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Tuesday, Jan. 18, 2011 RSSSEND TO A FRIENDPRINT
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Top 5 Stories
Banks Loosen Purse Strings
Opinion: New Fuel Target Must be Rational and Transparent
Younger Market a Challenge to Automakers
After Culling the Herd, Suzuki Seeks New Dealers
Opinion: The Great Auto Restructuring Shows Signs of Success
Top 5 Stories
Banks Loosen Purse Strings

U.S. banks are expanding their loans to consumers for the first time since the credit crisis erupted, as lending standards begin to loosen and demand for new loans edges higher. The consumer-loan uptick is most pronounced in the auto sector, where the dollar value of loans originated last year topped the 2009 total, Equifax estimates. The percentage of auto-loan applications by prime borrowers that were approved rose to 91% in December from 82% a year earlier, said CNW Research. Among so-called near-prime borrowers with credit scores of 620 to 749, the approval rate jumped to 83% from 70%. In addition, down-payment requirements have loosened, and "there are plenty of resources for financing," said John McEleney, president of McEleney Chevrolet and McEleney Toyota in Clinton, Iowa.
Source: The Wall Street Journal

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Opinion: New Fuel Target Must be Rational and Transparent

The U.S. auto industry, along with the rest of America, must prepare for the inevitable bump-up in gasoline prices to avoid a devastating economic shock like the one suffered during the summer of 2008. But this is no time to panic or do stupid things. A look around the North American International Auto Show in Detroit last week revealed a bumper crop of small, fuel-efficient vehicles -- many with alternative powerplants -- that consumers will demand when pump prices reach some as-yet-undetermined threshold. By September, the Obama administration plans to devise fuel economy standards for 2017-25, which will mandate that companies achieve more miles per gallon. The Obama administration must maintain control. It is in everyone's best interest to have a transparent process to establish a single, national fuel economy standard that is achievable and affordable.
Source: Automotive News

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Younger Market a Challenge to Automakers

Even as new-car sales recover -- and consumers flock to the Detroit auto show to check out all the latest cars and trucks -- automakers are grappling with a new and different market after the recession of the last few years. It's a younger market, and it is challenged by a housing slump and nagging uncertainty over gas prices. "Many young people care more about buying the latest smartphone ... than getting their driver's license," said Jim Lentz, president of Toyota Motor Sales. "That's a serious problem we need to address." Right now, pent-up demand is driving much of the recovery. The average vehicle on the road is more than 10 years old, according to consumer marketing researcher R.L. Polk. The luxury market is getting a boost from the recent two-year extension of the Bush administration tax cuts, said Paul Taylor, economist for the National Automobile Dealers Association. The other encouraging sign is that lenders are taking reasonable risks again. Auto loan approval rates for consumers with FICO scores between 620 and 749 have recovered to the 85% to 90% range from 75% in late 2009, according to CNW Marketing.
Source: Detroit Free Press

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After Culling the Herd, Suzuki Seeks New Dealers

American Suzuki Motor Corp. is recruiting dealers after buyouts and departures slashed its dealership roster last year. Suzuki is targeting dealers in metropolitan areas across the United States, said Chris White, senior manager of dealer development. "I honestly believe that as things thaw out, we'll accelerate" recruiting, he said. "I think we'll be aggressive, and there are a lot of people that are interested in a [Suzuki] franchise right now." The brand has about 290 dealerships after beginning 2010 with about 350.
Source: Automotive News

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Opinion: The Great Auto Restructuring Shows Signs of Success
By Paul Ingrassia

The entitlement mentality is gone, and the tough-love approach could be a model for the country

Everybody knows about the Great Depression and, more recently, the Great Recession. The 2011 North American International Auto Show, which opens to the general public today, comes on the heels of something better: the Great Restructuring. The city's 2009 car show seemed like a funeral, with a few lonely- looking cars scattered on tattered carpets. It symbolized a time when workers, managers, shareholders, bondholders and dealers were losing their jobs, pensions and investments, and taxpayers were paying the price. The good times are beginning to roll again, far faster than anybody expected, at General Motors, Ford and even at the weakest of the Detroit Three, Chrysler. There might be a lesson here. If the Great Restructuring has the potential to resolve the seemingly intractable problems of Detroit, perhaps bold structural overhauls can produce similar results on some broader issues facing America.
Source: The Wall Street Journal

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Quotable
 
"It is in everyone's best interest to have a transparent process to establish a single, national fuel economy standard that is achievable and affordable."

    -- Automotive News, Jan. 17

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