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Wednesday, March 11, 2009 RSSSEND TO A FRIENDPRINT
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At a Glance...
Top Stories
Analysts Share Ideas to Help Auto Industry
Clash Over Labor-Rights Bill Appears Likely
TALF Bogs Down as Investors Balk
UAW and GM Reach Accord
GM Delays Innovative New Diesel Truck Engine
Audi Sales, Profits Up in 2008
NADA Update
NADART 401(k) Named Preferred Provider for National Independent Auto Dealers Association
Union Legislation Addressed in New Virtual Seminar
Seminar Takes 'Deeper Dive' into FTC Red Flags Rule
Top Stories
Analysts Share Ideas to Help Auto Industry

Two auto analysts suggest that spending some government auto aid money for direct-to-consumer incentives could boost sales and benefit the whole industry. They say the government could provide discount vouchers for new car buyers, as is successfully being done in Europe, or could underwrite the costs of a federal version of South Korean automaker Hyundai's successful Assurance Plan. The key benefit of either plan: "The government fund would support the entire industry, allowing customers to buy what they want," says Itay Michaeli, auto analyst at Citi Investment Research. A federal program similar to Hyundai's incentive would tap what could be pent-up demand for new cars among buyers numbering in the millions for $5 billion or less, he says. The other plan, usually called scrappage, provides government discounts for new car buyers if they trade in old cars to be scrapped. It is currently being done in several European nations, and its value is seen as not only improving car sales — helping automakers, dealers, parts suppliers and lenders — but also retiring older vehicles that pollute more, use more fuel and are less safe. Such a plan "could turn the (U.S.) auto industry around in a year," says Joseph Barker, sales forecaster at consultant CSM Worldwide. "It would have an immediate, stimulating effect on auto sales."
Source: USA TODAY

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Clash Over Labor-Rights Bill Appears Likely

President Obama has hinted that although he supports the Employee Free Choice Act, he would be open to revised legislation that commands broader support, and is not exactly burning to push the labor-rights bill anytime soon. But as the legislation, which would make it easier for unions to organize, was re-introduced yesterday, all signs were pointing to the kind of incendiary clash the president hoped to avoid. Sen. Tom Harkin (D-Iowa) and Rep. George Miller (D-Calif.), two leading sponsors, announced the bill's arrival as hundreds of union members and business owners swarmed Capitol Hill to start making their case for and against the measure. The business owners, drawn from the states of key senators, got their marching orders at U.S. Chamber of Commerce headquarters, where leaders of the organization and Sen. John Thune (R-S.D.) praised them as the "first Marines hitting the beach" to defeat a "job killer" bill. The bill would allow employees to form unions by getting a majority of workers to sign cards, without having to hold a secret ballot; at present, it is up to employers to decide whether workers must hold an election or organize via "card check." And the bill would mandate that if employers and workers cannot agree on a contract in 120 days, a government arbitrator will intervene. The bill has majority support in the House and the Senate, but it needs 60 Senate votes to survive a filibuster. And compared with its last go-round, the measure has six fewer sponsors in the Senate and seven fewer in the House, even though there are more Democrats on the Hill now. The bill will not be taken up right away, as Democrats hope that Al Franken will be able to claim a contested Senate seat from Minnesota. Chamber leaders told their troops to demand a filibuster vote and not settle for senators saying they would improve the bill. "There is no compromise," said Chamber general counsel Steven J. Law.
Source: The Washington Post

[Editor's Note: NADA strongly opposes this legislation, and encourages dealers to immediately contact their Members of Congress in opposition. NADA is also hosting a virtual seminar tomorrow from 1 to 2:30 p.m. EST to discuss best practices in dealer labor relations as well as the potential impact of the Employee Free Choice Act. More information on the seminar, click here.]

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TALF Bogs Down as Investors Balk

The government's $1 trillion program to spark consumer lending hit another roadblock when investors balked at signing an agreement required to participate in the program, arguing that it gave Wall Street dealers and the Federal Reserve too much power to look at their books and reject them from the program. Through the Term Asset-Backed Loan Facility, or TALF, program, an investor can put down $5 to $14 for every $100 it will put up, borrowing the remaining $95 to $86 cheaply from the Fed. They agree to buy eligible, highly rated securities issued by lenders making loans to businesses and consumers to buy cars, pay for their educations or use credit cards. The Fed-and-Treasury-backed program is set to begin next week, but it faces the tough task of getting potentially hundreds of financial firms to agree on the wording of the contracts. Hanging in the balance are plans for several deals that bankers hoped to include in the first round of offerings sold under the Fed's program, including: auto lender World Omni's expected $750 million deal; a deal for auto-loan-backed securities from Ford Motor Credit; and offerings from the finance arms of Nissan Motor Co. and used-car retailer CarMax Inc., say bankers. TALF was initially launched last November, and the government trickled out few details about it until this February, when the program became a marquee feature of Treasury Secretary Timothy Geithner's revamped plans to stabilize the financial system.
Source: The Wall Street Journal

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UAW and GM Reach Accord

Fiscal concessions match Ford deal
The UAW has agreed to contract concessions with General Motors Corp. that are similar to the recently approved Ford Motor Co. deal in terms of economics but "drastically different" in other areas, according to a top union leader. But union members will not get a chance to ratify the agreement until the UAW and GM finish negotiating a debt restructuring of the retiree health care trust, Cal Rapson, UAW vice president of the GM division, said in a note dated Monday to local presidents and chairpersons. "The tentative changes that we have made to the UAW GM National Agreement in the area of economics pattern the UAW Ford agreement," Rapson said. "However, other parts of the Ford agreement are drastically different." The differences include "no mandatory physical examinations in the UAW GM agreement" and "with regard to employee placement," he said. "Other parts of the agreement are different to better fit the UAW GM culture."
Source: The Detroit Free Press

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GM Delays Innovative New Diesel Truck Engine

DETROIT -- General Motors' deteriorating financial situation has caused the company to delay one of the most advanced engines that it has ever designed, a 4.5-liter diesel for light-duty trucks. "We have to make tough decisions right now," said GM Powertrain spokeswoman Susan Garavaglia. GM had planned to install the engine in the Chevrolet Silverado and GMC Sierra pickups. The result would have been a fuel-efficient truck priced for less than the heavy duty diesel-powered trucks available now. GM has been awarded several patents for the engine design, and early tests have shown the new motor to be as smooth and quiet as a gasoline engine. Development of the engine was far along when the decision was made to put the program on hold. Rights to the engine may be sold to another company, Garavaglia said.
Source: Automotive News

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Audi Sales, Profits Up in 2008

Bucking the gloomy industry trend, German automaker Audi AG increased sales and profits to record levels last year after outperforming its rivals in major markets and expanding its business in China and Eastern Europe. In the United States, where luxury car sales slumped 18 percent, Audi increased its share of the premium auto market. It expects to raise it again this year after rolling out new models such as the stylish A4 sedan and Q5 SUV. "We think we're in a very good position to weather the economic storm," said Audi of America President Johan de Nysschen. "2008 was the most successful fiscal year in the history of our company," Audi CEO Rupert Stadler said. "We have been steadily improving our productivity in recent years, and the main financial figures for 2008 reflect this." This year, Audi expects its sales to fall but not as steeply as overall worldwide vehicle sales. Company officials anticipate a 10 percent drop in Audi sales, compared with a global contraction of between 15 percent and 20 percent.
Source: The Detroit News

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NADA Update
NADART 401(k) Named Preferred Provider for National Independent Auto Dealers Association

McLEAN, Va. -- NADA Retirement Administrators, Inc. (NADART) was selected as the preferred retirement plan provider for the National Independent Auto Dealers Association (NIADA), a trade group representing about 20,000 members. "NADART was chosen for its ability to provide a quality retirement plan to its members at a cost they can afford," said Stephen Johnson, director of marketing for NADART. "Our products as well as our commitment to the auto industry will prove to be a good fit for NIADA and their members."
Source: NADA Newswire

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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 tomorrow 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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Quotable
 
"[A nationwide vehicle scrappage plan] could turn the (U.S.) auto industry around in a year. It would have an immediate, stimulating effect on auto sales."

    -- Joseph Barker, sales forecaster at consultant CSM Worldwide, on the positive effect of government discounts for new car buyers if they trade in old cars to be scrapped, USA TODAY, March 11

Video Highlights
 
 

NADA-TV: McEleney Says Meeting With Obama Auto Task Force Was Productive

 

NADA-TV: McEleney Testifies at EPA Hearing on Fuel Economy Rules

 NADA Tackles Industry Crisis


NADA Chairman Speaks at the Convention in New Orleans
NBC: "Demise of Local Dealerships Leaves Big Dent"
2009 Convention in New Orleans
NADA on the Front Lines


Click here for more NADA-TV reports.

Member Products & Services
 
Lenovo Celebrates  St. Patrick's Day

NADA Members can save up to 41 percent off the Web price on select Lenovo PCs and notebooks by entering the eCoupon USXSTPATSSALE at checkout. Great savings also are available on all ThinkPad and IdeaPad notebooks along with all computing accessories. Shipping is free on all Web orders. This offer ends March 17. To take advantage of these savings, visit NADA's PC Purchase Program online (login required).

NADA Used Car Guide Unveils Used-Vehicle Appraisal Product for Dealers

NADA Used Car Guide is introducing a unique and affordable new appraisal product called NADA AppraisalPRO, which provides a complete picture of the used-vehicle market in one location. The online tool provides dealers with the flexibility to define the market area and customize each appraisal by making adjustments to determine the best number for each and every trade-in. NADA AppraisalPRO is available at a low introductory monthly subscription rate of $150 for unlimited lookups per location. For more information, visit www.nada.com/appraisal. To place an order, call (866) 974-6232.

 
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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.