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Thursday, April 2, 2009 RSSSEND TO A FRIENDPRINT
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Top Stories
U.S. Auto Dealers Lobby Senate, 'Clunkers' Accelerate
SBA Pick Says She'll Look at RV, Car Loans
Auto Makers See a Ray of Hope
Obama, IRS Promote Write-offs For Vehicle Buys
Investors Latch On To Signs Of Hope
Loan Giant GMAC Reaches Out to Car Buyers, Dealers
Top Stories
U.S. Auto Dealers Lobby Senate, 'Clunkers' Accelerate

WASHINGTON -- Auto dealers stepped up lobbying on Wednesday for government to help them finance their inventories, while lawmakers sought to broaden support for an auto sales incentive plan worth up to $2 billion. The National Automobile Dealers Association asked members to support a Senate petition to the Obama administration to loosen a credit logjam, improve liquidity within the sector and stem dealership closings and job losses. Dealers want the administration to expand access to Small Business Administration lending to help finance their floorplans. Additionally on Wednesday, proposals to stimulate car sales took shape in the House of Representatives and Senate with any final action still weeks away, lawmakers said.
Source: Reuters

[Editor's Note: NADA strongly urges dealers to call their senators to ask them to sign a letter to President Obama requesting that he expand the availability of auto credit for floorplanning. The deadline for senators to sign the “Shaneen Auto Credit" letter is this Friday at noon Eastern Time. Senators can be reached through the Capitol Switchboard at (202) 224-3121. For more information click here.]

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SBA Pick Says She'll Look at RV, Car Loans

WASHINGTON – The nominee to head the Small Business Administration promised Wednesday to see what she can do to provide loans to RV and car dealers to pay for their inventories. The pledge from Karen Mills nudges the Obama administration’s position closer to what the RV and auto dealers have said is their top priority: easing credit so dealers can purchase the cars, trucks and RVs for their showroom floors. John McEleney, chairman of the National Automobile Dealers Association, issued a statement that "vehicle inventory financing is the building block to automaker viability. It affects the entire auto retail network, domestic and international." He said that finding a way to extend credit to dealerships "is essential not only to a healthy automotive industry, but to the overall economic recovery."
Source: The Journal Gazette (Fort Wayne, Ind.)

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Auto Makers See a Ray of Hope

March Sales Fell 37%, but Drop Was Less Than in February; GM Points to 'the First Signs of Brightening'
Despite reporting another major sales decline in March, auto makers expressed a rare bit of optimism Wednesday, saying they see signs the industry's downturn might be near bottom and a recovery could be starting. All the big car makers suffered sales declines of 36% or more compared to March 2008. The annualized sales pace, a closely watched indicator, came in at 9.86 million vehicles, well below the 16 million or more the industry typically logged a few years ago, but up from February's pace of 9.12 million. "I believe we are in a bottoming process for the industry," Bob Carter, a group vice president at Toyota Motor Corp., said in a conference call.
Source: The Wall Street Journal

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Obama, IRS Promote Write-offs For Vehicle Buys

The tax write-off passed by Congress in February and mentioned Monday by President Barack Obama is helping dealers close some new-car sales, says National Automobile Dealers Association spokesman David Hyatt. The deduction covers the taxes paid on new cars, light trucks, motor homes and motorcycles up to $49,500. President Barack Obama mentioned the initiative Monday during a discussion on the General Motors and Chrysler LLC bailouts. "I was talking to dealers yesterday about this," Hyatt told Automotive News. "I asked a salesmen if he used the tax write-off as a talking point. He said it was a welcome thing that he's used to close some deals," Hyatt said. The NADA was instrumental in getting the provision included in the stimulus package that passed in February.
Source: Automotive News

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Investors Latch On To Signs Of Hope

Hints of Stability Give Stocks Boost
Stocks climbed yesterday as investors started the second quarter by extending a rally that began in March on hopes that the economy could be stabilizing, continuing to shrug off more poor economic news and search instead for the silver linings. A major sell-off Monday spurred by concerns that the country's large automakers could be forced into bankruptcy has been wiped away as stocks posted their second straight day of gains. Ford climbed 4.2 percent, to $2.74 a share. Chrysler is privately held. General Motors was down 0.5 percent, to $1.93 a share. But GM's stock has tumbled 47 percent this week since the Obama administration gave it a limited timetable to submit new restructuring plans or face bankruptcy.
Source: The Washington Post

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Loan Giant GMAC Reaches Out to Car Buyers, Dealers

WASHINGTON -- Auto lending giant GMAC took steps Wednesday to shore up struggling auto dealers and moved to boost auto sales by reducing financing charges and extending loans to subprime buyers with lower credit scores. The auto and home mortgage finance company said it will accept auto loan applications for customers with credit bureau scores under 620, which is considered subprime. John McEleney, president of the National Automobile Dealers Association, called GMAC's moves a "very positive step." He estimated that at least 20 percent of GM customers didn't have the credit scores to get financing. "It's going to help ... dealers and make credit available to a wider range of customers," he said. GMAC, rapped by critics as being too tough on dealers, will waive some dealer payments and help them sell aging inventory. GMAC said it will end so-called "curtailment" payments for aging inventory this month.
Source: The Detroit News

[Editor's Note: NADA applauds GMAC for (1) taking meaningful steps to help dealers emerge from the current credit crisis, and (2) responding to several NADA requests for assistance to its members, including those contained in a February 6 letter to General Motors from NADA Chairman John McEleney. NADA will continue to stress to GMAC and other finance sources the precarious position of many dealers due to inadequate credit and the need to explore all available measures to ease the burden that the credit crisis has created.]

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Quotable
 
"Credit is the lifeblood of the franchised dealers' economic model. Additionally, dealers, like many other businesses, need sufficient working capital to maintain cash flow."

   
-- Sen. Jeanne Shaheen, a New Hampshire Democrat, in a draft letter to President Barack Obama, Reuters, April 2


"For those thinking about buying a new car this year, this deduction may give them a little more drive to make their purchase this year. This deduction enables taxpayers to buy now and get cash back later on their tax returns."

   
-- IRS Commissioner Doug Shulman, referring to the tax write-off passed by Congress in February and mentioned Monday by President Barack Obama, Automotive News, April 1
Video Highlights
 
 
New Mexico Dealer Testifies Before Senate Committee on Floorplan Loans (NADA-TV)


 
Banks Turning on American Car Dealers? (WTNH-TV)


 
McEleney: Meeting With Obama Auto Task Force 'Productive'  (NADA-TV)


 
NADA Testifies at EPA Hearing on Fuel Economy (NADA-TV) 


 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 video reports.

 
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