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Top Stories
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Ford boosts production 16% as June car sales show strength
Ford is boosting its third-quarter production schedule after seeing more demand for its cars and trucks in June, the company said Monday, USA Today reports. Ford plans to increase production by 16 percent compared with the third quarter of 2008. The automaker had said it would increase production 10 percent, but is adding another 25,000 vehicles because it's seen some stabilization in June auto sales, to be reported Wednesday. The news comes amid several preliminary reports that June sales have been stronger than recent months. Last week, Edmunds.com and J.D. Power reported that June sales had increased significantly compared with May sales.
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AutoPacific: U.S. Auto makers score tops with consumers
Porsche and Ford Motor Company earned top honors in the 2009 Ideal Vehicle Awards (IVA), announced today by automotive research firm AutoPacific. The IVAs are based on owners' ratings of their new 2009 model year cars and trucks across 15 key vehicle attributes. The cars or trucks that owners would change the least are the most ideal.
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Terminated Chrysler dealers offered free 'rebound' training
Former dealership general manager Dave Anderson is offering auto dealers who lost their Chrysler franchise agreements a free $1,500.00 training package to help their businesses rebound. Anderson, the president of LearnToLead and a popular Dealer magazine columnist, says, "As someone who used to manage a large group of dealerships in Northern California, I can just imagine how devastating it would be to have a major franchise terminated without warning. I want to do something for these guys. "While this offer of free training products and services won't change anyone's fortunes overnight, I hope they will help these former Chrysler dealerships rebuild their businesses," he says. "There are no strings attached, no "gotchas", no fine print. Anyone who knows me will tell you that I shoot straight." For more information click here
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Ford invoice charges are among the changes for dealers
While Ford continues moving to consolidate dealerships nationwide, the Dearborn-based automaker also is trying to cut dealer-related costs in other ways, the Detroit Free Press reports. Ken Czubay, Ford's vice president of sales and marketing, said a variety of dealership policy changes recently were put in place after extensive meetings between the company and the Ford National Dealership Council. Czubay declined to confirm specific changes. But in a statement provided to the Free Press, Ford said modifications include changes to floor plan assistance, advertising costs and factory-to-dealer sales incentives. The changes include charging about $300 more for costs related to processing an invoice and cutting commissions provided to dealers who sell a car to Ford employees by a half-percent, said George Gorno, president of Gorno Ford in Woodhaven, Mich.
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Save the Date
Several weeks ago, Jack Fitzgerald, Alan Spitzer, and Tamara C. Darvish worked to form the Committee to Restore Dealer Rights. The primary focus of this committee is to secure passage of the Bipartisan Automobile Dealer Economic Rights Restoration Act of 2009, which now carries 202 Congressional Cosponsors and 10 Senators. The committee was formed in the wake of the Chrysler and GM bankruptcies to protect the rights of thousands of terminated auto dealerships and customers and communities they serve. As the process of the Bankruptcy hearings for Chrysler and GM progressed, and both Manufacturers initiated new Dealer Agreements for the “move forward” dealers, it became more than obvious that all Dealers, whether “rejected” or “move forward” were is dire need of this exact legislation that House introduced as HR2743 and the Senate as S1304, says Darvish, of the DARCARS Automotive Group and Washington Director – NADA Member – Committee to Restore Dealer Rights. Read her letter to dealers inside.
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ActivEngage
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Cars.com launches consumer guide to 'Cash for Clunkers' law
With the Cash for Clunkers bill having been signed into law, Cars.com Friday said it launched a guide to help consumers understand how they can take advantage of the new legislation and get a credit for trading in their old car and upgrading to a new, fuel-efficient model.
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Nissan to make electric cars in Tenn. with fed help
Nissan Motor Co. will start making electric cars in the United States in 2012 with the help of a $1.6 billion loan provided by the U.S. government to encourage automakers to produce cleaner and more fuel-efficient vehicles, The Detroit News reports. Nissan plans to produce electric cars at its Smyrna, Tenn., assembly plant, powered by lithium-ion batteries that will be built at a new facility on the site. The Japanese automaker plans to start selling electric cars in the United States next year and has lined up partnerships with several state and local governments and utilities to establish charging stations. Nissan will initially import electric cars from Japan, but expects to have the capacity eventually to make 150,000 electric cars a year in Tennessee, said Dominique Thormann, senior vice president for administration and finance at Nissan North America.
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GM says dealer changes complete
See letter to dealers
A GM executive has informed dealers that the carmaker sees “no need” to order the closure of additional dealerships. “Keep selling,” says the letter from Mark LaNeve, GMs’s marketing chief for North America. “[T]here is no need for any further wind-down or participation agreements….our network restructuring process as we emerge from the 363 bankruptcy is complete. Look inside to see the text of the letter as reprinted by Politico.
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Trying to dispell dealership myths
Don Hall, president and CEO of the Virginia Automobile Dealers Association, was speaking recently to a politician about the closing of auto dealerships, the Lansing State Journal reports. He realized the politician had little idea about how the industry works. "His assumption, and the assumption that most people have, is that dealers, in fact, don't own their inventory - that it's on consignment and so their carrying costs or handling is very limited or very nominal until they sell a car," Hall said. But that's not the case. You might think you're buying a car or truck from General Motors Corp. or Toyota Motor Corp., you're actually buying from a middleman: the automobile dealer. It's much like Best Buy Co. Inc. selling televisions made by Sony Corp. or Samsung Electronics Co. Ltd. Dealerships have been in the news lately as Detroit's GM and Auburn Hills-based Chrysler LLC try to shrink their operations buy paring their dealer networks. But while bankrupt GM and Chrysler have received government loans, their dealers aren't entitled to a dime.
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South Floridians can't wait to cash in on gas-guzzlers
Ted Axiotis is thrilled that the federal government may give him $4,500 for the gas-guzzler he plans to trade for a new fuel-efficient truck, the South Florida Sun-Sentinel reports. He figured he'd be lucky to get $2,500 for his 1999 Ford Astrovan. "Wow. I'm all over that," said Axiotis, 36, owner of a Boca Raton body-repair shop, when he learned about the "cash-for-clunkers" law signed Thursday by President Barack Obama. Washington is now writing rules for the program that offers $1 billion in rebates by Nov. 1 for drivers who turn in older cars and trucks for new ones that are more fuel efficient. The money aims to help trim pollution, boost dismal car sales and rev up the economy in today's recession.
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Some Chrysler dealers see lending for inventory cut off
GMAC LLC is suspending wholesale financing for certain Chrysler Group LLC dealers it considers to be too risky to lend to, GMAC and Chrysler confirmed Wednesday, The Wall Street Journal reports. The move could ultimately push more Chrysler dealers out of business and hurt the company's ability to sell vehicles. During its bankruptcy restructuring, Chrysler shed 789 dealers.GMAC, formerly the captive lending arm of General Motors Corp., recently took over financing of Chrysler dealers' inventory after Chrysler's own lending arm stopped doing so. About 60% of the roughly 2,400 dealers who survived Chrysler's bankruptcy applied for interim wholesale financing with GMAC, according to Chrysler. So far about 6% -- more than 80 -- have been informed that their wholesale financing has been temporarily suspended, the company said.
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In Dealer magazine
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Dealers asked and we answered your dealership insurance questions
by Roger Beery
Over the past six months, Austin Consulting Group has taken part in a number of webinars regarding auto dealer insurance. .jpg?i=070109152324) How to buy it; how to get the best deal; and what to look out for. During the webinars, the participants have asked some very good questions. It seems to me that if the folks on the calls wanted answers to these questions, you might too. So here are some of their questions...and the answers. Read more
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Now it’s personal
by Greg Gilmore
For the first time in industry history, manufacturers are laying out plans for a mass dealer count reduction that involves franchise termination. In the coming months we will see some manufacturers become extremely aggressive with respect to the dealer count reduction. Targeted franchise agreement terminations are nothing new to the industry. However, the scale and volume of termination activity we are likely to see is unprecedented. In 2007, I wrote an article for Dealer magazine .jpg?i=070109152324) concerning Chrysler sending 180-day termination letters to approximately 170 dealers. Chrysler determined that these dealers were at the bottom of the list in terms of management, capital, facility and overall performance. However, it was directed at a relatively small group of dealers compared to what GM is proposing today. The Chrysler termination program also lost a little steam when Jim Press took over and the combative factory/dealer relationship improved. Lately, Press has taken a hit for the aggressive wholesale practices that Chrysler was forced to engage in this past winter. As a side note, it is my hope that Press’ legacy in the industry will not be tied to the recent short-term wholesale vehicle allocation program at Chrysler. He is an excellent car-man who did a lot for the sales arm of Toyota in the ‘90s. I think if you ask Toyota dealers, most would agree that both Press and Bob McCurry were the driving factors to the growth behind the brand in the ‘80s and ‘90s. I find it ironic that McCurry started at Chrysler and finished at Toyota while Press started at Toyota and may finish at Chrysler. Read more
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Dave Anderson Quote of the Week
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Life doesn’t reward knowing, it rewards doing. Get up off your knowledge and do something! Dave Anderson, Learn to Lead, Inc.
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