International Nameplate Dealers: Stop Playing Politics with Car Sales
The House Ways & Means Committee will consider a proposal tomorrow that would provide for a total of $12,500 in tax credits for EVs, including a $4,500 tax credit only for EVs made in union factories. Cody Lusk, President & CEO of the American International Automobile Dealers Association (AIADA), released the following statement on Sunday in response to the move by Democrats on the House Ways and Means Committee:
“The House Democrats’ complete disregard for the 673,000 Americans employed by international nameplate dealerships and manufacturers is more than insulting. It’s a slap in the face for all American workers who don’t align with the Democratic worldview that every workplace should be unionized and that American tax dollars should contribute to that goal. International nameplate dealers and manufacturers will continue to refine EV technology and promote its acceptance in the United States. In the meantime, we only ask that the House Ways and Means committee stop playing politics with car sales.” Read AIADA’s full statement here.
Dealers and their employees should contact their Members of Congress TODAY and urge them to oppose this discriminatory proposal that will divide American workers. Click here to learn more and to contact your Member of Congress.
Toyota, Honda Oppose U.S. House Electric Vehicle Tax Plan
Toyota Motor Corp and Honda Motor Co on Saturday sharply criticized a proposal by Democrats in the U.S. House of Representatives to give union-made electric vehicles in the United States an additional $4,500 tax incentive, reports Reuters. Toyota said in a statement that the plan unveiled late Friday discriminates "against American autoworkers based on their choice not to unionize." The bill, set to be voted on Tuesday by the Democratic-led House Ways and Means Committee as part of a proposed $3.5 trillion spending bill, would benefit Detroit's Big Three automakers, which have union-represented auto plants. In a statement, Honda called the bill "unfair" and said it "discriminates among EVs made by hard-working American auto workers based simply on whether they belong to a union...The Honda production associates in Alabama, Indiana, and Ohio who will build our EVs deserve fair and equal treatment by Congress." Read more here (Source: Reuters).
Tight Inventories Weigh on Dealers, But Outlook Remains Upbeat
Franchised dealers generally remain optimistic about the U.S. auto market in the third quarter, even as their outlook on new-vehicle inventory hovered at its lowest-ever levels on Cox Automotive's quarterly Dealer Sentiment Index survey. Automotive News reports that dealer optimism cooled slightly in Cox's third-quarter poll, fielded in July and August, after reaching record highs in the previous quarter. But the outlook about the market is rosier than in the third quarter of 2020, when the economy started to rebound from the coronavirus pandemic and associated shutdowns of dealership showrooms and vehicle assembly plants. Dealers' outlook for the next three months is strong and an improvement from their forward-looking view recorded in the year-ago quarter. The positive perspective was buoyed by record-setting views on dealership profitability in the third quarter. Yet inventory constraints stemming from the dual crises of the pandemic and a global microchip shortage are weighing on dealers' minds. Read more here (Source: Automotive News).
Chip Shortage Drives Tech Companies and Carmakers Closer
Cooperation between semiconductor companies and the automotive industry is moving into the fast lane, driven by a chip shortage and a recognition that cars are becoming ever-more digital, reports The Wall Street Journal. More than a year into the crisis, executives from car and chip makers are establishing closer ties to address the shortage and working together to introduce new products. The shift was on display as executives from such chip companies as Intel Corp., Qualcomm Inc., and Nvidia Corp. flocked to Munich last week for an annual auto show. The chip crisis highlighted to car makers how dependent they have become on semiconductors, but Intel Chief Executive Officer Pat Gelsinger told car industry officials at the event Tuesday that the appetite of the auto industry for processors is making it a more critical customer segment for semiconductor companies. “We need you, and you need us,” he said at the event. “This is a symbiotic future that we are off innovating and supplying as the automobile becomes a computer with tires.” Read more here (Source: The Wall Street Journal).
Everything Must Go! The American Car Dealership is for Sale
The way people buy and sell cars is changing, reports The Wall Street Journal. More of it is happening online as buyers get comfortable with completing transactions remotely. It is a shift that started before the pandemic but accelerated over the last 18 months as Covid-19 spurred people to do more of their shopping from home and demand for cars unexpectedly surged. The auto dealership, as a result, could soon look like other parts of the business world upended by e-commerce. National chains, instead of local small businesses, will set prices and give salespeople less room to haggle. Some larger dealership chains flush with cash are already scooping up smaller rivals, hoping that scale will help them dominate this transformation. The number of acquisitions last year hit 289, according to dealership consulting firm Kerrigan Advisors, which was the highest count in years. Deals continued to climb this year, according to Kerrigan, up 27% in the first half of 2021. Read more here (Source: The Wall Street Journal).
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