With a Lot of Optimism and Vaccine Hopes, U.S. Auto Sales Could Increase as Much as 10% in 2021

First Up 01/15/21

Dealers Do Good

AIADA continues to highlight dealers and their impact in their local communities. Throughout recent months, dealers have spared no opportunity to reach out and help those who needed it. We’re highlighting a few in this week’s FirstUp. If you know of a dealer who is doing great things, let us know here or tag us on Twitter with the #DealersDoGood hashtag and tag @AIADA_News.

Hawkinson Nissan/Kia in Matteson, Ilinois, presented a vehicle in December to a local mom who is working two jobs. The vehicle, part of the dealership and its commitment to “Friends Helping Friends,” was presented on Christmas Eve by dealership General Manager Greg Freeman, and filled with gifts for her two boys. Click here to watch the video about her story and the vehicle presentation. 

Brewer Airport Toyota in Moon Township, Pennsylvania, supported the Pittsburgh Community Foodbank over the holidays, providing $18,000 to help it feed local families in need. Last May, the dealership donated $100 to the food bank for every vehicle it sold, generating a $18,600 donation. To-date, Brewer Airport Toyota has provided 183,300 meals. Read more here. 

Community Toyota, Honda, Kia, in Baytown, Texas, fully funded and coordinated a Food Distribution for over 1,250 families in need in the local community over the holidays. Each family received enough food for a family of four for a week, including Christmas dinner. The distribution was assisted by community partners Faith Family Church, Kroger, HEB, Wismer Distributing, the Kiwanis Club of Baytown, and volunteers from across the community. Click here for a photo. 

CFPB Task Force Weighs in on Auto Lending Discrimination, Adverse Action Notices

Dealership responsibility to produce adverse action notices to consumers rejected for automotive financing and enhanced anti-discrimination protections were among approximately 100 recommendations an external task force made last week to the Consumer Financial Protection Bureau, reports Automotive News. The CFPB charged the task force with identifying issues in existing consumer financial protection regulations and issuing guidance on how the agency can best educate consumers on credit markets and products. In its 798-page report, the four-member task force isolated key elements that consumer protection policy should focus on: the "consequences for inclusion and access" by underserved communities; avoiding harms to consumers in lieu of specifying how credit providers design and market their products; and modernizing the regulatory framework to adapt to shifting technology and consumer preference trends. Read more here (Source: Automotive News). 

Kia Reshapes Brand, Teases 7 New BEVs, and New Line of What it Calls PBVs

Kia plans to roll out seven all-new battery-electric vehicles by 2027, along with four other plug-based models, the Korean carmaker’s CEO announced Friday morning from the company’s headquarters in Seoul, while also launching a new line of products dubbed Purpose-Built Vehicles, or PBVs. According to The Detroit Bureau, they’re all part of a broader brand transformation Chief Executive Ho-Sung Song and other senior executives detailed during an online webinar and subsequent media roundtable. The company – which has dropped the word, “Motors” from its name, first teased its plans for a new direction when, last week, it revealed a new version of the Kia logo. “Our great transformation begins right now, today,” proclaimed Song, emphasizing that Kia wants to be seen as a “mobility company,” not just an automotive manufacturer, going forward. As part of the big brand transformation, said CEO Ho-Sung Song, the company will now be called just Kia Corp. Read more here (Source: The Detroit Bureau). 

With a Lot of Optimism and Vaccine Hopes, U.S. Auto Sales Could Increase as Much as 10% in 2021

U.S. automakers are suffering from the deepest sales decline in decades, the country is still politically divided, and it’s in the middle of a pandemic. But if officials can quickly roll out a Covid-19 vaccine and stabilize the nation, automotive executives and analysts have reason to hope U.S. vehicle sales will return to some form of normalcy in 2021, reports CNBC. “I am as optimistic as one could be because I think the core environment is there, but, of course, what is weighing on everything is how quickly can we get the shots rolled out and things stabilized,” Volkswagen Group of America CEO Scott Keogh told reporters during a recent media call. Industry executives and analysts predict strong consumer demand will continue this year and expect a return of commercial fleet sales as local officials distribute the Covid-19 vaccine. Early forecasts for new vehicle sales this year range from about 15.6 million to 16 million vehicles, which would be an increase of between 7.6% and 10.3% compared with 2020. Last year’s sales were down 14.8% to 14.5 million vehicles, according to Cox Automotive. Read more here (Source: CNBC). 

Trump's China Tech War Backfires on Automakers as Chips Run Short

Automakers around the world are shutting assembly lines because of a global shortage of semiconductors that in some cases has been exacerbated by the Trump administration’s actions against key Chinese chip factories, industry officials said. Reuters reports that the problems stem from a confluence of factors as auto manufacturers compete against the sprawling consumer electronics industry for chip supplies. Consumers have stocked up on laptops, gaming consoles and other electronic products during the pandemic, creating tight chip supplies throughout 2020. They have also bought more cars than industry officials expected last spring, further straining supplies. In at least one case, the shortage ties back to President Donald Trump’s policies aimed at curtailing technology transfers to China. One automaker moved chip production from China’s Semiconductor Manufacturing International, or SMIC, which was hit with U.S. government restrictions in December, to Taiwan Semiconductor Manufacturing Co in Taiwan, which in turn was overbooked, a person familiar with the matter told Reuters. An auto supplier confirmed TSMC has been unable to keep up with demand. Read more here (Source: Reuters).

Carfax Warns Dealers: Watch Out for Odometer Rollbacks

There is a big misconception that odometer fraud disappeared with digital odometers, but that’s not so: CARFAX data suggests that more than 1.8 million vehicles on the road today have had their odometer rolled back, a 13% annual increase over 2019. Several heavily populated states saw double-digit increases in cases of possible rolled-back odometers, with Texas leading with a 31% rise. Identifying vehicles with potential odometer rollbacks can obviously make an important difference in your business, and that’s a simple job for CARFAX Advantage® dealers. Advantage dealers can quickly check for potential rollbacks by running a CARFAX Vehicle History Report. Of course, the Reports provide a lot more information than that, and CARFAX Advantage dealers can run as many as they need. The benefits for your customers start with extra information they want to know when shopping for a pre-owned car. You can get the CARFAX Advantage for your dealership by calling (833-807-8899) or visiting the CARFAX for Dealers website.

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Podcast: A Car Dealer's Inside From From Capitol Hill [Automotive News