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Inside this issue
Stair-Step Plans Prompt Fresh Dealer Grousing
Opinion: Help Vehicle Dealers Fight For Rights
Auto Maker Fuel Economy, Emissions Improvements on Track
In Reversal of Fortune, Fiat Needs Chrysler to Survive European Crisis
Automakers Tuning Out Traditional In-Car Radios
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Top Stories
Stair-Step Plans Prompt Fresh Dealer Grousing

Stair-step programs, the incentive plans that drive many dealers crazy, are causing more grumbling than they were a year ago. Several major retailers, including some of the largest dealership groups in the country, say stair-step programs are worse than last spring, when the programs set off renewed debate about the practice and even triggered a media campaign against the programs by the National Automobile Dealers Association. Executives from Sonic Automotive Inc., Asbury Automotive Group and Lithia Motors Inc. agreed. The tiered sales targets being given to dealerships to earn escalating stair-step bonus money are erratic, they said. Some stores may have easy targets, but others have targets that they call impossible. The programs cause major disruptions as stores chase bonus payments, which can be huge, retailers say. They wreak havoc on dealerships' front-end new-car margin. And customer satisfaction suffers.
Source: Automotive News

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Opinion: Help Vehicle Dealers Fight For Rights

When community groups need support, they often turn to our local auto dealers. Whether it is sponsorship of local sports teams, educational programs, social service programs or many other nonprofit groups that make our communities better, stronger and healthier, the auto dealers have been there for us. Now, the auto dealers are asking us for help, and their request seems reasonable and in the best interests of our communities and the state. The New Hampshire Automobile Dealers Association (NHADA) is supporting Senate Bill 126, a limited expansion of the existing Automobile Dealer Bill of Rights that will give them greater control of their business and be less at the mercy of manufacturers. In an editorial board meeting this week, many local dealers told us that relationship is far from merciful. "Automobile manufacturers control nearly every aspect of a dealer's livelihood," they told us. "At the start of the relationship and at renewals, a dealer must sign a one-sided contract drafted by the manufacturer without negotiation. During the relationship, the factory exercises further control through allocation of vehicles, pricing of vehicles and various other methods."
Source: Portsmouth Herald (Portsmouth, N.H.)

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Auto Maker Fuel Economy, Emissions Improvements on Track

U.S. auto makers made record mileage and carbon-dioxide-emissions improvements in model-year ’12 and appear on track to meeting first-year targets in the industry's march toward new federally mandated levels of fuel efficiency. Preliminary U.S. Environmental Protection Agency data shows the industry's fleet-wide CO2 emissions at 296 grams per mile, or the equivalent of 30.0 mpg. Auto makers were expected to achieve 295 gpm, or 29.3 mpg, in the first year of the targets that ratchet up to maximum CO2 emissions of 250 gpm, 35.5 mpg, by 2016. Factoring in credits for advanced air-conditioning systems should push the industry safely over its requirements. But some manufacturers remain under pressure to achieve individual targets enforced separately by the U.S. National Highway Traffic Safety Admin. “They are tough standards,” says Greg Schroeder, a senior research engineer at the Center for Automotive Research in Ann Arbor, Mich. “Things could get interesting in 2016.”
Source: WardsAuto

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In Reversal of Fortune, Fiat Needs Chrysler to Survive European Crisis

Nearly four years after Sergio Marchionne led a taxpayer-funded rescue of Chrysler, he is struggling to fix Fiat through a merger that has put him at odds with tens of thousands of retired Chrysler workers. The roles between rescuer and troubled partner have been reversed for some time. This morning, Chrysler is expected to report a substantial profit for the first quarter, while Fiat, excluding its majority stake in Chrysler, is expected to lose money for the seventh straight quarter.
Source: Detroit Free Press

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Automakers Tuning Out Traditional In-Car Radios

AM-FM not dead yet but music streaming, Internet new priority

Automakers have killed the cassette player, and CD players are taking a back seat to Bluetooth-connected iPhones. The in-dash car radio, with its dials and knobs, isn't signing off yet. But it's past its prime in the eyes of some automakers, and most aren't prepared to spend much time or money tinkering with it. Instead, they're focusing on the next generation of in-car entertainment, such as Web browsing and music streaming. Startup automaker Detroit Electric plans to be the first without a radio when it rolls out its first car in August — audio will be delivered via smartphone.
Source: The Detroit News

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More Articles
"Stair-step programs are awful."

-- Jeff Dyke, executive vice president of operations for Sonic Automotive Inc., Automotive News, April 29

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