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Inside this issue
Lender Scrutiny Could Put Dealers Under the Microscope
GOP Tax-Writers Roll Out Estate Tax Repeal Bill
NADA: Prices of Used Plug-in Electric Vehicles to Drop 30% in 2013
GM Makes Big Move Up in J.D. Power Quality Survey
Judge Leaves Marchionne in Lurch Over Chrysler Purchase Price
Report: Megaplatforms Will Be a Major Factor in Industry's Future
A Legacy of Detroit
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Lender Scrutiny Could Put Dealers Under the Microscope

Dealerships better brace themselves for a much higher level of scrutiny by auto lenders now that the Consumer Financial Protection Bureau has the lenders under a microscope, F&I experts say. The CFPB put auto lenders on notice this year that it would hold lenders accountable if it finds that pricing differences at dealerships result in discrimination against minorities or other legally protected classes. But auto lenders fear they'll lose share if they're the first to switch to flat fees, said Jeff Levine, a partner with Hudson Cook law firm of Hanover, Md.

Paul Metrey, the National Automobile Dealer Association's chief regulatory counsel for financial services, privacy and tax, said NADA doesn't have an official position on fixed pricing. "We recognize it as a proactive measure in terms of compliance, but dealers need to talk to their attorneys whether it's something to adopt and how they would go about it," he said. Metrey said NADA has grave concerns that if the CFPB does away with dealer discretion to set prices, it could have the unintended consequence of making pricing less competitive and therefore more expensive for customers.
Source: Automotive News

Editor's note: On May 28, 13 House Financial Services Committee Democrats asked, in writing, for the CFPB to explain its methodology and analysis to substantiate their conclusion that unintentional discrimination may be taking place. Despite the June 7 deadline set by Congress, the bureau has yet to respond. Click here to read the letter.
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GOP Tax-Writers Roll Out Estate Tax Repeal Bill

A pair of senior GOP tax-writers is reintroducing legislation to repeal the estate tax. Sen. John Thune (R-S.D.) and Rep. Kevin Brady (R-Texas) announced Wednesday that they were bringing back legislation almost identical to what they released in the last Congress to permanently get rid of the tax.
Source: The Hill

Editor's Note: With the passage of permanent estate law at the end of 2012, further changes in this Congress are unlikely, but may be considered as a part of comprehensive tax reform. President Obama has proposed an increase in the estate tax in his latest budget. NADA, in its leadership role in the Family Business Estate Tax Coalition (FBETC), supports the efforts of Sen. Thune and Congressman Brady. To see the letter from the FBETC to Sen. Thune in support of his bill, click here.
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NADA: Prices of Used Plug-in Electric Vehicles to Drop 30% in 2013

Market-leading depreciation of EVs expected to change little through 2014

Values for used plug-in electric vehicles are expected to decline nearly 30% this year—the highest depreciation out of all vehicle segments, according to the NADA Used Car Guide in its latest report, Plug-in Electric Vehicles: Market Analysis and Used Price Forecast. “The steep rate of depreciation for used plug-in electric vehicles can be attributed to limited range, manufacturer incentives and federal tax credits intended to offset the higher prices of new plug-in electric vehicles,” said Jonathan Banks, executive automotive analyst for the NADA Used Car Guide.
Source: NADAFrontPage.com

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GM Makes Big Move Up in J.D. Power Quality Survey

GM brands ace quality survey, Porsche in first and Scion is dead last

Four years out of bankruptcy reorganization, General Motors has risen dramatically up the ranks in one of the auto industry's most respected measures of new vehicle quality. The company's GMC truck brand jumped to No. 2 among all brands -- just behind Porsche -- for fewest new vehicle problems in the 2013 J.D. Power and Associates' Initial Quality Study. GM's Chevrolet brand rose to fifth in the annual ranking, and its other two brands, Cadillac and Buick, both beat the industry average. The Chevy brand also took five of the 26 top awards for individual models with best quality vs. other vehicles in the same car or truck market segment based on size, type and price. Click here for full ranking of brands and category winners.
Source: USA Today

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Judge Leaves Marchionne in Lurch Over Chrysler Purchase Price

Fiat S.p.A. CEO Sergio Marchionne may have to wait months longer than planned to learn the price of shares he needs to complete his acquisition of Chrysler Group. Fiat asked Delaware Chancery Court Judge Donald Parsons, 64, last year to rule that a call-option agreement covering some shares held by a UAW retiree health-care trust are worth $139.7 million. The trust puts the value as high as $342 million. Parsons, who is considering the matter based on pretrial filings by the two sides, is likely to call for a trial, where witnesses and experts can be questioned and cross-examined, before placing a value on the shares, said Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. That would add months to a process Marchionne had estimated would be completed by the end of September.
Source: Bloomberg
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Report: Megaplatforms Will Be a Major Factor in Industry's Future

The auto industry's next-generation vehicle platforms may allow manufacturers to produce new products at unprecedented speed, but they also will bring great challenges to manufacturers and suppliers, according to an AlixPartners study. The so-called megaplatforms will account for nearly 90 percent of the industry's growth in the next five years, the study released on Tuesday says. The modular templates will allow automakers to produce millions of units spanning different global brands, models, vehicle types and sizes -- even allowing manufacturers to adapt easily to local requirements and global suppliers.
Source: Automotive News
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A Legacy of Detroit

The Detroit Historical Society manages a collection of 62 classic cars that could be placed on the block if Detroit winds up in bankruptcy court. The cars are pieces of Detroit — and automotive — history. Click here for commercials and promotional videos for cars in the group's collection.
Source: The New York Times
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More Articles
 
Quotable
"From the lender side ... moving to a flat fee is considered damaging to dealer relationships and damaging for volume." 

     --- Jeff Levine, a partner with Hudson Cook law firm of Hanover, Md., commenting on the CFPB's suggestion to switch to flat fees for auto loans, Automotive News, June 19


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Videos

 
Video: NADA Chairman Discusses How CFPB Guidance Could Hurt Consumers (NADAFrontPage.com)


Video: Bob Lutz on the Future of Electric Cars, Tesla, Fisker and Better Place (CNBC)

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NADA Webinars
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- July 17: Put the Brakes on Auto Theft and Vandalism

- July 24: Accessory/Service Drive Warranty Sales Success

 For more information about the webinars, click here.

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