Automotive News - May 26, 2008 - (Page 8)

8 • MAY 26, 2008 advertising OUR DEALERS ARE GROWING GM, American Axle to resume output Robert Sherefkin rsherefkin@crain.com AND SO CAN YOU! “With Zimmerman as a partner we have grown to be the # 1 GM Dealer in Albany, NY.“ Kara DePaula DePaula Chevrolet DETROIT — Many of General Motors’ 2,000 North American suppliers are boosting production early this week after the resolution of a threemonth-long labor dispute between GM’s axle maker and the UAW. American Axle & Manufacturing Holdings Inc. is expected to resume axle production for GM truck assembly plants this week, according to industry insiders. GM spokesman Dan Flores says the automaker’s light-truck assembly plants can resume full production as soon as American Axle resumes produc- tion. GM’s pickup assembly plants in Flint and Pontiac, Mich., are down. The company’s Janesville, Wis., SUV plant is running on one shift. Thirty GM parts and assembly plants were shut or slowed by the strike. American Axle’s 300 to 400 suppliers are preparing to ramp up as well. Production at the Detroit driveline supplier’s Tonawanda, N.Y., forge plant was expected to resume last weekend. Workers at the supplier’s remaining plants are expected to return by Tuesday, May 27. American Axle spokeswoman Renee Rogers declined comment. GM suppliers facing the biggest startup chal- lenges are those whose business is concentrated on GM trucks. GM’s light-truck plants were quickly shuttered by the UAW strike. Magna International Inc., the largest supplier of GM light-truck frames, began calling back workers Friday, May 23, said spokeswoman Tracy Fuerst. Normal production will resume June 2. Production increases should be relatively easy for suppliers whose products were on both GM trucks and cars. The automaker lost little car production. One supplier in that category is mirror maker Gentex Corp., of Zeeland, Mich. “We never laid anyone off,” says CEO Fred Bauer. “We’re set to go.” c RESULTS! • KEYES AUTO GROUP • IRA MOTOR GROUP • TOM WOOD AUTOMOTIVE • CHECKERED FLAG • AUTONATION • DIEHL MOTOR COMPANY • CORAL SPRINGS AUTOMALL • RUSTY ECK FORD • AUTOLAND • HENDRICK CARY AUTOMALL • PATRICK AUTO GROUP • HUBLER AUTOMOTIVE • PLEASANTON AUTOMALL • DEPAULA CHEVROLET • WALLACE NISSAN OF KINGSPORT • SUPERIOR CHEVROLET Dealers Prove Our Advertising Gets The Lexus RX 400h, above, and the second-generation Toyota Prius, right, are among vehicles that use hybrid technology that a federal jury decided infringed on a patent. Toyota owes royalties on some hybrids Harry Stoffer hstoffer@crain.com GET A COMPLETE MARKETING PROGRAM! Guerrilla TV Marketing Radio Print Hispanic Direct Mail Web Design WASHINGTON — Toyota Motor Corp. has suffered a blow to its reputation for innovation by losing a patent infringement case over technology in its popular hybrid vehicles. This month, the U.S. Supreme Court declined to consider Toyota’s appeal in the case. As a result, the company will owe royalties for most hybrids it sells. But patent experts say the outcome for Toyota could have been worse. Toyota owes the royalties to Paice LLC, a small company that holds patents but makes no products. A trial court set the amount at $25 per vehicle, but the amount and duration of the royalties could be changed or renegotiated. In its filing with the Supreme Court, Toyota called Paice “a patent litigation company.” Toyota spokesman Xavier Dominicis noted last week that a jury in the case had not found the patent infringement to be willful. Toyota expects that fact to be a mitigating circumstance when royalties are determined, Dominicis said. A worse outcome for Toyota would have been a court injunction against further sales of hybrids, said Joel Lutzer, a patent expert with the New York City law firm of Sheppard Mullin Richter Hampton. Lutzer did not take part in the Toyota case. Courts and lawmakers are rethinking the rights of companies that critics call “patent trolls,” Lutzer added. Such companies acquire patents with no intention of making products but with the hope of collecting from companies that do. In the Toyota case, a federal court jury in Texas found in 2005 that a component used in the company’s hybrids is “equivalent” to a device Paice patented in 1994. The component manages torque from gasoline and electric motors in a hybrid powertrain. The infringing vehicles include the second-generation Toyota Prius, Toyota Highlander and Lexus RX 400h, according to court records. As of mid-2006, court records say, Toyota had sold about 170,000 of the affected vehicles. Between 2006 and April 2008, Toyota sold 458,296 of the vehicles. Toyota appealed the patent infringement finding. At the same time, Paice appealed the lack of an injunction in the case. Last October, a federal appeals court upheld the jury verdict but told the trial court to reconsider the royalty award. Attempts to reach Paice executives and lawyers last week were unsuccessful. A Paice Web site lists Robert Oswald, a former Robert Bosch Corp. executive, as CEO. The site says the company’s mailing address is Bonita Springs, Fla. c Chrysler sends mystery shoppers to dealerships Bradford Wernle bwernle@crain.com Internet Website Optimization In-Store CALL OR E-MAIL THE AGENCY THAT WILL WORK FOR YOU 24/7 (SERIOUSLY) 1-888-878-ZADV zauto@zadv.com or visit www.zadv.com DETROIT — Chrysler LLC wants to find out how well its dealership salespeople know their way around the company’s vehicles. So the automaker is sending hundreds of mystery shoppers into the field to evaluate them. Salespeople who pass the test with flying colors can win as much as $1,000 in a drawing. Chrysler claims the program can be a motivational tool and can focus its sales force on promoting the virtues of its vehicles, rather than deals. Chrysler CEO Bob Nardelli was a mystery shopper when he was Home Depot chairman. pot Inc. But critics say mystery shoppers can be easily identified by experienced salespeople and can alienate sales personnel if not handled carefully. The “Chrysler Multi-Million Dollar Mystery Shop Challenge” began May 12 and will run through December. During that time, the automaker will conduct more than 20,000 mystery shopper visits, roughly one for every sales consultant at every dealership. Chrysler has hired contractor Mar- ket Force Inc. to handle the shopping. The firm has a network of about 140,000 shoppers, says Mark Engelsdorfer, director of the Chrysler Academy, which is running the program. Chrysler hopes the program will get the sales force focused on the attributes of its vehicles. “It’s an opportunity to increase the customer satisfaction and the product focus our salespeople should have,” says Engelsdorfer, who adds that Chrysler had good results from a similar study in 2004. keting Research in Bandon, Ore., says salespeople are good at identifying real prospects. They don’t appreciate spending time with mystery shoppers, he adds. “To have one of your ups get wasted by having to deal with a mystery shopper is not good.” Dealerships can benefit Pen Frey, vice president of sales and operations for Jeff D’Ambrosio Chrysler-Dodge-Jeep in Downingtown, Pa., says dealerships can benefit from mystery shopping. But, he says, so many customers these days do advance research on the Internet and make initial contacts by phone that many are sold by the time they walk in the door. “The problem is, the live shopper is diminishing,” Frey says. “The reason he got live is because somebody handled him right in the first place.” c No distraction Chuck Fortinberry, owner of Clarkston Chrysler-Jeep in Clarkston, Mich., says Chrysler has assured dealers that the mystery shoppers won’t distract salespeople by coming into the store when traffic is heavy. Art Spinella, analyst for CNW Mar- Likes, dislikes Mystery shopper programs have supporters and detractors. Chrysler CEO Bob Nardelli is a believer and became a mystery shopper himself when he was chairman of Home De- http://www.zadv.com http://zadv.com http://www.zadv.com

Table of Contents Feed for the Digital Edition of Automotive News - May 26, 2008

Automotive News - May 26, 2008 Bad times? Not for CEO paychecks GM seeks Volt tax break to avoid $40k sticker Ford's big cuts aim for a Honda-sized lineup Automotive News gets new marketing communications director Toyota pushes N.A. suppliers to match offshore prices VW predicts 5% U.S. sales gain Toyota plans 3 plants for hybrid batteries GM's American Axle strike tab: $2.82 billion Lawsuit in Florida targets congressman's dealership Orbiting the blogosphere Kia to build small cars in U.S. plant VW Mexico exec will run North American purchasing Fiat mulls 500 minicar for U.S. GM scraps big rwd sedans for Chevrolet and Buick Hyundai spends like never before to launch Genesis luxury sedan Surprise: Suzuki slides as fuel prices rise GM paid Walter Chrysler a whopping $600,000 a year Chrysler sends mystery shoppers to dealerships Toyota owes royalties on some hybrids GM, American Axle to resume output Ford predicts bigger demand for smaller engines in Escape This is Volvo? Ads sell chic, not just safety An overnight success in 50 years Obama's comments were out of line Japan does it; why shouldn't we? 25% is high, but Chrysler is wise to revisit SCORE Safety efforts must focus on the driver Blame the dealer for poor service Don't judge Ford quality by just one car Ford quality is best in many years Mitsubishi considers piggybacking with Caterpillar suppliers to cut costs Nissan to make lithium ion batteries 'Boss Ket,' Connery inspire Tim Jackson Germany leads rise in Europe sales Court: Buyers must act in good faith to win lemon law damages Nissan wants suppliers to reduce utility bills Bajaj: From scooters to autos The next $2,500 car? Infiniti will look different, add engine power in Europe Lamborghini boss wants to keep the big engines Lamborghini ups ante in 'entry' supercars Continental exec: We're done selling VDO assets Honda plans Fit hybrid Outgoing Visteon CEO to receive $2.5 million Audi production chief: Cooperation with Porsche will grow Picture this RV shipments fall in March M-B will buy Chrysler studio Supplier personnel VW expects to reap big share of U.S. diesel market Valeo CEO Morin: Pass rising costs to consumers Suppliers to the 2008 Nissan Altima Dealers Auction workshops demystify Web buying April used-vehicle prices: Light trucks fall and cars rise Volvo certified plan offers free satellite radio Mulally: Full speed toward smaller Toyota plans credit card Sanfilippo switches agencies International idles plant Honda Pilot starts at $28,230 Plastech plans assets auction What counts GM's 2-pronged strategy for Calif. rules: If you can't beat 'em . . . meet 'em New wheels for the cop shop The cost of luxury? For Hyundai, it would have been $2.5 billion New tools allow early design input from consumers Lexus in the sky with carbon: How ex-Beatle's PR effort tanked Buy an '08 . . . get a .44 $4 gasoline gives new cachet to aging econo-beaters Time tips its hat to Tata Car marketers: Magazines must widen ad reach Automakers seek 'one-to-one' approach to magazine ads Auto ads go to the movies Here's the next big thing: Ads tailored to you GMC courts women with Acadia

Automotive News - May 26, 2008

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