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Sent to over 30,000 recipients every weekday morning, FirstUp conveys the day's auto-related news quickly, concisely, and accurately. Topics covered in FirstUp range from new vehicle releases, to the latest legislation concerning the auto industry. This is news designed with you in mind.
March 10, 2014
Throughput Dips at VW, Infiniti
Volkswagen and Infiniti, in aggressive quests to gain sales and market share, added franchises last year, each raising the franchise count by 4 percent. But their U.S. sales fell, so average sales per franchise, or throughput, fell, reports Automotive News. The VW brand's sales slid 7 percent, and sales per franchise dropped 10 percent. Infiniti's sales dipped 3 percent, slicing its throughput by 5 percent. Overall U.S. new-vehicle sales rose 8 percent in 2013, while the number of new-vehicle franchises was up by less than 1 percent. Last year some brands added a few franchises and others let attrition take its course, but changes in the number of franchises generally were modest. The overall number of new-vehicle dealerships and franchises was flat, according to the exclusive annual dealership census compiled by the Automotive News Data Center. As of Jan. 1, the number of new light-vehicle dealerships in the United States increased 0.6 percent from a year earlier to 17,875. The number of franchises edged up 0.3 percent to 31,464. Nissan trimmed its franchise count 1 percent to 1,061 last year, and sales climbed 11 percent. For more on dealership throughput in 2013, click here.
Senator, Safety Advocates Press NHTSA in Wake of GM Recall
The Detroit News reports that a Massachusetts senator urged the National Highway Traffic Safety Administration (NHTSA) to improve disclosure of safety-related defects, while two safety advocates urged the Transportation Department to review the agency’s handling of reports of ignition switch problems in older Chevrolet Cobalt and other General Motors Co. vehicles. “More details about auto defects could prevent more deaths on the nation’s roads,” said Sen. Ed Markey (D-Mass.). “Americans need NHTSA’s Early Warning Reporting system to actually provide early warnings, instead of just a rearview mirror look into what has already gone wrong. If NHTSA won’t take action to greatly increase public disclosure of information related to potential safety defects, I will introduce legislation ensuring that it does so.” Markey cited a letter from Center for Auto Safety director Clarence Ditlow to NHTSA Administrator David Friedman on Friday questioning NHTSA’s investigation of deaths in 2005 and 2006 linked to faulty ignition switches in 2005 Cobalt cars. Ditlow wants the Transportation Department inspector general to investigate. A former NHTSA administrator, Joan Claybrook, made a separate request Friday to the inspector general for an investigation. Click here for the latest on an investigation into GM’s ignition switch problem.
Newspaper Consortium Seeks to Sell Cars.com for $3 Billion
According to The Wall Street Journal, a group of newspaper publishers has put the cars.com online marketplace up for sale for as much as $3 billion, hoping to cash in on booming values for e-commerce sites, people familiar with the plans said. Moelis & Co., which is advising the Classified Ventures publishers’ consortium on the sale, already has begun discussions with potential bidders, which are expected to include private-equity firms and strategic investors, the people said. It is also possible that one of the publishers could raise its stake or buy out the others. Started in 1997, Classified Ventures was aimed at giving its newspaper-publisher owners a toehold in what was then a nascent market for online auto and rental classifieds. Cars.com attracts around 11 million car shoppers a month, according to its website, while AutoTrader says it reaches 14 million car buyers monthly. Cars.com generates around $400 million to $500 million in revenue a year, according to a person familiar with the site. But a new owner potentially could tap roughly an additional $200 million annually. For more on the potential sale of Cars.com, click here.
Whither Compact Cars?
Is America’s love affair with the C-car over? It certainly seems things are trending in that direction, reports WardsAuto. The 6.0 percent decline in WardsAuto’s Upper Small segment in February marked the sixth straight month of losses for the U.S. group. While some compacts have been able to buck a downward trend – Hyundai’s Elantra has been up five of the past six months—most nameplates are off a little or a lot. The Subaru Impreza, Volkswagen Jetta, Dodge Dart, Mazda3, and Ford Focus struggled in the September through February period. Declines ranged from about 3.0 percent for the Impreza and Jetta to double-digit percentage plunges for the Dart and Focus. FiatChrysler announced March 3 it is temporarily laying off 325 workers at the Dart’s Belvidere, Ill, assembly plant the first week of March due to bulging inventory. Toyota’s Corolla, the No.2 best-selling compact in the U.S., also has seen reduced demand. But even sales of the Civic haven’t been immune, falling four of the past six months, from a minor dip of 0.3 percent in January to a deficit of 15.9 percent in November. For more on falling demand for compact cars, click here.
Leasing Tracks Toward Middle
In a recent post to the AutoEconomy trends section of Edmunds.com, Lacey Plache — the site’s chief economist — dispels some of the commonly held notions about leasing, and in doing so, illustrates how it has gone mainstream. And, reports Auto Remarketing, it’s likely to become even more popular in 2014, which could lead to an ironic twist, Plache points out. “While current leasing popularity is expected to continue in the coming months, its very success could later prove to be its undoing. Growing lease returns are combining with more trade-ins from higher new-car sales to rebuild used-car inventories,” she said in the post, titled “AutoEconomy Trends: Leasing Goes Mainstream.” Aside from what the future may hold, data from Edmunds and others suggests there have been changes in the leasing market, some that have moved people towards the segment. And as it stands, leasing has never been more popular. Plache indicates that the 23 percent of new-vehicle sales that leases represented last year was an all-time high. Experian’s State of the Automotive Finance Market report indicated that 28.4 percent of all new vehicles financed were leases in Q4 2013, up from 24.8 percent the previous year. For more on the lease market, click here.
It Starts Here: Join AIADA at Its Spring Auto Summit in Washington, D.C.
AIADA's 8th Annual International Auto Industry Summit is an opportunity for dealers to learn about the policy and legislative issues that are shaping the industry this year. Join dealers and industry leaders May 7-8 at the Hyatt Regency Washington Capitol Hill in Washington, D.C., to better understand how to be an effective advocate for the international nameplate auto industry. This year's speakers include Cook Political Report Editor Charlie Cook, Former White House Budget Director Jim Nussle, and Jonah Berger, who is the best-selling author of Contagious: Why Things Catch On. AIADA will also host a special reception and briefing for members of AIADA's Rising Dealers Network featuring Brad Fitch, CEO of the Congressional Management Foundation. Don't miss your chance to attend AIADA's Summit. Register today online by clicking here, or call 1-800-GO-AIADA.
Around the Web
Small, Obscure, Green Cars at the 2014 Geneva Motor Show [Green Car Reports]
Bugatti to Reveal Final Legend Editions in Beijing, Pebble Beach in August [Autoblog]
Nissan Mirror is Also a Monitor for Rear View Camera [NY Times]
Americans Riding Public Transit in Record Numbers [Detroit Free Press]