Chairman’s Blog: Invested in America
International Nameplates by the Numbers
Chairman John Connelly is back with another blog post. AIADA this week released its 2022 International Nameplate Economic Impact report in conjunction with Autos Drive America, our manufacturer counterpart in D.C. This annual report details, from every angle, the positive and expansive economic impact of our stores and brands in the United States. Even today, more than 40 years after Volkswagen opened their first manufacturing facility near Pittsburgh, our products are disingenuously defined by both the media and policy makers as “foreign.” This year’s report shows that nothing could be further from the truth. It also serves as a powerful refutation of legislation that differentiates between so-called foreign and domestic automobiles, effectively punishing American workers and consumers. Consider this. Last year, 543,000 Americans went to work at international nameplate auto dealerships. These stores, as you well know, provide stable jobs that endured through the highs and lows of 2021 and represent a $43.5 billion national payroll, encompassing more than half of all dealership employment in the U.S. Click here for the full blog post.
Biden Pledge to Tax Wealthy, Companies Revived with Manchin-Led Bill
President Joe Biden's campaign trail promise to increase taxes on corporations and the wealthy as part of a battle against glaring income inequality in the United States got an unexpected boost on Wednesday. Early proposals to increase tax rates from Biden and his fellow Democrats hit a brick wall in Congress after Republicans, and some Democrats, opposed them. But a sudden reversal by West Virginia Democratic Senator Joe Manchin, a swing vote in the divided Senate, has given Biden's tax agenda a new lease on life. Reuters reports the new compromise bill includes $430 billion in new spending on energy, electric vehicle tax credits and health insurance investments. Click here to learn more about the EV tax credits. It more than pays for itself by raising minimum taxes for big companies and enforcing existing tax laws, Manchin and Senate Majority Leader Chuck Schumer said in a statement. The bill would impose a 15 percent minimum tax on corporations with profits over $1 billion, raising $313 billion over a decade, they wrote. Companies could claim net operating losses and tax credits against the 15 percent. Click here for the full story.
Senate Approves $280 Billion Bill to Boost U.S. Science, Chip Production
The Senate on Wednesday approved a $280 billion bill to boost scientific research and the U.S. semiconductor industry, sending the legislation on to the House, where Speaker Nancy Pelosi has promised quick action. The CHIPS and Science Act of 2022 creates a $39 billion fund that would provide direct financial assistance for the construction and expansion of semiconductor manufacturing facilities, among other purposes, according to a summary from the Senate Commerce Committee. The bill was approved 64-33, with 17 Republicans joining Democrats to vote in favor. The Wall Street Journal reports companies that could tap the funding for U.S. expansions include Intel Corp., Taiwan Semiconductor Manufacturing Co., GlobalFoundries Inc., Micron Technology Inc., Applied Materials Inc. and more. A separate $11 billion program seeks to join with industry to advance semiconductor manufacturing research and workforce training, while another $2 billion fund aims to more quickly translate laboratory advances into military and other applications. Lawmakers added $24 billion in tax credits for investments in semiconductor manufacturing. Click here for the full story.
Toyota Increases Overseas Car Production as Output Slumps in Japan
Toyota is increasing overseas production to offset lower output at home in Japan. From January to June, the world’s largest automaker made more cars overseas than it ever has during that period. And it capped the run by notching record overseas sales and production results for the month of June, as the automaker gradually recovers from pandemic and supply-chain woes. Automotive News reports the latest tallies, released on Thursday, show that Toyota still struggles in the home market, where factories have been idled by a shortage of parts. But outside Japan, Toyota is cranking up its factories to recover lost ground. In the first six months of the year, overseas output climbed 5.6 percent to an all-time high of 3.35 million vehicles. Production in Japan, by contrast, shrank 18 percent to 1.73 million units. For the month of June, Toyota booked record overseas output of 637,240 units, and a best-ever sales total of 750,450 vehicles. The totals include the Daihatsu minicar and Hino truck units. Meanwhile, June production in Japan slid 27 percent, while home market sales fell 24 percent. Click here for the full story.
How Texas Dealer Ben Keating Is Competing for Market Share Amid Tight Supply Conditions
Automotive dealers are challenged now, more than ever, with very limited supply. And while it is limited across the board, that isn’t stopping dealers from seeing record-breaking profitability. Today on CBT News’ Inside Automotive, is Ben Keating, Owner and President of Keating Auto Group, to give us an update on his operation and get his perspective on how the EV market has changed. Like many others, Keating is experiencing record profits, but the business is not as fun as it used to be, he says. Part of the entrepreneurial spirit and competition for market share has been stripped away due to inventory shortages. However, Keating adds that his group has done a great job of adapting to the current market. There is something fun about competing for market share, creating advertising, and customer relationships. In the last two years, Keating Auto Group has purchased 11 stores, for a total of 28 dealerships. He says there have been some growing pains trying to manage this influx of stores. In most cases, Keating has been able to keep almost all of the employees from these dealerships, under the guidance of Keating managers. Click here for the full story.
Did You Know…? Top 5 Interesting Facts About How ACV Can Help Dealerships
Our industry is constantly changing, challenging dealerships to evolve their people and processes to match market demand. These trends might seem daunting at first. But in reality, they pose opportunities for you to streamline operations, right size inventory, and improve the overall customer experience. Because of this, you need to focus on selling vehicles more, faster, and for a higher gross profit. This isn’t news. But accomplishing it is.
ACV helps shed light on even the darkest of corners. No fad or unexpected turn is immune to the powerful data ACV employs to make influential decisions for the automotive retail sector. You probably already have a playbook for success. But chances are that there are some fresh ideas that can add which will make the difference between surviving and thriving. Check out 5 facts about how ACV can help you drive success at your dealership.
Around the Web
2023 Genesis G90 Reservations Open Through Priority One [Autoblog]
Delivery-Mileage McLaren P1 Could Set a New Record At Auction [Carscoops]
Hyundai Hits Home Run with Most-Seen Car Commercial [Wards]
Porsche Entering F1 After Reportedly Buying 50% of Red Bull Team [Carbuzz]
