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Inside this issue
Fox News: NADA Study Says Federal Regs on Dealers Cost the Economy More Than $10 Billion
Sales Soar, Gains Galore as May Stars
BMW Tops Mercedes in May as Cheaper Luxury Models Woo Buyers
Electric Vehicle Sales Rise in May
G.M. Officials Say They Expect Mary Barra Will Be Cleared of Wrongdoing
Large Cars, After Brief Comeback, Lose Traction
UAW Delegates Pass Union's First Dues Increase Since 1967
Lincoln's MKC Trickles into Showrooms
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Fox News: NADA Study Says Federal Regs on Dealers Cost the Economy More Than $10 Billion


 

Federal regulations for auto dealers are costing America's economy more than $10 billion in lost sales and employment each year, according to a new study conducted by the Center for Automotive Research provided to Fox News. The study finds that the nation's dealers are being hit with more than $3 billion in regulatory costs each year -- with the average dealership incurring about $182,754 in annual regulatory costs, representing roughly one-fifth of the average dealership's net profits. Forrest McConnell, III, chairman of the National Automobile Dealers Association, said car buyers are generally unaware of how the burden of regulation compliance adds to the cost of a car. "They would be shocked to know that 21 percent of the cost of the car is just what the manufacturer's cost is for compliance," he said. "That takes money out of their pockets ... and hurts jobs, too."
Source: Fox News

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Sales Soar, Gains Galore as May Stars

Sometimes the stars align. The weather held, the calendar added both an extra selling day and a fifth weekend, lenders relaxed a bit, factories sweetened the pot. And May U.S. auto sales jumped 11 percent to 1.6 million units. How good was May? The seasonally adjusted annual selling rate climbed to 16.8 million, the highest monthly number since July 2006. The seven largest automakers all boosted sales, four of them by double-digits.
Source: Automotive News
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BMW Tops Mercedes in May as Cheaper Luxury Models Woo Buyers

BMW topped Mercedes in May U.S. sales as cheaper models and fashionable crossover vehicles helped luxury brands gain traction in the market with new buyers enjoying rising disposable income. Mercedes, BMW and Audi are among luxury-auto brands expanding with lower-cost models as they seek to capture new buyers while retaining wealthier customers loyal to their market. The strategy is hitting home as the vehicles attract individuals including younger people new to the luxury market, whose wealth is increasing as real estate values rise and interest rates stay low.
Source: Bloomberg
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Electric Vehicle Sales Rise in May

Electric vehicles sales jumped in May, as the Nissan Leaf had its best-ever sales month and General Motors' plug-in hybrid Chevrolet Volt rose nearly 5 percent. Nissan said sales of the EV Leaf rose 46 percent and added overall sales since the vehicle was launched in 2012 now top 50,000.Toyota Motor Corp. said sales of its plug-in hybrid-electric version of the Toyota Prius were up 282 percent to 2,692 in May — and are up 111 percent this year to 7,729. GM said sales of the Volt rose to 1,687 in May, but said sales for the year are still off 4.5 percent to 6,838.
Source: The Detroit News
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G.M. Officials Say They Expect Mary Barra Will Be Cleared of Wrongdoing

The moment captured a new sense of confidence that General Motors has been anxiously awaiting from Mary T. Barra, its embattled chief executive. At a meeting on May 28 with 2,000 of G.M.'s sales and marketing employees, Ms. Barra sounded nothing like a leader under fire for the company's failure to recall millions of defective cars for more than a decade. Instead, she came across as a chief executive who fully expects to survive a crucial internal investigation of the recall that could be made public as soon as this week. “They keep saying the recall is hurting us, but you keep proving them wrong,” she said to cheers from the crowd. “I believe in this team, and I know you can do it.”
Source: The New York Times

Editor's note: For more information on the GM recall, go to www.gmignitionupdate.com or www.safercar.gov.

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Large Cars, After Brief Comeback, Lose Traction

The large car's comeback appears over. After a solid rise in 2013, U.S. sales of nonluxury big sedans dropped 5 percent through May, while car sales were flat and total light-vehicle sales jumped 5 percent. Volumes are falling as consumers switch to mid-sized cars and crossovers and automakers pull large sedans out of their fleet offerings, analysts say.
Source: Automotive News
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UAW Delegates Pass Union's First Dues Increase Since 1967

UAW delegates approved a dues increase [Tuesday] for the first time since 1967, after a long, emotional debate. Over two hours, 20 delegates spoke forcefully for the proposal and 20 spoke out against it, challenging UAW leadership's fiscal management. The vote was taken by a show of hands and easily passed with several hundred delegates on the convention floor. The proposal raises member dues from the equivalent of 2 hours of pay per month to 2.5 hours. Most members will pay an additional $10 and $17 per month.
Source: Detroit Free Press
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Lincoln's MKC Trickles into Showrooms

The 2015 MKC, Lincoln's entry in the fast-growing compact luxury crossover segment, appeared on the sales charts for the first time in May with 677 units sold. Many of the units are dealer demonstrators and test models. Though Lincoln is running a social media campaign to promote its newest vehicle, the big advertising push will come in September, according to Andrew Frick, Lincoln group marketing manager. “We have a media plan that mirrors the launch curve,” Frick said at a media event here. Lincoln is ramping up production of the MKC at its Louisville, Ky., plant, and some units are being shipped to dealers.
Source: Automotive News
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Quotable

"We have a huge impact on the local economy and jobs, and these regulations are absolutely crushing entrepreneurship in this country."

   
-- NADA Chairman Forrest McConnell, commenting a new study by the Center for Automotive Research which found that the nation's new-car dealers are being hit with more than $3 billion in regulatory costs each year, Fox News, June 3

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