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Top 5 Stories
Japan Quake Stirs Unease About Global Supply Chain
NADA Guide Analyst: Used-Car Prices Continue to Surge from Crisis in Japan
U.S. Auto Sales to Post First Drop in Seven Months on Gas Costs
Chrysler May Put Off Its Public Offering Until 2012
NADA University to Launch Social Networking Community Sites
Top 5 Stories
Japan Quake Stirs Unease About Global Supply Chain

BEIJING -- A shortage of auto parts and other components after Japan's earthquake has stirred unease about two pillars of manufacturing: the country's role as a crucial link in the global supply chain and "just in time" production. Manufacturers slashed costs by adopting Japanese-style small inventories and close links to a tight circle of suppliers. But that left them without a cushion of raw materials to ride out disruptions, forcing factories as far away as Louisiana to close when the March 11 quake and tsunami battered Japanese producers. Companies can use more suppliers spread over more countries but that would mean they have less bargaining power to lower costs. Manufacturers may hold more inventories. That might mean higher prices for consumers. Tsunami damage and power shortages that idled thousands of Japan's factories highlighted its role as a key -- and sometimes the only -- source of auto parts, graphics chips and other high-end components.
Source: The Associated Press

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NADA Guide Analyst: Used-Car Prices Continue to Surge from Crisis in Japan

NADA Used Car Guide Responds Quickly to Extreme Shocks in the Automotive Market

 
McLEAN, Va. – Prices of fuel-efficient, used cars – both at auction and at the retail level – continue to feel the ripple effect of the March 11 earthquake and tsunami in Japan. “The dramatic increase in wholesale vehicle prices indicates that buyers are expecting the supply of small, fuel-efficient cars to dwindle even more because of the crisis in Japan and gas prices that continue to rise,” said Jonathan Banks, executive automotive analyst for the NADA Used Car Guide. “In response to this trend, NADA values for April 2011 reflect large increases in most car segments compared to March 2011,” Banks added. “We’re basing our adjustments on the current market conditions and the expectation that these price increases will continue during the next few months.” The crisis in Japan and the subsequent damage to the Fukushima nuclear plant have caused several auto assembly and parts plants to suspend operations, interrupting the supply of new vehicles and parts for export to the U.S. market. “The impact of the crisis in Japan will have its most significant effect on the global auto industry during the next three months, unless Japan is able to quickly restore consistent power,” Banks said. “The bottom line is that price increases—for used cars in demand—are here to stay for the short term.”
Source: NADAFrontPage.com

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U.S. Auto Sales to Post First Drop in Seven Months on Gas Costs

U.S. automobile sales probably fell for the first time in seven months in March as the crisis in Japan and the highest gas prices in more than two years hurt consumers’ confidence. March light-vehicle deliveries, to be released tomorrow, may have run at a 12.9 million annual rate, the average estimate of nine analysts surveyed by Bloomberg. While higher than a year ago, it’s less than the seasonally adjusted rate of 13.4 million in February, according to Autodata Corp. The conflict in Libya helped push gas prices to the highest since September 2008, slowing truck and sport-utility vehicle sales. Confidence among U.S. consumers fell more than forecast to a three-month low this month, the Conference Board said March 29. The group said 3.6 percent of Americans plan to buy a new auto in the next six months, down from 3.9 percent in February.
Source: Bloomberg

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Chrysler May Put Off Its Public Offering Until 2012

Fiat and Chrysler CEO Sergio Marchionne suggested Wednesday that Chrysler may delay its initial public offering until next year. Marchionne said previously that an IPO was likely in the second half of this year. But on Wednesday, he said the timing depends on how much the automaker and the autoworkers' health care trust need liquidity. The trust, negotiated in 2007 by the UAW, pays health benefits for retirees and holds a 63.5% stake in Chrysler. "We have to get ready to be a public company again, and issuing securities takes time," Marchionne said Wednesday after Fiat's shareholder meeting in Turin, Italy. Marchionne confirmed that Fiat expects to raise its stake to 35% or more by the end of the year, up from its current 25%. "Our goal remains to achieve a stake of more than 51% within the year," Marchionne said... Fiat can raise its stake to 51% if Chrysler repays $7.2 billion in loans to the U.S. and Canadian governments. Chrysler's board of directors has been talking with Goldman Sachs and other investment banks to restructure the loans that carry interest rates ranging from 7% to 20.4%.
Source: Detroit Free Press

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NADA University to Launch Social Networking Community Sites

NADA University unveiled the launch schedule for online social networking communities for Next Generation ATD (American Truck Dealers), NADA-ATD Academy and NADA-ATD 20 Group. The first of the three comes on board in April with the remaining two going up in May and June. The Next Gen ATD Community is set to launch at the ATD Convention and Expo in Phoenix on April 15-18. The Academy Community is scheduled to launch in May. The 20 Group Community is set to go online in June. DrivingSales.com, the social network created by NADA University partner trainer Jared Hamilton, is providing the online platform for the new initiative. “I believe the best ‘real-world’ information for dealers comes from the actual experiences of other dealers,” (Hamilton said.) “That’s why NADA University and I have teamed up to help dealers build on the strong collaborations that already exist to make them more efficient and continuous using a 24/7 social network.”  
Source: Auto Remarketing

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For more auto industry news, visit NADAFrontPage.com

Webinar April 6: 'How Does Your Dealership Measure Up?'
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Quotable
"The impact of the crisis in Japan will have its most significant effect on the global auto industry during the next three months, unless Japan is able to quickly restore consistent power."

   
-- Jonathan Banks, auto analyst for the NADA Used Car Guide, NADAFrontPage.com, March 31
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