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Top Stories
NADA to Meet with Federal Reserve Today to Clarify the Availability of Wholesale Inventory Auto Loans
NADA Chairman Urges President Bush to 'Act Now' on Emergency Automaker Loans
Paulson Takes Lead in Auto Rescue Talks
Chrysler Financial May Briefly Stop Dealer Loans
Chrysler Tightens Terms on Dealers
Chrysler to Close All 30 Plants for One Month
GM and Chrysler Reopen Talks on a Merger
Carmakers Cut Costs, Await Loan
Retooling Loan Requests at $30.8 Billion
U.S. Firms Join Forces to Build Car Batteries
NADA Update
NADA Convention to Focus on Future of the Industry
Members Can Now Save on FedEx Shipping
NADA Offers Virtual Seminar Today to Help Dealers in 'Tough Times'
STAR Answers Dealers' Questions About Hardware Based Systems
Lenovo Offers Holiday Savings
Top Stories
NADA to Meet with Federal Reserve Today to Clarify the Availability of Wholesale Inventory Auto Loans

WASHINGTON – Officials from the National Automobile Dealers Association are meeting today with representatives of the Federal Reserve Board to seek clarification that eligibility requirements under the Term Asset-Backed Securities Loan Facility (TALF) extend to auto floor plan securitizations. “Now more than ever, there is a great need for wholesale auto inventory loans. So, NADA will call upon regulators today to confirm that TALF also extends to floor plan securitizations,” said Andy Koblenz, NADA vice president of regulatory and legal affairs.

Addressing a key request from NADA stated in a Nov. 7 letter, the U.S. Treasury Department announced Nov. 25 that it would increase the availability of consumer auto loans and SBA guaranteed small business loans through the TALF program. At the time, it was unclear whether TALF also included loans for dealers at the wholesale level. TALF was created by the Federal Reserve to help spur auto lending. As part of a plan announced in November, the Fed established a $200 billion TALF program to facilitate the issuance and sale of securitized auto loans. Utilizing the Troubled Asset Relief Program (TARP) funds, the Treasury Department will provide $20 billion of credit protection to the Federal Reserve in support of TALF.
Source:  NADA Newswire

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NADA Chairman Urges President Bush to 'Act Now' on Emergency Automaker Loans

Economic downturn taking heavy toll in communities across the country
The Chairman of the National Automobile Dealers Association, Annette Sykora, says that with each passing day, more dealerships are closing and more people are losing their jobs. “These are desperate times in many communities around the country,” Sykora said in a written statement issued [Wednesday]. “We’ve heard encouraging words from the White House, but time is of the essence. A lot of people are depending on the White House to provide the bridge loans to prevent a collapse of the auto industry. We need action now,” Sykora added. This year alone 900 dealerships out of 19,700 are expected to close, with a loss of almost 50,000 jobs.
Source:  NADA Newswire

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Paulson Takes Lead in Auto Rescue Talks

WASHINGTON — The White House and the Treasury are deep into negotiations with General Motors and Chrysler over reorganization plans that could result in freeing up more than $14 billion in emergency loans to keep the companies afloat through the first quarter of 2009, according to industry executives and a senior administration official. The Bush administration appears to want an agreement with the automakers before Dec. 25. It was unclear, however, when all of the particulars might be worked out, said the senior official, who spoke on the condition of anonymity because of the delicate nature of the negotiations. But the official indicated that the administration was inclined to do more than just keep G.M. and Chrysler alive until President-elect Barack Obama takes office, saying, “Giving them enough money to limp along doesn’t solve anything.” In the negotiations, the Treasury secretary, Henry M. Paulson Jr., is effectively taking on the role of “auto czar,” which was envisioned in the carmakers rescue bill written by the White House and Congressional Democrats and approved by the House but blocked by Senate Republicans. In the days since the White House said it would step in to prevent the collapse of G.M. and Chrysler, Treasury officials have been poring over detailed financial data in a meticulous exercise that one G.M. executive likened to “putting on the aqualung” and diving deep into the companies’ books.
Source:  The New York Times

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Chrysler Financial May Briefly Stop Dealer Loans

DETROIT -- Chrysler LLC's finance arm has told dealers it may temporarily stop loans used by dealers to stock vehicles because the retailers pulled money from a fund that helps finance them. Chrysler Financial Chief Executive Tom Gilman sent letters to dealers, dated Dec. 12, that asked them to refrain from withdrawing large amounts from a "cash management account" used to finance the loans, a source familiar with the letter said. Withdrawals from the fund, which have totaled more than $1.5 billion since July, have caused a drain on Chrysler's resources and could limit the company's ability to offer financing to dealers to buy vehicles, according to the letter. Chrysler Financial said in a statement that it finances 75 percent of all vehicles shipped to U.S. dealers and continues to support its dealer network with "uninterrupted" wholesale financing. The National Automobile Dealers Association urged the government to act soon on the emergency loans to automakers, saying that with each passing day, more dealerships are closing and more people are losing their jobs. "These are desperate times in many communities around the country," NADA Chairwoman Annette Sykora said in a statement. "We've heard encouraging words from the White House, but time is of the essence."
Source:  Reuters

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Chrysler Tightens Terms on Dealers

Auto Maker to Begin Charging New Fees for Unsold Vehicles; Move Could Trigger New Outlet Closings
Dealers selling new Chrysler LLC vehicles are about to come under additional financial pressures that could trigger the closing of more sales outlets in 2009. Starting Jan. 1, the struggling auto maker's financing arm will impose large fees on dealers holding new cars and trucks that are unsold after more than 360 days, and will require the payment of all remaining balances on any used vehicles unsold after more than six months. Some dealerships could incur charges totaling hundreds of thousands of dollars over the course of 2009 at a time when many are already losing money and battling to stay in business, according to dealers familiar with the plans. Chrysler Financial acknowledged it has changed the terms on aging inventory. It said it is working with dealers "to ensure we minimize the impact." The sudden loss of dealers could hurt the auto maker's sales and increase consumer worries about the company's future.
Source:  The Wall Street Journal (Subscription required.)

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Chrysler to Close All 30 Plants for One Month

Chrysler LLC said Wednesday that it is closing all 30 of its manufacturing plants for a month starting Friday as it seeks to counter the most severe downturn in U.S. auto sales in more than two decades. By extending the traditional two-week holiday shutdown period, the struggling Auburn Hills, Mich.-based automaker can adjust production to slowing demand and conserve cash. In a statement Wednesday, Chrysler said tighter credit markets are keeping would-be buyers away from its showrooms. The company said its dealers are unable to close sales for buyers due to a lack of financing, and estimate that 20 to 25 percent of their volume has been lost due to the credit situation. Sales in November slid 47.1 percent.
Source:  Associated Press

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GM and Chrysler Reopen Talks on a Merger

General Motors Corp. and Chrysler LLC have reopened merger talks, as Chrysler owner Cerberus Capital Management LP has signaled its willingness to give away part of its ownership in the auto maker, say people familiar with the discussions. With cash running low at both companies, Cerberus took the initiative to restart discussions that sputtered just weeks ago. At that time, both GM and Chrysler viewed a business combination as impractical and as a distraction from their mounting liquidity problems. The renewal of the talks could be a way for Cerberus to show Washington -- which is weighing a $14 billion rescue package for the auto industry -- that it wants to cooperate in restructuring the industry, say people familiar with the buyout firm's thinking. And it could offer the firm a way to protect its stakes in two distressed auto-finance companies, GMAC LLC and Chrysler Financial, which are crucial to the survival of the Detroit auto makers.
Source:  The Wall Street Journal (Subscription required.)

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Carmakers Cut Costs, Await Loan

GM to halt work on new plant in Flint that will build engines for plug-in Chevy Volt and Cruze
WASHINGTON -- Detroit automakers took sweeping steps to cut costs Wednesday as they worried about declining auto sales and waited for President George W. Bush to decide the size and terms of a bailout to prevent General Motors Corp. and Chrysler LLC from collapsing. In its latest move to conserve cash, GM said it would temporarily halt work on a new $370 million factory in Flint that will build engines for two key future products: the plug-in Chevrolet Volt and the Chevrolet Cruze, a small car that will get more than 40 miles per gallon. Chrysler said it will shutter all 30 of its North American assembly plants for at least a month, starting Friday, to keep production in line with falling sales, saying the credit crisis is making it difficult for buyers to get financing. Ford Motor Co. confirmed that it would continue its two-week holiday shutdown to three weeks at nine assembly plants. A tenth Ford plant, Kentucky Truck, is down for retooling.
Source:  The Detroit News

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Retooling Loan Requests at $30.8 Billion

WASHINGTON -- Detroit's automakers and 11 other companies have asked for $30.8 billion in low-interest federal loans to retool factories for more fuel-efficient vehicles, the U.S. Department of Energy told the Free Press on Wednesday -- outstripping the $25 billion that Congress gave the program just three months ago. The loans were approved as part of last year's law boosting fuel economy standards to 35 miles per gallon by 2020. But money for the plan has become a political cause over the past few months as the finances at Detroit's automakers weakened. The three automakers told Congress earlier this month that they were seeking $21.7 billion in loans through the program, and that was in addition to the $34 billion in loans and credit lines they were seeking from Congress. Under the program, the loans could be used to pay part of the retooling costs for vehicles such as the Chevrolet Volt. Energy Department spokeswoman Healy Baumgardner said the agency was reviewing 15 loan applications from 14 companies -- seven automakers and seven parts suppliers. The department had been pressed by lawmakers to start lending within a matter of weeks.
Source:  Detroit Free Press

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U.S. Firms Join Forces to Build Car Batteries

Fourteen U.S. technology companies are joining forces and seeking $1 billion in federal aid to build a plant to make advanced batteries for electric cars, in a bid to catch up to Asian rivals that are far ahead of the U.S. The effort, the latest pitch from corporate America to inject federal dollars into a project, is similar to an alliance that two decades ago helped the U.S. computer-chip industry restore its competitiveness. Participants include 3M Corp. and Johnson Controls Inc. Many experts believe battery technology and manufacturing capacity could become as strategically important as oil is today. Auto makers, including General Motors Corp. and Ford Motor Co., say they plan to roll out plug-in electric cars by 2010. But the U.S. has limited capacity to make the lithium-ion batteries those cars will need. Asian producers such as Panasonic Corp. dominate the car-battery field.
Source:  The Wall Street Journal (Subscription required.)

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NADA Update
NADA Convention to Focus on Future of the Industry

Now is the time to attend the industry event of the year and ensure your dealership’s success
McLean, Va. -- Economic turmoil and uncertainty form the backdrop to the National Automobile Dealers Association (NADA) convention in New Orleans next month. "This is a must-attend convention if there ever was one," says Steve Pitt, NADA vice president of conventions and expositions. “The fate of the industry is hanging in the balance. All of the top manufacturer executives will be there, and dealer franchise meetings are more important than ever. We're also providing new ideas and information and a series of workshops designed to help dealers get through these tough times."
 
The 2009 NADA Convention & Exposition, which runs Jan. 24-27, is offering more than 40 workshops, many of which are designed to tackle today’s tough economic issues head-on, such as maintaining dealer profitability, improving cash flow, surviving the credit crunch and driving customers back to dealerships. “Convention participants will learn what they need to do back home at their dealerships for the good of their businesses,” Pitt added. “The convention will help dealers prepare for an upcoming year of uncertainty.”

For the first time ever at a NADA convention, two former U.S. presidents will take center stage. Former presidents George H.W. Bush and Bill Clinton will deliver remarks during the general session. Ford Motor Co. President and CEO Alan Mulally will deliver the industry keynote address. Inspirational speakers Archie Manning, former quarterback of the New Orleans Saints and the NFL’s Most Valuable Player in 1978, and Christopher Gardner, the inspiration for the movie “The Pursuit of Happyness” will offer motivational talks.

Take a moment to register today. Advance registration for the convention closes Friday, Dec. 19. Many hotel rooms are still available. Airline flights to and from New Orleans have been added, and airfares have been reduced. Hotel rooms can be booked through NADA’s housing agency until Tuesday, Dec. 23.

“This is our 92nd convention and, in many ways, it’s the most important one ever,” says Pitt. “If you’re a dealer, you have to be there.”
Source:  NADA Newswire

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Members Can Now Save on FedEx Shipping

Click here for savingsNADA members are now eligible to receive valuable discounts of up to 29 percent on select FedEx shipping services. There are no costs and no minimum shipping requirements to take advantage of this member benefit. NADA members can save:

• Up to 29 percent on select FedEx Express services
• Up to 25 percent on select FedEx Express international services
• Up to 20 percent on select FedEx Ground services
• Up to 10 percent on select FedEx Home Delivery services

For more information or to enroll in the FedEx Advantage Program, click here or call 1-800-MEMBERS (1-800-636-2377, 8 a.m.–6 p.m. EST, M-F).

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NADA Offers Virtual Seminar Today 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 from 1–3 p.m. EST and Jan. 13 from 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, Jan. 24 at 11 a.m. CST and Monday, Jan. 26 at 8:30 a.m. CST.

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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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Lenovo Offers Holiday Savings

Lenovo is offering NADA members savings of up to 35 percent on all ThinkPad notebooks and accessories. Lenovo's ThinkPad SL notebook -- built for small businesses with legendary ThinkPad reliability, plus advanced wireless and multimedia features -- is available at a discount with eCoupon USXHOLIDAY. This offer ends Dec. 31. To take advantage of these savings, visit NADA's Online PC Purchase program (log-in required), click www.lenovo.com/shop/deals/nada, then "Special Offers," or call (800) 426-7235, Option 1, Ext. 4838. 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
 
"These are desperate times in many communities around the country. We've heard encouraging words from the White House, but time is of the essence."

   
-- NADA Chairman Annette Sykora in a statement urging the government to act soon on the emergency loans to automakers, saying that with each passing day, more dealerships are closing and more people are losing their jobs, Reuters, Dec. 17


"Giving them enough money to limp along doesn't solve anything."

   
-- A senior White House official, who spoke on the condition of anonymity, indicated that the administration was inclined to do more than just keep GM and Chrysler alive until President-elect Barack Obama takes office, The New York Times, Dec. 17


"A lot of people are depending on the White House to provide the bridge loans to prevent a collapse of the auto industry. We need action now."

    -- NADA Chairman Annette Sykora, urging President Bush to act now on automaker loans, NADA Newswire, Dec. 17
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) What You Should Know About Dealership Federal Income Tax Issues

(2) Lean Management - Unleash Your True Potential

(3) Improve Profitability and Customer Retention in Your Service and Parts Operations

Tax Issues speaker Terri Harris of the Internal Revenue Service will discuss Federal Income Tax issues relevant to automobile dealerships, including the latest on dealership UNICAP and LIFO pooling issues. Additionally, this workshop will cover the latest in dealership-specific court cases and other issues of current concern to the IRS.

Lean Management speaker David Summers of Lexus will teach dealers and managers how they can unleash the latent potential in their most valuable resource—their people—through effective lean management. Participants will learn how to create a culture of engaged associates in dealerships of all sizes.

Profitability speaker Robert Atwood of NADA Dealer Academy will teach participants the critical variables of the service department and how the parts department supports them. Attendees will learn how to manage their time to achieve consistent results.

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

Only 2 days left to pre-register! Click here to register online.

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.