Cody Lusk and Chairman Howard Hakes Talk Tariffs, Trends, and the Future of the Auto Retail Industry
AIADA President Cody Lusk and Chairman Howard Hakes recently joined CBT News to discuss tariffs and industry trends. Hakes describes the threat of new tariffs as concerning. “It’s one of the things that when you think about it, you look at if something goes into effect like that as you’re trying to sell cars. It comes into employees. Do I have to layoff employees? Do I have to not take as many cars? The downturn in the business that this would do. I’ve always gone by as the automobile business goes, goes the economy. That’s being such a huge part of it. So it is a real crucial time for all of us to really get together and make sure that we’re on the same page.” Both Lusk and Hakes urged dealers to attend AIADA’s Fly-In next month in Washington, D.C., to make sure legislators hear directly from them about the negative impact new tariffs would have on their businesses. Watch the entire interview with CBT News here.
Trump Eyes Auto Tariffs in EU Standoff
President Donald Trump placed more pressure on the stalled trade talks with the European Union Wednesday, threatening tariffs on European automobiles if no deal is reached, reports CNN. "The European Union has been very tough on the United States for many years," Trump told reporters on Wednesday, saying the auto tariffs were under review. "We're looking at something to combat it.” Trump received a report from the Commerce Department last month with the findings of an investigation into whether imports of automobiles and auto parts could qualify for tariffs as a national security threat under an obscure Cold-War era statute. The report and its recommendations have not been made public; Trump has until the middle of May to choose a course of action. On Wednesday, Trump said his decision would hinge on how talks with the EU proceed. Read more here.
Trump Blasts GM, UAW Over Lordstown Plant During Ohio Visit
President Donald Trump again chastised General Motors Co. on Wednesday at an appearance in Ohio, demanding the Detroit automaker keep open its Lordstown Assembly Plant in the northeast corner of the state, reports The Detroit News. Trump continued his pressure on GM and the United Auto Workers, again demanding the parties speed up negotiations to determine the future of GM's only assembly plant in the electorally important Midwestern swing state of Ohio that helped deliver Trump the presidency. GM's Lordstown Assembly, nearly 200 miles from Lima in northeast Ohio, is leading off the months-long process of the Detroit automaker's U.S. production stops. "Get that plant open," Trump demanded, asking GM to either begin building in Lordstown again or find a company that will. The president later turned his criticism to the UAW during his visit to UAW-represented Joint Systems Manufacturing Center, an Army tank plant in Lima that's been a prominent presidential campaign stop dating back to the Dwight Eisenhower campaign in 1952. Read more here.
Rising New-Vehicle Prices, Interest Rates Mean More Used-Vehicle Sales in 2019
Rising interest rates and vehicle prices are pushing car and truck buyers away from new vehicles and into used, Edmunds said Wednesday. Automotive News reports that the price gap between new and 3-year-old used vehicles was 62 percent in 2018 and represented an average of $14,000, according to Edmunds. That compares with a gap of 56 percent that averaged about $11,000 in 2013. Meanwhile, new-vehicle interest rates grew 17 percent in 2018, while rates for used vehicles rose just 9 percent. With a record level of lease returns expected this year, used-vehicle sales will likely hit their highest level since the recession, Edmunds said. Used-vehicle sales are forecast to hit 41 million in 2019, up from 40.2 million in 2018. New-vehicle sales are widely projected to dip below 17 million this year, after reaching 17.3 million in 2018. Read more here.
Some Popular Pickup Trucks Get Poor Marks in Latest Crash Tests
New crash tests show pickups with some of the oldest designs could struggle to protect passengers riding in the front seat, reports CNBC. The Insurance Institute for Highway Safety (IIHS) tested eleven mid-size and full-size pickups and found mixed results. "In general, the pickup truck class of vehicles is not doing as good a job protecting right front passengers as other classes of vehicles," said David Zuby, IIHS chief research officer. Among the the full-size pickups, the Ford F-150, the Ram 1500 and Nissan's Titan received the best possible rating of "good" — one grade above the Honda Ridgeline which was rated "acceptable." By comparison, the IIHS says the Chevy Silverado 1500 and GMC Sierra provided "marginal" protection for passengers in the front seat when the right front corner of their truck slams into another vehicle or an object at 40 miles per hour. Read more here.
Dealers Receive Record Distribution Amount for Participation Programs for 2018
CNA National returned nearly $49 million to automobile dealers across the U.S. through its various participation programs for 2018, bringing its inception-to-date total to over half a billion dollars. “2018 was a banner year for our plans, with the highest annual return since their establishment,” said Joe Becker, president and CEO. “With more than $500 million distributed to our dealers over the years, these industry-leading retro and reinsurance options continue to offer an effective way to generate income.” Dealers can choose the structure that best meets their business and individual financial goals. CNA National reinsures vehicle service contracts, warranties, GAP and tire-and-wheel protection. The company has earned multiple awards as “Best Reinsurance Provider” in the Dealers’ Choice Awards, including first-place honors in 2011, 2012, 2013 and 2017. To learn how CNA National can help you maximize your income potential and long-term success, call (800) 345-0191 x450.
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More Women Cracking the Auto Industry's Glass Ceiling [Forbes]
