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Inside this issue
Sen. Cruz, Rep. Peters to Speak to Auto Dealers
U.S. Auto Sales Expected to Slow After 16M
Marchionne Prepares Final Hand in Chrysler Merger Game
U.S. Treasury Speeds Up Sell-Off of GM Stock
NADA UCG Connects August New-Sales Performance to Used-Price Trends to See by Year's End
Fisker Loan to Be Auctioned After Sale Prospects Wane
NHTSA Finds More Than a Third of Children Killed in Crashes Were Not in Car Seats or Wearing Seat Belts
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Sen. Cruz, Rep. Peters to Speak to Auto Dealers

Sen. Ted Cruz (R-Texas) and Rep. Gary Peters (D-Mich.) will speak to the National Automobile Dealers Association this week. Cruz and Peters are scheduled to appear at the NADA's annual Washington conference on Thursday. National Highway and Traffic Safety Administrator David Strickland and former President George W. Bush adviser Karl Rove will also speak to the NADA. The auto dealer group said it was members will also meet with lawmakers "to discuss issues affecting their businesses, such as the need for greater transparency from the Consumer Financial Protection Bureau (CFPB) on auto financing, tax reform and efforts to reduce the regulatory burden on dealerships by eliminating outdated and unnecessary laws and rules."
Source: The Hill
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U.S. Auto Sales Expected to Slow After 16M

Analysts concerned about low loan rates, artificial demand

U.S. auto sales climbed 13 percent last year and another 8 percent during the first eight months of 2013, but some industry analysts warn that the growth rate will slow as annual sales reach 16 million. Brian Collie, vice president of consulting firm Booz & Co., said during an automotive panel Monday evening that the auto industry is typically a small-growth industry — with annual gains of about 1 or 2 percent — and that after the industry reaches 16 million or 16.5 million, the growth rate is likely to level off. And if it doesn't — and if annual sales climb to 18, 19 or 20 million — that could signal that some of the big sales gains have been propped up by external factors like low interest rates and not necessarily product or good economic fundamentals. “That's when you can start to be concerned,” Collie said. “Because that's artificial demand.” Interest rates on new-vehicle loans remain historically low, which has some concerned that recent sales gains aren't driven necessarily by new product and technology innovation, but because credit is cheap.
Source: The Detroit News
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Marchionne Prepares Final Hand in Chrysler Merger Game

Sergio Marchionne, who has spent four years pursuing a merger between Fiat SpA and Chrysler Group LLC, plans to file an initial public offering for the American carmaker in the coming days. It's an IPO that he'll do everything he can to avoid letting happen. The share sale preparation is part bluff by Marchionne, who heads both carmakers and plays cards with staff on flights between Italy and the U.S. The ultimate goal is to use the process to strike a deal with the United Auto Workers' retiree health-care trust, or Veba, the only other shareholder in Chrysler, said two people familiar with the matter. The Veba has been holding out on selling its Chrysler shares for a price that's at least $1 billion more than Fiat wants to pay. The IPO gambit is meant to set a market value and force the Veba, or voluntary employee beneficiary association, back to the bargaining table. If all else fails, Marchionne still has a standing agreement to pay about $6 billion for the stake. Should the IPO market point to a higher value than that, he could exercise his option to buy at the fixed price. If investors indicate the shares are worth less than that, Marchionne would only need to offer more than the market valuation to take control. “Marchionne'll make a call once the price is set, keeping in mind the downside is the $6 billion,” said Philippe Houchois, an analyst at UBS in London.
Source: Bloomberg
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U.S. Treasury Speeds Up Sell-Off of GM Stock

The U.S. Treasury is accelerating its sell-off of stock in General Motors Co., which likely will be free of the moniker “Government Motors” by spring. The taxpayers' ownership stake in the Detroit-based automaker, once more than 60 percent, is now down to 7.3 percent. According to documents filed Tuesday on the Treasury's website, the government has 101 million remaining shares, and it intends to sell them by March. The pace of the sell-off has picked up: The government sold an average of 19 million shares in the early part of the year, but since May has sold more than 25 million a month — plus a one-time special sale of 30 million in June, worth more than $1 billion, to coincide with GM's return to the S&P 500.
Source: The Detroit News
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NADA UCG Connects August New-Sales Performance to Used-Price Trends to See by Year's End

NADA Used Car Guide executive automotive analyst Jonathan Banks explained how last month's headline-grabbing new-vehicle sales performance is creating price trends in the used-vehicle space that ought to delight dealers. Banks recapped how franchised dealers turned 1.5 million new models in August. This pushed the new-vehicle seasonally adjusted annualized rate above 16 million for the first time in six years. “When August's strength is combined with the slightly more positive outlook for the remainder of the year, NADA expects that for all of 2013 the average price in units up to 8 years in age will be up by a material 1 percent relative to 2012 instead of remaining essentially flat as previously predicted,” he said.
Source: Auto Remarketing
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Fisker Loan to Be Auctioned After Sale Prospects Wane

The U.S. Energy Department will auction off Fisker Automotive Inc.'s unpaid loan balance to cut its losses after concluding there's no prospect of finding a buyer for the dormant plug-in electric carmaker's assets. The agency, which disbursed $192 million to Fisker before cutting off funding in June 2011, said in a blog post that it will require bidders to make a commitment to doing design and engineering work in the U.S. “After exhausting any realistic possibility for a sale that might have protected our entire investment, the department announced today that we are auctioning the remainder of Fisker's loan obligation, offering the best possible recovery for the taxpayer,” Peter Davidson, executive director of the agency's loan program office, said in the post. Fisker, based in Anaheim, California, has about $168 million remaining on its loan after the Energy Department recouped about $28 million from the company's accounts after it missed its first payment. The auction will be held Oct. 11 with initial bids due Oct. 7, according to a posting on a government sales website.
Source: Bloomberg
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NHTSA Finds More Than a Third of Children Killed in Crashes Were Not in Car Seats or Wearing Seat Belts

According to the Department of Transportation's National Highway Traffic Safety Administration (NHTSA), more than a third of children under age 13 who died in passenger vehicle crashes in 2011 were not in car seats or wearing seat belts. To help eliminate these deaths, and as part of Child Passenger Safety Week, NHTSA is highlighting the important safety benefits associated with the proper use of car seats, booster seats, and seat belts. Motor vehicle crashes remain a leading cause of death for children. Child Passenger Safety Week is September 15 through September 21, with the final day of the week (Sept. 21) recognized as National Seat Check Saturday. Throughout the week, at more than 600 events in 45 states across the country, certified child passenger safety technicians will inspect car seats and show parents and caregivers how to correctly install and use them. In most cases, this service is free of charge. Parents and caregivers can visit SaferCar.gov/TheRightSeat to determine if your child is in the right seat for his or her age and size and to locate a car seat check event in your area.
Source: NHTSA

Editor's note: For more information on NADA's Child Passenger Safety program, click here.
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Quotable
"Safety is our top priority, particularly when it comes to protecting our children – who are our most vulnerable passengers."

    -- U.S. Transportation Secretary Anthony Foxx, commenting on Child Passenger Safety Week, NHTSA, Sept. 18
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