Automotive News - November 3, 2008 - (Page 8)

8 • NOVEMBER 3, 2008 advertising Bidders bet they can rebuild Heard 4 dealers aim to rescue stores after empire collapses April Wortham and Chrissie Thompson awortham@crain.com The bidders Established dealers are the lead bidders for the stores in Bill Heard Enterprises’ former empire. Here are the bidders so far. Carl Black, 58. Bid for store in Kennesaw, Ga. Owns 5 new-car and 2 used-car stores in Georgia, Tennessee and Florida. Dealer since 1993. Tom Durant, 58. Bid for store in Plant City, Fla. Owns 6 Texas stores. Dealer since 1972. Mac Haik, 62. Bid for 1 of 2 stores in Houston. Owns 5 Texas new-car stores. Dealer since 1980. Joe Serra, 48. Bid for 1 of 2 stores in Las Vegas. Owns 23 stores in Michigan, Colorado, New Jersey, Tennessee, Ohio and California. Dealer since 1999. ago but was outbid by Heard Enterprises President William Heard Jr. offer for the Henderson store, saying he had been presented with information that made that location “less desirable.” Serra declined to elaborate. But his change of heart is indicative of the challenges facing the new owners of Heard’s dealerships, several of which have a long history of consumer complaints on file with watchdog groups and government agencies. Tom Durant, owner of six Texas stores selling Detroit brands, is well aware of that history. On Monday, Oct. 27, Durant entered a bid for Heard Enterprises’ Chevy dealership A second-generation Michigan dealer with Detroit blood in his veins. A retired NFL player who turned a bad car-buying experience into a career. A Texas megadealer who built a Chevrolet empire with a laid-back approach. The prospective buyers of Bill Heard Enterprises Inc.’s bankrupt dealerships are a diverse group of dealers with a shared belief: They have what it takes to turn the struggling stores around. “The past is the past. The future is what we’re going to make of it. It’s a new team,” says Joe Serra, president of Serra Automotive Inc., a 23-store group based in Grand Blanc, Mich. Serra is the sole bidder so far for Heard Enterprises’ Chevrolet dealership in north Las Vegas. The past president of the Detroit Auto Dealers Association said he tried to buy the store from a previous owner several years Second chance Now that Heard Enterprises has filed for Chapter 11 reorganization and put its 14 dealerships on the market, the son of late Michigan dealer Al Serra has a second chance. On Oct. 24, Joe Serra submitted agreements to U.S. Bankruptcy Court in Alabama to buy both of Heard Enterprises’ Las Vegas-area stores: Vista Chevrolet and Bill Heard Chevrolet in nearby Henderson, Nev. Five days later, Serra withdrew his in Plant City, Fla., near Tampa. Last year, the Plant City dealership and another Heard dealership near Orlando agreed to pay the Florida Attorney General’s Office $400,000 in fines resulting from a yearlong investigation into the stores’ misleading advertising practices. Durant, 58, a Chevy dealer since 1972, said he hopes to rebuild the store’s reputation with the same slogan he used to expand his six stores in Texas: “Relax, and enjoy the difference.” His 50-acre flagship store in Grapevine, Texas, sold more Chevrolets in 2006 and 2007 than any other store in the country. The feat is reminiscent of “Mr. Big Volume,” Bill Heard, himself. ‘A better way’ “His ideal is pretty much the same as mine. It’s just that I’ve got a better way of hanging onto my customers,” Durant said. “You’ve just got to start over, one customer at a time, and you’ve got to rebuild it.” Durant’s operating partner for the see HEARD, Page 37 1 size fits all Catalog offers Infiniti ragtop before L.A. show NASHVILLE — A long-awaited Infiniti convertible will go public at the Los Angeles auto show on Nov. 19. But Bloomingdale’s customers will get the opportunity to buy it before then. A limited-edition Infiniti G convertible — featuring a red interior, 19inch wheels and a special front grille — will be sold through BloomingOn Thursday, Bloomingdale’s holiday catalog will offer one of the Premier Edition Infiniti G convertibles, priced at the stocking-stuffer sticker of about $60,000. dale’s annual holiday mail-order catalog on Thursday, Nov. 6. Catalog customers will have the chance to buy one of 200 of the new Premier Edition convertibles. A phone number in the catalog will connect shoppers to an Infiniti dealer who will arrange delivery. Bloomingdale’s buyers will have to wait until spring, along with all other convertible customers, to take delivery. Both the Premier Edition and the regular convertible are expected to retail for about $60,000. — Lindsay Chappell NADA: Give us tax incentives, dealer loan guarantees Harry Stoffer hstoffer@crain.com tle or no income tax. Such consumers now tend to buy used vehicles. Dealer wish list Among NADA’s proposals for helping dealerships and boosting the economy. The feds should Provide refundable tax credits to vehicle buyers Restore the tax deduction for interest on auto loans Expand business tax breaks for vehicle purchases Fund state programs to buy clunkers Guarantee loans for dealership operating capital cle for more aid to the industry. WASHINGTON — The National Automobile Dealers Association wants an economic stimulus bill to boost showroom traffic and vehicle sales. Dealers also need loan guarantees to keep their doors open, NADA says. Among the incentives the dealer group suggests are refundable tax credits for car and truck buyers and restored tax deductibility for auto loans. “Now it is time to give families an extra financial incentive to buy a new car or truck and to provide dealers the access to capital they need to keep their small businesses open and their work forces employed,” NADA Chairman Annette Sykora said in a letter to the White House last week. NADA warns that as many as 700 dealerships will close this year, out of a total of about 20,000. Providing refundable tax credits for vehicle purchases would make them available to low- and moderate-income Americans even if they pay lit- ‘Broad efforts’ David Regan, NADA’s vice president for legislative affairs, told Automotive News the group’s focus is on new cars and trucks, but it does not seek to exclude used-vehicle buyers. NADA believes “broad efforts” are needed to stimulate sales, he added. Regan declined to specify the size of tax credits NADA seeks, but said it “has to be a sufficient number to get the buying public’s attention.” NADA also proposed federal aid to state programs that take air-polluting clunkers off the roads, and giving businesses more tax breaks for vehicle purchases. Congressional Democratic leaders say they want to consider a stimulus bill by year end. Some economists told lawmakers last week that up to $300 billion in new government spending is needed to combat a recession. UAW legislative director Alan Reuther has said the stimulus bill could be a vehi- Seeking a piece of the pie Automakers and suppliers are lining up for $25 billion in low-interest federal loans, approved in September to help with retooling for more fuelefficient vehicles. But industry leaders warn the money may come too late and with too many restrictions. Automakers, auto lenders and oth- ers in the industry continue to seek shares of the $700 billion in federal aid to the nation’s financial system enacted last month, and for help under the Federal Reserve’s broad powers to lend money. Sykora, a multifranchise Texas dealer, said in her letter that the government’s “rescue plan has begun to show its promise by freeing up credit for corporations, and banks to start lending again.” But NADA says more must be done to help consumers and dealers. NADA’s plan includes a request for Small Business Administration loan guarantees to help dealers get operating capital. NADA President Phil Brady, a former White House staffer, and Andrew Koblenz, NADA’s vice president and general counsel, delivered the letter to the White House. David Hyatt, NADA’s vice president for public affairs, said the association’s legislative staff will pitch the plan to Congress. Hyatt said franchised dealers face a “crisis situation.”c http://www.zadv.com http://www.zadv.com

Table of Contents Feed for the Digital Edition of Automotive News - November 3, 2008

Credit? Come and get it, industry groups say GM's product delays signal dire health Ford sticks with small-car plans Mitsubishi CEO: Let's halt Galant production in U.S. A dealer â and his reputation â on the ballot Help vehicles shed pounds American Axle posts loss UAW hires bailout adviser Ford to spend $200 million to upgrade 2 Ky. plants No off-lease cars? Certified will find others Arlena Sawyers China's stock market plunge has spooked car shoppers Advantage, Ford: Mulally likes owning Ford Credit Supplier execs join innovation panel at congress Quietly, Mini seeks 500 drivers to lease electric car for a year Reynolds bolsters document business Winterkorn: Audi needs to build in U.S. The great revenue drop of 2008 Bidders bet they can rebuild Heard 1 size fits all NADA: Give us tax incentives, dealer loan guarantees Campaigns' climate, energy plans hit economic wall Detroit 3 need and deserve U.S. help now Chrysler needs a buyer, but not GM Dealers pay fair share of taxes Washington hurts, not helps, electrics Compressed natural gas is the best fuel New ads aim to raise Suzuki's low profile Suzuki's new ad strategist: This brand has soul Fuel efficiency is coming â it just takes time Electrics edge closer by 2010 Tougher CAFE standards loom R&d chiefs shift gears for an electric future Japan carmakers lead charge into electrics Buffett backs BYD's sketchy plan for U.S. electric car Q&A: BYD envisions 2010 exports to U.S., Europe Girding the power grid for an electric fleet Hype powers plug-in vehicles Coachbuilders see salvation in electric cars Electric vehicles are charging into Europe Expect stop-start's big start to arrive in 2010 Flexibility will help Honda survive the storm Nardelli: Bailout not perfect â but needed Audi goes high-tech to boost service Acura offers quick service to win business Toyota's fashion fan Picture this Hondaâs N.A. operating profit falls 80.6% in quarter Aug. RV shipments fall 44% VW drops hints about car for new Tenn. plant Mexico sales fall 10.7% in September Honda to boost CR-V, end Civic output in Ohio Ford and GM jockey for steel discounts Dealers Ford Credit seeks to tap $700 billion package GM will end a used-car incentive early Nissan, Mitsubishi, Mazda recast fiscal 2009 forecasts Metaldyne to bondholders: Take 30% or Chap. 11 looms Detroit 3 ties hurt profits of dealer groups GM takeover would eviscerate Chrysler ranks, model lineup Mitsubishi plans electric hauler To match Toyota, Nissan offers 0% loans Sticker, sticker at the mall, what's the cheapest of them all? The Versa Waiting is what it's all about, Alfa Buy Chrysler? GM should sell Buick to SAIC Pickups pumped up by pump price plunge Chrysler hybrids, we hardly new ye Ghosn: Your best partner is a president in your pocket Sonic wins, but Mercedes wants last word

Automotive News - November 3, 2008

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