NADA Headlines - 10/23/2013 (Plain Text Version)
NADA Chairman David Westcott delivered a major speech to Detroit's Automotive Press Association, discussing the Consumer Financial Protection Bureau (CFPB) and the essential services provided by the dealer franchise network.
Editor's note: For Westcott's remarks and a video of the full speech, click here.
What countries don't have two car garages today? Fewer than one might think. The core auto markets of Australia, New Zealand, Japan, Canada, United States and Europe are either growing slowly or in decline as people cut back on spending. The big four emerging markets of Brazil, Russia, India and China have already had stakes firmly planted in the ground by the global auto makers and their suppliers. Where are the new frontiers? In a 37 page report released Tuesday by the Boston Consulting Group, the new players are in markets not yet deemed all that friendly to foreigners. Like Iran and Libya, for example. The annual growth rate in those markets is expected to be about 6% between now and 2020 while the core markets will growth around 1.5%. They'll also make up about a fifth of global auto sales in that time period.
Toyota Motor Corp.'s in-house lender is leveraging the automaker's AA- credit rating and cash to offer low rates and keep customers coming back. Toyota's $37 billion cash pile and credit ratings that outrank General Motors Co. and Ford Motor Co. enable its Toyota Financial Services unit to offer more loans and take on riskier borrowers. The operation, with $95 billion of assets, handles more of affiliated dealers' direct loans and leases in the U.S. than any other automaker's captive lender, or wholly owned finance arm. Toyota also uses intense data systems to keep buyers from straying to GM or Ford.
Ford will temporarily stop producing the Focus and C-Max at the Michigan Assembly plant for two weeks to reduce growing inventories. The assembly plant in Wayne will be idle for the weeks of Oct. 28 and Dec. 16. Inventory of the C-Max has crept up to 122 days supply which is double what most automakers consider as a desirable stock. Focus started October with a 71-day supply. “We expect to take approximately two weeks of downtime at our Michigan Assembly Plant starting this month, as we continue to match production with demand,” said Ford spokeswoman Kristina Adamski in a statement.
Tesla Motors Inc. fell as much as 3.8 percent after the top U.S. auto regulator said the agency is studying an Oct. 1 fire involving one of the plug-in electric carmaker's Model S sedans. “We have our experts that are in contact with Tesla right now,” National Highway Traffic Safety Administrator David Strickland told reporters in Washington. Tesla shares fell $1.06 to $171.54 at the close in New York, after sinking as low as $166.11. The shares have risen more than five-fold this year.
Peugeot: 'Business model just wasn't there'
General Motors and PSA/Peugeot Citroen are scaling back their alliance as the French carmaker pursues an investment by China's Dongfeng and the U.S. automaker seeks greater control of its destiny in Europe. PSA said a planned joint platform for subcompact cars at the heart of the alliance was likely to be cancelled. "Further analysis showed that the business model just wasn't there," a PSA spokesman said, without elaborating.
Subaru dealership owner: 'Dogs help people relax'
Click on the "About Us" icon on Patriot Subaru's home page and you'll see a roster and photos of the dealership's 57 employees. But three, who work in customer relations, don't look or act like everyone else. They tend to sit around a lot. They can often be found snoozing on their sides under a desk. And they answer to just one name. The Saco, Maine, dealership is one of a handful of dog-friendly stores around the country. The job titles on the store's Web site for Colby, Subie and Licorice aren't posted just to be cute. Colby and Subie, golden retrievers, and Licorice, a black Labrador retriever, really do have jobs. "Buying a car takes longer than it should," says owner Adam Arens. "Dogs help people relax. They tend to sit next to people who are tense. They kind of think that's their job," he said of the dogs, who are at the store most days. The way Arens sees it, having dogs on the sales floor is not just a business strategy designed to give his store a leg up on the competition. The policy is consistent with Subaru's pet-friendly brand image, and it meshes with what he sees as Maine's affection for dogs. Many of his customers, he says, travel frequently with their dogs and take them to their jobs. And, he says, being pet-friendly helps the store give back to the community. Patriot holds pet adoptions and sponsors fundraisers for pet charities, including the Animal Refuge League and Animal Welfare Society.