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Inside this issue
Why Insiders Say Subprime Auto Loans Pose No Risk
U.S. Auto Sector Employment at Highest Level Since 08
IRS Provides Updated Truck and Automobile Depreciation Deduction Limitation Amounts for 2015
A Mission to Add, Keep Minority Dealers
GM is Forming a Second 20 Group for Female Dealers
VW Dealers Begin to See Upside of U.S. Sales Target
Nissan Raises Profit Forecast, Powered By Strong U.S. Sales
Mitsubishi Goes From Near-Death to Vibrancy
Top Bidder of ADESA Motorcycle Auction to Raise Additional Funds for the NADA Foundation
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Why Insiders Say Subprime Auto Loans Pose No Risk

Auto retailers and lenders are trying to debunk the notion that a bubble of rapid growth in subprime auto loans will lead to a wave of defaults, tanking the U.S. financial system the way subprime mortgage defaults did before the 2008-09 recession. Mike Jackson, CEO of AutoNation Inc., the largest U.S. auto retailer, dismissed the threat during a conference call last week. "People. Pay. Their. Auto. Loans," Jackson said, emphasizing each word. He said subprime auto loans don't threaten the U.S. economy because auto debt is relatively small -- about $900 billion of American consumers' $12 trillion in debt outstanding -- and because auto defaults are low. "Lower than mortgages. Lower than credit cards. Lower than student loans."
Source: Automotive News
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U.S. Auto Sector Employment at Highest Level Since 08

The U.S. auto industry added 6,700 jobs in January, hitting its highest level since March 2008. Strong auto sales are fueling continued job growth at automakers, parts manufacturers — as well as auto dealers. Auto sales rose 13.7 percent in January in part because of low gasoline prices increasing demand for trucks and other large vehicles. Automakers and parts companies now employ 913,200 people in the United States — and account for nearly one-third of all new manufacturing jobs in January. The industry is up by nearly 300,000 jobs since it hit bottom in June 2009, with just 622,000 people on payrolls. The auto sector has added nearly 67,000 jobs over the last year. Auto dealers are also adding jobs, and were up 2,900 jobs in January to 1.21 million — its highest level since June 2008. Dealers have added about 43,000 jobs over the last year. Last year, auto sales hit the highest level since 2006.
Source: The Detroit News

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IRS Provides Updated Truck and Automobile Depreciation Deduction Limitation Amounts for 2015

On February 6, 2015, the IRS issued Rev. Proc. 2015-19, which includes updated depreciation limitation amounts for passenger automobiles and trucks (and vans) placed in service in calendar year 2015. The updated amounts are as follows:


Source: NADA Regulatory Affairs
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A Mission to Add, Keep Minority Dealers

FCA, GM: Get succession plans set

Fiat Chrysler and General Motors, whose minority dealer ranks suffered huge losses during the recession, say they are working hard to add more minority-owned dealerships to their networks and keep the ones they have. In separate interviews, the companies said they are encouraging minorities to sell their stores to other minorities when they cash out. They also are pressing minority dealers to designate family members or minority managers as successors to their stores. The strategies were laid out in interviews during the National Automobile Dealers Association convention [in San Francisco] last month.
Source: Automotive News

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GM is Forming a Second 20 Group for Female Dealers

After adding 17 female-owned dealerships last year, General Motors is setting up its second 20 group for female dealers, said Celeste Briggs, director of the GM Women's Retail Network. At the end of 2014, women owned 225 GM dealerships, a net gain of 10 since the end of 2013, Briggs said. Many women who own GM dealerships took over their stores from husbands, fathers and other family members, she said. "We want to make sure they have the resources to keep them in the business," Briggs told Automotive News during the National Automobile Dealers Association convention [in San Francisco].
Source: Automotive News

Editor's note: Any individuals interested in learning more or joining the second NADA 20 Group for GM female owners can contact NADA 20 Group at nada20group@nada.org or call 800-557-6232.
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VW Dealers Begin to See Upside of U.S. Sales Target

Factory signals it will share the burden

Shaun Del Grande was an early critic of the way Volkswagen doggedly pursued its goal to sell 800,000 vehicles a year in the U.S. by 2018. "I was a complainer," admits Del Grande, president of Del Grande Dealer Group in San Jose, Calif., and one of many VW dealers frustrated with what they saw as undue pressure from the factory to hit the ambitious target. In recent weeks, Volkswagen has said it's sticking by its 800,000-vehicle goal. But dealers such as Del Grande now sound much more positive about it, amid increasing signs that they won't have to shoulder the burden themselves. For example, VW has stopped the clock on its sales target, telling a gathering at the National Automobile Dealers Association convention last month that boosting dealership profitability would be more important than the 2018 date, or any specific date.
Source: Automotive News
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Nissan Raises Profit Forecast, Powered By Strong U.S. Sales

Japanese car maker is closing in on Honda in the crucial U.S. market

Nissan Motor Co. raised its full-year profit forecast Monday, helped by a weak yen and strong sales in the U.S., where it is closing in on rival Honda Motor Co. Though Nissan is the second-largest Japanese car maker in global sales, behind Toyota Motor Corp., Honda surged past Nissan in the U.S. in 1988 on the popularity of its Civic and Accord models. Pursuing aggressive sales tactics while helped by stumbles at Honda, Nissan pulled within 154,000 vehicles of Honda in the U.S. in 2014, narrowing the gap to nearly half of what it was a year ago. Despite efforts to expand their presence in emerging markets, Japanese auto makers are highly dependent on North America.
Source: The Wall Street Journal
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Mitsubishi Goes From Near-Death to Vibrancy

Just two years ago, once-proud Mitsubishi essentially was begging Americans to believe the car company wasn't on the verge of decamping from the USA. "Absolutely not," said Mitsubishi President Tetsuro Aikawa, in Japan in February 2013, when asked if he would leave. "I can assure you we have no intention of pulling out," executive vice president Masatoshi Hasegawa, told USA TODAY at the New York Auto Show a month later, as the automaker unveiled a new Mirage economy car. Now, sales are up, an expanded lineup is in the works, and new optimism infuses the U.S. unit.
Source: USA Today
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Top Bidder of ADESA Motorcycle Auction to Raise Additional Funds for the NADA Foundation

Greg Noonan, the top bidder on the 2012 Harley-Davidson Heritage at ADESA's auction during the NADA Convention and Expo in San Francisco last month, will ride the motorcycle about 3,200 miles across the country to raise additional funds for National Automobile Dealers Charitable Foundation and the Wounded Veterans Initiative of Canine Companions for Independence (CCI).

The two-week trip will begin at Canine Companions' headquarters in Santa Rosa, Calif., on February 12, followed by stops at ADESA's auction facilities in Sacramento, Los Angeles, Phoenix, Houston, Dallas, Tampa and Jacksonville to raise additional funds.

“Our goal is raise a hefty $250,000, which was inspired by a challenge from David Cox of Hare Chevrolet in Noblesville, Indiana,” said Noonan, owner of Insight Media Enterprises in Cooperstown, N.Y. “If someone pledged just 5 cents a mile, that's a $150 donation.”

Noonan will present the additional funds raised for the NADA Foundation and CCI during the INSIGHT15 Customer Loyalty and Retention Conference in Orlando on March 25.

Noonan's winning bid of $20,000 at the NADA convention on January 24 was matched immediately by Joe Verde, president of the Joe Verde Group in San Juan Capistrano, Calif. Verde won ADESA's auction the past two years. The $40,000 raised at the auction was added to two $10,000 grants from the NADA Foundation to CCI.

The four ADESA auctions at the NADA convention have raised $111,000 for the NADA Foundation and CCI. Proceeds from the auction and the grant go to NADA Foundation's Frank E. McCarthy Memorial Fund, in whose name the CCI donation is made. McCarthy was NADA's chief executive from 1968 to 2001.

Online donations can be made at https://donate.nada.org/CCI.
Source: NADA Public Affairs
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Quotable

"In the last couple of years it has become clear that this is an excellent moment to invest in the U.S. market. We see a restructuring taking place here, and we see Nissan having a very bright future here."

   
-- Manuel Garrido, president of Grupo Autocom, a retailer from Mexico, commenting on opportunities in the U.S. market, Automotive News, Feb. 9

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