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Inside this issue
NADA to Appeal Court Decision on FTC's Risk-Based Pricing Rule
AutoFocus: NADA Chairman Outlines New Initiatives on Factory-mandated Facility Programs
May Auto Sales Expected to Soar by at Least 30%
Toyota Plans 8 Compact Cars for Emerging Markets
Fiat Likely to Expand Chrysler Stake in July
Apps Allow Electric Cars to Charge at Cheapest Rates
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
NADA to Appeal Court Decision on FTC's Risk-Based Pricing Rule

D.C. District Court upholds FTC interpretation concerning the scope of the Risk-Based Pricing Rule

The U.S. District Court for the District of Columbia on May 22 granted the Federal Trade Commission’s motion for summary judgment against an action brought by NADA that challenged the agency’s broad interpretation of the scope of the federal Risk-Based Pricing Rule. The law that the rule implements (section 311 of the FACT Act) applies to persons who, among other requirements, “use” a credit report in particular credit transactions.

The FTC issued an interpretation in July 2011 stating that dealers engaged in three-party vehicle financing transactions who do not obtain, receive or review a credit report nevertheless “use” a credit report based on the finance source’s use of a credit report and therefore are responsible for complying with the Risk-Based Pricing Rule’s notice requirement.

Believing this interpretation to be flawed, unnecessary and burdensome to many dealers by requiring them to purchase credit reports for no purpose other than to comply with the Risk Based Pricing Rule, NADA subsequently initiated this challenge. In its complaint, NADA argued that Congress never intended the word “use” to extend to this subgroup of dealers and that the FTC lacked authority to issue such an interpretation. Although the court found that the statute is capable of supporting NADA’s interpretation, it held that the FTC possessed authority to issue its interpretation and that its interpretation is reasonable.

Regardless of which party prevailed at the district court level, NADA anticipated that the other party would appeal the District Court decision to the D.C. Circuit Court of Appeals. NADA will now direct its outside counsel to commence the appeal.
Source: NADA Newsroom

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AutoFocus: NADA Chairman Outlines New Initiatives on Factory-mandated Facility Programs

In a television interview, Bill Underriner, chairman of the National Automobile Dealers Association, highlighted four, new initiatives as NADA pursues answers to questions surrounding factory image programs. “Dealers today are spending billions of dollars putting up new facilities complying with the manufacturers,” Underriner said in an interview on AutoFocus with David Hyatt. “And the manufacturers can’t tell the dealers whether their investment will help them sell one more car.” Click here to view the interview.
Source: NADA Newsroom

Related Article

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May Auto Sales Expected to Soar by at Least 30%

Sales of cars and trucks are expected to increase 30% or more in May compared with the same month last year when an earthquake and tsunami in Japan led to inventory shortages at dealerships and gas prices dampened consumer demand. Consumers are on track to buy about 1.38 million new cars and trucks in May compared with 1.05 million last May, J.D. Power and Associates and LMC Automotive said [Thursday.]
Source: Detroit Free Press

Editor’s note: NADA Chief Economist Paul Taylor points out that U.S. new-car sales will look dramatically different in May 2012 compared to a year ago when the tragic Tsunami in Japan resulted in a 4 percent increase in U.S. auto sales last May. “A key problem then was an extremely low inventory of cars, particularly four-cylinder versions and some light-truck models from Japan,” Taylor said. “May sales gains in 2012 look large against a weak May 2011, and reflect some pent up demand for some customers now finding the car they desire with low financing rates and rising incentives.” Taylor added that the next four months will feature growth in the luxury car segment, which may be limited by the unsettled world financial markets. “Declining gasoline prices as well helped boost auto sales in May because consumers shopped for a wider range of vehicles,” he said. “Most manufacturers have rebuilt their car inventories to ideal levels, which provides car buyers with a mix of vehicle choices heading into the long Memorial Day weekend.”

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Toyota Plans 8 Compact Cars for Emerging Markets

Automaker aims to reduce dependence on U.S., Europe and Japan

Toyota Motor Corp. today said it would roll out eight compact car models tailored for emerging markets by 2015 in an attempt to catch up to front-runners such as Volkswagen Group and General Motors Co. Toyota, which lost the crown as the world's top automaker last year, is looking to reduce its dependence on the mature North American, European and Japanese markets.
Source: Reuters

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Fiat Likely to Expand Chrysler Stake in July

Fiat is likely to increase its stake in Chrysler to 61.8% in July and is eager to explore a broader alliance with Mazda, Chrysler and Fiat CEO Sergio Marchionne told reporters at a plant in Illinois on Thursday. Marchionne said there is more than a 50% chance that Fiat will boost its stake by purchasing 3.32% of Chrysler's total shares.
Source: Detroit Free Press

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Apps Allow Electric Cars to Charge at Cheapest Rates

One the great, but not well known, features of electric cars is the degree to which they are taking full advantage of smartphones and connectivity. It's not just for show. Using smartphone apps, owners can make sure their car won't start recharging at home until an electric utilities rates drop for the night.
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 we continue to see strong month-over-month results in retail sales points to the underlying strength of the recovery for the industry going forward."

   
-- John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates, referring to new-car sales in May, Detroit Free Press, May 24


 

NADA - National Automobile Dealers Association

Videos

 AutoFocus: NADA Chairman Outlines New Initiatives on Factory-mandated Facility Programs

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