Calif. Lawmakers Send Dealer Franchise Bill to Governor's Desk
After a similar bill was vetoed in 2018, California lawmakers have again passed dealer franchise legislation that would in part adjust the reimbursement rate the retailers receive from automakers for warranty and recall service work. Automotive News reports that with the legislation, backed by the California New Car Dealers Association, going to the governor's desk for the second time in two years, auto dealers say they hope their effort won't end in a veto this time. The California State Assembly last week adopted the state Senate's changes to AB 179, a final procedural step before the bill moves to Gov. Gavin Newsom's desk. Newsom's office did not immediately respond to a request seeking comment on whether the governor, who took office in January, intends to sign it. Newsom, a Democrat, has until Oct. 13 to sign the bill before the California Legislature recesses until January. Read more here (subscription required).
Trump Delays China Tariff Increase as Trade Talks Approach
President Donald Trump said he was postponing the imposition of 5 percent extra tariffs on Chinese goods by two weeks, a move that delays the next escalation of the trade war and brightens the backdrop for upcoming negotiations, reports Automotive News. “At the request of the Vice Premier of China, Liu He, and due to the fact that the People’s Republic of China will be celebrating their 70th Anniversary on October 1st, we have agreed, as a gesture of good will, to move the increased Tariffs on 250 Billion Dollars worth of goods (25% to 30%), from October 1st to October 15th,” Trump wrote Wednesday on Twitter. Negotiators are due to meet in Washington in coming weeks to push forward talks to end the trade war, which is causing increasing economic damage as it stretches into its second year. There’s little sign that substantive progress is being made on the two countries’ differences, while Trump still has further tariff increases lined up. Read more here (subscription required).
Why Buying a New Car is More Expensive Than Ever
The average cost of owning a new vehicle reached an all-time high this year as financing costs jumped, reports USA Today. AAA's annual cost-of-car-ownership study, released Thursday, found that a 24% increase in average financing costs on new cars contributed to a 4.9% overall increase in the expense of owning a new vehicle. Altogether, it costs the average American about $9,282 per year, or $773.50 per month, to own a new vehicle when factoring in fuel, maintenance, depreciation, insurance, and borrowing costs, according to AAA. That's up from $8,849 in 2018. The average buyer pays $920 in annual financing costs alone – namely, loan interest – which is up from $744 in 2018. That increase came in part from longer loan terms and higher vehicle prices. Read more here.
Nissan Management Withholds Full Ghosn Report from Board
Nissan Motor Co.’s management has yet to give Nissan’s board the complete version of a 170-page report detailing alleged wrongdoing by former Chairman Carlos Ghosn, drawing complaints from some directors, according to people familiar with the discussions. The Wall Street Journal reports that directors arrived at their scheduled board meeting on Monday afternoon expecting to get the full report, the result of an investigation dating to last year, and were surprised to receive a five-page summary instead, the people said. When directors asked why they didn’t receive the full report, they were told it was because the report had gained final internal approval only the day before and there had not been enough time to make copies. As of Wednesday, the directors still hadn’t received the full report, the people said. Some directors believe the five-page summary isn’t enough to understand the allegations against Mr. Ghosn, said one of the people familiar with the discussions. “How can we ensure this doesn’t happen again, if we don’t know everything that happened?” said this person. Read more here (subscription required).
States Hit Electric Vehicle Owners with High Fees, Consumer Reports Says
Electric vehicle owners in some states are paying higher annual fees for driving zero-emissions cars than their gas-guzzling friends, according to new analysis by Consumer Reports. CNBC reports that of the 26 states that impose fees on electric vehicles, 11 charge more for an EV than an owner of a traditional gas-powered car ends up paying in gasoline taxes every year. Three of those 11 states charge more than twice the amount. Trends for the fees, generally paid through annual registration renewals, don’t look promising either. Another 12 states are considering their own EV fee proposals — seven of which would double over time. Read more here.
Kerrigan Advisors Second Quarter Blue Sky Report®
The 2019 auto dealership buy/sell market stayed on course for yet another 200+ transaction year in the first half of 2019, with 103 completed transactions year-to-date, as reported in the just-released Second Quarter 2019 Blue Sky Report® by Kerrigan Advisors. Strong dealership earnings and lower interest rates continue to support an active buy/sell market. The Blue Sky Report® is the leading industry publication analyzing the auto retail buy/sell market and current franchise values. Read the preview here.
Around the Web
Behold, a Car So Ugly It Looks Like It's Already Been Wrecked [Jalopnik]
This Car Has So Many Screens There's Even One in the Steering Wheel [CNN]
What Happens When You Train Like an F1 Driver for a Month? [Autoblog]
Lamborghini Honors Savior with New Sian Hybrid Supercar [The Detroit Bureau]
