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Thursday, Aug. 13, 2009 RSSSEND TO A FRIENDPRINT
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Top Stories
Clunker Payment Woes Continue; Dealers 'Angry and Nervous'
Feds Say Dealers Can't Hold Vehicles Pending Clunker Approval
Chrysler Plans New Dealerships
Chrysler Said to Boost 2nd-Half Production to Fulfill Demand
'Cash for Clunkers' Puts Ford in Focus Overdrive
Kia's Net Jumps as Incentives, New Models Push Up Sales 12%
Text Messaging: Regulations for Dealer Communications with Customers
Top Stories
Clunker Payment Woes Continue; Dealers 'Angry and Nervous'

WASHINGTON -- In apparent violation of the new cash-for-clunkers law, the Department of Transportation is more than 10 days late in paying rebates of at least hundreds of thousands of dollars on dealer claims, several dealers said. Dealers are reporting that they can't get responses to their claims, leaving them in limbo as to whether they've been approved or rejected, [NADA Spokesman Bailey] Wood said. Many also are getting rejections for procedural minutiae that they can't straighten out because Transportation employees are inaccessible by phone or e-mail, he said. David Wilson, a Toyota dealer in Orange County, Calif., said he has been paid for only three of the 92 claims he submitted before Aug.2, leaving him holding the bag for about $374,000. Altogether, he has 450 unpaid claims filed for a total of $1.9 million.
Source: Automotive News

Editor's Note: NADA and Automotive Trade Association Executives (ATAEs) from across the country held a conference call Wednesday with the National Highway Traffic Safety Administration (NHTSA) regarding the "cash-for-clunkers" (CARS) program. NADA and the ATAEs reiterated a number of dealer concerns about the program, its implementation, and the financial burden it has placed on many dealers across the country. NHTSA recognizes that the CARS program has had a number of technical problems, and indicated that it is working hard to address those technical issues. An update on the status of these issues was emailed to NADA members Wednesday night.

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Feds Say Dealers Can't Hold Vehicles Pending Clunker Approval

WASHINGTON -- Under the cash-for-clunkers program, dealers are not allowed to withhold delivery of new cars in stock while waiting for their rebate claims to be approved by the government, the Department of Transportation said [Wednesday]. That guidance was a response to numerous customer questions about dealers' use of contingency agreements, a NHTSA official who asked not to be identified said in an interview. Such agreements are proliferating as dealers are subject to continuing delays in getting paid or in finding out whether their deals have been accepted, [Bob Israel, president of the Louisiana Automobile Dealers Association] said.
Source: Automotive News

Editor's Note: Several recent entries on the CARS.gov Web site, including one entry relating to transaction contingency agreements and the timing of vehicle delivery, have created confusion. This issue was raised with NHTSA and is under review.  NADA will report any clarifications as soon as they are received.

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Chrysler Plans New Dealerships

Some terminated dealers might have a chance at one of 140 new locations
Two months after terminating 789 dealerships, Chrysler Group LLC is approaching some of those dealers to compete for a chance to sell Chrysler, Dodge and Jeep cars again in one of 140 "open" locations throughout the United States. Jim Tarbox, who was stripped of his Jeep dealership in North Kingstown, R.I., and a Dodge dealership in Attleboro, Mass., said a Chrysler official told him last week he would be considered as a candidate for a new location near the one he closed. "I don't know if they're harassing me or what. They just took everything away from me," said Tarbox.
Source: Detroit Free Press

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Chrysler Said to Boost 2nd-Half Production to Fulfill Demand

Chrysler Group LLC, the U.S. automaker run by Fiat SpA, will make more light trucks than it had planned in the second half to meet growing demand, a person with knowledge of the situation said. Chrysler has scheduled overtime at its Dodge Ram truck plant in Warren, Michigan, and a plant in Toledo, Ohio, that makes the Jeep Wrangler sport-utility vehicle, said the person familiar with the plans. The U.S. government’s auto trade-in stimulus plan, nicknamed “cash-for-clunkers,” helped to drive Chrysler’s inventory down. The Dodge Ram 1500 and Chrysler’s two minivan variants qualify for the program.
Source: Bloomberg News

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'Cash for Clunkers' Puts Ford in Focus Overdrive

Ford Motor Co. has increased production of its Ford Focus compact and could announce additional production increases today as the federal government's "cash for clunkers" program boosts demand for its products. The Focus has been one of the most popular choices among the more than 316,000 Americans who have taken advantage of the program ... Other production increases also may be in the works. While Ford ended July with a 25-day supply of the Focuses, it had only a 21-day supply of Ford Escape compact sport utilities, which also have been strong sellers recently.
Source: The Detroit News

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Kia's Net Jumps as Incentives, New Models Push Up Sales 12%

SEOUL -- Kia Motors Corp. said second-quarter net profit soared amid a weaker won and a domestic sales boost from tax incentives and new models. The dollar's 23% rise against the won in the second quarter helped offset lower demand from overseas markets and a drop in the value of Kia's exports as it shipped more small and midsize models, the company said.
Source: The Wall Street Journal

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Text Messaging: Regulations for Dealer Communications with Customers

Communications with prospective customers or others via “text messaging” may be subject to a number of federal regulations. A text message may be deemed to be a phone call, an email or perhaps even both under federal law. At the request of NADA's IT Committee, NADA Legal Affairs has prepared a summary of the legal issues that dealers should consider before "texting."  Click here for the summary.
Source: NADA Newswire

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Quotable
 
"I've never experienced anxiety like this in business before. If I don't get paid, I will have been working almost free for several months."

    -- Brad Wood, a dealer in Salisbury, N.C., who has 12 unpaid "cash-for-clunkers" claims for $47,000 pending since Aug. 1, Automotive News, Aug. 12


"I'm worried the government will run out of money before we get paid."

    -- David Wilson, a Toyota dealer in Orange County, Calif., who said he has 450 unpaid "cash-for-clunkers" claims filed for a total of $1.9 million, Automotive News, Aug. 12

Video Highlights
 

Keep or Scrap Cash for Clunkers? 
(CNBC)


Dealers, Detroit Look for Boost From 'Clunkers' (PBS)



Helping Dealers Left Out of New GM (Fox Business)



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)



Cutting Dealers a Mistake (Fox Business)



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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