March 13, 2012
As Dealer Count Holds, Sales Per Store Jump
U.S. new-vehicle sales rose 10 percent last year while the number of franchises remained flat, reports Automotive News. The gains were widespread: Of 41 brands sold last year in the United States, 30 had higher per-franchise sales – and 27 posted double-digit percentage gains. The exception: Weak sales at Japanese-brand stores hurt by the March 2011 earthquake in Japan cut their sales per franchise. The Japanese brands sold an average 750 vehicles per franchise, more than twice the Detroit 3 pace. Japanese brands collectively increased their per-franchise throughput by only three units last year. Many of those brands were hamstrung by inventory shortages stemming from the earthquake. Kia added more unit sales per franchise than any other brand. Its franchises each sold an average of 654 units, an increase of 152 units, or 30 percent. Last year Kia's unit sales increased 36 percent, and it raised its franchise count by 25, or 3 percent. Mitsubishi had the highest percentage increase of average sales per franchise: a 44 percent jump to 200. Mitsubishi dropped five franchises last year, and its sales rose 42 percent. For the latest on last year’s auto franchise sales, click here.
NHTSA Defends Anti-Distraction Rules That Limit In-Car Tech
The National Highway Traffic Safety Administration (NHTSA) proposed voluntary guidelines last month urging automakers to block drivers from plugging addresses into navigation systems or browsing the web while in motion. According to USA Today, it plans a second round of guidelines later for mobile devices and a third for voice-activated systems. The agency will deal with mobile devices "as rapidly as feasible," NHTSA chief David Strickland said at a hearing Monday on the proposal. NHTSA says 3,000 people were killed in distracted-driving crashes last year, but its data also show the biggest driver distractions are reaching for objects and talking to passengers. In its proposal, NHTSA reported that 17 percent of police-reported crashes in 2010 involved distraction, but just 3 percent of those involved distraction by devices installed in the cars, such as navigation systems. Marc-Anthony Signorino of the Distracted Driving Safety Alliance of electronics and vehicle equipment manufacturers says it's critical that mobile devices be addressed because it's second nature for young "digital natives" to use them constantly. Getting activities off handhelds would be "one step closer" to cutting distraction, he testified. For the latest on federal efforts to reduce driver distraction, click here.
Study: Dealers Show Improvement in Web Response Time, Luxury Nameplates Top Ranks
According to the Internet Lead Effectiveness study, which measures auto dealerships responsiveness to customer inquiries received over the internet, Lexus Infiniti, and Acura dealerships ranked highest. Numerous luxury nameplates are gaining traction with web-surfing car shoppers as these dealers hone in on internet leads and improve response time, according to the 2012 Pied Piper Prospect Satisfaction Index (PSI). Auto Remarketing reports that study rankings by brand were determined by the Pied Piper PSI process, which ties "mystery shopping" measurement and scoring to actual industry sales success The study measured 37 different combinations of dealership replies relying on automated and/or personal responses. Industry-wide performance improved substantially from 2011 to 2012, with two-thirds of the 34 auto brands recording higher scores. This past year dealerships on average responded to customer inquiries within 24 hours, 64 percent of the time. Now in 2012, rooftops have improved to 78 percent of the time on average. The study also showed that today, most dealerships rely on "Auto Responder" software to generate an automatic email reply to customer inquiries based upon information gleaned from the customer inquiry. Click here to check out the entire study on dealer customer response. For coverage from Auto Remarketing, click here.
Emails: Fuel Rule Talks Heated
Automakers clashed with the White House during talks to significantly boost fuel efficiency standards by 2025, according to emails obtained by The Detroit News. The emails, which were disclosed by automakers to the House Oversight and Government Reform Committee, reflect the contentious nature of the talks that went on for as much as 16 hours a day for much of July. The Detroit News reports that the committee, headed by Rep. Darrell Issa (R-Calif.), is investigating whether White House officials circumvented the traditional regulatory process by reaching a deal with automakers before federal agencies sought public input in drafting new fuel rules. Issa has argued the administration didn't weigh the impact that higher vehicle costs could have on the public. Obama has repeatedly acknowledged that reaching the fuel deal "was not easy," but shows government and industry can work together. 13 major automakers, including Detroit's Big Three, signed off on a proposal to nearly double fuel standards to 54.5 mpg by 2025. The rules are to be finalized later this year. They will cost the industry $157.3 billion, the Obama administration estimates, but will save consumers $1.7 trillion at the pump. For coverage of the contentious discussions leading to new federal fuel rules, click here.
Unbeatable New-Car Lease Deals
The conventional wisdom for generations among those looking to get the most for their money has been to purchase a new car and hold onto it until it would cost more to repair than it was ultimately worth. However, a growing number of consumers are finding leasing a vehicle for a set term, rather than buying one outright, to be financially advantageous thanks to a perfect alignment of market forces. According to Forbes, record low interest rates and high resale values caused by an ongoing shortage of used cars are helping automakers offer some of the best lease deals in years. Leasing now accounts for 21 percent of all new-vehicle transactions, according to Kelley Blue Book, which is up from around 12 percent in 2009; analysts believe leasing could account for as much as 25-30 percent of the new-car business over the coming years. How good are the deals these days? Forbes’ slide show runs down a baker’s dozen of the best deals it could find among a wide range of makes and models. Click here to see it. To read more on today’s best lease deals, click here.
Take Action to Get Ahead of Rising Healthcare Costs
A valuable healthcare benefits plan is an important element to recruiting and retaining the best employees. But it can also be a costly one. However, there are healthcare strategies you can implement to mitigate these rising costs and stay ahead of the curve. Overall cost reduction can be achieved with medical claims management and wellness initiatives. What does this mean? Well, did you know that the top 5 percent of members drive nearly 70 percent of the amount paid (premium or claims)? A two step process of identifying these at-risk members and then engaging them with RNs who can help them reduce their risk factors will help prevent the costly medical events from taking place to begin with. It’s a different approach – and one that benefits consultant, Northwestern Mutual, has recommended to help its clients. This proactive approach provides a platform to create behavior change and engage your employees in a health culture. Northwestern Mutual and AIADA recently hosted a webinar that covered this topic – click here to access the recording. Your benefits advisor should act as a consultant in helping you to manage your costs. Northwestern Mutual, an AIADA Affinity Partner, provides benefits consulting for dealerships across the country and can help you evaluate alternative benefit strategies to select the most cost-effective plan design for your dealership. To learn how they can help, contact David Markley at 1-855-55-AIADA (855-552-4232) or David.Markley@NMFN.com. Click here to get a quote for your dealership.
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