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Top Stories
NADA Urging Congress, Obama to Include Consumer Tax Break for Auto Purchases in Stimulus Plan
Is Chrysler a Lost Cause?
Fuel Rules Deferred by Bush
Car Dealerships Slash Prices to Drive Traffic
GM Expands Credit Union Program Nationally
U.S. House's Frank Says TARP Funds Should Aid Muni-Bond Issuers
Upside-Down Auto Loans
'09 Auto Output May Hit 6.2 Million
NADA Update
Reminder of New FTC Restrictions on Automated Telemarketing Calls
Convention to Host 21 Automaker Franchise Meetings at Critical Time for the Industry
NADA Convention Features Former U.S. Presidents and Industry Leaders
Carville and Matalin to Headline AFSA's Vehicle Finance Conference in New Orleans
NADA Convention to Focus on Future of the Industry
Understanding the TALF
NADA Offers Virtual Seminar to Help Dealers in 'Tough Times'
STAR Answers Dealers' Questions About Internet Content Systems
Lenovo Offers New Year Savings
Top Stories
NADA Urging Congress, Obama to Include Consumer Tax Break for Auto Purchases in Stimulus Plan

Legislation is part of NADA’s efforts to help increase auto sales.
WASHINGTON – With auto sales at a 16-year low, NADA is pressing the new Congress and the incoming Obama administration to temporarily restore the tax deductibility of auto loan interest to help stimulate the economy. NADA wants this measure included in the larger economic stimulus package being considered by Congress. “Since the stimulus plan is being written in the coming days, it is critical that dealers call their members of Congress immediately to ensure that they ask their House and Senate leadership to include auto deductibility in the new economic stimulus plan,” says David Regan, NADA vice president of legislative affairs.

The auto deductibility measure, first introduced late last year by Sen. Barbara Mikulski (D-Md.) in the Senate and Rep. Bill Pascrell (D-N.J.) in the House, has broad bipartisan support. The proposals would help consumers by making auto loan interest and sales tax deductible for any new car purchase under $49,500 from the date of enactment through Dec. 31, 2009 for the life of the loan. These incentives could save an average family more than $1,500 on a $25,000 car purchase and individuals with income under $125,000 or family income under $250,000 would be eligible. Rep. Pascrell has already reintroduced the House bill, H.R. 159 and Sen. Mikulski is expected to reintroduce the Senate measure soon.

Senators and Representatives need to hear directly from dealers on the need to stimulate auto sales to help the broader economic recovery. A tax break can help provide the added incentive to bring customers into the showroom, restore consumer confidence and provide auto sales tax revenue to state governments suffering from record losses in tax revenue. Members of Congress can be reached through the Capitol Switchboard at (202) 224-3121.  For more information, call NADA’s Legislative Office at (800) 563-1556.
Source:  NADA Newswire

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Is Chrysler a Lost Cause?

DETROIT -- Even by the standards of battered automakers, Chrysler is in dire shape. Its sales in December were down a stunning 53 percent, far worse than Ford or General Motors, and analysts say it probably won't survive the year as an independent company -- despite $4 billion in government loans and the possibility of more. Things were so bad last year that a single Toyota model, the Camry/Solara midsize car, outsold the entire fleet of Chrysler LLC's passenger cars. Chrysler will not comment on speculation about its future, spokeswoman Shawn Morgan said Wednesday. "We are completely focused on our plans to ensure the future viability of our company," she said. U.S. sales of Chrysler, Dodge and Jeep brand vehicles fell 30 percent last year, the worst decline of any major automaker. It lost more market share than any of its peers, down to 11 percent. Chrysler Chief Executive Robert Nardelli, in a presentation to the Senate Banking Committee last month, said the company could stay alive in the long term with reasonable concessions, a $7 billion bridge loan and $6 billion more out of the $25 billion Congress allocated to develop new fuel-efficient technology. Nardelli said Chrysler will improve fuel economy on 19 models this year, about three-quarters of its product line. Besides the electric car, it also has a deal with Nissan to produce a Chrysler subcompact in 2010.
Source:  Associated Press

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Fuel Rules Deferred by Bush

Plan to increase auto industry gas mileage standards handed off to President-elect Obama
WASHINGTON -- The Bush administration abandoned efforts Wednesday to finalize a landmark increase in fuel efficiency standards, leaving a difficult decision to President-elect Barack Obama's administration in his first two months in office. Last April, the Bush administration proposed hiking the standards to a fleet-wide average of 31.6 miles per gallon -- or about 4.5 percent annually -- at a cost of about $47 billion to the U.S. auto industry. The decision to delay the regulation came after many in the White House questioned whether the Bush administration should impose one of the most expensive regulations in U.S. history at the same time the government was giving the auto industry $23.4 billion in emergency loans. The decision not to release the regulation is a setback to automakers, who fear the Obama administration will set even tougher fuel economy rules. The Alliance of Automobile Manufacturers, a trade group that represents Detroit's Big Three car companies, Toyota Motor Corp, Daimler AG and five other automakers, was disappointed in the Bush administration's action. "Now more than ever automakers need certainty and this decision only further delays their ability to finalize future product plans," spokesman Charles Territo said. "We look forward to working with the Obama administration to provide them with any information they need to complete this rulemaking." Mike Stanton, president of the Association of International Automobile Manufacturers, also expressed concern. "Our member companies have pledged to meet or exceed the challenging new fuel economy requirements," Stanton said. "Achieving these goals, however, requires significant lead time to properly design and engineer a new generation of high efficiency vehicles for the market. This delay will complicate an already ambitious timetable."
Source:  The Detroit News

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Car Dealerships Slash Prices to Drive Traffic

DES MOINES, Iowa -- By all accounts it's a great time to buy a new car. Manufacturers are willing to slash thousands off sticker prices and offer interest-free money. But there's a catch. Those deals won't do you any good if you can't qualify. "The biggest challenge we've got is the availability of credit," said Dale Early, owner of Deerbrook Forest Chrysler-Jeep in Kingwood, Texas. Early said approvals have dropped down to about 50 percent, a fall from about 80 percent just a year ago. "If you have (credit score of) 700 and above you don't have a problem getting a loan. We're seeing some great opportunities for people with excellent credit," he said. But in his experience anyone with a credit score of 650 or lower is having trouble getting approval. The reason lenders remain cautious was revealed Wednesday in the American Bankers Association quarterly credit report. Auto loan delinquencies reached record levels in the third quarter of 2008 as unemployment continued to climb. Delinquencies for indirect auto loans -- those made through an auto dealer and which account of 90 percent of auto loans -- rose to a record 3.25 percent. That's up from 3.07 percent in the second quarter. But the outlook may be improving as the restrictions on credit may be easing. "I think that some of the bailout money initially given to lenders is finally starting to trickle down to the streets," said Lenny Sims, general manager at NADAguides.com, a company that focuses on auto pricing.
Source:  Associated Press

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GM Expands Credit Union Program Nationally

DETROIT -- General Motors today launched a nationwide test program that gives 90 million credit union members access to the company's Credit Union Member Discount Program with participating GM dealers. The "Invest in America" program also gives members access to financing on new-vehicle purchases. This follows a four-state Midwest program GM began early last month. This week, Chrysler LLC expanded its credit union program nationally after starting it in 12 states. Mark LaNeve, GM vice president of North America sales, service and marketing, said in a statement: "We've had very positive responses from our dealers to the four-state Midwest credit union pilot that is currently running. This national pilot really expands the benefits of a great GM supplier price to credit union members all around the country who also have access to affordable financing through their local credit union."
Source:  Automotive News (Subscription required.)

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U.S. House's Frank Says TARP Funds Should Aid Muni-Bond Issuers

Representative Barney Frank, chairman of the House Financial Services Committee, said the second half of the government’s $700 billion financial rescue should include aid for municipal bond issuers hurt by the credit crisis. In a memo to House colleagues yesterday, Frank said he was crafting legislation with “new conditions” for spending the funds. Even if the bill is rejected, Frank said “it would be our hope” that President-elect Barack Obama will agree to follow its provisions. Frank’s letter listed six elements he said are necessary for Congress to support releasing the other half of the Troubled Asset Relief Program. Along with help for cities and states, Frank said the measure will include “substantial efforts” to reduce foreclosures, a demand for banks to disclose how they’re spending TARP money and “explicit authority to make sure” funds are used for auto financing. “If we are able to get guarantees that funds will be re-lent, a reduction in mortgage foreclosures, aid for the purchasers of automobiles, help for tax-exempt bond issuers and for home buying going forward, then I believe the $350 billion could make a very important contribution to our economic efforts,” wrote Frank, a Massachusetts Democrat.
Source:  Bloomberg

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Upside-Down Auto Loans

Plummeting vehicle values trap some buyers into owing more than their trade-ins are worth
Long-term auto loans and low down payments, coupled with falling values, are leaving some drivers "upside down" -- owing more than their vehicles are worth. Consumer advocates worry that this trend will worsen in the next year as cash-strapped consumers -- desperate to dump their gas-guzzling sport-utility vehicles, trucks and cars -- discover that they can't get good financing on their negative-equity trade-ins. The values on "clean, 1-year-old" vehicles have dropped in the past year -- by between 9 percent and 38 percent, depending on the make and model -- according to the National Automobile Dealers Association.
Source:  The Columbus Dispatch

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'09 Auto Output May Hit 6.2 Million

North American auto production may reach a "worst-case scenario" this year and next as 2009 U.S. output plunges 27% amid reductions by General Motors Corp. and Ford Motor Co., IHS Global Insight Inc. said. Automakers may build 6.22 million cars and light trucks in the United States this year, after producing an estimated 8.5 million in 2008, the Lexington, Mass.-based forecasting company said Tuesday in an e-mail statement. The outlook comes a day after automakers reported that 2008 U.S. sales of vehicles built in various countries slid 18% to 13.2 million, the lowest level in 16 years.
Source:  Bloomberg

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NADA Update
Reminder of New FTC Restrictions on Automated Telemarketing Calls

An “Existing Business Relationship” Will Not Be Enough
In 2008, the FTC adopted an amendment to the Telemarketing Sales Rule (“TSR”) that, among other things, prohibits prerecorded telemarketing calls without a consumer’s express written agreement to receive such calls.

As of Dec. 1, 2008, sellers and telemarketers (including dealers that make such calls) are required to provide a keypress or voice-activated opt-out mechanism promptly at the outset of any prerecorded message call. This requirement applies to calls delivering prerecorded messages, whether answered by the recipient in person, or answered by an answering machine or voicemail service, and requires that any prerecorded message call promptly disclose at the outset a toll-free number that a consumer may use to assert a request not to receive such calls. The rule also requires that automated calls allow the telephone to ring for at least fifteen seconds or four rings before disconnecting an unanswered call.

Under the new rule, sellers and telemarketers may, for the time being, continue to place calls that deliver prerecorded messages to consumers based on an existing business relationship (“EBR”) with that customer -- provided they do so in compliance with the new requirement that prerecorded message calls include an automated interactive keypress or voice-activated opt-out mechanism.

However, as of Sept. 1, 2009, sellers and telemarketers may not make such prerecorded calls unless they have a prior express written agreement from the recipient to receive such calls. That written agreement: (1) cannot be required (directly or indirectly) of customers as a condition of purchasing any good or service; (2) must “evidence the willingness” of the recipient to receive such calls; and (3) must include the recipient’s telephone number and signature (although such signature may be electronic in compliance with ESIGN).  

Note that this amendment differs in some regards from current FCC restrictions regarding prerecorded telemarketing calls.  If you have any questions about the FCC restrictions consult nada.org or contact our office. Click here for the amendment to the TSR.

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Convention to Host 21 Automaker Franchise Meetings at Critical Time for the Industry

Now that U.S. automakers are receiving bridge loans, attention has shifted to the NADA Convention & Exposition in New Orleans Jan. 24-27 when dealers will have an opportunity to meet face-to-face with the top leadership of the auto manufacturers. NADA’s Industry Relations Group has announced that 21 separate manufacturer franchise meetings have been confirmed at the convention.

“NADA is pleased that nearly all of the automakers’ CEOs and presidents plan to attend these important meetings,” said Annette Sykora, NADA chairman. General Motors’ Rick Wagoner, Toyota’s Jim Lentz, Chrysler’s Jim Press and Ford’s Alan Mulally are all planning to attend. Mulally will deliver the keynote industry address at the convention’s opening session on Saturday, Jan. 24. “There could not be a more important time for a dealer to attend an NADA convention and hear directly from their manufacturer,” Sykora added. "Franchise meetings offer dealers the opportunity to hear from NADA, dealer councils and the automaker’s leadership, as well as ask questions of their manufacturers directly."

“These meetings come at a critical time,” Sykora said. “Automotive retailing is going through historic changes, and there is no better place for dealers to meet and discuss the future of their industry than at the NADA convention." Information and a complete list of scheduled franchise meetings can be found at www.nada.org/convention.
Source:  NADA Newswire

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NADA Convention Features Former U.S. Presidents and Industry Leaders

The National Automobile Dealers Association (NADA) has assembled a lineup of leading political figures and inspirational speakers—including former U.S. presidents George H.W. Bush and Bill Clinton—to deliver remarks at its 92nd annual Convention & Exposition in New Orleans Jan. 24-27. “This year’s lineup is one of the most impressive in NADA’s history,” said Convention Chairman and auto dealer Jeff Carlson. “In line with NADA’s convention theme of ‘Committed to Community,’ former U.S. presidents George H.W. Bush and Bill Clinton join us in highlighting nationwide efforts to give back to the New Orleans community.” Last year, the NADA Charitable Foundation made a $400,000 contribution to the Brees Dream Foundation—founded by New Orleans Saints quarterback Drew Brees and wife, Brittany—to help rebuild the athletic fields at the largest public high school in New Orleans. Ford Motor Co. President and CEO Alan Mulally will deliver the keynote address during the General Assembly on Saturday, Jan. 24, following NADA Chairman Annette Sykora. Archie Manning, former Saints quarterback and NFL Most Valuable Player, and Christopher Gardner, the inspiration for the movie “The Pursuit of Happyness,” will offer motivational talks. Incoming NADA Chairman John P. McEleney will outline his priorities Monday, Jan. 26 for the coming year.
Source: NADA Newswire

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Carville and Matalin to Headline AFSA's Vehicle Finance Conference in New Orleans

Political commentators James Carville and Mary Matalin will give the keynote presentation at the American Financial Services Association’s (AFSA) 13th Vehicle Finance Conference and Exposition scheduled Jan. 21-23 at The Sheraton New Orleans. The husband and wife duo, who have sharply different political views, will discuss the new presidential administration during a presentation on Friday, Jan. 23. The vehicle finance conference, held just prior to the National Automobile Dealers Association (NADA) annual convention, also will feature a panel of top industry leaders who will share their views about the current market environment as well as the traditional “Straight Talk with Dealers” session featuring the NADA leadership: John McEleney, incoming chairman; Ed Tonkin, incoming vice chairman; and Mike Martin, director from Virginia. Michael Brown from the Atlantic Auto Group will also speak. Additional sessions and round tables will focus on Risk Management, Legal and Legislative Issues, Maximizing Human Capital, the New Generation of Auto Finance Companies, Profitability Management Analytics and Operational Effectiveness and Dealing with Fraud. To register for AFSA’s meeting, visit www.vehiclefinanceconference.com.
Source:  AFSA

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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
Economic turmoil and uncertainty form the backdrop to the National Automobile Dealers Association (NADA) convention in New Orleans. "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.

“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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Understanding the TALF

A new Web page on nada.org explains in greater detail what the Federal Reserve Board's Term Asset-Backed Securities Loan Facility (TALF) program means to dealers and how they will benefit from the action taken on Dec. 19 to include securities backed by dealer floorplan loans as a qualifying asset class. The information is helpful in explaining this action to dealers and the media. Click here for "Understanding the TALF."
Source:  NADA Newswire

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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 new seminar on dealership survival, Tough Times, Tougher Dealers: Saving Your Dealership’s Assets. The seminar is being presented both as a virtual seminar and as a convention workshop at the 2009 NADA Convention & Exposition in New Orleans.

The first virtual seminar, held Dec. 18, drew more than 200 participants and lasted more than an hour, followed by a lively and informative Q & A session. As participants were not identified by name or dealership, discussion was extremely candid. NADA is offering only one more virtual seminar to be held Jan. 13 from 1–3 p.m. EST. The registration fee is only $50 per computer connection. Don't miss out! Register now at www.nada.org/seminars.

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

In Tough Times, 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 the tough environment, both legally and financially.

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STAR Answers Dealers' Questions About Internet Content Systems

Standards for Technology in Automotive Retail (STAR) has developed new guidelines to help dealers evaluate their dealership data security. Visit STAR's Dealer Infrastructure Guidelines (DIG) publication to learn more. To read the answer to the question "What are the things that a dealer should look for when considering any type of Internet Content System?" click here.

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Lenovo Offers New Year Savings
NADA members can now save up to 34 percent on select notebooks and all ThinkPad and IdeaPad notebooks along with all computing accessories. The discounts are available to dealership employees too. This is a limited-time offer. 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. Enter eCoupon USXNEWYEAR at checkout to receive the NADA discount. Free ground shipping is available on all Web orders.

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Featured Video
 
  
Click here to see why New Orleans is still America's premier convention city.



More Video Highlights

Quotable
 
"We are completely focused on our plans to ensure the future viability of our company."

   
-- Chrysler spokeswoman Shawn Morgan, referring to the company's survival, Associated Press, Jan. 7


"We look forward to working with the Obama administration to provide them with any information they need to complete this rulemaking."

    -- Alliance of Automobile Manufacturers spokesman Charles Territo, responding to the Bush administration's decision to defer increases in fuel efficiency standards, The Detroit News, Jan. 8


"Our member companies have pledged to meet or exceed the challenging new fuel economy requirements. Achieving these goals, however, requires significant lead time to properly design and engineer a new generation of high efficiency vehicles for the market. This delay will complicate an already ambitious timetable."

    -- Mike Stanton, president of the Association of International Automobile Manufacturers, responding to the Bush administration's decision to defer increases in fuel efficiency standards, The Detroit News, Jan. 8


"The biggest challenge we've got is the availability of credit."

    -- Dale Early, owner of Deerbrook Forest Chrysler-Jeep in Kingwood, Texas, explaining one reason for the industrywide sales decline, Associated Press, Jan. 8

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) How Smart Dealers are Changing the Way they Advertise

(2) Creating Superstar Salespeople

(3) Maximize Service Advisor Performance: Four Easy Steps to Enhance Performance

Smart Dealers speaker Dorthy Miller Shore of the Miller Agency will present a 360-degree approach to advertising that integrates all forms of media to drive business. Participants will learn a new media model that applies in today’s Internet world.

Superstar Salespeople speaker Mark Tewart of Tewart Enterprises, Inc. will give specific examples of sales skills, people skills, life skills, and marketing skills that can transform average sales performance to great performance.

Service Advisor speaker Jim Phillips of NADA will present dealers with a clear-cut plan for improving the performance of service advisors. Participants will learn the best approaches to the appointment process, the pre-work process (including homework), the walk-around and write-up and interactive delivery.

Advance registration for the 2009 NADA Convention & Exposition is now closed. Register onsite beginning at 10 a.m. Friday, Jan. 23.

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



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.