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Inside this issue
GM Records Its Highest Profit Ever: $7.6 Billion
Ford, GM Help Lead Industry to Best-ever Showing in Vehicle Reliability -- J.D. Power Study
Auto Dealers Warn Fuel Efficiency Proposal Will Price Out Millions of Buyers
Why Hybrids and Diesels Don't Always Save You Money
Romney Targets Auto Bailout in Battle for Michigan
G.M. Changes Pensions for Salaried Workers
Saab Dealers Look to Add 2nd Brand
Cars' Instrument Panels Become More Like Video Games
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
GM Records Its Highest Profit Ever: $7.6 Billion

General Motors earned its largest profit ever in 2011, two years after it nearly collapsed into financial ruin. Strong sales in the U.S. and China helped the 103-year-old carmaker turn a profit of $7.6 billion, beating its old record of $6.7 billion in 1997 during the pickup truck and SUV boom. GM is a vastly different company than it was back then. It's smaller, has less debt and its contract with the United Auto Workers is less costly.
Source: The Associated Press

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Ford, GM Help Lead Industry to Best-ever Showing in Vehicle Reliability -- J.D. Power Study

Four out of the top 10 brands in J.D. Power’s reliability study are from Ford or General Motors and their performance contributed to the industry’s best overall score in the history of a study that dates back to 1990. “The fact that almost every brand improved ... at a time when the industry was really hurting is impressive and frankly surprising,” David Sargent, vice president of global automotive for J.D. Power and Associates said in an interview. The study measures the number problems per 100 for cars and trucks purchased in 2009. It is designed to measure long-term vehicle dependability.
Source: Detroit Free Press

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Auto Dealers Warn Fuel Efficiency Proposal Will Price Out Millions of Buyers

American auto dealers are pushing back on proposed fuel economy rules that, they claim, would price out millions of buyers from the new-car market, potentially jeopardizing the environmental benefits of the program and the resurgent auto industry itself. Throughout the Obama administration's campaign to jack up fuel efficiency, officials claimed that for consumers, the upgrades would pay for themselves. Sure, buyers would pay more for a new vehicle off the lot, but they'd make up that cost in fuel savings in just a few years. But the changes from two sets of fuel efficiency standards could add $3,000 to the price of a new car by 2025. And the National Automobile Dealers Association argues that if buyers can't qualify for a loan up front, the rest is fantasy. Cash-strapped buyers instead will go for gas-guzzling used cars or put off buying another car altogether, leaving the fuel-efficient marvels parked in the lots of auto dealers across the country. "Where's the environmental savings ... if you can't get the older cars off of the road?" NADA spokesman Bailey Wood said. The NADA estimates that by 2025, 6.8 million drivers will no longer qualify for a new-car loan if the proposed fuel efficiency standards go into effect.
Source: FoxNews.com

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Why Hybrids and Diesels Don't Always Save You Money

Hybrids and the current crop of clean diesels offer impressive fuel savings over their gas counterparts. But hybrid and diesel technologies aren't cheap and often add thousands of dollars to a car's sticker price. As recently as 2010, the federal government offered tax credits that helped soften the financial impact. That spurred sales and encouraged consumers to adopt this new technology. But these tax credits stopped on Jan. 1, 2011. With their expiration comes a good question for consumers: Are hybrids and diesels a good value? A few years ago, Edmunds editors came to the conclusion that hybrids didn't make financial sense. Even with the federal tax credits available at the time, it would have taken a number of years before anyone would start to see significant savings from a hybrid over a comparable non-hybrid vehicle. Now that the credits are gone, the pure financial case for hybrids and diesels has weakened further.
Source: Edmunds.com

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Romney Targets Auto Bailout in Battle for Michigan

Republican presidential candidate Mitt Romney is wooing tea partyers in his home state of Michigan with a potentially risky strategy: blasting the auto industry bailout that many people credit with saving the state's most vital industry. A May 2010 poll conducted by EPIC-MRA for the Detroit Free Press found that nearly two-thirds of Michigan adults thought the auto bailout was a good idea. Republicans were more closely divided, with 51 percent calling it a good idea, and 43 percent calling it a bad idea. The auto bailout started when the Bush administration loaned money to GM and Chrysler to keep them from collapsing during the 2008 financial crisis. The Obama administration brought the total to $81 billion, and Obama now calls the results a triumph.
Source: The Associated Press

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G.M. Changes Pensions for Salaried Workers

General Motors said Wednesday that its salaried employees would stop accumulating pension benefits later this year as the company tried to narrow a large shortfall in its retirement funds. G.M. also said its 26,000 salaried employees in the United States would receive bonuses but no across-the-board pay raises this year. They will receive one additional week of paid vacation time going forward. Starting in October, the 19,000 salaried workers who have been covered by G.M.’s pension plan will be shifted to a 401(k)-type plan, though they will not lose any of the pension benefits they have accumulated.
Source: The New York Times

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Saab Dealers Look to Add 2nd Brand

They try to cope with bankrupt firm, uncertain future

The bankruptcy of Saab Automobile has left the carmaker's 900 dealers around the world scrambling to reinvent themselves, sometimes in creative ways. Tom Backes, general manager at Guilford Saab in Connecticut, is considering trading in his sensible Saab wagons and sedans for the racier world of Maserati, the luxury brand owned by Fiat SpA, which is expanding its U.S. dealer network. He has also approached Mitsubishi. "I've reached out to quite a few brands," Backes said. "Some have said, 'We're not expanding,' and others have said, 'We'll take a look at it.' It's a slow process."
Source: Bloomberg

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Cars' Instrument Panels Become More Like Video Games

More automakers are using digital instrument-panel displays — more akin to video games than traditional gauges — to jazz up models with techno-glitz. Chrysler Group is giving its 2013 Dodge Dart ... a digital display, with whiz-bang graphics, that lets drivers choose the information they want to see. Ford first used the technology on its Fusion Hybrid in 2010, including a pre-startup show in which the entire instrument panel turns to images of grass and blue skies when the driver unlocks the door.
Source: USA Today

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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. For more information, visit www.nada.org.

 
Quotable
"The fact that almost every brand improved ... at a time when the industry was really hurting is impressive and frankly surprising."

   
-- David Sargent, vice president of global automotive for J.D. Power and Associates, referring to its annual reliability study, which reported the industry’s best overall score in the history of the study that dates back to 1990, Detroit Free Press, Feb. 15




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