Automotive News - October 27, 2008 - (Page 6) 6 • OCTOBER 27, 2008 Toyota may renew no-interest loans Kathy Jackson kjackson@crain.com LOS ANGELES — Toyota’s 0 percent loans are building traffic and might be renewed, says Bob Carter, general manager of Toyota Division. In Lewisville, Texas, dealer Rene Isip says, “0 percent is working for us.” He says his September sales were down 18 percent from September 2007, but October sales are tracking at just below 2 percent behind last October’s total. Toyota Motor Sales U.S.A.’s sales dropped 32.3 percent from the yearago month. Frank Carl, operations manager at Camelback Toyota in Phoenix, says that under the loan program, which began Oct. 2, daily Internet leads have grown from 10 or fewer to as Toyota’s “Saved by Zero” ad campaign touting 0 percent financing runs through Monday, Nov. 3. Dealers say the drive is building showroom traffic. many as 45. “But I wish Toyota would come out with more customer rebates,” Carl says. Camelback Toyota sold 340 Toyotas in September, down from 550 to 650 a month for the past 24 months. “We use rebates to get people in cars more than half the time,” Carl says. “Rebates are more helpful than the interest rate.” Isip also says Toyota Financial “is buying deep.” He says he recently financed a customer with a 550 credit score. Credit scores range from 300 to 850, with most people scoring in the 600s and 700s. A score below 600 is considered risky. Toyota offers 0 percent, 36-month loans on 11 models: the Matrix, Corolla, Camry, RAV4, Highlander, FJ Cruiser, 4Runner, Sequoia, Sienna, Tacoma and Tundra. Only consumers with good credit qualify. Also available are 1.9 percent loans for 48 months and 2.9 percent for 60 months. The program is due to expire Monday, Nov. 3. “We’re getting traffic,” Carter says. If sales continue to improve, he says, he would consider an extension of the program. c Hesterberg: Group 1 CEO Thomson: Chrysler media director Hesterberg, Thomson will address congress Earl Hesterberg, CEO of Group 1 Automotive, and Susan Thomson, director of media for Chrysler LLC, will be featured speakers at the 33rd Automotive News World Congress in Detroit. Both Hesterberg and Thomson will speak Tuesday afternoon, Jan. 20, about new media and marketing and how today’s realities affect current business models. Thomson, 49, was named director of media for Chrysler in May. Previously, she was senior manager of Jeep global brand communications and senior manager of Chrysler global brand communications. As director of media, Thomson is responsible for all media planning and buying on behalf of the Chrysler, Jeep and Dodge brands. She also coordinates agency contracts for Chrysler LLC. Thomson joined Chrysler in 1982. Hesterberg, 55, a 33-year veteran of the auto industry, has worked for Ford Motor Co. and Nissan Motor Co. in North America and Europe. He also was CEO of the independent distributorship Gulf States Toyota. Hesterberg joined Group 1 as CEO in the spring of 2005.c Dodging a bullet Investor Carl Icahn escaped when his July 2007 offer for Lear Corp. was rejected. Icahn offer: $37.25 per share; market capitalization, $2.88 billion Oct 23 actual: $2.63 per share; market capitalization: $220.4 million Lucky Icahn lost Lear David Barkholz dbarkholz@crain.com When investor Carl Icahn lost out on a bid to buy Lear Corp. in July 2007, boy was he lucky. Lear CEO Bob Rossiter supported the deal to provide Lear with more access to capital. He also would have received a hefty payday from it. Icahn offered $2.9 billion, or $37.25 per share, to take the seat maker private. Shareholders beat back the offer, saying Lear was worth far more over the long haul. The long haul keeps getting longer. In the past 12 months, Lear’s value has fallen 90 percent. Hit by collapsing pickup and SUV sales, the stock of the suburban Detroit company is trading around $3 per share. Lear relies on the especially hard-hit Detroit 3 for more than half its revenue. Richard Pzena, the New York investment manager who led the opposition to the Icahn buyout, declined to be interviewed last week. Icahn declined to comment as well. Lear is doing its best to hold down costs and boost profits. This month the company announced an additional $150 million in cost cutting to try to stay ahead of the effects of falling vehicle sales. Icahn hasn’t completely escaped the North American automotive bloodletting. He and his companies took a controlling interest in FederalMogul Corp. when the suburban Detroit supplier emerged from Chapter 11 reorganization in December. Icahn’s holdings represent about 75 percent of the supplier’s outstanding shares, according to the Securities and Exchange Commission. Federal-Mogul makes engine and underhood parts. Last week, Federal-Mogul shares were trading below $7, down from $29.50 last December.c With Warren Buffett’s backing, BYD Auto plans a U.S. plug-in hybrid like the F3DM, displayed at the Beijing auto show. China’s BYD plans U.S. hybrids Kevin Huang kevinhuang@autonewschina.com Key facts Another Chinese automaker wants to sell cars in the United States. This one has financial backing from America’s richest man, Warren Buffett. BYD Co., armed with a $230 million investment from a subsidiary of Buffett’s Berkshire Hathaway Inc., aims to sell plug-in hybrids in the United States as early as 2010. But 2010 looks like a stretch. For instance, subsidiary BYD Auto acknowledges that it must meet strict federal safety guidelines. “We are talking to some third-party consulting and engineering companies to get a thorough understanding of the safety standards there,” says Henry Li, general manager of BYD Auto Co.’s export trade division. Also, its hybrid is not yet on sale in China. BYD has not signed a U.S. distributor. BYD is a minor automaker in China but a substantial battery maker for cell phones. Hybrids use an internal combustion engine and batteries to power the wheels. Plug-in hybrids use household electrical current to recharge the batteries, reducing the need for gasoline. Li says BYD is in talks with distributors in Europe and the United States, but he declines to reveal names. BYD, based in the south China city of Shenzhen, began making gasolinepowered cars in 2005. It sold 85,104 cars in the first eight months of this year, according to Automotive Resources Asia, a unit of J.D. Power and Associates. c When: Jan. 19-22 Where: Detroit Marriott Renaissance Center Cost: $1,495 early registration fee by Dec. 1 (save $200); daily fee $850 Information: 313-446-0485 or autonews.com/worldcongress Exclusive lead sponsors: PricewaterhouseCoopers and IBM Mahindra’s U.S. launch to get $60 million ad drive Charles Child cchild@crain.com Mahindra’s U.S. plan Automaker: Mahindra & Mahindra, of Mumbai, India Vehicles: 2- and 4-door compact pickups, powered by clean diesel engines, go on sale in late 2009; SUV to follow Key selling point: 33 mpg on the highway Dealers: 325 dealerships signed, mainly on West and East coasts and in the South; dealership fee: $195,000 DETROIT — Mahindra’s U.S. distributor plans to launch the Indian brand next year with a $60 million ad campaign in the first 12 months. Xavier Beguiristain, 49, vice president of marketing for distributor Global Vehicles USA Inc., said he will emphasize effective management of Internet leads, which many dealers handle poorly. Global Vehicles, of Alpharetta, Ga., will take initial responses from customers and channel them to dealers, Beguiristain said during an interview here. Beguiristain’s expertise is in Internet marketing, not autos. He joined Global Vehicles this year from United Parcel Service of America Inc., where he was director of international air Global Vehicles USA’s Xavier Beguiristain: Handling Internet leads properly is key to engaging consumers. Connecting with pickup shoppers on the Internet will be critical. “We want to get consumers engaged with the brand if they buy or not,” Beguiristain said. The $60 million in the first year will be spent on national, regional co-op and local advertising, he said. Target customers will be outdoors enthusiasts who, for example, prefer to attend football games rather than watch them on TV, or bass fishermen who tow boats. Beguiristain said he also sees potential with landscape and other contractors who like diesels for their mileage, towing ability and long life. Beguiristain also will target an estimated 80,000 U.S. owners of Mahindra farm tractors — who, he said, are enthusiastic about the brand. c freight marketing. One of his projects was shipping Dell computers from the China factory to U.S. customers in two days. India version of Mahindra’s pickup http://www.autonews.com/worldcongress http://www.autonews.com/worldcongress
Table of Contents Feed for the Digital Edition of Automotive News - October 27, 2008 Chrysler dealers under GM? States would rule Survey: Worried dealers flee GMAC Va. dealers turn to local credit unions Anxiety over Chrysler: Deal or no deal? Ford, GM execs join panels looking at eco-friendly options Big pickups, SUVs gain share Chrysler will cut 4,300 salaried jobs by year end BMW seeks joint vehicle electronics effort Runkle: Give tiny suppliers a chance VW goal: 80% N.A. content for Tenn. plant April Wortham China's BYD plans U.S. hybrids Lucky Icahn lost Lear Mahindra's U.S. launch to get $60 million ad drive Toyota may renew no-interest loans Hesterberg, Thomson will address congress Desperate industry begs feds for help Hyundai dealers want ads to pitch favorable loans Toyota, GM top global r&d spending After Detroit 3 take back design, supplier sitting pretty Germany's Preh supplies F-150 ventilation part Buehler is Volt supplier Freescale: New infotainment chip Are they too big to fail? A goal for GM: Buy back full control of GMAC Tax credit would move domestic cars GMAC loan bonus is a bad idea Take a good look: Toyota is losing its halo What flexibility is and what it isn't Toshiba joins battery battle Personnel Hyundai slows Ala. output of Sonata, Santa Fe Picture this LaNeve: GM marketing budget faces '09 hit Hyundai counts on luxury, hybrid hopes Keogh: Audi belongs with top luxury brands Dealers Court overturns class-action status in Blue Oval suit 2 major lemon-law lawyers lose right to practice in Md. Auctions offer more online for just-in-time dealers Used-truck prices higher in September Lack of used Minis limits certified program Wood trim maker expects to avoid worst of woes VW: U.S. may get Scirocco after all Ford's new F-150 is built for jobs, not jaunts Think of it as GPS for tools Feds look at China-made valves on Ford tires Shareholder value tumbles in 3rd quarter Shareholder value tumbles in 3rd quarter Ford truck marketing exec: Hybrid pickup 'publicity stunt' Survey: Ford Motor reliability improves Chrysler heir: Get back to basics Farley has bright idea to boost auction action Kerkorian speeds away from autos Names familiar? NADA leadership is a family affair Mitsubishi bucks trend on profits New trade debate in the works? Beware the 'vital' deal Automotive News - October 27, 2008 Automotive News - October 27, 2008 - (Page Intro) Automotive News - October 27, 2008 - (Page Bellyband1) Automotive News - October 27, 2008 - (Page Bellyband2) Automotive News - October 27, 2008 - Va. dealers turn to local credit unions (Page 1) Automotive News - October 27, 2008 - Va. dealers turn to local credit unions (Page 2) Automotive News - October 27, 2008 - Chrysler will cut 4,300 salaried jobs by year end (Page 3) Automotive News - October 27, 2008 - VW goal: 80% N.A. content for Tenn. plant April Wortham (Page 4) Automotive News - October 27, 2008 - VW goal: 80% N.A. content for Tenn. plant April Wortham (Page 5) Automotive News - October 27, 2008 - Hesterberg, Thomson will address congress (Page 6) Automotive News - October 27, 2008 - Hesterberg, Thomson will address congress (Page 7) Automotive News - October 27, 2008 - Toyota, GM top global r&d spending (Page 8) Automotive News - October 27, 2008 - Toyota, GM top global r&d spending (Page 9) Automotive News - October 27, 2008 - Freescale: New infotainment chip (Page 10) Automotive News - October 27, 2008 - Freescale: New infotainment chip (Page 11) Automotive News - October 27, 2008 - GMAC loan bonus is a bad idea (Page 12) Automotive News - October 27, 2008 - GMAC loan bonus is a bad idea (Page 13) Automotive News - October 27, 2008 - What flexibility is and what it isn't (Page 14) Automotive News - October 27, 2008 - What flexibility is and what it isn't (Page 15) Automotive News - October 27, 2008 - Hyundai slows Ala. output of Sonata, Santa Fe (Page 16) Automotive News - October 27, 2008 - Picture this (Page 17) Automotive News - October 27, 2008 - Picture this (Page 18) Automotive News - October 27, 2008 - Picture this (Page 19) Automotive News - October 27, 2008 - LaNeve: GM marketing budget faces '09 hit (Page 20) Automotive News - October 27, 2008 - Hyundai counts on luxury, hybrid hopes (Page 21) Automotive News - October 27, 2008 - Keogh: Audi belongs with top luxury brands (Page 22) Automotive News - October 27, 2008 - Keogh: Audi belongs with top luxury brands (Page 23) Automotive News - October 27, 2008 - Dealers (Page 24) Automotive News - October 27, 2008 - 2 major lemon-law lawyers lose right to practice in Md. (Page 25) Automotive News - October 27, 2008 - Lack of used Minis limits certified program (Page 26) Automotive News - October 27, 2008 - Lack of used Minis limits certified program (Page 27) Automotive News - October 27, 2008 - Lack of used Minis limits certified program (Page 28) Automotive News - October 27, 2008 - Lack of used Minis limits certified program (Page 29) Automotive News - October 27, 2008 - Lack of used Minis limits certified program (Page 30) Automotive News - October 27, 2008 - VW: U.S. may get Scirocco after all (Page 31) Automotive News - October 27, 2008 - Feds look at China-made valves on Ford tires (Page 32) Automotive News - October 27, 2008 - Ford truck marketing exec: Hybrid pickup 'publicity stunt' (Page 33) Automotive News - October 27, 2008 - Ford truck marketing exec: Hybrid pickup 'publicity stunt' (Page 34) Automotive News - October 27, 2008 - Survey: Ford Motor reliability improves (Page 35) Automotive News - October 27, 2008 - Survey: Ford Motor reliability improves (Page 36) Automotive News - October 27, 2008 - Survey: Ford Motor reliability improves (Page 37) Automotive News - October 27, 2008 - Beware the 'vital' deal (Page 38) Automotive News - October 27, 2008 - Beware the 'vital' deal (Page 39) Automotive News - October 27, 2008 - Beware the 'vital' deal (Page 40)
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