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Inside this issue
Satisfaction With Car Dealership Service at Record High
Volkswagen CEO Stresses Cautious Outlook
BMW Auto Margins Slip on Spending to Keep Ahead of Audi
U.S. and Europe Seek Support for Trade Pact
Payroll Audits Put Small Employers on Edge
Tests Show Key Safeguard Can Fail When Cars Rear-End Big Rigs
Henrik Fisker Resigns From Fisker Automotive
Audi, BMW, Mercedes Look For Edge With Virtual Showrooms
Fort Drum Soldier Wins $20,000 in Car Dealership's Contest
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Satisfaction With Car Dealership Service at Record High

Forget about the days when bringing your car into the shop was the type of experience that left you frustrated. A new survey by J.D. Power & Associates find customer satisfaction with auto service centers has hit a record high. Customer satisfaction with auto service centers has been steadily improving in recent years as automakers work with the dealers to refurbish or build new service centers. J.D. Power surveyed 91,000 owners of vehicles in their first three years of ownership. It is a period that covers the majority of the vehicle warranty period. Service centers at luxury auto dealerships ranked higher than those at mass brands, according to J.D. Power and Associates.
Source: CNBC

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Volkswagen CEO Stresses Cautious Outlook

Volkswagen's chief executive Martin Winterkorn said today the company faces a challenging year particularly in Europe where many countries are in recession. Winterkorn told the company's annual news and analyst conference that "Volkswagen is feeling the headwinds — especially in Europe." However, he said he was "guardedly confident" and that this year's operating earnings should match last year's. In 2012, VW recorded record sales and earnings. Winterkorn said prospects were better in the United States, "where the upward trend is continuing," and in China. He said that of 10 planned new plants, seven were in China, strengthening future earnings there.
Source: Associated Press

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BMW Auto Margins Slip on Spending to Keep Ahead of Audi

Bayerische Motoren Werke AG (BMW), the world's biggest maker of luxury cars, reported a drop in profitability at its auto unit as it invests on expanding offerings to keep ahead of Audi in a tightening race for the sales lead. Operating profit at BMW's car division fell to 10.9 percent of sales last year, down from 11.8 percent in 2011, the Munich- based carmaker said today in a statement. BMW slightly trailed the 11 percent margin of Volkswagen AG's Audi in 2012. BMW is introducing the 3-Series GT and the 4-Series coupe and is preparing to roll out its first electric vehicle, the i3 city car. The expansion is aimed at securing a third consecutive year of record sales in 2013 and countering Audi, which trails the BMW brand by 407 car deliveries after two months in 2013. The investment comes as European car sales head for a sixth consecutive annual decline this year.
Source: Bloomberg

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U.S. and Europe Seek Support for Trade Pact

President Barack Obama and the top trade official for the European Union sought to rally support Tuesday for a landmark trans-Atlantic free trade deal, saying it would benefit a wide variety of exporters and offer a significant boost to growth. Karel De Gucht, the E.U. trade commissioner, said one of the biggest beneficiaries of a trade deal with the United States would be automobile manufacturers like BMW that have long rankled at tariffs. Mr. De Gucht was shoring up support for a mandate to negotiate on behalf of E.U. member states — like Germany, home to a powerful auto sector — and whose governments still must agree to let him lead the talks. Exports of motor vehicles from Europe to the United States could increase 149 percent if a deal removed existing tariffs and harmonized different safety standards, according to a study conducted by the Center for Economic Policy Research in London and released Tuesday by Mr. De Gucht's office. “I feel just as safe when I drive a car in the U.S. as I do when I drive in Europe, so we should find ways to align our systems to find ways to cut costs,” Mr. De Gucht said at a news conference.
Source: The New York Times

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Payroll Audits Put Small Employers on Edge

Tax crackdown comes as use of contract workers grows; companies find rules unclear

Internal Revenue Service auditors showed up with little warning at Brian Robinson's staffing firm in Atlanta a year ago, seeking to verify that a dozen outside contractors he had hired to handle his information-technology services weren't, in fact, full-time staffers. The audit was part of a government crackdown on employers who misclassify workers as independent contractors to avoid paying payroll taxes, and other employment-related expenses. Mr. Robinson says the auditors ultimately found that his 30-year-old family business, TRC Staffing Services Inc., with its 100 permanent employees and up to 20 temporary workers, was in the clear. But he says the audit was "nerve wracking" because tax law doesn't make it easy to distinguish between full-time staff and independent contractors doing full-time work. He says the legal distinction can be confusing even for an employer with his decades of experience in the labor market. The appeal of using outside workers is growing as many small businesses struggle to stay lean. Some employers also are turning to contractors to avoid hitting the 50-employee threshold that would require them to pay for employees' health insurance, starting next year, under the federal health-care law, or pay a penalty.
Source: The Wall Street Journal

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Tests Show Key Safeguard Can Fail When Cars Rear-End Big Rigs

Passenger vehicles are designed to handle severe frontal crashes, but in some crashes into the back of large tractor-trailers, all bets could be off, according to recent crash tests done by the Insurance Institute for Highway Safety. The problem is that underride guards on the back of tractor-trailers don't always do a good job of keeping passenger vehicles from sliding beneath a truck's trailer in a crash, the institute found. If they do not prevent that underride, all the structures designed to absorb crash energy are bypassed. The weaker windshield becomes the point of impact and the top of the occupant compartment is crushed. Air bags and seat belts don't make a difference. The result is life-threatening head and neck injuries, even decapitation, according to the institute, which is financed by the insurance industry.
Source: The New York Times

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Henrik Fisker Resigns From Fisker Automotive

Fisker Automotive announced Wednesday that Henrik Fisker, its co-founder and executive chairman, had left the company because of disagreements with management. In a statement, the company said his departure was “not expected to impact the company's pursuit of strategic partnerships and financing to support Fisker Automotive's continued progress.” The company declined requests for interviews. In an e-mail to Automotive News, the company attributed Mr. Fisker's resignation to “several major disagreements” regarding the business strategy of the company's executive management.
Source: The New York Times

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Audi, BMW, Mercedes Look For Edge With Virtual Showrooms

Audi has opened the second of 20 planned digital showrooms designed to impress urban customers with an interactive experience that goes well beyond the standard dealership fare of brochures and machine coffee. The new Audi City in Beijing follows last year's opening of the inaugural London showroom, and keeps to the same format by letting customers view configured cars on floor-to-ceiling screens but reducing traditional dealer functions such as the test drive. Audi's "real-life cyberstores" are also being rolled out by its two biggest rivals. Last year, BMW opened its first Brand Store on an upscale Paris shopping street and says it will be making announcements on similar showrooms later this year. And in September last year, Mercedes-Benz opened its first Visionary Store in a shopping arcade in central Milan, focusing on the new A class. By locating in prestigious, high-traffic locations, the automakers aim to introduce potential customers to the brand rather than give them the hard sell.
Source: Automotive News

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Fort Drum Soldier Wins $20,000 in Car Dealership's Contest

A Fort Drum soldier scheduled to be deployed soon to Afghanistan with the post's 10th Combat Aviation Brigade won $20,000 Saturday at Davidson Chevrolet/GM [in Watertown, N.Y.]. More than 4,200 people entered the contest and 20 names were selected to take turns trying different keys to start a 2013 Chevrolet Malibu. Spc. Quentin Patton, San Antonio, Texas, was the 18th person to try to start the car, and the engine promptly turned over. Spc. Patton had his choice of the car or $20,000. He was leaning toward the car but his girlfriend, Spc. Connie McKenney, a Texas native also heading to Afghanistan soon, talked him into taking the cash. He also could have chosen a 2013 Ford Fusion or a 2013 Nissan Altima. Spc. Patton arrived at Fort Drum last year from an assignment in South Korea. His upcoming deployment will be his second to Afghanistan.
Source: Watertown Daily Times (Watertown, N.Y.)

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Quotable
"Dealerships are placing more emphasis on the service adviser's role. Having a skilled, trained adviser is vital for a positive customer experience."

   
-- Chris Sutton, senior director at J.D. Power, commenting on recent survey results that show customer satisfaction with dealer service centers has hit a record high, CNBC, March 13
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