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Top 10 Stories
House Panel Adopts Amendment to Protect Auto Dealers
GM Dealers Win Some Access to State Courts for Disputes
U.S. Lawyer: New GM Could Make its Debut Thursday
Judge Denies Bid to Move GM Appeal to Higher Court
GM Dealers Resist Being Driven Off
Surviving Car Dealers Woo Customers Left in the Lurch by Industry Shakeup
U.S. Used-Vehicle Prices Rise for Sixth Month in Row
Chrysler to Resume Operations at Illinois Plant
Hyundai Shies Away From Challenging Prius With Hybrid
Dealers Urged to Take Survey on Floorplan Loan Availability
Top 10 Stories
House Panel Adopts Amendment to Protect Auto Dealers

The House Appropriations Committee late Tuesday approved a fiscal 2010 Financial Services spending bill after adopting an amendment intended to send a message to auto companies who have angered members by accepting government funding while shutting down dealerships. The amendment [offered by Rep. Steve LaTourette, R-Ohio,] would require automakers who have taken government funding, such as General Motors and Chrysler, to reinstate agreements with dealerships they have dropped as part of their recent bankruptcy proceedings.

"I don't think Chrysler or GM has been able to demonstrate there is a savings associated with fewer dealers, since the dealers themselves bear the costs of operating their dealerships with little help from the manufacturers," LaTourette said in a written statement.

LaTourette also expressed anger at the Obama administration auto task force, which he said had run "roughshod" over state franchise laws. "Rep. LaTourette's amendment demonstrates strong congressional support for preserving the rights of auto dealers," said David Regan, NADA vice president of legislative affairs.

The LaTourette amendment could be subject to a procedural challenge when the entire bill comes to the House floor, possibly late next week, because it authorizes policy on a spending bill. But appropriation leaders have indicated they would fight to keep the LaTourette amendment in the larger legislation. 

Additionally, Reps. Dan Maffei, D-N.Y., and Frank Kratovil, D-Md., sponsors of similar legislation, H.R. 2743, continue to aggressively push their bill forward and seek hearings. H.R. 2743’s Senate companion, S. 1304, has garnered 14 co-sponsors. Dealers should continue to seek co-sponsors for these important dealer-protection bills and thank Members of Congress for their support. Congress can be reached through the Capitol switchboard at (202) 224-3121.
Source: Congressional Quarterly/NADA Newswire

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GM Dealers Win Some Access to State Courts for Disputes

Bankruptcy ruling sets rules for state disputes
General Motors dealers will get access to state courts for a host of potential disputes with the new car company under an agreement approved by the bankruptcy court. Among the disputes that can be addressed in state courts include those involving product-liability claims, warranties, and compliance with lemon laws, privacy and "no call laws, and environmental and tax laws ... "This provides bread-and-butter protection against arbitrary or coercive corporate action," Tim Jackson, president of the Colorado Automobile Dealers Association, said [Tuesday].
Source: Automotive News

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U.S. Lawyer: New GM Could Make its Debut Thursday

General Motors Corp. and the U.S. Treasury are prepared for the new GM to emerge from bankruptcy Thursday afternoon, the government’s lawyer told the court in a filing [Tuesday] — hours before a judge rejected a motion to fast-track appeals from opponents of the deal. GM CEO Fritz Henderson has said he expects the new GM to emerge soon after objectors exhaust their appeals.
Source: Detroit Free Press

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Judge Denies Bid to Move GM Appeal to Higher Court

NEW YORK -- A U.S. bankruptcy judge refused on Tuesday to allow a group of individuals claiming to have been harmed by General Motors Corp vehicles to appeal directly to a U.S. federal appeals court against the sale of the automaker's assets. Normally, appeals of bankruptcy court decisions are made in the district court, but due to the speed sought in the case, the accident victims had sought to skip that step.
Source: Reuters

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GM Dealers Resist Being Driven Off

38 say they won't sign 'wind-down' plan
A Mississippi Chevrolet dealer is among 38 GM dealers nationwide with which the company is seeking to cut ties effective Friday, court documents show. The 38 dealers refused to accept the manufacturer's "wind-down" agreement that is part of the company's bankruptcy proceedings. Officials with the National Automobile Dealers Association wouldn't comment on individual cases but said ... it's encouraged the House and Senate are considering legislation that would give individual dealers more options amid federal bankruptcy proceedings.
Source: The Clarion Ledger (Jackson, Miss.)

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Surviving Car Dealers Woo Customers Left in the Lurch by Industry Shakeup

Across the country, hundreds of car dealers have closed their doors amid slumping sales, and hundreds more will wind down this year because of the bankruptcy reorganizations of Chrysler and General Motors Corp. The upheaval means that many car owners are seen as up for grabs -- six million of them, according to R.L. Polk & Co., an auto-industry market researcher. As a result, surviving dealers are scrambling to win over as many as they can.
Source: The Wall Street Journal

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U.S. Used-Vehicle Prices Rise for Sixth Month in Row

The Manheim Used Vehicle Value Index, which measures wholesale prices at auctions, increased 5.8 percent in June from a year earlier, the Atlanta-based data provider said [Tuesday] in a statement. The biggest gains were for pickup trucks and sport- utility vehicles, after demand tumbled in mid-2008 as gasoline prices soared to a record high. The gain reflects “the significant reduction in potential supply available,” Manheim said.
Source: Bloomberg

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Chrysler to Resume Operations at Illinois Plant

BELVIDERE, ILL. -- Chrysler plans to restart production at a northern Illinois plant and is recalling hundreds of workers. Spokesman Max Gates says employees have been asked to report for work at the automaker's Belvidere plant [today]. The Belvidere plant assembles Dodge Calibers, Jeep Patriots and Jeep Compasses.
Source: The Detroit News

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Hyundai Shies Away From Challenging Prius With Hybrid

Hyundai Motor Co.’s first hybrid car, twelve years behind Toyota Motor Corp.’s Prius, won’t pose a threat to the world’s best-selling hybrid. Hyundai’s Elantra hybrid, which goes on sale today, will use liquefied petroleum gas and be sold only in South Korea. “The LPG-hybrid isn’t a global model,” said Lee Hang Koo, a research fellow at Korea Institute for Industrial Economics & Trade said. “The real battle will come when Hyundai releases a full gasoline-electric hybrid model.”
Source: Bloomberg

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Dealers Urged to Take Survey on Floorplan Loan Availability

While access to credit is still limited for both domestic and import dealers, NADA is working with Congress, the Department of the Treasury and the Federal Reserve Board to expand the availability of financing for dealers to purchase vehicle inventory. Expanding loan guarantee programs such as the Small Business Administration’s (SBA) Dealer Floorplan Financing Program is just one step in NADA’s federal efforts to get lenders to provide financing again. NADA is pursuing initiatives that will ensure dealers have access to financing at competitive rates, but it is important for NADA to have a full picture of the difficulties dealers are facing. While there is a great deal of anecdotal evidence, little numerical data is available related to the constriction of floorplan lines of credit and its impact on dealers. NADA urges dealers to take a few moments to participate in a 16-question online survey. Click here to take the survey.
Source: NADA Newswire

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Quotable
 
"I don't think Chrysler or GM has been able to demonstrate there is a savings associated with fewer dealers, since the dealers themselves bear the costs of operating their dealerships with little help from the manufacturers." 

    -- Rep. Steve LaTourette, R-Ohio, referring to his amendment that would require automakers who have taken government funding to reinstate agreements with dealerships dropped as part of bankruptcy proceedings, NADA Newswire, July 8
Video Highlights
 

Media Coverage: The Tragedy of Dealer Closings (NADA-TV)


NADA's New Buy Now Campaign



No Dent in Demand for Some U.S. Cars (NBC)



Car Dealers Trying to Buy More Time (NBC)



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 Floorplan Credit Crisis (NADA-TV)


John McEleney's Testimony to Senate Committee (CNBC)
 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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