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Inside this issue
Regulation Stays on F&I Forefront for 2014
NHTSA Chief David Strickland to Step Down
Ford to Add 5,000 U.S. Jobs, Open Three Global Factories in 2014
General Motors Sells Ally Stake for $900 Million
Ford, GM Get $50M in Tax Credits for Green Energy Efforts
Mercedes Warns U.S. Dealers of Tight Supply for New CLA C
NADA Convention Mobile App for 2014 Now Available
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Regulation Stays on F&I Forefront for 2014

Auto finance regulation will stay on the front burner in 2014, with conclusions likely from investigations that began in 2013, according to attorneys who specialize in the area. Several auto lenders disclosed in 2013 that the Consumer Financial Protection Bureau had asked them for information regarding “certain retail practices,” language that was almost certainly shorthand for dealer reserve or dealer markup. Yet none of those CFPB investigations has produced any public statement from the CFPB or any additional word from the lenders so far.

“We do know the CFPB is investigating several lenders. Maybe there will be a conclusion -- maybe several” in 2014, Joseph Karam, a staff attorney for RouteOne said during a phone interview last week. Ally Financial Inc., American Honda Finance Corp. and Toyota Motor Credit Corp. all disclosed in 2013 filings with the Securities and Exchange Commission that they were under CFPB review. Several banks, including Chase Auto Finance and Bank of America, have sent letters to dealerships warning them about discrimination, almost certainly in response to issues raised by the CFPB.

Judging by recent history in other rulings, conclusions from the CFPB investigations now under way could include consent orders in which lenders agree to comply with additional direction from the CFPB, without admitting any violations. Paul Metrey, chief regulatory counsel for financial services at the National Automobile Dealers Association, said it “remains to be seen” how consent orders -- if there are any -- would affect the marketplace. Lenders have said they don't want to switch to flat fees unless their competitors switch, too.

“While many commentators anticipate that the CFPB could enter into consent orders with large banks to resolve disparate impact allegations, it is by no means inevitable that finance sources will move in lockstep to adopt whatever pricing parameters may result from any such consent orders,” Metrey told Automotive News in an e-mail last week.

Another shoe that's expected to drop in 2014 is the outcome of an independent study recently launched by the American Financial Services Association, a lender trade group, into the economic impact of reforms recommended by the CFPB, including flat fees. CFPB Director Richard Cordray said recently the CFPB had not performed such a study. Opponents of flat fees, including the NADA, have said flat fees could raise the cost of credit. Metrey said the AFSA study is “filling a huge need by actually considering how the Bureau's actions could affect the cost of credit for consumers.”
Source: Automotive News

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NHTSA Chief David Strickland to Step Down

David Strickland, who since 2010 has played a key role in managing the federal agency with direct regulatory oversight of the automobile industry, will step down in the near future. As administrator of the National Highway Traffic Safety Administration, Strickland has overseen development of the nation's fuel efficiency program and various safety initiatives, particularly those linked to reducing distracted driving and focusing on child passenger safety. The reason for Strickland's departure, or whether he is taking another job, was not immediately known.
Source: Detroit Free Press
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Ford to Add 5,000 U.S. Jobs, Open Three Global Factories in 2014

Ford Motor next year will launch 23 new vehicles worldwide, open three new factories in Asia and S. America, and add more than 5,000 U.S. jobs to support its growth amid strong demand for its vehicles. “Next year, we are embarking on our most ambitious global launch year ever to meet customer demand for our products around the world,” said Raj Nair, group vice president, Ford global product development. Sixteen of the 23 new models will debut in North America, including the redesigned Ford Mustang, Edge and F-series pickups, as well as the all-new Ford Transit van and Lincoln MKC luxury crossover. The growth in 2014 will come on the heels of a strong 2013, during which Ford is expected to produce 6 million vehicles, or about 16 vehicles per minute around the world.
Source: Forbes
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General Motors Sells Ally Stake for $900 Million

General Motors Co. completed the sale of its 8.5 percent stake in Ally Financial Inc. for about $900 million as the automaker moves to sever ties from its former financing arm. The sale will result in a gain of about $500 million in the fourth quarter, GM said in a statement. The buyers weren't named. Ally, formerly known as GMAC, is seeking to regain its independence after taking a U.S. bailout during the financial crisis that was designed to keep the auto industry afloat. Taxpayers still held a 64 percent stake in Ally as of Nov. 20, according to the company.
Source: Bloomberg

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Ford, GM Get $50M in Tax Credits for Green Energy Efforts

Two U.S. automakers will receive $50 million in tax credits to help build greener vehicles under a tax provision in the 2009 stimulus. The Energy Department said it was awarding $150 million through the Advanced Energy Manufacturing Tax Credit for various green energy efforts to 12 firms — tapping funds that were awarded but not used. Ford Motor Co. will receive a $30 million credit while General Motors Co. will receive a credit worth more than $20 million.
Source: The Detroit News
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Mercedes Warns U.S. Dealers of Tight Supply for New CLA C

Mercedes-Benz told its U.S. dealers they should expect fewer CLAs in 2014's first half, after the new $29,900 coupe helped widen the automaker's luxury-sales lead this year over Bayerische Motoren Werke AG's BMW. The Daimler AG unit in a Dec. 9 letter to dealers said it anticipates “tight inventories and low days supply” from February through June because of the car's “overwhelming success” worldwide. The CLA's plant is at full capacity, and output should support demand by July, according to the letter. “This is our best launch in 20 years,” Steve Cannon, head of Mercedes's U.S. sales, said yesterday in an e-mailed statement. “The CLA has been a phenomenal success right out of the gate.” Mercedes widened its U.S. lead over BMW in November as CLA sales contributed almost all its monthly gain.
Source: Bloomberg
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NADA Convention Mobile App for 2014 Now Available

The mobile app for the 2014 NADA Convention & Expo is now available for download for smart phones and tablets. The free app, which syncs with myNADAplanner, allows attendees to maximize their convention experience by providing: up-to-the-minute updates on workshop sessions and events; workshop handouts and presentations that can be downloaded; a customized schedule builder; walking maps to navigate the convention center and expo floor with exhibitor descriptions and booth locations; and tools to stay organized.

The app is available for iPhone, iPod Touch, iPad and Android devices. To download, visit the App Store or Google Play Store and search for NADA2014. Click here to access myNADAplanner, a free, easy-to-use online tool for planning, scheduling and networking.

The NADA convention will be held in New Orleans from Jan. 24-27. Dealers and their managers who register by Jan. 16 will receive a $75 discount from the on-site rate. For more information or to register, visit www.nadaconvention.org.
Source: NADAFrontPage.com
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Quotable
"We saw unprecedented growth in the United States this year, especially in the midsize and utility segments. With the addition of 16 new products to our showroom, including Ford Mustang, our momentum continues." 

   --- Joe Hinrichs, Ford president of The Americas, commenting on the automaker's plans to add 5,000 jobs in the U.S. and open 3 global factories in 2014, Forbes, Dec. 12

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