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Inside this issue
Auto Dealers Push Back on Required Renovations
Auto Trade Talks Will Target Tariffs, Unified Rules
Volkswagen's Start to Year is Worse Than in 2012, Poetsch Says
Hyundai Home Advantage Vanishes as Koreans Say Camry Best
Almost All Fords Will Get EcoBoosts
GM Pilot Program Shows That Shoppers Resist Buying Without Seeing and Trying
Coming to a Track (and Showroom) Near You
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Auto Dealers Push Back on Required Renovations

U.S. auto dealers are pushing back against manufacturers' requirements for upgraded facilities as a new industry-sponsored study analyzing the investment returns confirmed previous concerns. Meanwhile, recent data from Sageworks Inc., a financial information company, suggests that privately held auto dealers are understandably focused on the programs' payoff, considering dealerships historically work with thinner margins than do other types of retailers and private companies as a whole. “Privately held auto dealers have been experiencing improving net profit margins in recent years ..." said Sageworks analyst Robb Granado. “But the money for these kinds of programs comes straight out of the bottom line, so dealers likely have issues with the requirements for a number of reasons.” Ford Motor Co. and General Motors Co. have some programs to help dealerships pay for renovations. But at the National Automobile Dealers Association's annual convention this month, industry consultant Glenn Mercer expressed concern that manufacturers' push for dealers to build more expensive and more brand-customized stores will result in excessive and wasteful spending, according to a NADA statement from the event. His study found that while dealer service expansions can pay off, modernizations are harder to justify and OEM-mandated standardization “was a bad investment,” a NADA video report said.
Source: Forbes

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Auto Trade Talks Will Target Tariffs, Unified Rules

Obama plan wins wide support in Europe, U.S.

Automakers on both sides of the Atlantic are enthusiastically backing trade talks between the United States and Europe that President Barack Obama announced during his State of the Union address. But a host of obstacles stand in the way of a trade deal: parochial auto safety standards, steep tariffs on light trucks and a thicket of unrelated political disputes in other industries such as agriculture. "We are absolutely convinced that it will lower costs and it will make the business case for investment in the U.S. and Europe even stronger than it is right now," said Steve Biegun, vice president of international governmental affairs at Ford Motor Co. Automakers are dissatisfied with current rules that force automakers to do engineering and testing work twice to satisfy regulators on both continents. These regulatory differences may cost automakers as much as a traditional tariff of 10 or 20 percent, Karel De Gucht, the European Union trade commissioner, recently told the BBC.
Source: Automotive News

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Volkswagen's Start to Year is Worse Than in 2012, Poetsch Says

Volkswagen AG predicted the first quarter would be worse than a year earlier, adding to a forecast last week that 2013 operating profit probably wouldn't increase as Europe's auto market shrinks. The first quarter 2013 "will be clearly below" the first quarter of last year, Chief Financial Officer Hans Dieter Poetsch said in an interview with Frankfurter Allgemeine Sonntagszeitung published over the weekend. He didn't provide additional details. Unchanged earnings this year would mark the first time since 2009 that annual operating profit hasn't risen. Europe's largest automaker on Feb. 22 scaled back its 2013 profit forecast from a year-old prediction in its annual report.
Source: Bloomberg

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Hyundai Home Advantage Vanishes as Koreans Say Camry Best

For more than two decades, Hyundai Motor Co. could count on the sun rising each morning and for South Koreans to buy South Korean vehicles. Then Toyota Motor Corp.'s Camry became the country's "Car of the Year." Sure, it's the same staid sedan that won consumers' hearts around the globe as more than 14 million units rolled off Toyota production lines since 1982. But given Korea's fraught relationship with its one-time and sometimes brutal occupier, it was a surprise the country's auto journalists awarded the title to any Japanese car. Shifting attitudes to foreign goods in South Korea, free-trade pacts and a stronger currency have driven the share of imports to a record in Asia's fourth-biggest car market.
Source: Bloomberg

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Almost All Fords Will Get EcoBoosts

Cleveland plant adds the 2.0-liter engine

By bringing production of its 2.0-liter, four-cylinder EcoBoost engine to a plant [in Cleveland] in late 2014, Ford Motor Co. is setting the stage for using the engine brand through nearly its entire lineup. Even the Mustang, long known for muscular V-6 and V-8 power, could benefit when the next-generation pony car arrives in 2015. The company said EcoBoost engines will be offered on more than 90 percent of its North American nameplates this year and 95 percent by 2015. Ford will invest nearly $200 million and add 450 jobs at its Cleveland Engine Plant, which will produce all 2.0-liter EcoBoost engines for North America, in addition to the 3.5-liter EcoBoost it already builds.
Source: Automotive News

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GM Pilot Program Shows That Shoppers Resist Buying Without Seeing and Trying

To attract Web-savvy customers, General Motors is experimenting with easy-to-use online shopping. Consumers can cut time at dealerships, for instance, by filling out credit applications online and getting preliminary values on trade-ins. But initial results from GM dealers show that nearly all shoppers are a long way from buying a $30,000 vehicle sight unseen. It's the latest piece of evidence that the migration to online auto shopping is proceeding surely -- but slowly.
Source: Automotive News

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Coming to a Track (and Showroom) Near You

Richard Petty competed in Nascar from 1958 to 1992, long enough to have won seven championships while driving dozens of racecar models. So he could not help chuckling when asked about the name of the racecar being introduced this season in the Sprint Cup series. Nascar calls it the Gen-6, for sixth generation in the sport's 65-year history. For Petty, the Gen-60 might have been more fitting. “I guess they had to call it something besides the Car of the Future,” he said with a laugh, “because that didn't work too good.”
Source: The New York Times

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Quotable
"It's one thing to buy headphones online; it's quite another to buy a $30,000 car."

    -- Robert Sawyers, general manager of Sawyers Chevrolet in DeWitt, Mich., commenting on online car shopping, Automotive News, Feb. 25


  

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