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Tuesday, Jan. 12, 2010 RSSSEND TO A FRIENDPRINT
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Top Stories
Finally, US Automakers Start to See Improvement
Toyota 'Trying' to Boost North America Sales to Avoid Loss
Top Dealers See Ford Hitting Stride, GM Just Behind
GM's Whitacre Wants to Restore More 'Good Dealers'
Chrysler May Sue to Challenge Arbitration for Rejected Dealers, Marchionne Says
Richardson Backs Bill to Protect Local Auto Dealers
Reminders
FTC and FRB Release Final Risk-Based Pricing Rule
Top Stories
Finally, US Automakers Start to See Improvement

DETROIT -- The vital signs are improving for American automakers. General Motors may reopen some shuttered factories because it can't produce four of its vehicles fast enough to meet demand, and Chrysler is set to hire more engineers and product development workers. While both companies still depend on government help, the moves are signs of increased confidence that the U.S. auto market bottomed out last year and will improve in 2010, even without a jolt from a Cash for Clunkers-style program. The head of Chrysler, Sergio Marchionne, said his company does not have enough people to revamp its U.S. product line and soon will start hiring, probably beginning with temporary workers.
Source: The Associated Press

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Toyota 'Trying' to Boost North America Sales to Avoid Loss

Toyota Motor Corp.’s sales and production in North America may not rebound in the current fiscal year, jeopardizing the world’s largest automaker’s ability to turn a profit in the region even after cutting costs. “The finance company is having a solid year, so if you include that it will be so much easier to say positive things,” Yoshimi Inaba, Toyota’s North American chief executive, told reporters in Detroit. “We are still trying hard to improve” sales and manufacturing operations, he said at the North American International Auto Show yesterday, without elaborating. In the year ended in March 2009, collapsing North American sales, combined with an unfavorable exchange rate and excess production capacity, helped fuel the ... company’s record ... $4.37 billion net loss. Toyota ended 2009 with a 20 percent drop in U.S. vehicle sales, its biggest since 1961.
Source: Bloomberg

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Top Dealers See Ford Hitting Stride, GM Just Behind

DETROIT -- The top executives of two of the largest U.S. auto dealership groups said on Monday that Ford Motor Co's turnaround was gaining momentum after three full years under former Boeing executive Alan Mulally. "It shows you the difference that one individual can make," AutoNation Inc Chief Executive Mike Jackson told Reuters on Monday. But Jackson and Earl Hesterberg, the president and chief executive of Group 1, said Ford's string of recent successes, including a 33 percent sales gain in December, should not overshadow encouraging progress at General Motors, still the largest Detroit-based automaker. As with Ford, Jackson and Hesterberg credited much of the progress at GM on one man: Ed Whitacre, the former AT&T chief executive appointed by the U.S. government to head the troubled automaker after its bankruptcy this spring.
Source: Reuters

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GM's Whitacre Wants to Restore More 'Good Dealers'

DETROIT -- General Motors Co. Chairman Ed Whitacre said (Monday) he wants “a lot more” rejected dealerships to be restored “if they’re good dealers.” In an interview at the Detroit auto show, Whitacre went beyond remarks he made last week -- expressing his preferences and hinting at how GM will proceed in upcoming arbitration. He said last week a "large number" of dealerships will be restored in arbitration, pegging the number at 100 or more. In a statement later posted on its Web site, GM said it is difficult to say how many dealerships will be restored: "It could be one hundred or fewer or several hundred." Dealer attorney Leonard Bellavia said last week he suspected that GM wants to restore rejected dealerships to try to increase sales. Asked about that (Monday), Whitacre said: “I want them to be restored if they’re good dealers.”
Source: Automotive News

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Chrysler May Sue to Challenge Arbitration for Rejected Dealers, Marchionne Says

DETROIT -- Chrysler Group may file a suit this month challenging a new law providing arbitration for rejected dealerships even if General Motors Co. doesn't join in, Chrysler CEO Sergio Marchionne said (Monday). He expressed annoyance that Chrysler's time and money would be diverted to defend arbitration claims after the automaker went through bankruptcy proceedings that cut 789 dealerships last spring. “Ask me what fairness is involved in all this,” Marchionne said in an interview with Automotive News editors and reporters at the Detroit auto show. “Why doesn't anyone ask what's fair to Chrysler?” Chrysler will make a final decision on a suit by the third week in January, he said. Marchionne also acknowledged that the automaker is trying to award franchises in the markets left by rejected dealerships, as dealer groups have alleged. But he said Chrysler is trying to fill these points not to deter arbitration claims from these showrooms, as dealer groups have claimed, but to increase sales in areas where business is lagging. “We have a right to sell Chrysler products,” said Marchionne, clad in his trademark open-neck shirt and sweater. “As of today, (rejected dealers) have no right.”
Source: Automotive News

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Richardson Backs Bill to Protect Local Auto Dealers

Gov. Bill Richardson is throwing his support behind a bill that will be introduced in the state Legislature to protect franchised car dealers in the state. ... the bill ... would require defined reimbursements and compensations to a dealer if a manufacturer decides to terminate a dealership that is meeting its performance criteria. In securing a stronger value for the investments required to operate a franchised dealership, these measures would also strengthen the ability of these businesses to operate, Richardson said. “Recent changes in the relationship between dealers and manufacturers have necessitated actions on our part that will protect the investments, the jobs and the benefits our dealers bring to every community in the state,” said Charles Henson, president of the New Mexico Automotive Dealers Association.
Source: New Mexico Business Weekly

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Reminders
FTC and FRB Release Final Risk-Based Pricing Rule

The Federal Reserve Board and the Federal Trade Commission have released their long-awaited joint Final Risk-Based Pricing Rule. The rule, which implements section 311 of the FACT Act of 2003 and takes effect Jan. 1, 2011, generally applies to dealers who obtain a credit report regarding a consumer and then enter into a credit transaction with that consumer. Covered dealers must issue a Risk-Based Pricing Notice (RBPN) to those consumers to whom the dealer extends credit on terms that are "materially less favorable" than those entered into with a "substantial proportion" of the dealer's other credit customers. Because of the difficulty in determining which customers fit into this ill-defined category, NADA recommended -- and the agencies adopted -- an Exception Notice that dealers and other creditors may issue in lieu of the RBPN. The criteria for using the Exception Notice and other elements of the Risk-Based Pricing Rule are explained in a preliminary NADA summary at www.nada.org/factact (member log in required).
Source: NADA Newswire

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Quotable
 
"I want them to be restored if they're good dealers."

   
-- General Motors Co. Chairman Ed Whitacre, in an interview Monday at the Detroit auto show, expressing his preferences on dealer reinstatement and hinting at how GM will proceed in upcoming arbitration, Automotive News, Jan. 11
2010 Convention
 


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