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Top Stories
Obama Says U.S. Can't Let Big 3 Fail
Recession Could End This Year, Fed Chief Says
Auto Industry Faces Squeeze From Fed Lending Program
Ford's Mulally Will Take 30% Salary Cut
A Scion Drives Toyota Back to Basics
NADA Update
Union Legislation Addressed in New Virtual Seminar
Seminar Takes 'Deeper Dive' into FTC Red Flags Rule
2010 Convention Workshop Proposals Now Being Accepted
Top Stories
Obama Says U.S. Can't Let Big 3 Fail

In first speech to Congress, he also tells nation 'we will recover.'
WASHINGTON -- President Barack Obama scolded the domestic carmakers Tuesday night for "years of bad decision making," but said "the nation that invented the automobile cannot walk away from it." In a speech to a joint session of Congress, the new president offered no details as to how he would help the industry restructure, and no promise to grant the billions of dollars in new aid that General Motors and Chrysler seek. But it was his strongest commitment yet to preserving the companies that have defined Michigan's economy and identity for a century. "We are committed to the goal of a re-tooled, re-imagined auto industry that can compete and win," he said. "Millions of jobs depend on it." Michigan Democrats acknowledged that Obama had tough words for the industry, but praised his commitment to saving it. "The key word I heard is 'committed,' " said Sen. Carl Levin, D-Detroit. "He's talking about winning. He's not talking about letting this industry go."
Source: The Detroit News

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Recession Could End This Year, Fed Chief Says

The nation's top economic policymaker yesterday offered a sliver of optimism in a time of gloom, saying in carefully hedged comments that growth could return next year if the financial system is put in order. In congressional testimony, Federal Reserve Chairman Ben S. Bernanke depicted an economy undergoing a "severe contraction." But Bernanke said the recession could end in 2009, paving the way for a "year of recovery" in 2010. The situation is "basically black and white," he told the Senate Banking Committee yesterday in his semi-annual testimony on monetary policy and the economy. "If we stabilize the financial system adequately, we'll get a reasonable recovery ... If we don't stabilize the financial system, we're going to founder for some time." Financial markets soared on Bernanke's remarks, with the Standard & Poor's 500-stock index up 4 percent yesterday, even as new data showed that consumer confidence hit an all-time low and home prices continued dropping at a record pace in December.
Source: The Washington Post

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Auto Industry Faces Squeeze From Fed Lending Program

The government's $200 billion program to revive the market for securities backed by consumer loans may end up providing little help to the very industry that needs it most: U.S. auto makers. As the Federal Reserve hashes out final terms of its Term Asset-Backed Securities Loan Facility, or TALF, it is becoming clear that securities that help finance auto dealers mightn't meet some criteria. The problem came to a head because of credit ratings. The Fed has insisted that any deal it helps finance be given a triple-A rating from Moody's Investors Service, Standard & Poor's or Fitch Ratings. Bankers said this kicks out deals backed by loans to auto dealers because S&P and Moody's, in particular, have cut the ratings on such securities over the past several weeks as the industry grapples with potential bankruptcy filings and weaker demand for U.S. cars. The auto companies ... needed the money so dealers could get financing to buy cars from manufacturers. If dealers can't borrow money to buy cars to fill their lots, "you're out of business," said Charles Oglesby, chief executive of Asbury Dealer Group, of Duluth, Ga., which operates 87 retail auto stores. "It backs up the whole process of selling cars." Cheaper loans for dealers also mean cheaper deals for consumers, he said, adding he gets financing from a consortium of lenders and isn't concerned about his own dealers' ability to borrow.
Source: The Wall Street Journal

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Ford's Mulally Will Take 30% Salary Cut

DETROIT -- Ford Motor Co. CEO Alan Mulally will take a 30 percent salary cut for two years as the centerpiece of a package of white-collar pay cuts that may make a vote for concessions more palatable to hourly workers. The disclosure, in a memo to employees obtained by Reuters, came as UAW union leaders urged members to approve a concessionary deal with Ford -- stepping up the pressure on General Motors and Chrysler LLC to reach similar cost-cutting labor agreements in coming weeks. Ford will offer a new round of buyouts to UAW workers of from $20,000 to $50,000, plus the option of a $25,000 voucher toward a Ford vehicle or a $20,000 cash payment, according to a union summary posted on the Detroit Free Press Web site. Ford's deal with the UAW on the VEBA would save it almost $7 billion in cash and could provide the model for concessions at GM and Chrysler, analysts have said. The agreement would also transfer risk to a growing pool of Ford retirees.
Source: Reuters

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A Scion Drives Toyota Back to Basics

TOKYO -- Toyota Motor Corp.'s incoming president, Akio Toyoda, has a sobering message for the giant company founded by his grandfather: It has gotten too fancy for its own good. On Monday, three top executives who helped lead Toyota the past four years -- including Mitsuo Kinoshita, one of the primary architects of the company's global expansion -- announced their retirement. The departures clear the way for Mr. Toyoda's planned makeover of the world's biggest auto maker. Auto makers world-wide are in pain, and Toyota is much stronger than rivals such as General Motors Corp., which is flirting with a bankruptcy filing. Still, Toyota is expecting its first annual net loss in 59 years. Mr. Toyoda blames more than the recession, according to people familiar with the matter. He is sending the message that his predecessors worsened the problem by straying from core ideas of thrift and efficiency. "I think Toyota probably over-expanded a little bit in order to compete with the American auto makers," said his father, Shoichiro Toyoda, 83, who himself was the auto maker's president during the 1980s. "There are a lot of things that we have to review."
Source: The Wall Street Journal

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NADA Update
Union Legislation Addressed in New Virtual Seminar

The so-called Employee Free Choice Act (EFCA) could become law in 2009 and usher in the most dramatic pro-union shift in federal labor law in U.S. history. The EFCA would eliminate the secret ballot in union representation elections, escalating labor union membership, returning traditional labor issues to the forefront—and forcing dealerships to bargain with unions.

To help dealerships understand the issues and meet the challenges they present, NADA has asked D. Gerald Coker, a partner in the law firm Ford & Harrison LLP, to conduct a virtual seminar on March 12 from 1 to 2:30 p.m. EST. In “Responding to Organized Labor: Defending Workplace Democracy,” Coker will discuss the current and proposed federal labor legislation, analyze how the EFCA would affect union organizing strategies at dealerships and present a 10-Point Strategic Action Plan for dealerships to reduce potential vulnerability and improve employee relations. Participants’ questions will be addressed during the final 15 minutes of the seminar.

The fee for this important virtual seminar is $199 per computer connection. To register, visit www.nada.org/seminars or call (800) 252-6232, ext. 2.

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Seminar Takes 'Deeper Dive' into FTC Red Flags Rule

Attorneys from the FTC’s Division of Privacy and Identity Protection—which drafted and enforces the Red Flags Rule—will present a virtual seminar “A Deeper Dive into the FTC Red Flags Rule” on March 26 from 1 to 3 p.m. EST.

With the revised May 1 enforcement date approaching, dealers should ensure that their required Identity Theft Prevention Programs incorporate all of their covered accounts, include all relevant Red Flags, contain effective response and detection procedures, address all the Rule’s other requirements, and are tailored to their particular operations. It's a daunting task in view of the Rule’s general provisions that encompass all types of financial institutions and creditors.

To assist dealers in understanding how the Rule applies to dealership operations, FTC attorneys will join NADA Regulatory Affairs Director Paul Metrey to recap the required elements of the Red Flags and Address Discrepancy Rules and examine implementation considerations for dealers—and then, we’ll open the phone lines so dealers can present their questions directly to the FTC attorneys. Dealers should consider attending the “Deeper Dive” seminar even if they attended one of the previous Red Flags Rule virtual seminars. If you still have any questions, now is the time to ask. We’ll have a great team to answer your questions. And be sure to bring your copy of NADA's A Dealer Guide to the FTC Red Flags and Address Discrepancy Rules.

The fee for this important virtual seminar is $199 per computer connection. To register, visit www.nada.org/seminars or call (800) 252-6232, ext. 2.

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2010 Convention Workshop Proposals Now Being Accepted

Proposals are now being accepted for speakers who are interested in presenting a workshop at the 2010 NADA Convention & Exposition in Orlando, Fla., Feb. 13-16. Topics that are applicable to the current state of the U.S. automobile industry are strongly preferred. To download the proposal, go to www.nada.org/workshops. Completed proposals should be postmarked by midnight, April 30, 2009. For more information, contact NADA Management Education at (703) 821-7227 or workshops@nada.org.

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Featured Video
 
 

 NADA Tackles Industry Crisis


More Video Highlights

Quotable
 
"We are committed to the goal of a re-tooled, re-imagined auto industry that can compete and win. Millions of jobs depend on it."

   -- President Barack Obama, in a speech to a joint session of Congress on Wednesday, The Detroit News, Feb. 25

"We are not gods, we are not infallible. Sometimes even Tiger Woods misses a shot."

   -- Shoichiro Toyoda, former president of Toyota Motor Corp. and father of incoming president, Akio Toyoda, The Wall Street Journal, Feb. 24

Member Products & Services
 

Save Big with Lenovo
Lenovo is offering NADA members up to $815 off select ThinkPad notebooks. Great savings are available on all ThinkPad and IdeaPad notebooks along with all computing accessories. Free ground shipping is available on all Web orders. This is a limited-time offer. To take advantage of these savings, visit NADA's PC Purchase Program online (login required), click the "Lenovo" link, then "Special Offers," or call (800) 426-7235, Option 1, Ext. 4838.
Video Highlights
 
  

 
"The next two months are critical to the future of our industry as we know it," says NADA Chairman John McEleney, addressing a crowd of about 5,000 at the general session of the NADA convention in New Orleans.

NBC: "Demise of local car dealerships leaves big dent."
2009 Convention in New Orleans
NADA on the Front Lines


Click here for more NADA-TV reports.

 

 

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