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Top Stories
GM Executives, Dealers to Meet Friday to Discuss Contracts
Chrysler Dealers Urge Bankruptcy Judge to Save Businesses
GM's 2nd Group of Canceled Dealers Can Appeal by June 8
GM to Sell Saturn to Penske
Democrats May Add Car Vouchers to War Fund Bill
Many Closing Chrysler Dealers Have Little Inventory Left
No Gloom and Doom at Car-Dealer School
Dealer Closings May Require Advanced Notice to Employees
Top Stories
GM Executives, Dealers to Meet Friday to Discuss Contracts

WASHINGTON -- General Motors Corp. executives will meet with auto dealers [today] to work out a dispute over contracts that would set dealers' performance standards. GM North America President Troy Clarke and other company executives will meet with dealer representatives at the McLean, Va., headquarters of the National Automobile Dealers Association. Among the topics to be discussed will be so-called performance agreements that GM wants dealers to sign. Dealers contend the agreements are an example of "overreaching."
Source: Dow Jones Newswires

[Editor's Note: As a follow-up to Wednesday's Senate hearing, NADA leadership, led by Chairman John McEleney and GM committee head Mike Martin, will relay serious concerns with the Wind-down and Performance Agreements that dealers are required to sign and return no later than next Thursday.]

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Chrysler Dealers Urge Bankruptcy Judge to Save Businesses

The dealers, testifying at a court hearing about Chrysler's plans to cut ties with about a quarter of its dealerships, cited awards and strong sales and questioned the auto maker's methodology for choosing which ones would be shut down. James Tarbox, who owns a dealership in Rhode Island and one in Massachusetts, choked back tears on the witness stand as he recalled receiving news last month that Chrysler would force him out of business. "I was completely flabbergasted to say the least," said Mr. Tarbox ...
Source: The Wall Street Journal

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GM's 2nd Group of Canceled Dealers Can Appeal by June 8

DETROIT -- General Motors says dealers who were targeted in a second round of franchise cancellations have until June 8 to appeal. Spokesman [Pete] Ternes said GM provided a Web address to the latest group of canceled dealers. Dealers can apply for an appeal through the Web site. GM will make final decisions on the appeals by June 12, when dealers must sign the wind-down agreement or face termination in bankruptcy court.
Source: Automotive News

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GM to Sell Saturn to Penske

NEW YORK -- Bankrupt automaker General Motors Corp. announced [today] that it will sell its Saturn unit to car dealership operator Penske Automotive Group. The deal, which GM expects to be completed in October, would save more than 13,000 jobs at Saturn and its roughly 350 dealers nationwide. "There has been a groundswell of support for Saturn, with our retailers and owners urging us to save the brand," Jill Lajdziak, Saturn's general manager, said in a statement. "We heard their call loud and clear, and it inspired us as we worked to secure Saturn's future."
Source: CNNMoney.com

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Democrats May Add Car Vouchers to War Fund Bill

WASHINGTON -- U.S. congressional Democrats are considering fast-tracking legislation to boost auto sales by offering Americans vouchers to trade in older, less fuel-efficient vehicles for ones that get better mileage, a congressional aide said on Thursday. The legislation, known as "cash for clunkers," would be added to a pending war funding measure in Congress, but "no final decisions have been made" despite wide support for the voucher program, said Nadeam Elshami, a spokesman for Democratic House Speaker Nancy Pelosi. The Senate proposal would provide up to $4,500 in vouchers to car buyers who participate in the program.
Source: Reuters

[Editor's Note: Following NADA’s endorsement of the Stabenow-Brownback cash for clunkers amendment in the Senate, the association is working closely with the House leadership and Rep. Betty Sutton, D-Ohio, to include the same Senate provisions in the House version. The House bill is likely to be on the floor next week.

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Many Closing Chrysler Dealers Have Little Inventory Left

Dealers scheduled to close Tuesday have only 1,981 vehicles left to sell, and many of those dealers still have the option of finding another dealer to buy their excess inventory, Chrysler spokeswoman Carrie McElwee says. Wade Walker, a Jeep dealer in Montpelier, Vt., ... says he feels bad both for colleagues being cut off who are stuck with Chrysler vehicles, and for dealers staying in business who he says are being pressured to take on new cars they may not want or need. "The market is just going to be flooded with these discounted vehicles for a while," Walker says.
Source: USA TODAY

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No Gloom and Doom at Car-Dealer School

On a Saturday morning in May, Emily Bourne donned a cap and gown and collected a diploma in a field hardly known for its job prospects: auto retailing. Ms. Bourne is one of 132 graduates this year who received Northwood University's bachelor's degree in business administration focused on automotive management and marketing, the only one of its kind in the U.S. Despite the auto industry's dire state, almost all of this year's crop of graduates, many of whom aspire to run auto dealerships, have landed jobs.
Source: The Wall Street Journal

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Dealer Closings May Require Advanced Notice to Employees

Dealers whose franchise agreements are being canceled, those who are closing their facilities, or those who are downsizing need to be reminded of a federal law that requires them to provide advance notice to employees. The Worker Adjustment and Retraining Notification (WARN) Act generally requires 60 calendar days’ notice when there is to be a mass layoff or closing. Please click here for more information about the WARN Act as well as links to the U.S. Department of Labor Web site sections concerning the law.
Source: NADA Newswire

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Quotable
 
"I was completely flabbergasted to say the least. I said there must be a mistake because I'm the top, the top guy. I've won all sorts awards."

   
-- James Tarbox, who owns a dealership in Rhode Island and one in Massachusetts, choking back tears on the witness stand as he recalled receiving news last month that Chrysler would force him out of business, The Wall Street Journal, June 4


"The market is just going to be flooded with these discounted vehicles for a while."

   
-- Wade Walker, a Jeep dealer in Montpelier, Vt., who -- like many other Chrysler dealers scheduled to close Tuesday -- sold his excess inventory to another nearby dealer, USA TODAY, June 4

Video Highlights
 
 
Car Dealers Trying to Buy More Time (NBC)

 
John McEleney's Testimony to Senate Committee (CNBC)



Fighting the Dealers' Fight (CNBC)


 
Cutting Dealers a Mistake (Fox Business Network)



Vice Chairman Tonkin on Chrysler Closures (Bloomberg)


 
Should Government Decide Dealers' Fate? (CNBC)



The Case Against Closing Dealerships (CNBC)



In-Depth Look - Pent Up Auto Demand (Bloomberg)



NADA on Cash for Clunkers (NADA-TV)



NADA on Floorplan Credit Crisis (NADA-TV)


 Senate Testimony on Floorplan Loans (NADA-TV)
 Banks Turning on American Car Dealers? (WTNH-TV)
 NADA Tackles Industry Crisis (NADA-TV)
 McEleney Speaks at NADA Convention (NADA-TV)
 Demise of Dealerships Leaves Big Dent (NBC)
NADA on the Front Lines  (NADA-TV)


Click here for more video reports.

 


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