December 5, 2012
Ray on Point: Dealers Must Be Active & Engaged
The election is behind us, but dealers are still working to understand what is happening in Washington, D.C., and how it will impact our businesses. Will the threat of a fiscal cliff torpedo our sales? Will newly elected legislators further regulate our industry? Are our taxes going up or down? AIADA Chairman Ray Mungenast writes in his latest blog post that dealers who want to grow a thriving business today know that it’s not enough to run a tight ship at home; they must also make their voices heard by Congress, the White House, and regulatory agencies. For that we have AIADA. You can learn more about what AIADA is doing to support dealers, and how you can be a part of its mission in Washington, D.C., by attending the association’s 43rd Annual meeting and luncheon during the NADA conference this winter in Orlando, Florida. The luncheon, which will feature keynote remarks from Mercedes Benz’s Steve Cannon, will give you an eye-opening look at the challenges we face on the federal level. Staying active, engaged, and informed is the best way to approach post-election uncertainty. Read more of Chairman Mungenast’s new blog post on how dealers must be involved here.
Subaru Mulls Expansion of Indiana Assembly Plant
According to Automotive News, Subaru is studying expanding its Indiana assembly plant as the Toyota Motor Corp. affiliate seeks to boost U.S. output to curb currency losses and meet growing demand for its models. The U.S. unit and its parent are in discussions to expand the Lafayette, Indiana, factory, Tom Doll, Subaru's U.S. executive vice president and chief operating officer, said in an interview. A decision whether the plant will add assembly of Impreza cars or Forester crossovers hasn't been made, he said. The combination of a high yen and expensive shipping costs means "it becomes more difficult with production in Japan to import those vehicles into the United States," Doll said. Fuji Heavy joins Japan's Toyota, Honda Motor Co., Nissan Motor Co., and Mazda Motor Corp. in seeking further production capacity in North America to stem losses related to the yen's persistent strength relative to the dollar. Demand for Subaru's all-wheel-drive cars and light trucks has risen 29 percent this year to 299,788, capped by a 60 percent sales increase in November. Click here to read more about Subaru’s potential U.S. production plans.
Suzuki Reaches Settlement Pacts With 97% of Its Dealers
The American Suzuki Motor Corporation has reached settlement agreements with 213 of its 219 automotive dealers, Suzuki said Tuesday, nearly a month after the unit filed for bankruptcy. The New York Times reports that the agreements are intended to compensate dealers and smooth their transition from automobile sales to warranty-and-repair providers for hundreds of thousands of Suzuki owners. The process “makes the dealers whole and puts them at the head of the line in terms of getting paid” during reorganization, said Rachel Rosenblatt of FTI Consulting, a Suzuki representative. Specific terms were not disclosed. The final deadline for agreements that covers dealer in the continental United States, which are subject to bankruptcy court approval, is Dec. 28. The automaker said it is hopeful that it will be able to reach agreements with the remaining six dealerships. Agreements include the company’s top 50 dealers and represent more than 98 percent of the total volume of American Suzuki sales in the contiguous United States. Suzuki plans to market and sell its remaining inventory of vehicles through its dealer network. Click here for more on Suzuki’s settlement progress.
Sleek, Light, Fun: Five Cars to Watch in 2013
Los Angeles is a town where people like to get noticed for what they drive, and expect to be served the auto industry's freshest ideas. That is why the Los Angeles Auto Show, which opened late last week, makes an excellent place for spotting trends. There, the newest approaches to electric cars are being spotlighted. And old notions of what makes high-performance luxury cars worth the money are being upended. This year, auto makers used the L.A. show to unveil 24 cars for the first time anywhere, and 25 for the first time in the U.S. About a dozen of the premieres were from luxury brands, reflecting Southern California's status as one of the biggest luxury- and performance-car markets in the country. The models getting attention in L.A. are diverse in price and style. According to The Wall Street Journal, they reflect the demands of consumers who spend an inordinate amount of time on the road and want better fuel efficiency without compromising performance, seamless digital connectivity, and at least the promise of a car that runs on electricity and is fun to drive. Click here to see some cars from the L.A. show worth watching in 2013.
Car Loan Access, Payoff Times Grow
New-vehicle loans to customers with subprime loans grew by nearly 3 percent during the third quarter and now comprise nearly 25 percent of all new car loans, according to an Experian Automotive report. And the total subprime financing market for used vehicles grew even more – by about 5.5 percent – and now comprise more than 54 percent of all used-car loans. All the while, the average loan term for new vehicles has climbed to 64 months, while the average used-vehicle loan term is now 60 months. Both are one month longer than at the same time a year ago. "With leasing showing a continued upward trend, and lenders increasing their appetite for risk, consumers were in a good position to obtain a vehicle during Q3," said Melinda Zabritski, director of automotive credit at Experian Automotive. According to The Detroit News, the Experian Automotive report showed that financial lenders remain more risk-averse now than they were before the recent recession. The average credit score for a new-car consumer is now 755, up from 749 before the recession, but lower than the average of 763 during the same time last year. Click here for more on Experian’s vehicle loan report and what it says about today’s car buyers.
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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