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Top Stories
Opinion: It's Time for GM to Admit, Finally, Its $2 Billion Lie
Chrysler to Invest in Dealer Network
House Democrats Pass Health-Care Bill
Global Car Market is Starting to Recover, Aided by U.S., Ghosn Says
Carfax, Experian Add Clunker VINs to Databases
Car Dealers Team with Army to Provide Jobs for Soldiers
NADA Marketplace
Nov. 18 Webinar to Address New IRS Field Directive on UNICAP and What It Means for You!
Experient, Inc. is NADA's Official Housing Bureau for the NADA Convention
Top Stories
Opinion: It's Time for GM to Admit, Finally, Its $2 Billion Lie

It's time for General Motors to come clean.

Eliminating 1,350 U.S. dealerships -- or even 2,500 if you include stores that have sold the discarded Saturn, Saab, Hummer and Pontiac brands -- will not cut anywhere near $2 billion in costs. GM executives must know that. And so should the Treasury officials on the auto task force if they have done their homework.

But CEO Fritz Henderson testified in Washington in June that getting down to 3,600 dealers in 2010 would save about $2 billion on incentives paid to dealers, factory floorplan support and a 1 percent market support paid for each vehicle. He also said GM would save $415 million a year for items such as advertising assistance, service, training and support of information technology.

But as many outraged dealers have noted, most of those are variable costs that depend on the number of vehicles sold -- not the number of dealerships selling vehicles. Or, in many cases, they are expenses for which the dealer ultimately is billed. To claim otherwise is disingenuous and the worst kind of new math.

It is clear that GM and Chrysler needed to thin their distribution networks in many metropolitan markets. Both automakers have been trying to do so for years. But the approaches used during restructuring make no sense, especially eliminating profitable dealerships in rural markets.

GM's own studies have shown that small, profitable dealerships contacted only through a call center are an asset because they buy parts, do warranty work, take care of GM owners who are traveling and buy used GM vehicles at auction.

Letting market forces do the dirty work of consolidation would have taken longer but would have been a better approach.

Having chosen the quick alternative, GM executives should at least be honest about it.
Source: Automotive News

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Chrysler to Invest in Dealer Network

$500 million plan aims for dealer body of 3-brand stores
DETROIT -- Chrysler Group dealers will require lots of capital in the coming years to improve operations. The company plans to help. "We plan to invest over $500 million in the network over the next five years -- $120 million next year alone," said Peter Grady, vice president of dealer network development. The bulk of the money will go for "real estate, training, infrastructure upgrades and technology upgrades," said Kathy Graham, a Chrysler spokeswoman. About 140 Chrysler Group dealerships have not been approved for permanent floorplan financing because of lingering issues with Chrysler Financial, Grady said. Grady said he hoped to resolve the problems by the end of the month.
Source: Automotive News

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House Democrats Pass Health-Care Bill

One Republican votes for plan Senate will act next on legislation
Hours after President Obama exhorted Democratic lawmakers to "answer the call of history," the House hit an unprecedented milestone on the path to health-care reform, approving a trillion-dollar package late Saturday that seeks to overhaul private insurance practices and guarantee comprehensive and affordable coverage to almost every American. The House legislation would for the first time require every individual to obtain insurance, and would require all but the smallest employers to provide coverage to their workers. It would vastly expand Medicaid and create a new marketplace where people could obtain federal subsidies to buy insurance from private companies or from a new government-run insurance plan. Attention will now shift back to the Senate.
Source: The Washington Post

Editor's Note: NADA opposes the House version of healthcare reform (H.R. 3962) because it would enact unfair taxes and increase healthcare costs for dealers and their employees. Click here for arguments against the bill. Thirty-nine House Democrats (click here for the list) and all but one Republican, Rep. Joseph Cao, R-La., voted against the bill. As the legislation moves to the Senate, NADA urges dealers to engage their Senators to ensure the final bill does not include cost increases and unreasonable mandates for small business dealers who are already struggling to control healthcare costs.

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Global Car Market is Starting to Recover, Aided by U.S., Ghosn Says

NEW DELHI -- The global car market has bottomed and is on track for 60 million units sales next year, aided by the United States, Carlos Ghosn, who heads Japan's Nissan Motor Co. and France's Renault SA, said on Sunday. "It looks like we are here hitting a plateau," he said at a World Economic Forum event in New Delhi. India has been a recent bright spot for the global car market, with year-on-year sales rising at double-digit percentages during the three months through September.
Source: Reuters

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Carfax, Experian Add Clunker VINs to Databases

The industry's two top vehicle history reporting companies have added to their databases vehicle identification numbers of the 700,000 trade-ins meant to be scrapped under the government's cash for clunkers program. Experian Automotive and Carfax Inc. say they obtained the VINs from the National Highway Traffic Safety Administration. Making the information available to the public will protect dealers and shoppers from buying vehicles that should have been scrapped, both companies say.
Source: Automotive News

Editor’s Note: During congressional consideration of cash for clunkers legislation, NADA successfully requested that VINs of trade-in clunker vehicles go to the National Motor Vehicle Title Information System (NMVTIS)/DMV database as well as commercial vehicle history providers such as Experian and Carfax.

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Car Dealers Team with Army to Provide Jobs for Soldiers

BRISTOL — Two years ago, Eric Diaz needed a job. He also needed an employer who would understand that as an Army Reservist he might need to leave anytime to serve his country. Luckily, he found Ken Crowley, who understood his situation and was willing to give him a chance. Crowley’s arrangement with Diaz, who was recently discharged from the Army, is now being replicated on a statewide scale. Connecticut’s New Car Automobile Dealers and the Connecticut Automotive Retailers Association have agreed to an Employer Partnership commitment with the U.S. Army. This new partnership helps veterans secure interviews with Connecticut auto dealers and is the first of its kind for the auto industry.
Source: New Britain Herald (New Britain, Conn.)

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NADA Marketplace
Nov. 18 Webinar to Address New IRS Field Directive on UNICAP and What It Means for You!

NADA will present IRS Motor Vehicle Technical Advisor Terri Harris in a Webinar on the Uniform Capitalization Rules (UNICAP) directive on Wednesday, Nov. 18, from 1-3 p.m. EST. Here’s the background: On Sept. 15, the IRS Director for the Heavy Manufacturing and Transportation (HMT) Industry issued a memo that provides direction to IRS field examiners on how to conduct UNICAP audits at car and truck dealerships. The unofficial directive contains an audit toolkit and announces the suspension of new UNICAP audits through Dec. 31, 2010 to provide dealers with an opportunity to change their accounting methods in order to comply with a September 2007 Technical Advice Memorandum [TAM 200736026] that involved a franchised car dealer. The Industry Director issued the field directive to address the "high level of taxpayer noncompliance on this issue" and because it represents "the highest compliance risk" to the industry. So what does this mean for dealers?

NADA will tackle this issue in an interactive Webinar that will feature a powerpoint presentation by the IRS' Terri Harris. The program will be moderated by Paul Metrey, director of NADA's Regulatory Affairs. Thirty to 60 minutes of the Webinar will be devoted to Q & A. Cost of the Webinar is only $199 per computer connection. Registrants will have access to the Webinar recording for up to six months. Register online at www.nada.org/seminars or call (800) 248-6232, ext. 7273.
Source: NADA Newswire

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Experient, Inc. is NADA's Official Housing Bureau for the NADA Convention

NADA has made arrangements with Experient, Inc. to book hotel rooms for the upcoming NADA Convention & Expo in Orlando. NADA has NOT authorized any other organization or company to make hotel reservations for the convention. E-mails, phone calls or other communications from “Expo Marketing” or “Expo Housing” or any other third party are not being sent by NADA or on behalf of NADA. To register and reserve a hotel room for the convention, visit www.nada.org/convention.
Source: NADA Newswire

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Quotable
 
"The car dealers get a trained employee. The veteran gets a great job with good pay and benefits. And the customers get to deal with disciplined, trained people."

   
-- James Fleming, president of the Connecticut Automotive Retailers Association, on its Employer Partnership commitment with the U.S. Army, New Britain Herald, Nov. 6
Video Highlights
 

Crisis Timeline: NADA in High Gear (NADA-TV)


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



NADA's New Buy Now Campaign


 Senate Testimony on Floorplan Loans (NADA-TV) 
 NADA Tackles Industry Crisis (NADA-TV) 
NADA on the Front Lines  (NADA-TV)

Click here for more video reports.
2010 Convention
 


NADA Chairman: Convention is the 'Must-Attend Event'

Did you know?

As a bonus for attending the NADA convention, you’ll receive Steve Miller’s Marketing Stimulus Package, which includes the seven-part video series, “Introduction to the Seven Foundational Concepts for a Successful Marketing Strategy” and once a week for 12 weeks you’ll also receive valuable marketing tips, tactics or tools designed to help generate more prospects and customers.

Already registered? Check your e-mail for instructions to access these marketing tips. For more information or questions, contact
expo@nada.org.


Be in the know
at the NADA convention Feb. 13-15.


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NADA For more information on NADA, visit www.nada.org or contact NADA, 8400 Westpark Drive, McLean, VA 22102. This email may contain an advertisement of NADA products and services. Any opinions or statements contained herein do not necessarily reflect the views of NADA. Factual errors are the responsibility of the listed publication. If you are a franchised new-car or -truck dealer and would like to become a member of NADA, please visit the Join NADA section of www.nada.org. Questions or comments concerning NADA Headlines content may be directed to media@nada.org.