existing base of clients, the coalition of local officials from cities and towns in 10 states is one of several groups lobbying to put Main Street’s imprimatur on the auto rescue package to counterbalance a case of bailout fatigue on Capitol Hill. The coalition is sponsoring a fly-in day starting Monday to lobby in support of the $34 billion bailout package. Mayors and local officials from 25 cities in six states are scheduled to participate. The message is twofold: Approve the bailout, and help communities, like Anderson, that have already been hurt by the constriction of the domestic auto industry with new economic development money. “Local governments bear the worst brunt of the closed plants, idled brownfields, unemployed citizens, lost tax revenue, increasing foreclosures, and other terrible impacts of the decline of this industry,” a paper distributed on Capitol Hill states. The mayors won’t be the only ones lobbying for the bailout... Auto dealers and suppliers are also mounting their own grassroots effort to build support for the bailout. Critics say the car makers should be allowed to go bankrupt so that they can restructure to become more competitive with Japanese car companies. But the prospect of bankruptcy scares John McEleney, who owns two dealerships in the Iowa towns of Clinton and Iowa City. “I’m afraid people will be reluctant to do business with a bankrupt company,” said McEleney, who is the incoming chairman of NADA. NADA is sponsoring a fly-in of its members ... as well. One hundred and fifty dealers are expected to participate. Like the mayors, the dealers will be lobbying for both the bailout and something else: in their case, more direct inducement to consumers to buy new cars.
Source:  The Hill

[back to top]

Major Issue in Big 3 Aid is Final Cost

DETROIT — So what will it cost to fix Detroit’s Big Three automakers? Now that Congress has signaled its willingness to help the ailing car companies with short-term loans, that question has gained new urgency — particularly for President-elect Barack Obama, who will inherit the crisis in Detroit when he takes office. The ultimate price tag for a new and improved American auto industry may be as unfathomable as questions about the potential harm to the economy if any of the companies were allowed to collapse. But estimates of the final bill are rising rapidly, particularly as the economy weakens and car sales keep falling. A comprehensive bailout for General Motors, the Ford Motor Company and Chrysler could cost as much as $125 billion, and even the companies themselves are hard pressed to dispute that figure. Mark Zandi, chief economist of Moody’s Economy.com, testified before Congress last week that the Big Three’s request for $34 billion in loans “will not be sufficient for them to avoid bankruptcy at some point in the next two years.” He said from $75 billion to $125 billion would be needed to pay for a full-scale reorganization of the automakers.
Source:  The New York Times

[back to top]

Opinion: Keep Fingers Crossed for Auto Aid Package
The Detroit News

Better judgment is beginning to prevail in Washington as lawmakers and the White House move closer to a rescue loan package that will keep the Big Three out of bankruptcy, save 4 million jobs and head off a disaster that could turn this recession into a depression. This has been a long and difficult process, far more wrenching even than the comparatively quick debate over whether to spend $700 billion to shore up the financial markets. And it is by no means over. But the agreement between congressional leaders and President George W. Bush to free part of the already approved $25 billion energy loan package for use by the automakers to stay afloat is a major breakthrough. House Speaker Nancy Pelosi, D-Calif., dropped her opposition to using those funds for anything other than research on clean energy vehicles. The Big Three chief executives who appeared before the House and Senate were roughly treated, forced to reveal far more information about their strategic plans than the banks and brokerage houses that walked away with far more taxpayer cash. It has been more an inquisition than hearing. The lack of urgency by Congress to help the Big Three reflects a deep misunderstanding of how the domestic automakers have already transformed their businesses, as well of their importance to the national economy. If these companies fail, no amount of stimulus from Washington will keep the economy from crashing. Congress and the president must continue working to make sure that doesn't happen.
Source:  The Detroit News

[back to top]

NADA Update
NADA Offers Virtual Seminar to Help Dealers in 'Tough Times'

In response to the challenges facing dealers during these uncertain times, NADA is offering a presentation featuring two speakers who can explain the options and detail the steps dealers need to take to protect their businesses. Tough Times, Tougher Dealers: Saving Your Dealership’s Assets will be offered as a virtual seminar in December and January and as a workshop at the 2009 NADA Convention & Exposition in New Orleans.

Tough Times, Tougher Dealers, presented by Michael Charapp, Esq., of Charapp & Weiss, LLP and Bradley Nicklin, CPA, of Beers + Cutler, discusses the tough issues facing almost every dealer today. It is intended to help dealers and managers understand the steps required to protect their dealerships’ assets during these tough economic times.

In this presentation, participants will learn valuable information on cash management, expense control, and franchise rights issues. They will also learn how to deal with bankruptcy—both at the manufacturer and dealership level—as well as franchise terminations, brand terminations, and the legal ramifications of reducing a workforce. Additionally, the speakers will present other practical considerations for surviving this tough environment, both legally and financially.

The virtual seminar will be offered twice—on Dec. 18, 2008, 1–3 p.m. EST, and on Jan. 13, 2009, 1–3 p.m. EST. The registration fee is only $50 per computer connection. For more information or to register, visit www.nada.org/seminars.

The Convention workshop will also be offered twice—on Saturday, January 24, 2009 at 11:00 a.m. CST, and on Monday, January 26, 2009 at 8:30 a.m. CST.

[back to top]

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.

[back to top]

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.

[back to top]

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.

[back to top]

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.

[back to top]

 
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
 
"Dealers are not part of the problem facing the automakers."

    -- NADA Chairman Annette Sykora arguing that dealers do not want mandated reductions in the number of dealerships to be a condition of federal aid to the Detroit 3 automakers, Automotive News, Dec. 8


"We're not a cost to the manufacturers. We pay for our facilities, we pay for our people and we even pay for the manufacturer signs out front. If anything, we're a transfer of costs for the automakers."

   
-- John McEleney, NADA's incoming chairman said that as independent business owners, dealers aren't the ones responsible for the current woes of the U.S. automakers, Associated Press, Dec. 5


"Far from being a burden to the manufacturer it represents, [dealers] support the manufacturer's efforts by providing a vast distribution channel that allows for efficient flow of the manufacturer's product to the public at virtually no cost to the manufacturer."

   
-- A report prepared by the Casesa Shapiro Group for NADA says that the nation's roughly 20,700 dealers have $233.5 billion invested in their businesses, employing and training more than 1.1 million people and accounting for nearly 20 percent of all retail sales, The Washington Post, Dec. 7
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) Tough Times, Tougher Dealers: Saving Your Dealership’s Assets

(2) Technology-Enabled Sales and Marketing: Putting People Skills Back into the E-process

(3) The Five Essentials to Create and Maintain Accountability in Your Dealership

Tough Times speakers Michael Charapp, Esq., of Charapp & Weiss, LLP and Bradley Nicklin, CPA, of Beers + Cutler, will discuss the tough issues facing almost every dealer today and teach dealers and managers how to protect their dealerships’ assets during these tough economic times. Participants will learn how to deal with bankruptcy—both at the manufacturer and dealership level—as well as franchise terminations, brand terminations, and the legal ramifications of reducing a workforce.

Technology speaker Jim Ziegler of Ziegler SuperSystems, Inc. will show attendees how to use new online social networks and online technology to generate sales. Participants will learn how to incorporate video blogging and video walk-arounds into their online marketplaces, and will learn how to build stronger personal relationships with customers over the phone and Internet.

Accountability speaker Michael Rees of DealerPro Sales Solutions will teach dealers and managers how to hold their teams accountable for attracting and retaining customers. Participants will learn how to keep their employees on task and learn how to approach those who don’t.

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.

 
Search Back Issues | Unsubscribe | Subscribe | 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.