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April 15, 2014 FacebookTwitterFlickrRSSSEND TO A FRIENDPRINT
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Inside this issue
NADA's McConnell Spotlights Franchise System Virtues
NADA Chairman Appears on CNBC at 2014 Automotive Forum in New York
Barra Hopes to Shine Positive Light on GM
Despite Risks, Many Recalled Vehicles Will Remain Unrepaired as Drivers Ignore Notices
GM Seeks New PR Boss, Replaces Human Resources Chief
Mercedes Dealers in U.S. Could Be Overwhelmed by Wave of Off-Lease Vehicles, Remarketing Boss Says
For the Auto Industry, a Showcase for Change
Ford to Put '15 Mustang on Top of Empire State Building
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
NADA's McConnell Spotlights Franchise System Virtues


NADA Chairman Forrest McConnell delivers keynote remarks today at the 2014 Automotive Forum in New York City. Photo/NADA

To kick off the NADA/J.D Power Automotive Forum on Tuesday, Forrest McConnell III, NADA chairman and a Montgomery, Ala., Honda and Acura dealer, made a rousing speech. It was a blunderbuss with at least three barrels but the big one is one aimed at Tesla's efforts to erode franchise laws in order to open legislative locks keeping factory-direct retail models out of the market, therefore, cutting out dealers.

McConnell's major messages: franchised auto dealers are mom and pop small and medium-sized business that have real, personal relationships with car buyers; help keep automakers afloat because dealers are the drivers of new vehicle sales in a way that the automaker could never be by themselves; save automakers money because dealers handle service and marketing costs at the regional and local level; and save consumers money because the franchise model is inherently competitive and if automakers were controlling it they would have few incentives to give consumers a break beyond established incentives.

"If manufacturers sold directly to customers there would be zero competition in pricing, parts and services. Customers would be stuck paying full sticker price because there would be no 'same brand dealership' to shop and compare prices: The biggest competition for the Ford dealer is the dealer down the street."

He also made a point about the dealerships role in recalls like GM's noting that the automaker's 4,000 U.S. dealers are gearing up service bays to handle the ignition redo, "From New York to Yuma, Arizona. When something goes wrong on an assembly line their service departments are there to make things right. Instead of dialing a faceless 800 number they have direct contact to provide retail and warranty at no cost."
Source: MediaPost

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NADA Chairman Appears on CNBC at 2014 Automotive Forum in New York



NADA Chairman Forrest McConnell was a guest today during a live interview on CNBC's "Squawk on the Street” during the 2014 Automotive Forum presented by NADA and J.D. Power in New York City. He answered questions ranging from Tesla Motors’ direct-sales model, the General Motors’ recall situation to the auto sales rebound. Click here to view the interview.
Source: CNBC

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Barra Hopes to Shine Positive Light on GM

Automakers are sparing little expense to unveil new cars and SUVs at this week's New York International Auto Show as rising auto sales prompt a lot of new entries. But in the days leading up to the show, not all eyes will be on the new cars and trucks. Rather, some of the spotlight will diverted to General Motors Co., which is facing its biggest safety crisis in years over its recall of 2.59 million cars linked to at least 13 deaths. The automaker will try to talk about its new vehicles being shown this week, but analysts say it will be hard to get that message through. CEO Mary Barra will make just her third public appearance since the crisis broke when she takes part this afternoon at the NADA/J.D. Power Automotive Forum in New York. Her previous appearances have been before congressional committees.
Source: The Detroit News
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Despite Risks, Many Recalled Vehicles Will Remain Unrepaired as Drivers Ignore Notices

Even with U.S. auto recalls on pace to reach the highest level in a decade this year, there's a good chance many of the vehicles won't get fixed. About a third of all recalled cars and trucks don't get repaired, and about one out of every seven vehicles, or 36 million, still on the road have an unrepaired defect, according to data compiled by regulators, safety advocates and the CarFax vehicle history company. That means recalled cars from automakers as varied as General Motors Co., Honda Motor Co., Chrysler Group and Toyota Motor Corp. will remain unrepaired on the roads, in some cases putting drivers at risk. GM CEO Mary Barra will struggle to achieve her stated goal of repairing 100 percent of the 2.19 million small cars recalled for an ignition fault linked to 13 deaths.
Source: Bloomberg

Editor's note: For more information on the GM recall, go to www.gmignitionupdate.com or www.safercar.gov.
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GM Seeks New PR Boss, Replaces Human Resources Chief

General Motors said its public relations chief is leaving and appointed a new head of human resources, with both moves effective immediately. A GM spokesman, Greg Martin, said the actions are not connected to the company's ongoing recall crisis, but rather a result of Mary Barra's appointment as CEO three months ago. GM said John Quattrone, 61, will take over as the head of human resources, replacing Melissa Howell in a position that Barra herself held until 2011. The company will begin a search to replace Selim Bingol, 53, a former AT&T corporate communications executive who had led GM's public relations team since March 2010. Bingol also was GM's head of global public policy since October 2012.
Source: Automotive News
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Mercedes Dealers in U.S. Could Be Overwhelmed by Wave of Off-Lease Vehicles, Remarketing Boss Says

Mercedes-Benz USA expects its dealership network to be overwhelmed by a tsunami of off-lease vehicles at some point, forcing the brand increasingly to sell those vehicles through non-Mercedes dealers. “We're going to be having something like 200,000 units coming back at some point,” Stephen Nicholson, the company's remarketing manager, said during a panel discussion today at a conference here. Mercedes' off-lease “numbers are going to get pretty big down the road. We've been leasing at 40, 50, 60 percent for a long time,” he said. Mercedes dealers have first dibs on off-lease units. Nicholson said the company already sells a lot of units to non-Mercedes-Benz dealers, but that proportion logically would increase as overall volumes increase.
Source: Automotive News
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For the Auto Industry, a Showcase for Change

The 2014 New York International Auto Show is billed, rightly so, as a showcase for dozens of new and significantly changed automobiles. But more than that, it is also a showcase for the quickening pace of change in the auto industry. Organizers have designated more than five dozen vehicles as world or North American premieres, among the hundreds on display at this year's show, which opens Wednesday for two days of press previews at the Jacob K. Javits Convention Center in Manhattan. Models expected to draw large crowds include the 2015 Chevrolet Corvette Z06 convertible; the 2015 Jeep Renegade, a smaller addition to the Jeep line that made its debut earlier this year in Geneva; and the much anticipated Alfa Romeo 4C sports car.
Source: The New York Times
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Ford to Put '15 Mustang on Top of Empire State Building

Ford Motor Co. will put a new 2015 Mustang GT convertible on the top of Empire State Building this week, commemorating a stunt it used to tout the new vehicle nearly 50 years ago. The Dearborn automaker on Monday released a video that shows how the company will disassemble the Mustang and get it to the observation deck on the 86th floor. Ford will hold a media event to show off the car Wednesday night in Manhattan as part of the New York International Auto Show this week. The new car is longer and wider than the original Mustang; Ford put a '66 Mustang on the top of the Empire State Building in fall 1965.
Source: The Detroit News
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Quotable

"If manufacturers sold directly to customers there would be zero competition in pricing, parts and services. Customers would be stuck paying full sticker price because there would be no 'same brand dealership' to shop and compare prices: The biggest competition for the Ford dealer is the dealer down the street."

   
-- NADA Chairman Forrest McConnell in keynote remarks today at the 2014 Automotive Forum in New York, MediaPost, April 15 

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