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Top 5 Stories
New Car Sales Expected to Grow by 1.1 Million in 2010
Wall Street Sweet on GM in 2011
Rising Gasoline Prices Prompt Dealers to Rethink SUV Strategies
Analysis: Automakers Race to Trim Weight, Keep Trucks Brawny
For GOP House Freshman (and Car Dealer) Mike Kelly, Washington Is a Tough Sell
Top 5 Stories
New Car Sales Expected to Grow by 1.1 Million in 2010

Pent-up demand is driving new vehicle sales to their highest level since 2008, an auto dealers trade group said. Sales of light vehicles, on the decline since at least 2006, have accelerated this year, according to the National Automobile Dealers Association. Paul Taylor, an NADA economist, said Tuesday that NADA officials look for sales to reach 11.5 million vehicles this year. In comparison, new vehicles sales reached 10.4 million in 2009. In 2008, dealerships sold 13.2 million new vehicles while in 2007 they sold 16.1 million, the NADA said. Taylor said improvements in the stock market and pent-up demand created from consumers putting off purchases will push up car purchases next year. The period between Christmas Day and New Year’s Day tends to be one of the briskest for dealers, Taylor said. A combination of consumers armed with time off from work and cash given to them as gifts, along with heavy promotion by the auto industry fuel the increased demand, he said.
Source: Dayton Daily News

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Wall Street Sweet on GM in 2011

Stock could hit $50 with sales rising, new models on the way
General Motors Co. stock could climb as high as $42 to $50 a share by the end of 2011 with industrywide auto sales on the upswing and the automaker reaping the benefits of last year's bankruptcy restructuring, Wall Street analysts predict. Analysts at several big banks, including J.P. Morgan, Citigroup and Barclays Capital, offered bullish projections on GM's future, issuing their first reports Tuesday morning on the automaker since its return to the New York Stock Exchange Nov. 18. The recommendations are a powerful vote of confidence in a company that was dropped from the NYSE and filed for bankruptcy in June 2009. The analysts' ratings, released Tuesday morning, helped push GM's share price up 72 cents to $35.32 at Tuesday's close. The share price has climbed 7 percent from the $33 paid by initial investors in mid-November.
Source: The Detroit News

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Rising Gasoline Prices Prompt Dealers to Rethink SUV Strategies

'Hoping for the best, but prepared for anything'
As gasoline prices rise, some analysts predict a drop in SUV sales and trade-in values at dealerships. U.S. gasoline prices topped $3 a gallon during the past week, the highest level since October 2008, according to the U.S. Department of Energy. Crude oil reached $91 a barrel on the New York Mercantile Exchange on Monday, causing nationwide pump prices to increase 7 cents a gallon to an average of $3.05. That is up nearly 45 cents from a year ago. Diesel prices also have risen, reaching $3.29 a gallon, more than 56 cents a gallon higher than last year. For dealers, caution is key when stocking inventories. “Our small SUVs are doing OK but the large SUVs and large trucks have definitely cooled off since the pickup in gas prices,” said Jason Stewart, general manager of Earl Stewart Toyota of North Palm Beach in Florida. At the same time, Stewart said, Prius sales have tripled -- a reversal of the sales situation when gasoline prices crashed later in 2008. Two years ago, “when gas was in the low-to-mid twos, we did a 180 the other way where Prius sales fell off the mark and we were selling more of the Sequoias and Tundras,” he said. “My gut is it ties right into people's pocketbooks.”
Source: Automotive News

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Analysis: Automakers Race to Trim Weight, Keep Trucks Brawny

DETROIT -- Major automakers are scrambling to strip hundreds of pounds off future pickup trucks in an effort to meet new U.S. standards for fuel economy without sacrificing strength or towing capability. The new mandates take effect in 2016, giving automakers such as Ford and General Motors just one design cycle to make significant changes that will require costly steel substitutes including aluminum, new steel alloys and magnesium. Automakers are faced with having to pass on those higher costs to consumers who have come to associate mass with performance. Automakers must reach an average fleet fuel economy of 35.5 miles per gallon by 2016. Light trucks -- which were half of all U.S. auto sales in the first 11 months of 2010 -- will have to get about 30 miles per gallon. The first automaker out with a new-model large pickup truck aiming to comply with the tougher fuel economy standards will be GM with its Chevy Silverado for the 2014 model year. Meanwhile, Ford is looking closely at a magnesium alloy frame for the next generation of its F-150 pick-up truck... Ford is also looking to use aluminum for the body panels of the F-150...
Source: Reuters

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For GOP House Freshman (and Car Dealer) Mike Kelly, Washington Is a Tough Sell

The onetime Notre Dame defensive tackle sat in an underground auditorium of the U.S. Capitol, discomfited. Mike Kelly had come to Congress to change the ways of Washington. But first he had to be schooled in them. In this closely watched class of roughly 100 first-year lawmakers, there are stars. But Kelly is not one of them. At 62, he is the oldest GOP House freshman, an avuncular, white-haired Chevy dealer from the hardscrabble industrial town of Butler, Pa. The unusual election of 2010 has ushered in an unusual crop of new legislators. Many were never groomed for higher office, or any political position at all. Kelly had never considered a Washington life for himself until government reached directly into his livelihood - but now he's here, trying to find his way, literally and politically.
Source: The Washington Post

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Quotable
 
"I would say it's the busiest week in the whole year."

    -- Fernando Lobo, a sales manager at Bill Page Honda in Falls Church, Va., referring to the week between Christmas and New Year's Day, which accounts for as much as 70 percent of car sales in December, WTOP.com (Washington, DC), Dec. 28
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