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Inside this issue
Glenn Mercer: Getting to the Bottom of Renovations
New Car Prices Rising Along With Sales
Auto Shoppers in a Buying Mood in January
Business Groups Press Conference Committee on Tax Incentive
Super Bowl: The Car Ads Are Back
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Glenn Mercer: Getting to the Bottom of Renovations

Ask auto retail experts about manufacturer-mandated store improvements and you will find no shortage of opinions, analyst Glenn Mercer said. But ask them to back their opinion with research and you'll find a shortage. "Franchise economics have been studied well," said Mercer, 56, an auto analyst for more than 25 years. "What hasn't been covered much is automotive dealer franchise economics as they relate to the facilities, which is not surprising because the average dealer is about five businesses at once: new-car sales, used-car sales, parts and tech labor, financing [and] in some cases a body shop." Mercer, a former partner in the management and consulting company McKinsey & Co., was hired in August by NADA to study the value of showroom renovations. NADA will release the study on facility renovations at the convention Saturday, Feb. 4.
Source: Automotive News

Editor's note: The study will be released during the NADA convention at a 9 a.m. PST press briefing on Saturday, Feb. 4, in Room 233 North of the Las Vegas Convention Center.

Related article

  Facilities Projects: Who's Asking for What (Automotive News)

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New Car Prices Rising Along With Sales

U.S. auto dealers are now selling vehicles at historically high prices in another sign the auto industry's recovery is moving into the fast lane. Cash rebates and other incentives also have dropped by more than $400 since 2008, according to the J.D. Power and Associates' 2012 annual automotive industry outlook released here on Friday before the start of the National Automobile Dealers Association convention. "We see increasing optimism but the auto maker discipline in production must remain," John Humphrey, the association's vice president of global automotive operations, said during a speech Friday.
Source: The Wall Street Journal

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Auto Shoppers in a Buying Mood in January

Consumers were in a buying mood in January, pushing the industry's sales to the strongest level since May 2008 as the annual selling rate reached 14.2 million vehicles. The sales rate exceeded the 14.1-million pace registered in August 2009 when the government's cash-for-clunkers incentive program successfully boosted sales while getting thousands of older vehicles off the road. "It's the best start to a new year since 2008," said Toyota Group Vice President Bob Carter.
Source: Detroit Free Press

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Business Groups Press Conference Committee on Tax Incentive

The U.S. Chamber of Commerce and more than 100 other business groups are urging lawmakers to include a tax incentive for capital investment in any package extending the payroll tax cut. The groups say the provision, commonly known as bonus depreciation, would be a boon for businesses and help spark job creation. “Given the continued economic uncertainty and high unemployment, it is important to extend this important investment incentive through 2012,” the groups wrote to Rep. Dave Camp (R-Mich.) and Sen. Max Baucus (D-Mont.), who are leading a conference committee tasked with a payroll tax cut extension. The House last year passed bonus depreciation as part of its measure to extend the payroll tax cut for all of 2012. Without the extension, companies would only be able to write off 50 percent of capital investments this year. On Thursday, conferees did largely coalesce behind extending bonus depreciation through 2012 – though Baucus, the chairman of the Senate Finance Committee, did say that he thought the provision packed a little more punch when the economy was stronger.
Source: The Hill

Editor's note: NADA/ATD supports extending bonus depreciation and participates in the effort. Bonus depreciation helps small businesses free up capital to make purchases such as cars and trucks, and helps dealers make investments in their own stores. To view the letter, click here.

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Super Bowl: The Car Ads Are Back

Rising U.S. auto sales and improved financial performance are spurring a vigorous return by carmakers to television's priciest advertising venue, the Super Bowl. But this XLVI championship-within-a-championship has a new wrinkle this year. The dozen or so carmakers that have bought slots are releasing their ads early via YouTube and other social media platforms. As usual, the advertisements promise to be as entertaining, if more so, than the matchup between the two football teams.
Source: Fortune

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The NADA Story

The NADA story began in 1917 when 30 auto dealers traveled to the nation’s capital to convince Congress not to impose a luxury tax on the automobile. They successfully argued that the automobile is a necessity of American life, not a luxury. From that experience was born the National Automobile Dealers Association. Today, NADA represents nearly 16,000 new-car and -truck dealerships with 32,500 franchises, both domestic and international.

 
Quotable

"It's the best start to a new year since 2008."

   
-- Bob Carter, Toyota Group Vice President, Detroit Free Press, Feb. 3




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