Automakers Toyota, Mercedes, & BMW Top List of World's Most Valuable Car Brands

First Up 10/11/18

Chairman's Blog: Fall Brings New Developments on Trade
Autumn has been an eventful season for trade, including the signing of the renegotiated U.S.-South Korea Free Trade Agreement (KORUS) and the finalizing of a trilateral agreement on what was NAFTA, now known as the United States-Mexico-Canada Agreement, or USMCA. AIADA Chairman Brad Strong writes that details of USMCA are still being absorbed, and auto manufacturers in particular are assessing how they will be impacted by new requirements and standards. Dealers, for the most part, are hopeful that these recent developments are a positive sign that we are putting some of the instability surrounding trade in our rear view mirror. While KORUS and USMCA do offer details and stability, the threat of damaging 25 percent tariffs on imported autos and auto parts remains, as part on an ongoing Department of Commerce 232 investigation. All eyes now are on President Trump and his trade negotiators, as they (hopefully) work to come to trade agreements with Japan and the EU. If we can open dialogue and secure pacts with those trading partners, we’ll be moving in a positive direction. Read more of Strong’s latest blog here. 

Looming Tariff Threat to Lessen New-Vehicle Sales
According to Auto Finance News, Auto ABS is experiencing strong performance this year, but President Donald Trump’s trade war and tariff threat on imported auto parts are expected to prompt a downturn in securitization volume, Jamie Feehely, managing director of securitization at National Bank, said during ABS East last month. “There are no securitizations done that are 100% used cars,” Feehely said. “If we are going to continue to have a market, we have to rely on new issuances of ABS, and new cars are going to be harder to sell if tariffs go up from virtually zero.” If the tariffs go through, the industry is going to suffer a dearth of new-car sales as the used market — which is already in high demand — is going to go up, and securitization volumes will decrease. Captives like Nissan Motor Acceptance Corp. are concerned about the impact of the new tariffs. Nissan’s North America production comprises 72 percent of the company’s total production, said Treasurer Steve Hetrick. Read more here. 

Audi's Keogh to Succeed Woebcken as CEO of VW Group in North America
Scott Keogh, who has steered Audi to 107 straight months of U.S. sales gains, will become CEO of Volkswagen Group's North American operations on Nov. 1. According to Automotive News, Keogh, 49, will succeed Hinrich Woebcken, 58, a former BMW executive who took over in April 2016 amid VW's diesel emissions scandal. When Keogh becomes CEO, he will be the first American to hold the German automaker's top job in North America in 25 years. Keogh will be succeeded as president of Audi of America on Dec. 1 by Mark Del Rosso, 54, Audi said in a statement Wednesday. Del Rosso transferred to run VW's Bentley unit in North America in 2017 after nine years as COO of Audi, where he was Keogh's top lieutenant. A successor for Del Rosso at Bentley has not been named. Woebcken, who has sought greater independence from VW's headquarters in Wolfsburg, Germany, will remain "available to the company in the North American region as senior executive strategy adviser," the automaker said in a statement. Read more here.

Auto Consumers Feel Pinch as Interest Rates Rise
Car buyers who already are reeling from high sticker prices are finding it harder to afford new vehicles as interest rates continue to rise, reports The Detroit News. The average annual percentage rate for a new-car loan was 5.8 percent last month, up a full percentage point from September 2017. In real terms, that means someone taking out a five-year, $30,000 car loan would pay $828 in additional interest over the course of the loan: $4,632 in interest payments vs. $3,804. The last time the average interest rate for a car loan was above 6 percent was January 2009. Concerns about interest rates and trade wars were behind an 831-point drop Wednesday for the Dow Jones Industrial Average. Making matters potentially worse, financing incentives from carmakers are becoming hard to find. Only 5.6 percent of vehicles purchased in September were financed with zero-percent loans, compared to 10.1 percent last year. The zero-percent figure was the lowest September level since 2005, according to analyst firm Edmunds. Read more here. 

Automakers Toyota, Mercedes, & BMW Top List of World's Most Valuable Car Brands
Interbrand has released the 19th edition of its Best Global Brands. These are the 100 most valuable brands in the world, reports USA Today. Apple is the most valuable brand with a valuation of $214 billion. Several car brands made the list, with two in the top 10. The most valuable car brand, according to Interbrand, is Toyota, the flagship brand of the Toyota Motor Corp., which came in seventh on the overall list. Its value was pegged at $53 billion, up 6 percent. Most years, it vies with Volkswagen for the lead in cars produced worldwide. Following next are two Germany luxury brands. Mercedes ranked eighth among all car brands at $47 billion, up 2 percent. BMW ranked 13th, with a valuation of $41 billion, down 1 percent. The Honda brand ranked 20th at $24 billion, up 4 percent. Read more here.  

Webinar: Will You Meet – and Beat –the Used Car Competition in 2019?Join AIADA's next AutoTalk webinar on Tuesday, October 16, 2018.

Learn: 

  • How to assess your 2018 used car department performance

  • Will you be meeting the competition in 2019?

  • Tips to your 2019 success, including increasing sales and protecting profits as used car shoppers move online

Happening Tuesday, October 16, 2018. 2:00pm EDT *Please note new session time*

To register, click here. 

Around the Web

Manual Transmission Continues to Fade: Here's Where It Sells Best and Worst [Autoblog]

12 Best Luxury Car Deals in October 2018 [U.S. News & World Report]

BMW to Take Control of China Joint Venture in $4B Deal [WSJ]

Self-Driving Cars May Hit U.S. Roads in Pilot Program [Automotive News]

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