October 31, 2012

East Coast Dealerships Assess Damages After Hurricane Strikes
Hurricane Sandy, the largest tropical storm the Atlantic has ever seen, hit southern New Jersey Monday evening, affecting sales and damaging inventory at dealerships there, as well as other East Coast states. According to Automotive News, nearly 8 million electric customers in 15 states and Washington, D.C., were without power on Tuesday and the storm's death toll reached 29. In central New Jersey, the DCH Auto Group was dealing with the mess today. The dealership group has nine stores that remain closed and could be severely damaged because they were located in the counties declared disaster areas, said Roy Bavaro, director of corporate marketing at DCH Auto Group in South Amboy, N.J. In areas more sheltered from the storm, some dealers were feeling fortunate. In Falls Church, Va., International Motors is closed for the day, but the store and inventory are undamaged, said owner Kurt Schirm. TrueCar analyst Jesse Toprak said that although the storm was more damaging than he thought, he still predicts an annualized sales rate of 14.9 million vehicles for October – which would tie September for the highest mark since early 2008. Read about Hurricane Sandy’s damage here.

Marchionne: Jeep Production Not Headed to China
According to The Detroit News, Chrysler Group and General Motors Co. forcefully attacked comments from Republican presidential candidate Mitt Romney that Chinese production could cost Americans jobs. After months of largely trying to stay out of the fray, the two U.S. automakers that were rescued by taxpayers in 2008 and 2009 attacked the Detroit native who opposed the $85 billion auto bailout. Chrysler CEO Sergio Marchionne rejected an assertion from Romney that Chrysler is planning on moving Jeep production to China. "I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China," Marchionne said in an email to employees Tuesday. GM denounced a new Romney radio ad in Ohio on Tuesday that also attacked GM for building cars in China, ramping up the rhetoric. The campaign on Saturday started airing an ad about the auto bailout that said Jeep might start building vehicles in China. The ad is technically accurate, but has been called misleading by many, since the automaker is only talking about Chinese production for Chinese consumers. Click here for the latest automotive news from the presidential campaign trail.

Lights That Bring Out a Car's True Colors
Dodge drivers are seeing red. Buick owners are being bathed in "ice blue." Ford buyers can push a button and pick a color to suit their mood. According to The Wall Street Journal, some of the auto industry's most dazzling experiments with electricity are happening not under the hood but inside the passenger cabin, with so-called ambient lighting – fixtures designed to add a splash of color and some restaurant-style chic to a dark vehicle interior. The Detroit companies are taking cues from European luxury-car makers, which pioneered the use of interior and exterior lighting features to distinguish their products, like the pearl string on Audi's headlamps, or the "light pipe" across the dashboard of the Mercedes-Benz S-Class. They're also taking advantage of sinking prices for light-emitting diodes, or LEDs, which are more energy-efficient, durable and versatile than traditional filament bulbs. Designers say some of the inspiration for new lighting systems comes from the way the entertainment industry uses light to complement the mood created by music or visuals. Further inspiration comes from the falling cost of LEDs, tiny bulbs that use a semiconductor to produce light. Click here to read more about changes to interior vehicle lighting.

Sandy Could Impact Unsuspecting Used-Car Buyers
It could be days, even weeks, before the storm-battered Eastern Seaboard dries out. According to NBCNews.com, the destruction is likely to include thousands of vehicles damaged or destroyed by floodwater. In some cases, vehicles can be repaired. But many will have suffered extensive, irreparable damage and should be scrapped. That doesn’t mean they will be. If recent history is any indication, a number of seriously flood-damaged vehicles will wind up on used car lots and sold to unsuspecting consumers. Experts say half of the vehicles damaged or destroyed by Hurricane Floyd were put back on the road. How many cars were damaged or destroyed by this week’s massive storm remains to be seen but as many as 600,000 vehicles were claimed by Hurricanes Rita, Katrina, and Wilma in 2005, according to CarFax, a service designed to help potential used car buyers track the history of a vehicle. “Many of these cars are still showing up for sale around the country,” CarFax notes, the service’s website pointing out that of 75,000 vehicles damaged by 1999’s Hurricane Floyd, “more than half were put back on the road.” For further coverage of how Hurricane Sandy could impact the used vehicle market, click here.

Best Luxury Car Buys of 2012
In the auto industry, as in politics, a third-party entry into a well-known, hotly contested race can cause significant consternation among the rank and file. Sometimes it’ll prove enough of a jolt to spoil the lead for a previously guaranteed winner. According to monthly sales figures compiled by Autodata, Audi is closing in on BMW and Mercedes in the race to sell the most luxury cars on the market this year. It likely won’t surpass either in overall volume, but it will siphon sales off current leader BMW. Indeed, in a contest once dominated by Lexus, which was No. 1 for 11 years in a row but faltered after Japan’s 2011 earthquake, Forbes reports that Audi has added a particular volatility that will make it difficult for BMW to repeat its top status. “There are a tremendous amount of new products coming out now,” says Thomas King, the senior director of automotive research at JD Power & Associates. “That bodes well for auto sales next year, absolutely.” Click here to see Forbes’ list of the best luxury cars of 2012. To read more about the luxury race to the top, click here.

Join Dealers in Orlando for AIADA’s 43rd Annual Meeting and Luncheon
Each year, AIADA’s dealers gather to consider where the international nameplate auto industry stands and prepare for what the future holds. Join fellow dealers and industry insiders in Orlando, Florida on February 11, 2013 for its 43rd Annual Meeting and Luncheon. This year, we’ll discuss how the economy is Driven by the international nameplate auto industry and what dealers can do to maintain their edge. Featuring keynote remarks by Mercedes-Benz USA President and CEO Steve Cannon, the presentation of the David F. Mungenast, Sr. Lifetime Achievement Award, and the passing of the gavel from 2012 Chairman Ray Mungenast of Missouri to 2013 Chairwoman Jenell Ross of Ohio, the 43rd Annual Meeting and Luncheon is a can't-miss event for international nameplate dealers, as well as their employees. Register today by clicking here or by calling 1-800-GO-AIADA.

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