December 2, 2011

November Sales Rate Best Since August 2009
For automakers and dealers, November sales were at their best monthly rate since August of 2009, when Cash for Clunkers was in full swing, reports AIADA’s Market Watch. The surge is partially credited to black Friday shoppers, who turned out at some of their highest levels in recent years to take advantage of great deals. Hyundai’s sales were up 21.8 percent; Kia was up 39.1 percent; Nissan was up 21.5 percent; and Mercedes Benz had its best November ever with sales of 27,841 units, up 42.6 percent from a year ago. Toyota, well on its way to recovery from March’s earthquake and tsunami, was up 6.7 percent and picked up a point in market share. Honda continues to struggle, now with supply issues caused by flooding in Thailand, and saw sales fall 6.2 percent from November 2010. “Bolstered by falling unemployment rates and attractive deals, consumers who had been deferring automotive purchases returned to dealerships in droves last month,” said AIADA President Cody Lusk. “Dealers are optimistic that last month’s numbers bode well for 2012.” Read the rest of AIADA’s Market Watch sales report for the month of November here.

Railroad Deal Wards Off Strike
The nation's freight railroads reached a deal late Thursday to head off a nationwide rail strike that could have crippled auto production and sales as early as next week. According to The Detroit News, the railroads said they reached tentative agreements with the Brotherhood of Locomotive Engineers and Trainmen and the American Train Dispatchers Association, which together represent about 26,500 employees in collective bargaining. The last remaining union without a deal, the Brotherhood of Maintenance of Way Employees, agreed to extend the "cooling off" period until Feb. 8, eliminating the immediate threat of a strike. A stoppage "would limit the ability of auto manufacturers to move components to plants to enable assembly, and stop shipment of finished vehicles," seven auto industry groups – including AIADA – told Congress Thursday. "Production at assembly plants and independent parts manufacturers throughout the country would be impacted immediately." Click here to see the entire letter the groups sent to Congress urging it to help prevent a strike. For more on an agreement to fend off a railroad strike, click here.

A Dealership is Not the Place to Organize a Factory
An Automotive News editorial argues that if the UAW is considering a plan to organize workers at factories operated by Asian and European automakers through an informational campaign for consumers at dealerships, the leaders ought to rethink that plan. It's not clear yet exactly what the union intends to do, according to the editorial, but whatever it is, dealerships are the wrong place to do it. Clearly, it would be absurd to expect to organize Volkswagen factory workers, for example, by picketing a VW dealership. AIADA has expressed concerns about what the UAW might be planning, observing that anything affecting business at a dealership could hurt the families of dealership employees. According to Automotive News, the best way for a union to organize workers and recruit members is with an honest, effective sales pitch that explains why workers would be better off with the union than without it. Anything else, including a campaign that targets dealerships, would be unfair and, ultimately, unsuccessful. Click here for Automotive News’ full opinion on the UAW’s plans to picket dealerships as part of a strategy to unionize international brand manufacturing facilities in the U.S.

Subaru Stops Sales of Three 2012 Nameplates for Brake Problem
Subaru of America stopped the sale of 2012 Impreza, Legacy, and Outback models on Nov. 25, following customer complaints about increased brake pedal travel. Parent company Fuji Heavy Industries says it is recalling around 3,000 cars already sold and delivered. According to Autoweek, the company received about 130 reports of the faulty brakes and confirmed the problem on three vehicles. The company says the brakes work. "Some customers said the brakes didn't feel right," Subaru of America spokesman Michael McHale said. "The pedal travels farther than it should. There were no failure issues, no accidents." The needed repair is a replacement of the master cylinder. McHale said the 130 field reports came either from dealers or dealership personnel handling the cars. NHTSA has been informed and recall notices to vehicle owners are in process and are expected to be sent out within the next day or so. McHale said he expects the sales freeze to be lifted within a few days, possibly early next week. The first priority is to repair the 3,000 vehicles already sold and then fix vehicles still in inventory. Read the latest on Subaru’s decision to halt sales on three of its 2012 nameplates to address brake issues here.

Nissan Gears Up to Outrun Honda
The head of Nissan Motor Co.'s operations in North America has a clear objective: move ahead of Honda Motor Co. as the No. 2 Japanese automotive brand in the U.S. market. "I can't see any excuse for not overtaking Honda in the U.S. market," Nissan Executive Vice President Colin Dodge said in an interview with The Wall Street Journal. Noting that Nissan outsells Honda everywhere the two brands compete globally except the U.S. and Thailand, Dodge said targeting his Japanese rival is crucial to Nissan's quest to boost its U.S. market share to 10 percent from the current 8 percent. As it is for Honda, the U.S. is a key market for Nissan and second only to China globally. Nissan's sales in the U.S. rose 18 percent to 908,570 vehicles last year, compared with a 7 percent U.S. sales gain by Honda to 1.2 million vehicles. Nissan said Thursday that its U.S. sales in November increased 19 percent from a year earlier to 85,182 autos amid strong demand for the company's Rouge compact sport-utility vehicle and Frontier pickup truck. Nissan has high hopes for growth in the compact segment that Honda dominates in the U.S. with its Civic model. For the latest on Nissan’s growth expectations, click here.

Around the Web 
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As Automakers Face Hurdles, Responsiveness Becomes Key [Kicking Tires]