Auto Lenders Cut Interest Rates on New-Vehicle Loans
Auto lenders lowered interest rates on new-vehicle loans last month in anticipation of a Federal Reserve rate cut, according to Edmunds. As a result, July marked the third straight month that the average rate fell for new-vehicle financing, reports Automotive News. On July 31, the U.S. central bank cut borrowing costs a quarter percentage point, the first rate decline since the financial crisis. The average interest rate for new vehicles financed in July declined 16 basis points from the previous month to 5.84 percent, Edmunds said. That's nine basis points above last year's 5.75 percent. Jeremy Acevedo, Edmunds' manager of industry analysis, said the industry responded to the Fed's decision before it happened in the belief that borrowing money would be cheaper in the coming months. The cut occurred at a good time for auto dealers, he said, as they needed a boost clearing out 2018 models this summer. Edmunds estimates 3.3 percent of new vehicles sold in July were 2018 models, the highest level of previous model-year sales in any July that Edmunds has recorded. Read more here (subscription required).
Trump's Bid to Ease Auto Rules Would Hike Fuel Costs, Study Says
President Donald Trump’s plan to freeze U.S. vehicle efficiency standards would hike costs for motorists without doing anything to boost highway safety, according to an analysis by Consumer Reports that undermines the administration’s chief talking points in favor of the move. Transport Topics reports that the analysis comes as the White House reviews a final drafted plan for easing vehicle emissions and fuel economy standards, despite escalating pressure from some automakers and California to change course. The administration last year proposed capping fuel economy and tailpipe carbon dioxide emission standards at 2020 levels, instead of allowing them to rise annually as under existing regulations. The plan also calls for stripping California of its authority to regulate tailpipe greenhouse gas emissions. Read more here.
Honda, Hyundai Join Growing List of Automakers Electrifying Motorsports Programs
While battery power is still struggling to gain traction in the consumer market, it is accelerating fast on the race track as a growing number of motor sports series – and automaker race programs – adopt various forms of electrification. According to The Detroit Bureau, two of the newest manufacturers set to plug in are Hyundai, which will preview an all-electric race car at the Frankfurt Motor Show next month, as well as Honda, which says it will return to next year’s IndyCar series with a hybrid-powered racer delivering “more than 900 horsepower.” The two announcements come just weeks after the conclusion of the fifth season of the Formula E series. Earlier this month, IndyCar announced that it will switch to hybrid technology with the launch of the 2022 series. Both Honda and its arch-competitor Chevrolet will join in on the switch. Read more here.
GM is Slowing Production of a Popular SUV to Align Market Demand
General Motors is making some production changes at two of its assembly plants in North America, reports The Detroit Free Press. Meanwhile, the fate of four U.S. plants slated to shutter remains uncertain, dependent on bargaining talks with the UAW, GM said. GM is cutting production in Canada and Mexico where it builds the Equinox SUV in anticipation of slowing sales in North America and other markets. GM will cut its third shift in San Luis Potosi, Mexico, effective next week, a GM spokesman said. Besides the Equinox, GM also builds the GMC Terrain and Chevrolet Trax at San Luis Potosi. GM will shut down its CAMI plant in Ontario for one week the last week in September. “Sales of the Equinox are very strong, however, we’re making a production adjustment to run the business in a responsible manner,” said Dan Flores, GM spokesman. Read more here.
Larry H. Miller Group Names Steven Starks CEO
Larry H. Miller Group of Cos., which owns the country's eighth-largest dealership group, on Wednesday named Steven Starks as its CEO, effective Aug. 12, reports Automotive News. Dean Fitzpatrick, 53, a 31-year veteran of the company, will continue as president of Larry H. Miller Dealerships, a role he has held since 2012, a spokeswoman told Automotive News in an email. Starks, 40, will leave his post as president of the NBA's Utah Jazz and LHM Sports & Entertainment, a position he's held since 2015. Larry H. Miller Group of Cos. is headquartered in suburban Salt Lake City and employs more than 10,000 people across the U.S., primarily in automotive, sports, entertainment, finance, insurance, and real estate businesses. Read more here.
Webinar: Tax Reform Status Update for Dealers
Join AutoTalk on Tuesday, August 20th at 2:00pm ET as Amy Stillwell and Dan Cheyney of Moss Adams' Automotive and Dealer Services Group update dealers on:
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Additional tax plan clarification on dealer operations
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What we know now
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How tax reform effects dealers
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What you can do to minimize your taxes
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