Automotive News - January 28, 2008 - (Page 46) 46 • JANUARY 28, 2008 remarketing Suzuki wants to reinvigorate certified program Too few retired fleet vehicles to certify caused problems Arlena Sawyers asawyers@crain.com Certified sales, December & 12 months Dec. 2007 Dec. 2006 12 mos. 2007 12 mos. 2006 Suzuki sales chief Gary Akin: “We’re getting ready to dust off and improve” the certified program. sales numbers.” To be eligible for certification, used Suzuki vehicles must be no more than five model years old and have fewer than 70,000 miles. They must pass an inspection and a title history check. American Suzuki Motor Corp. plans to jump-start its certified usedvehicle program this spring. Suzuki introduced the program in 2004. But the company’s vice president of sales, Gary Akin, said the program has lacked an adequate number of retired fleet vehicles to certify. Last month Suzuki sold just one certified vehicle, down from two in December 2006. In all of 2007, Suzuki sold 34 certified vehicles, down from 66 the previous year. But Akin said the company is relying on increased new-vehicle sales in the past few years to get used vehicles to certify. Last year Suzuki sold 101,884 new vehicles in the United States, up 0.9 percent from 2006. “We’re getting ready to dust off and improve” the certified program, Akin told Automotive News. Two warranties Certified Suzuki vehicles are covered by a 12-month/12,000-mile warranty that takes effect when the vehicles are sold as certified. They also are covered by a 7-year/100,000mile limited powertrain warranty from the time they are sold as new. Overall, the industry sold 128,639 certified used vehicles in December, down 1.4 percent from the year-ago month. For all of 2007, the industry sold 1,679,542 certified vehicles, 2.1 percent more than in 2006. Last year, General Motors sold 516,560 certified used vehicles — more than any other automaker but 0.7 percent less than GM sold in 2006. In December, GM sold 35,929 certified vehicles, down 14.1 percent from December 2006. BMW 9,496 Chrysler Division 2,755 Dodge 3,720 Jeep 2,385 CHRYSLER LLC† 8,860 Ford division 9,217 Lincoln Mercury 1,514 Ford div., Lincoln, Mercury 10,731 Jaguar 615 Land Rover 690 Volvo 1,684 FORD MOTOR CO. 13,720 Buick 1,976 Chevrolet 20,863 GMC 3,717 Oldsmobile 22 Pontiac 3,797 GM Certified 30,375 Cadillac 3,369 Hummer 141 Saab 480 Saturn 1,564 GENERAL MOTORS 35,929 Acura 3,254 Honda Division 15,454 AMERICAN HONDA 18,708 HYUNDAI 506 MAZDA 314 MERCEDES-BENZ USA 4,085 MITSUBISHI 80 Infiniti 265 Nissan Division 4,213 NISSAN NORTH AMERICA 4,478 PORSCHE 527 SUBARU 581 SUZUKI 1 Lexus 4,582 Toyota Division 21,480 TOYOTA MOTOR SALES 26,062 Audi 2,889 Bentley 60 Volkswagen division 2,343 VW GROUP OF AMERICA 5,292 TOTAL CERTIFIED 128,639 5,901 2,936 3,960 2,445 9,341 8,439 1,457 9,896 930 551 1,733 13,110 3,428 23,273 3,603 128 5,342 35,774 3,948 130 607 1,368 41,827 3,452 15,636 19,088 3 375 4,374 109 200 4,306 4,506 461 204 2 4,317 22,383 26,700 1,989 34 2,412 4,435 130,436 89,795 39,924 50,716 31,388 122,028 134,521 22,140 156,661 9,380 6,156 23,368 195,565 32,905 299,443 49,196 1,111 68,905 451,560 38,806 1,296 7,294 17,604 516,560 38,928 203,903 242,831 3,440 4,989 50,929 1,284 2,605 55,422 58,027 6,581 4,436 34 50,341 271,627 321,968 27,058 637 33,380 61,075 1,679,542 80,377 38,968 49,563 28,046 116,577 149,233 24,604 173,837 12,328 6,952 27,155 220,272 41,927 294,664 45,238 3,358 64,274 449,461 42,159 1,012 8,335 19,271 520,238 36,969 185,651 222,620 207 5,807 47,737 1,563 2,182 49,015 51,197 6,114 2,169 66 46,495 261,620 308,115 24,588 379 37,389 62,356 1,645,415 KAR goes after independents CARMEL, Ind. — KAR Holdings Inc., the parent company of vehicle auction company ADESA Inc., started a company this month that aims to help independent auto dealers close more deals with retail customers. Automotive Finance Consumer Division specializes in finance and insurance products and services. Its product line includes a dealer management system developed by Nowcom Corp., of Los Angeles. The system enables dealers to process forms, retail contracts and inventory management reports. It allows dealers to run credit reports and get vehicle price data from industry guidebooks. KAR, of Carmel, Ind., said the new company also offers F&I services to independent dealers who want to offer finance options to customers but lack the staff or budget to do so. Manheim expands to Turkey ATLANTA — Manheim has entered a joint venture with Otomax, a Turkish used-vehicle remarketing company, to launch its first auto auction in Istanbul, Turkey. Otomax is a subsidiary of Borusan Holding, an industry and service conglomerate with ownership stakes in new-vehicle distribution and retailing, logistics, steel and telecommunications companies. Otomax’s Private Auction sites will operate under the Manheim brand. The auctions are open only to Otomax’s 600 member dealerships. Manheim, of Atlanta, is the largest U.S. vehicle auction company. It has auction operations in 18 countries on six continents. †DaimlerChrysler sold the Chrysler group on Aug. 3, 2007 *Estimate Source: Automotive News Data Center and Autodata Corp. Fleet sales ceiling At the same time, Akin said, Suzuki is capping fleet sales at 10 percent of overall unit sales. That limit will help bolster residual values and make the certified program more attractive to dealers and consumers, he said. “We want to continue to control our fleet volume,” Akin said. “We’ve seen what some of our competitors have done in fleet to hit GM spiffs To help boost sales, the GM Certified brand is providing new financing incentives on Chevrolet Impala, Malibu and TrailBlazer certified vehicles and on certified GMC Envoy SUVs. Through March, the company is offering 2.9 percent financing on 48month contracts for those vehicles and 3.9 percent for 60 months. GM Certified also is offering 4.9 percent financing for 60 months on Buick LaCrosse, Chevrolet Suburban and Tahoe, GMC Yukon and Pontiac Grand Prix certified vehicles. In 2007, Toyota Motor Sales U.S.A. Inc. sold 321,968 certified used cars and trucks, up 4.5 percent from 2006. The company’s December 2007 sales of 26,062 certified vehicles were down 2.4 percent from the year-ago month. BMW remained the top-selling certified luxury brand last year. It reported 2007 certified sales of 89,795 vehicles, up 11.7 percent from 2006. BMW sold 9,496 certified vehicles in December, up 60.9 percent from the year-ago month. c Prices of big used pickups dropped in December Arlena Sawyers asawyers@crain.com Conn. auction adds lanes EAST WINDSOR, Conn. — Southern Auto Auction, of East Windsor, Conn., is adding two lanes as part of an expansion program. The lanes are scheduled to open in March, bringing to 20 the number of lanes at the auction. The expansion also includes more parking and new car-wash, vehicle reconditioning and check-in services. Southern’s clients include fleet and lease companies, financial institutions, automakers and dealerships. The auction offers 5,000 to 6,000 vehicles for sale each week. Average wholesale used-vehicle prices, December Average price December 2007 Average price November 2007 Average price December 2006 % change vs. November 2007 % change vs. December 2006 Wholesale prices of used full-sized pickups fell in December, the nation’s two largest vehicle auction companies reported. Last month, the average wholesale price of big pickups was $10,643, according to ADESA Inc. That price was down 5.5 percent from December 2006 and 1.6 percent from November 2007, ADESA said. Prices of used full-sized pickups as much as 3 years old dropped about 10 percent from October to December, according to Manheim’s usedvehicle value index. The monthly index is adjusted for model mix, mileage and time of year. 10 percent from December 2006. And he noted that for all of 2007, the average wholesale price of big used pickups rose 3.5 percent from 2006, to $11,615. Cars Small and mid-range Sporty Traditional Upscale Total car $7,610 12,024 11,136 13,130 $8,669 $7,565 11,863 11,006 12,318 $8,567 $7,175 10,817 8,020 8,657 10,432 12,390 14,609 $10,675 $9,682 $7,667 12,570 9,994 13,171 $8,662 $7,170 11,265 8,338 7,608 10,484 13,604 14,589 $10,765 $9,686 0.6 1.4 1.2 6.6 1.2 0.4 –1.6 –0.9 –10.3 0.9 1.2 –1.0 –0.2 0.6 –0.7 –4.3 11.4 –0.3 0.1 0.4 –5.5 –4.7 2.1 0.4 –7.9 –0.9 –1.0 0.6 No easy answers “It’s hard to tell anything about December,” Kontos told Automotive News. “It is a slower-volume month.” Last month, the average used vehicle sold at auction for $9,743 — 0.6 percent more than in both December 2006 and November 2007, ADESA said. Manheim’s used-vehicle value index stood at 110.2 in December, down 2.9 percent from December 2006 and 2.2 percent from November 2007. Webb attributed falling prices for some used vehicles to weaker consumer demand caused by tighter credit and the subprime mortgage mess. “You get a market with reduced floor traffic, lower closing rates and narrower gross margins,” Webb said. “These market forces have not yet fully played out.” c December doldrums Industry analysts noted that sales of new full-sized pickups fell 3.0 percent in 2007. Automakers ended the year with bloated inventories, they said. “Pickup trucks have been one of the weakest segments in recent months,” Manheim chief economist Tom Webb wrote in an online commentary. “That weakness intensified Light trucks Small pickups $7,202 Full-sized pickups 10,643 Minivans 7,944 Full-sized vans 7,766 Lower mid-range SUVs 10,524 Large SUVs 12,536 Other SUVs 14,460 Total light truck $10,655 TOTAL WHOLESALE $9,743 Turn to page 48 for the Note: Based on approximately a half million AuctionNet wholesale vehicle transactions a month *Includes standard and premium crossovers and small, upper mid-range and premium SUVs Source: ADESA Analytical Services and Automotive News market classifications Used Vehicle Auctions in December.” Tom Kontos, ADESA’s executive vice president of customer strategies and analytics, said last month’s
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