GM and Honda Establish Strategic Alliance in North America

First Up 09/04/20

#DealersDoGood Friday

AIADA is highlighting the ways dealers are making a difference and helping their communities in 2020. We are proud to represent an industry that is setting the standard for how to support our communities, customers, and employees in the midst of challenging times. 

If you know of a dealership is doing something great, we want to hear about it. Click here to let us know, or join us on Twitter by tagging @AIADA_News and using the #DealersDoGood hashtag.

  • Dan and Lisa Mattoon, owners of Prestige Auto in Eau Claire, Wisconsin, recently presented $16,300.00 to local organizations that support veterans. Prestige Auto donated $100.00 for every vehicle sold in the month of July. Over the past seven years, Prestige has donated over $107,000.00 to Chippewa Valley Veteran Organizations. Click here to see a picture. 

  • Southern California Volvo retailers have combined forces to buy nearly $50,000 worth of baby formula for children and families impacted by the COVID-19 pandemic and wildfires burning across the state. The 13 retailers that comprise the Southern California Volvo Dealer Association (SCVDA) set aside a portion of summer sales revenue for Baby2Baby (www.baby2baby.org), which provides diapers, clothing and other basic necessities to children up to 12 years old living in poverty. Read more here (Source: Tyler Morning Telegraph). 

  • Chatham Motor Sales/Pittman Enterprises in Savannah, Georgia, has donated $32,500 to Savannah-Chatham County Public Schools to help provide electronic devices for students during virtual learning. The donation was presented at Chatham Parkway Toyota. Read more here (Source: Savannah Morning News). 

  • Cavender Auto Group in San Antonio, Texas, has coordinated “Lots of love” to repurpose vacant lots into food distribution sites for families in need. The program gives community members an opportunity to come together & help out their neighbors who are struggling in these difficult times. Read more here (Source: Texas Auto Dealers).

GM and Honda Establish Strategic Alliance in North America

General Motors and Honda Motor have signed a nonbinding memorandum of understanding toward establishing a North American automotive alliance that includes collaborating on future vehicles and sharing purchasing costs, reports CNBC. The companies said they’ll immediately start planning for the new vehicles with engineering work expected to begin in early 2021. The alliance, according to the companies, will include a “range of vehicles to be sold under each company’s distinct brands, as well as cooperation in purchasing, research and development, and connected services.” The combined efficiencies of the companies are expected to free up cash for both companies to invest in advanced and next-generation autonomous and electric vehicle technologies. “Through this new alliance with GM, we can achieve substantial cost efficiencies in North America that will enable us to invest in future mobility technology, while maintaining our own distinct and competitive product offerings,” Seiji Kuraishi, Honda executive vice president, said in a statement. Read more here (Source: CNBC).  

U.S. Trade Deficit Widest Since 2008 in July as Imports Outpaced Exports

The U.S. trade deficit widened in July as Americans’ appetite for foreign-made goods bounced back while exports rose more modestly, reports The Wall Street Journal. The foreign-trade gap in goods and services expanded 19% from the prior month to a seasonally adjusted $63.56 billion in July, the Commerce Department said Thursday. That was the largest monthly trade deficit since July 2008, during the 2007-2009 recession. The growth of the deficit reflected a pickup in U.S. demand for foreign-made goods and services as states eased restrictions on business activities across the country. Imports grew 11% in July to $231.67 billion as Americans bought more foreign-made vehicles, industrial supplies, capital goods and consumer products like cellphones and furniture. That pushed the monthly goods deficit to its widest level on record. While the U.S. usually runs a deficit in goods, it runs a surplus in services. That surplus, in services such as tourism, medical care and higher education, shrank in July to its lowest level since August 2012 as many foreign visitors stayed home due to the coronavirus pandemic and international border closures. Read more here (Source: The Wall Street Journal). 

Consumers Concerned About COVID-19 Impact on Credit

Consumers impacted by the coronavirus have a lot to worry about — paying bills, possibly finding a new job and, of course, staying healthy. But chief among those concerns for many is the potential long-term impacts that pandemic conditions may be having on their credit — and whether the process of determining that score is fair. Automotive News reports that a recent study by Finicity, a personal finance and software company headquartered in Salt Lake City, shows many consumers are questioning the credibility of the credit scoring process as a whole. In a survey conducted in June of nearly 2,000 consumers, 82 percent of respondents said the current credit review process should make it easier for responsible borrowers to demonstrate creditworthiness. A separate, recent study by the Consumer Financial Protection Bureau found consumers have not experienced significant increases in delinquency or other negative credit outcomes as reported in credit record data following the COVID-19 pandemic. Read more here (Source: Automotive News). 

5 Reasons Why COVID-19 Pandemic Gives the Edge to Cars, SUVs, Pickups

Not long ago, in the pre-pandemic age, carmakers braced for the possibility that Americans would eventually stop buying vehicles, choosing instead to rely upon ride-hailing, especially once self-driving car technology becomes widely available. But, reports USA Today, COVID-19 has upended those expectations, swinging the pendulum back in the direction of personal car ownership as Americans say they’re increasingly likely to drive themselves instead of riding in someone else’s car or taking mass transit. Of Americans currently shopping for vehicles, more than 1 in 5, or 22%, had not planned to buy one before the pandemic began, according to a recent survey by car-buying site CarGurus. The bottom line: While analysts say it’s difficult to know exactly how transportation will change after the coronavirus, the death of personal car ownership has been greatly exaggerated. Click here to read about five trends boosting cars (Source: USA Today).

Webinar: An Update on COVID-19's Impact on U.S. Auto Sales

Cox Automotive Senior Economist Charlie Chesbrough returns to AutoTalk for an update on Thursday, September 10 at 2:00 p.m. EDT.

Topics to be reviewed include: 

  • Economic forecast and impact going into the fourth quarter 

  • Consumer sentiment and buying behaviors 

  • Stock market, interest rates, and employment 

  • An outlook for vehicle sales 

  • Current view of new and used retail sales and prices

Click here to register. 

Around the Web

The 10 Best Cars for a Roadtrip [TopGear]

What's the Best New-Car Deal for Labor Day 2020? [Cars.com]

Hyundai, Kia Recall 640K Vehicles for Leaks That Can Cause Fires [Autoblog]

Design Chief 'Lost Sleep' Over Wood-Grain Panels on New Jeep Wagoneer [The Detroit News]

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