Automotive News - February 18, 2008 - (Page 50)

50 • FEBRUARY 18, 2008 NADA MAKE MEETINGS Index for make meetings Acura . . . . . . . . . . . . . . . . . 57 Shift upscale has dealers excited Audi . . . . . . . . . . . . . . . . . . 58 Factory pledges to cut red tape in response to dealer protests Buick-Pontiac-GMC . . . this page New products — but no Trans Am BMW . . . . . . . . . . . . . . . . . . 57 Loaner program is in the works Cadillac . . . . . . . . . . . . . . . . 52 Ride the CTS wave, dealers told Chevrolet . . . . . . . . . . . . . . . 52 Dealers told to be aggressive on truck sales, push the Malibu Chrysler-Dodge-Jeep . . . . . . . 58 Personable newcomer Press is the antidote for Genesis jitters Ford . . . . . . . . . . . . . . . . . . 56 Ford’s recipe for happiness in tough times: Enlargin’ the margin General Motors . . . . . . . . . . 52 Marketing will emphasize hybrids and other green technology Honda . . . . . . . . . . . . . . . . . 54 Used cars pump up profits Hummer . . . . . . . . . . . . . . . 54 Execs: Pickup will perk up sales Hyundai . . . . . . . . . . . . . . . . 59 Metro-market expansion plan: Let the big dogs run Infiniti . . . . . . . . . . . . . . . . . 55 Dealer profits and customer service are top 2008 priorities Jaguar . . . . . . . . . . . . . . . . . 56 Dealers eager for XF, Tata news Kia . . . . . . . . . . . . . . . . . . . 59 Execs’ exit stuns dealers Land Rover . . . . . . . . . . . . . 57 Brand seeks input on LRX concept Lincoln Mercury . . . . . . . . . . 56 Mercury’s future still murky Mazda . . . . . . . . . . . . . . . . . 54 Dealers will see redesigned Mazda6 at April meeting Mercedes-Benz . . . . . . . . . . 58 38% of dealers working toward Autohaus standards for stores Mitsubishi . . . . . . . . . . . . . . 55 Dealers gets a challenging sales goal, and incentives to help Nissan . . . . . . . . . . . . . . . . . 55 Dealers are told new products will increase per-store sales Porsche . . . . . . . . . . . . . . . . 58 Factory cuts output in response to slump in luxury segment Saab . . . . . . . . . . . . . . . . . . 54 Saab will get new products; small concept will debut in Geneva Saturn . . . . . . . . . . . . . . . . . 52 Brand is called a key player in GM’s five-year growth plan Subaru . . . . . . . . . . . . . . . . . 56 Diesels, hybrid top wish list Suzuki . . . . . . . . . . . . . . . . . 55 Incentives are back, and sales are picking up as a result Toyota . . . . . . . . . . . . . . . . . 54 Brand seeks to increase loyalty through service improvements Volkswagen . . . . . . . . . . . . . 57 Dealers excited by a flurry of new products, especially Jetta diesel Volvo . . . . . . . . . . . . . this page Factory reviews metro markets, will use cash to thin dealer corps Volvo offers cash to thin the herd Mark Rechtin mrechtin@crain.com Highlights Buying out weak metro dealers Strong dealers must step up Dealer profits must rise SAN FRANCISCO — With sales declining, Volvo Cars of North America revealed its plan to winnow its dealer body. Volvo field executives will visit every dealer in the brand’s top 20 metro markets and review the dealer’s past financial statements and future plans. “Either we will analyze the point as having strategic importance, or else we’ll tell the dealer that there is a good, sound reason to get out,” said Doug Speck, Volvo’s executive vice president of sales and retailer operations. At a breakfast meeting here, dealers were told that Volvo has money to help buy out dealers ready to walk away from the franchise. “This requires making an investment,” Speck said. “But we’re not going to pour stupid money into the deal, like back in the ’90s where the public companies were buying for 10, 12 and 14 times earnings.” Speck stressed that the program is voluntary and that a weak dealer can remain with the franchise even if Volvo determines the numbers don’t make sense. After peaking at 139,607 units in 2004, Volvo was expected to hit 200,000 U.S. sales by 2010. Instead, sales reversed. Volvo sold 106,213 units last year. Speck said Volvo’s 2008 sales forecast is 90,000 to 95,000. Volvo has about 355 dealers. The top 20 markets have 157 dealers, which represent 60 to 65 percent of sales, Speck said. Volvo has not said how many dealers it wants to eliminate, but those remaining metro dealers are expected to show sales gains of 25 percent starting in 2009. Speck wants to have contracts from all dealers wanting to walk away by the end of 2008, before the new XC60 crossover arrives. Horace Ott Jr., who owns two Volvo dealerships near Fort Washington, Pa., cheered the plan. He has four competing Volvo stores in a 12-mile radius. “I went through the Mercedes consolidation a few years back,” Ott said. “The most important thing we found is having the right number of dealers in the right places.” David Stein, chairman of the dealer council and a partner in two Roger Beasley Volvo stores near Austin, Texas, said the plan “needs to be done. This is a timing thing, and it’s important to our longterm strategy.” Stein has said a 20 percent decrease in the dealer Doug Speck stressed that no dealer will be forced out, even if the numbers don’t look promising. body would be a good start, especially when compared to brands such as Lexus and BMW. Both those brands have much higher throughput from a smaller dealer network. Speck said the buyout funds are an addition to Volvo’s existing budget, so the company will not have to sacrifice advertising or variable marketing funds to finance the plan. c B-P-G focuses on new product push Jamie LaReau jlareau@crain.com SAN FRANCISCO — Buick, Pontiac and GMC dealers will get 12 new or special-edition vehicles over the next 20 months — but they won’t get a Pontiac Trans Am. Pontiac had lobbied for a sibling vehicle to the Chevrolet Camaro, which is scheduled to arrive in February 2009. General Motors’ plan to make Pontiac a rear-wheel-drive performance car division is likely to be scaled back because of fuel economy regulations, GM leaders told dealers at the make meeting. One dealer said the business case for the Trans Am didn’t compute. “It was an economic situation,” said Lynn Thompson, owner of Thompson Sales Co. (Buick-PontiacGMC-Cadillac-Saab) in Springfield, Mo. “It would cost $200 million to bring out the vehicle.” Pontiac will remain a car-only brand for the foreseeable future, dealers were told. But because of new legislation requiring vehicles to reach a fleet average of 35 mpg by 2020, Pontiac might not end up as GM’s performance division, dealers said they were told. “The plan is being tweaked because of the gas situation,” Thompson said. “I hope they don’t give up on performance because they don’t have to. You can use four-cylinder engines to achieve incredible power.” Pontiac will show the new hardtop Solstice sports car at the New York auto show in March, dealers said. Brand leaders told dealers that the new G8, which arrives this spring, will be allocated with a “fairly even distribution mix” to each region. Dealers are encouraged to push the four- JOE WILSSENS Brent Dewar, right, GM’s vice president for North American service, sales and parts, greets David Sweeney, of Sweeney Buick-Pontiac-GMC-Chevrolet, of Boardman, Ohio, before the Buick-Pontiac-GMC make meeting. Highlights No Pontiac Trans Am sport car Buick Enclave production will reach 55,000 this year The channel will get 12 new or special-edition vehicles over 20 months cylinder version of the G6. B-P-G will give dealers six new or special-edition vehicles — such as the special-edition GMC Sierra pickup, called Pro Grade — this year. They will get another six next year, dealers who attended the meeting told Automotive News. Executives also told dealers that GM will build nearly 55,000 Buick Enclave crossovers this year. Dealers said Jim Bunnell, general manager of Buick-Pontiac-GMC, told them GM increased Enclave production by 41 percent from the initial production plan. A dealer said Bunnell told them Buick built 6,400 Enclaves in January and then Bunnell added, “But it’s still not enough.” c

Table of Contents Feed for the Digital Edition of Automotive News - February 18, 2008

Ford cuts equipment combinations on '09s Lenders shun subprime market Toyota dealers test satellite service centers Despite cost, more carmakers use laminated glass Merger produces turnaround firm Chrysler would shut to move Plastech work Jeep accessories: Mo' for Mopar Auctions: Repos are rising Automakers face more child safety rules Supplier Personnel Family-owned stores could be tough sell for consolidation What would lineup be with brands under single roof? Mercedes will pay $9.5 million to settle suit Beru revamps strategy to boost profits, growth Jaguar: Dealers take 10,000 customer deposits for XF sedans Chrysler exec: Performance segment will survive Mahindra to offer hybrids in U.S. Mazda ad agency hires VW and Mini creative whiz Icy weather and perhaps boredom chill roadster sales GM, Saturn: What's after Reynolds? Ford: Mid-sized model year for mid-sized cars Kia's new American boss: Let's boost sales Rolls gets sporty Luxury brands push to meet demand in Russia Dealer is makers' best voice in D.C. Get real, Kia, Hyundai Face it, Detroit: Trimming dealers will be expensive GM has confidence in the Chevy Volt It's no wonder auto sales are declining A workable idea: GM dealer buyouts It's deja vu again with reborn 2CV Nothing beats face to face There's a person behind that e-mail Buying cars online makes perfect sense Bush seeks to save 2008-11 CAFE rules Personnel Lear investor: No regrets about blocking buyout GM CFO is mum on more aid to Delphi Dealers Road to tomorrow is paved with plastics Council aims to keep Ford current on environmental issues VW ponders Phaeton's U.S. flop, may try again McGuffie is Covisint's president In hydrogen race, Mazda seeks quicker route Suit seeks to enforce title-washing remedy Suppliers to the 2008 Buick Enclave Mercedes, Audi warn dealers: No sales for export Sykora wants CAFE flexibility Minority dealers see tough times in 2008 Arlena Sawyers Toyota goal: Create stress-free store NADA's Taylor predicts 15.7 million U.S. sales this year Honda widens support for dealer ad groups Jay's jabs Survival 101: Get lean, work harder Microsoft will test dealership system Farley wants market-by-market sales strategy Entertaining the troops Report: Detroit 3 cutbacks curb rental-fleet sales Dilts: High interest rates hurt industry GM asks for dealer assistance on quality On the Record Fisker: We're close to making plug-in car J.D. Power exec: Internet leads are slipping away Minority auto group nears 2 deals Garmin makes navigation technology deal Tenneco wins Ford work B-P-G focuses on new product push Volvo offers cash to thin the herd Cadillac challenges dealers to boost sales Chevrolet can stay No. 1, if it will fight GM will push a green marketing message Saturn is expected to be GM's growth brand Certified used sales help Honda dealer profits Hummer counts on pickup to perk sales Mazda will boost marketing budget, unveil Mazda6 Saab dealers to get new vehicles Toyota wants even better customer loyalty Infiniti stresses profits and customer satisfaction Mitsubishi CEO sets tough U.S. sales goal Nissan exec: New models will boost per-store sales Suzuki dealers cheer return of incentives Ford to boost dealer margins Jag dealers anxiously await the XF Ford executives vague about Mercury future Subaru dealers want diesels, hybrids Acura upscale shift inspires 'great faith in the future' BMW readies national loaner-car program Land Rover: Future upbeat, unclear VW dealers get vehicles on wish list Chrysler dealers OK with consolidation plan Mercedes pushes dealership standards Porsche shrinks as luxury segment lapses Large Hyundai dealers get more room to roam Execs' exit stuns Kia dealers Ford recalls 180,000 trucks over door part, fuel hose GM posts massive loss; eyes N.A. profits by 2011 Big-truck sales fall 33.5% in Jan. WTO rips China's tariffs on imported auto parts Fiesta will rejoin the party in the U.S. UAW's Valentine to Delphi: Hands off our pensions Rx for dealership flux: NFL draft + Mideast bazaar Toyota gets the boot in Mexico Nissan triples female managers Silverado hits a million, rolls on

Automotive News - February 18, 2008

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