March 22, 2012

VW Will Add 800 Workers to Build More Passats in Tennessee
Volkswagen Group of America, amid rising sales of the redesigned Passat, will add 800 jobs at its Tennessee plant to boost production of the mid-sized sedan. Automotive News reports that the move will increase the factory's workforce to 3,500 by year end and push the automaker closer to its new goal of building more than 170,000 Passats annually in Chattanooga by 2013. VW previously planned to build 150,000 Passats a year by 2013. Sales of the VW brand have increased 36 percent or more each month beginning with September, when the new Passat hit U.S. showrooms just months after production was launched. The brand’s sales have soared 45 percent through the first two months of this year to 57,786 units – one-fourth of them Passats. "Quite plainly, we need more Passats to meet the market demand," Jonathan Browning, CEO of VW Group of America, said in a statement. By 2018, the German carmaker aims to boost U.S. sales of its VW brand to 800,000 vehicles annually. The company also hopes to sell 200,000 of its Audi premium cars in the United States that year. Click here for the latest on VW’s plans to expand production at its Chattanooga plant. For more on the plant, visit AIADA's site, www.WhatisanAmericanCar.com.

Highway Bill Riles Automakers
Major automakers want significant changes in auto safety reforms that are part of a two-year highway reauthorization bill. Mitch Bainwol, president and CEO of the Alliance of Automobile Manufacturers, is expected to tell the House Energy and Commerce Committee today that it should make major changes in the $109 billion bill that the Senate approved on a 74-22 vote. The alliance, which represents Toyota Motor Corp., Volkswagen AG, and several others, wants the House to reject a provision in the Senate bill that would allow the government to fine them $250 million for failing to recall vehicles properly. That's up from about $17 million now. According to The Detroit News, automakers have questioned the need for new auto safety measures. They note that in 2010 the number of road deaths fell to the lowest number since 1949 – less than 33,000. The Senate bill would also require new regulations on pedal placement, push-button ignitions, and electronic performance issues. Automakers argue that new rules in these areas are unnecessary. Transportation Secretary Ray LaHood, on Wednesday called on the House to immediately pass the Senate bill. Click here for the latest on proposed highway safety measures.

Used Compact, Hybrid Car Prices Soar Along with Gas
Consumers who have been putting off buying a used compact car to save more gas may be in for some sticker shock. And it’s only going to get worse, according to USA Today. Used compact-car prices are rising in tandem with the soaring price of gas, and they could go up as much as 20 percent as they did last year, according to Kelley Blue Book. Used compact cars rose 0.4 percent in February but price increases started picking up toward the end of the month, going up 1.3 percent during the week ended March 2. The average used car was priced at $11,124 at wholesale auctions, the places that car dealers go to buy more used cars for their lots. As in past gas price spikes, there is no surprise about what used car is suddenly seeing the biggest turnaround in demand: "The 2010 Toyota Prius led in gains, increasing in value $1,370 through the month of February," said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. "Dealers have been aggressively bidding on fuel-efficient vehicles at auction as consumer demand increases in response to rising gas prices." Click here to read more about rising compact and hybrid gas prices.

Honda Promotes U.S. Managers in Revival Push
According to BloombergBusinessweek, Honda Motor Co. was the first Asian carmaker to build autos in the U.S. and is the most dependent on the market. Now it’s also putting more non-Japanese in key roles. North American Chief Operating Officer Tetsuo Iwamura becomes executive vice president April 1 and No. 2 to President Takanobu Ito. His new seven-member board will manage activities from product planning to production to sales in North America. Three members will be U.S. natives, the first time Americans held such responsibility, including Erik Berkman to lead regional product development and design, as well as John Mendel, executive vice president of U.S. sales. For the first time, Honda’s No. 2 executive will be based at the company’s U.S. headquarters in Torrance, California, instead of Tokyo. “Knowing the current competitive and complicated marketplace, rapid changes in customer needs, we think it’s better to put more emphasis on the American side,” Iwamura said in a March 12 interview. “Production and R&D, development facilities, those can be done by investing money. Localization of the people is one of the key issues.” For the latest on Honda’s management shifts, click here.

The Most-Improved Cars at the Gas Pump
Since 2008, carmakers have improved the fuel economy of their fleets by more than 16 percent. In many cases, they did it by fleshing out their showrooms with more small cars. But they’ve also replaced big, thirsty V6 and V8 engines in existing models with smaller, turbocharged engines that are just as powerful but sip less fuel, reports Forbes. Some have also added hybrid or diesel variants to their models. Edmunds.com decided to dig into the government’s fuel economy data to see which individual vehicles achieved the biggest increase in miles per gallon since 2008. The most improved was the Audi A3, which climbed 38.5 percent to an average 29.1 mpg in 2012. The big gain is mostly because in 2010 Audi introduced a 2.0-liter turbo-diesel four-cylinder engine (TDI) that produces 140 hp and gets 34 mpg in combined city and highway driving. Even sports cars are more fuel-efficient. Mercedes now offers a turbocharged four-cylinder engine in its SLK convertible, boosting fuel economy by 4 mpg. Overall fuel economy on the SLK line is now 23 mpg, up from 18 mpg. Click here to check out a slideshow of the vehicles Edmunds found boast the most-improved gas mileage. To read more about the list, click here.

Protect Your Legacy! Free Estate Planning Webinar for Auto Dealers
Are you part of the majority that has not created (or updated) their estate plan? It’s no surprise many dealers are having a hard time figuring out what they need to do – during the past ten years, the estate tax exemption amount and the top tax rate have changed six times. However, up-to-date estate planning documents are essential to ensure that your assets are distributed according to your wishes. Join AIADA and our Affinity Partner, Federated Insurance, on Thursday, April 12 at 11 a.m. EDT for a free webinar. The webinar will be hosted by Nichole Crawford, Manager & Counsel of Advanced Life Sales for Federated Insurance. Prior to joining Federated, Nichole spent time on both the financial and legal consulting sides of estate planning. She received her law degree from Arizona State University College of Law and an LL.M in Taxation from the University of Denver. She will address the timeless questions you need to consider when planning your estate, and offer insight to help simplify the planning process. Whether you are creating a new plan or updating an existing one, register today!

Around the Web  
2013 Scion FR-S Priced From $24,930 [MotorAuthority]
Fed Driver Distraction Guidelines Make Navigation Unusable [CNET]
'Peep Show' Marks Mini Roadster's Arrival [Driver's Seat]
Get with the Times: You're Driving All Wrong [The Bottom Line]

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