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Monday, May 4, 2009 RSSSEND TO A FRIENDPRINT
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Top 10 Stories
NADA Does Record 40 Media Interviews in One Day
SBA Relaxes Loan Program Standards; More Dealers Qualify
For Many Chrysler Dealers, Bankruptcy 'A Relief'
Chrysler Bankruptcy Won't Interrupt Warranties, Treasury Says
Some Sticking with Chrysler, Others Skeptical
Chrysler in Hand, Fiat Turns to Opel
GM Shifts Negotiations Into High Gear
Ford Outsells Toyota as Auto Sales Drops Go On
A Life Selling Pontiacs, and Feeling Sold Out
Federal Trade Commission Delays Enforcement of Red Flags Rule
Top 10 Stories
NADA Does Record 40 Media Interviews in One Day

On automaker restructuring, there’s one clear message: Dealers are not the problem: they are part of the solution
National and international media interest in the dealer's side of the Chrysler and GM restructuring story remains high. On Friday, NADA’s public affairs office handled more than 40 media interview requests. Most focused on the Chrysler bankruptcy and its announced plans to cut its dealer ranks. Others focused on GM’s dealer cutbacks, the expansion of SBA loan eligibility, floorplanning and various other lending issues. “There are too many media calls to list them all,” says David Hyatt, NADA’s vice president of public affairs. “The dealers have a unique Main Street America perspective that the media want to hear about,” Hyatt added. 

NADA Chairman John McEleney took the lead on most of the media interviews, with appearances on C-Span’s "Washington Journal," National Public Radio’s "All Things Considered" and "Talk of the Nation" and CBS News Radio, among others. McEleney was quoted extensively by a number of print and online media as well, including CNNMoney.com, Automotive News, The Washington Post, The New York Times, Bloomberg, The Financial Times and the Detroit Free Press, to name a few.

Dale Early, a Texas dealer and chairman of NADA’s public affairs committee, also did a number of interviews, most notably with The Associated Press on the Chrysler situation. Other dealers were involved in responding to media calls, including Chuck Eddy, an Ohio dealer and NADA board member, who handled a flurry of media requests on the Chrysler bankruptcy, including the Fox Business Network.

Mike Martin, a GM dealer from Virginia, appeared on NPR’s "Marketplace Radio." New NADA Board member Tammy Darvish, a dealer from the Metro DC area, appeared on “Washington Post Radio” with Warren Brown and also recently appeared on C-Span and CNBC. Geoff Pohanka, who’s also from the Metro DC area, discussed how GM dealers will be affected by GM cutbacks in a Saturday appearance on CNN.
Source: NADA Newswire

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SBA Relaxes Loan Program Standards; More Dealers Qualify

NEW YORK -- About 10,000 auto dealers and an untold number of suppliers will be eligible for federally backed loans of up to $2 million each under a new Obama administration program announced [Friday]. The temporary Small Business Administration plan will loosen eligibility requirements for working-capital loans starting early [this] week, the agency said in a statement. Although only about 25 percent of the 19,000 U.S. auto dealers have been eligible for the assistance, that percentage will more than double under the new program, said John McEleney, chairman of the National Automobile Dealers Association. "This means that thousands more dealers will be able to avoid layoffs, make payroll and keep employees," he said in an interview.
Source: Automotive News

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For Many Chrysler Dealers, Bankruptcy 'A Relief'

The Chrysler bankruptcy deal announced by the White House Thursday will require sacrifices from all sides: the company's creditors, unionized workers and even Chrysler's prospective new sister company, Fiat. What is not entirely clear yet is the fate of Chrysler's dealers. The dealers do not seem to have a lot of legal options — even John McEleney, chairman of the National Automobile Dealers Association, admits that the closure of franchises will now be up to the bankruptcy judge. But he hopes the court won't close dealerships "capriciously." "Dealers did not cause the problem — they do not represent any cost to the manufacturer," McEleney says.
Source: National Public Radio

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Chrysler Bankruptcy Won't Interrupt Warranties, Treasury Says

Chrysler LLC’s bankruptcy filing this week won’t keep it from honoring warranties on its vehicles, the Treasury Department said after President Barack Obama assured car buyers that the government would backstop claims if needed. Auto dealers want to be sure that someone will pay for the repairs they do, preferably the automakers, said John McEleney, who ... serves as the chairman of the National Automobile Dealers Association. Going to Treasury or a third party to win reimbursement for repairs isn’t appealing, he said. “Will we get paid at the full rate?” McEleney said. “Will we get paid on a timely basis?”
Source: Bloomberg

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Some Sticking with Chrysler, Others Skeptical

As Chrysler dealers across America try to sell vehicles with the auto manufacturer in bankruptcy, they're meeting different types of customers: loyalists who aren't fazed by the troubles, those simply seeking the best deal in a bad economy, and some who are willing to look, but aren't sold on the company's prospects. Dale Early, the owner of Deerbrook Forest Chrysler-Jeep [in Kingwood, Texas], said keeping customers and potential buyers abreast of developments in the restructuring is vital. He has a link on his company's Web site that provides details of the bankruptcy filing and Chrysler's hopes for its alliance with Fiat. Early said he also plans to send a recorded phone message to the 5,000 or so people in his client list, with a similar message. "I'm not afraid to sit down and discuss this with a customer, a neighbor or any other business person in the community," he said. "It's an issue. Let's deal with it."
Source: The Associated Press

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Chrysler in Hand, Fiat Turns to Opel

ROME -- Fiat SpA Chief Executive Sergio Marchionne is stepping up his plan to acquire a majority stake in General Motors Corp.'s German unit Opel ... Mr. Marchionne is expected to meet senior German government officials in Berlin [today], according to people familiar with the matter, in an attempt to get support for a potential alliance with Opel. If a deal is reached, Fiat will consider creating a new publicly traded company that combines the auto maker's car unit, Fiat Group Automobiles, with GM's European operations.
Source: The Wall Street Journal

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GM Shifts Negotiations Into High Gear

DETROIT -- General Motors Corp. is expected this week to accelerate talks with the United Auto Workers union and move toward closing about 2,600 dealerships. Reaching agreement on these fronts is critical if GM is to restructure outside of bankruptcy court. GM is expected next Monday to offer payments to the dealers who are targeted for closure, according to people familiar with the matter. Those dealers can either accept the offer, or take their chances in bankruptcy court.
Source: The Wall Street Journal

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Ford Outsells Toyota as Auto Sales Drops Go On

Ford Motor Co. turned the tables on Toyota Motor Co. in April, outselling Japan's largest automaker in monthly sales for the first time in more than a year. Ford, which has been promoting itself as the "different" American automaker that is surviving without federal assistance, sold 129,476 cars and trucks in April. Toyota sold 126,540. "Ford appeared to have benefited from the misery of GM and Chrysler," observed Jesse Toprak, executive director of industry analysis for Edmunds.com.
Source: Detroit Free Press

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A Life Selling Pontiacs, and Feeling Sold Out

HOUSTON, Pa. -- Small, out-of-the-way Arnold Pontiac sells only Pontiacs, GMC trucks and used cars, so the Arnolds figure their G.M. warranty is about to expire. “It was just like getting kicked in the stomach,” says the elder Mr. Arnold ... As Detroit and Washington work to save the car industry from going over a cliff like some roadster in a black-and-white melodrama, entire families have been upended — families that long ago linked their surname to the name of Pontiac in commercial banns of marriage. Mr. Arnold wonders about the future — what about their 20 employees? — and soon that wonder turns to complaint.
Source: The New York Times

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Federal Trade Commission Delays Enforcement of Red Flags Rule

On the eve of the new May 1, 2009, deadline, the Federal Trade Commission announced it will delay enforcement of the Red Flags Rule until Aug. 1, 2009, to give financial institutions and creditors more time to develop and implement written Identity Theft Prevention Programs. The FTC had previously extended the compliance date from Nov. 1, 2008, to May 1, 2009. The FTC also announced it would "soon release a template to help" certain entities comply with the Red Flags Rule. This does not affect the deadline for compliance with the Address Discrepancy Rule, which was Nov. 1, 2008.
Source: NADA Newswire

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Quotable
 
"This means that thousands more dealers will be able to avoid layoffs, make payroll and keep employees."

   
-- NADA Chairman John McEleney, on the Small Business Administration's new eligibility rules for lower-interest federal loans, Automotive News, May 1


 
"We're bouncing along the bottom of the bathtub."

   
-- Chrysler Vice Chairman Jim Press, responding to the automaker's dismal April vehicle sales, which fell 48 percent compared with last year, Detroit Free Press, May 2


"I'm not afraid to sit down and discuss this with a customer, a neighbor or any other business person in the community. It's an issue. Let's deal with it."

   
-- Dale Early, owner of Deerbrook Forest Chrysler-Jeep in Kingwood, Texas, says keeping customers and potential buyers abreast of developments in Chrysler's restructuring is vital, The Associated Press, May 3

Video Highlights
 
 
NADA on Floorplan Credit Crisis (NADA-TV)

  
NADA and the Obama Auto Task Force (PBS)



NADA: Legislative Options for Floorplan and Retail Credit (NADA-TV)



GM Bankruptcy Not Inevitable (msnbc.com)


 
Senate Testimony on Floorplan Loans (NADA-TV)


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


 
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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