NADA responds to GM dealer announcement

The National Automobile Dealers Association won't go quietly into the night. They are continuing to fight for the Chrysler dealers who were cut yesterday, and the announcement earlier regarding General Motors announment with the reduction of some 1100 GM dealers by the end of 2010.

Source: NADA

WASHINGTON (May 15, 2009) -- General Motors’ plans to cut its dealer network are drastic and far-reaching and will impact more than 63,000 dealership employees and thousands of their sales and service customers.

We view GM’s action with a profound sense of sadness and disappointment.
GM’s decision comes through no fault of the dealers, who are, in many cases, family-run businesses that have been loyal partners with GM – through good times and bad – for multiple generations.

NADA fully expects GM to honor all its obligations to the affected dealers, whether or not they decide to wind down their operations. It’s critical for GM to treat each affected dealer fairly and equitably.

NADA will work aggressively on all fronts with regard to assisting these dealers during these historically challenging times.

GM dealer network update

General Motors is going a different route than Chrysler LLC in regards to their dealer network. Rather than just say adios, you're done. GM is electing to not renew sales and service agreements with 1100 dealers when they come available for renewal in the 4th quarter of 2010.

Dealers targeted were stores that have poor annual sales 35 units or less per year. That makes up 400-500 of the dealers. The rest are not meeting their required sales and service performance, CSI, etc. that are performing below average. These 1100 dealers make up 7% of GMs yearly sales.

There are about 500 dealers who are dedicated to Hummer, Saab & Saturn brands. There will be a further update regarding these brands and those dealers in the next week or so. General Motors North America Vice President Vehicle Sales, Service and Marketing, Mark LaNeve did make it clear that dealers of these three brands "will exist outside of General Motors next year".

It was made clear that without GM filing bankruptcy, that these letters will be hard to enforce. This is why GM is putting the options into the dealers hands to enforce whether to wind down business and close, or find another brand to carry.

GM's intentions are to land somewhere in the neighborhood of 3600-4000 dealerships.

"This is one of the most difficult decissions we have as part of our restructuring" LaNeve said.

Press Release:

In conjunction with conversations General Motors started with its U.S. dealers today, GM issued the following statement -->

GM Statement Regarding Dealer Network Communications

As noted in our recent S-4 filing and updated Viability Plan, General Motors plans to reduce its dealer network from 5,969 stores today to approximately 3,600 by the end of 2010.

This process starts today, as GM begins contacting dealers regarding its long term planning. Approximately 1,100 underperforming and very small sales volume U.S. dealers will be advised that GM does not see them as part of its dealer network on a long-term basis. In most cases, existing franchise agreements run through October of 2010.

In addition, we will be updating about 470 Saturn, HUMMER and Saab dealers on the status of those brands and we will be discussing how the remaining dealers will support our retail plans going forward. While additional cuts will be made, we believe the vast majority, over 90 percent, of the remaining dealers will be offered a chance to remain with GM. However, specific dealer issues, further attrition and additional possible dealer network actions are expected to bring the number of future GM dealers to around 3,600 by the end of 2010, as described in the Plan. The actual number could vary given levels of attrition, etc. outside of GM’s control.

“We have said from the beginning that our dealers are not a problem but an asset for General Motors,” said Mark LaNeve, GM Vice President of Sales Service and Marketing. “However it is imperative that a healthy, viable GM have a healthy, viable dealer body that can not only survive but prosper during cyclical downturns. It is obvious that almost all parts of GM, including the dealer body, must get smaller and more efficient.”

“In response, we are letting them know about our long term plans. GM’s viability plan calls for fewer, stronger brands as well as fewer, stronger dealers. We have taken a very difficult step by identifying those dealerships we’d like to keep in the GM dealer network and those with whom we will have to wind down our business relationships,” LaNeve said.

As independently owned businesses, dealer owners will make their own decisions if and when they want to make this information public. GM is not releasing the names of any dealers.

“We are not terminating any dealerships today,” LaNeve clarified, “We will be talking to all of our dealers over the next few weeks, letting them know now in the spirit of open communication, so they are advised well in advance, about our long-term plans and their role in them. Long term, GM should have fewer, healthier dealers, maintaining GM’s current high customer satisfaction ratings, with more sales per outlet.”

Chrysler to close 789 dealers.

In compliance with bankruptcy protocol, Chrysler LLC is exercising the option to close 789 Chrysler, Dodge, and Jeep dealers across the United States. This is just one of the many steps being taken to return Chrysler to profitability when they emerge from bankruptcy proceedings and the new aliance with Fiat.

44% of the dealers affected have dual brands, meaning Chysler & Dodge, Dodge & Chevrolet etc. So some dealers will only loose one brand. But one of the key alignments is to align the dealers with the expected annual sales numbers of 12 to 14 million units per year. So you will see a Dodge dealer, that may take on Chrysler and Jeep in the near future.

Jim Press, Co-President of Chrysler LLC states that "Chrysler is open for business". And assures Chrysler customers that they will still be able to purchase cars, parts, and have their Chrysler products serviced for many years to come.

This raises the question of what will happen to the current inventory of Chrysler vehicles when the 789 dealers close. There is currently 400+ thousand Chrysler, Dodge & Jeep vehicles spread across the 789 dealers. The cars will be taken back by Chrysler and redistributed to the remaining dealers. This is due to Chrysler's decission to not produce any more vehicles during the bankruptcy process. So dealers that will be taking on new franchises will have a supply of cars to pick from.

Source: Chrysler

PRESS RELEASE:

Chrysler LLC Files Papers to Retain Majority of U.S. Dealer Network as Part of Company's Sales ProcessAuburn Hills, Mich., May 14, 2009 - Chrysler LLC today filed a motion with the U.S. Bankruptcy Court seeking to reject certain U.S. dealer agreements, and a list of U.S. dealer agreements to be assigned to the buyer of its business assets. Subject to Court approval, 2,392 Chrysler, Jeep® or Dodge dealers will continue with the new company in a global alliance with Fiat once the sale is complete. This action will help improve the landscape of the Chrysler dealership network following the sale and enhance the full line portfolio of Dodge, Jeep and Chrysler products for customers."We are in the process of revitalizing Chrysler's business to succeed as a viable enterprise under new ownership in the future," said Jim Press, Vice Chairman and President. "The unprecedented decline in the industry has had a significant impact on our sales and forced us to reduce production levels to better match the needs of the market. With the downsizing of operations after the sale and reduction of plants and production, similar reductions must be made to the size of the dealer body. We appreciate the support of our dealers and regret this painful action. We wish market conditions made it possible to keep everyone."Chrysler plans to maintain "business as usual" with all of its dealers through the transition. The Company intends to honor warranty and incentive payments during the period that rejected dealers remain active. Chrysler is committed to working with these dealers to ensure a positive relationship with customers. To ease the burden on dealers whose agreements have not been assumed, Chrysler will work to assist in the redistribution of new vehicles and parts to the remaining dealer network."It is with a deep sense of sadness that we must take steps to end some of our Sales and Service Dealer Agreements," said Steven Landry, Executive Vice President, North American Sales and Marketing, Global Service and Parts. "The decision, though difficult, was based on a data-driven matrix that assessed a number of key metrics. In total, 789 dealers, which represents 14 percent of our sales volume, will be rejected and, subject to the court approval, they will discontinue selling Dodge, Chrysler or Jeep vehicles on or about June 9."The review was an objective and rigorous process that was both thoughtful and thorough. We plan to work to have an orderly transition. These are extraordinary times, and they call for an extraordinary response. It is important to our dealers and to our customers that these steps be completed quickly and seamlessly as we transition to a new Chrysler," Landry added.Additionally, on May 12, the Court approved the motion regarding Chrysler LLC's agreement with GMAC Financial Services to provide the automotive financing products and services to the Company's dealers and customers moving forward. GMAC Financial Services will be the preferred lender in North America for Chrysler, Jeep and Dodge dealer and consumer business, including wholesale of new and used vehicles as well as retail. GMAC Financial Services will be able to offer the best long-term finance options for Chrysler dealerships and customers and is established as a bank holding company with access to a variety of funding sources.While difficult, the actions to restructure its dealer network are a necessary part of Chrysler's viability plan and are central to the proposed sale transaction. These actions will help ensure that both remaining dealers and the new company will be stronger and more profitable going forward."A stronger dealer network supported by GMAC's long-term finance options provides an advantage to consumers, and that is what will ultimately drive the creation of a significantly stronger global competitor," said Press.Additional information, including the motions filed, can be found at www.chryslerrestructuring.com.

Chrysler announces cutback in truck produttion. You're move GM

Following both General Motors and Ford, now Chrysler is going to shut down their truck plants for a while. Effective this month, Chrysler LLC is going to temporarily close their Warren, The Jefferson North Assembly and Windsor Assembly plants.

The Warren plant that assembles the Dodge Ram and Dakota pickup trucks will be closed the longest, from December 21 to February 4. Jefferson North, home of the Jeep Grand Cherokee and Commander SUVs, will close for three weeks starting January 4, 2008. That plant will also lose 911 workers, and will lose its second shift as of February 4. The Windsor plant, in Ontario, Canada, which builds the Chrysler Town & Country and Dodge Grand Caravan, will close January 14 for two weeks.

Source: Automotive News.

GM to halt production at three factories

GM has plans in place to cut production in the first quarter of 08 to help dealers control their excess inventories. Though today, The Detroit News announced that GM will halt production at three factories for two weeks. Production is limited to just the Chevrolet Silverado and GMC Sierra as of right now. The factories effected are, Pontiac, Michigan, Fort Wayne, Indiana and Oshawa, Ontario Canada. The factories will stop production effective December 31st.

Source: The Detroit News.

2008 Barrett Jackson Shelby GT Mustang. A special edition of a sepecial edition

Amen to Ford and Shelby for offering the Shelby GT. It brought the Shelby name and performance at a price that we can afford. Though it's still not the same as the Shelby GT 500.

When the GT500 went in to production the 1st one for sale was sold at the Barrett Jackson Auction for some crazy money. And the car wasn't even built yet. Since then we have seen many first run special cars go across the blocks at B-J each year.

Thus year though we will see a different kind of Barret Jackson special car. One that you can actually buy. Well 100 people can actually buy as there will only be 100 made. If you live in Arizona or Las Vegas, Nevada. You can go down to your local Ford dealer and pick up one of the 2008 Barrett Jackson Edition Shelby GT Mustang. Offered in both coupe and convertible, each will come only in black with "Barrett Jackson Red" stripes. And special B-J signature door sill plates. Oh, and an autographed photo of Carroll Shelby, Craig Jackson, Amy Boylan and Steve Davis.

The rest of the package is made up of black 18 inch wheels, a Ford Racing tuned 319 horsepower V8, flow through exhaust with x pipe crossover, 5 speed manual trans with a Hurst short throw shifter, front strut tower brace, and Ford Racing Handling Package. That adds special dampers, larger sway bars, and a 3.55:1 ratio rear axle.

Not a bad package for only $39,000. Though I'm sure dealers will mark them up since there's only 100 to go around. Though I highly doubt that the dealers are going to match or exceede the $250 per car donation(built in) that will go to the Carroll Shelby Children Foundation. So buying one is for a good cause. Now to get my tickets to Arizona.......

http://www.shelbychildrensfoundation.org/

Source: Ford, Chelby, Barrett Jackson.

PRESS RELEASE:
Exclusive 2008 Barrett-Jackson Shelby GT Unveiled in Arizona

• 2008 Barrett-Jackson Shelby GT Production is Scheduled for 100 Total Units


• Black Exterior with "Barrett-Jackson" Red Stripes and Other Touches Included


• Cars Will Be Sold Through Arizona Ford Dealers


• A Portion of Proceeds from Sales to Benefit the Carroll Shelby Children's Foundation.

SCOTTSDALE, Ariz. --(Business Wire)-- Nov. 21, 2007 Three American automotive icons, Ford Motor Company, the Barrett-Jackson Auction Company and Shelby Automobiles, have collaborated to create collector car history with a limited edition 2008 Mustang Shelby GT. The companies today unveiled the 2008 Barrett-Jackson Shelby GT based on the Ford Mustang at the Arizona International Auto Show.

With an MSRP beginning at US$38,980.00, a total of 100 2008 Barrett-Jackson Shelby GTs, in both coupe and convertible body styles, will be sold through Arizona Region Ford dealers beginning today. The purchase price of each car will include a $250 donation to the Carroll Shelby Children's Foundation.

"The Arizona and Las Vegas Ford dealers have been strong supporters of mine over the years, which is why Shelby Automobiles joined with Barrett-Jackson and Ford Motor Company to create a limited edition car just for their customers," said Carroll Shelby, CEO of Shelby Automobiles. "And I'm pleased that a portion of the sales will benefit an endowment we're building at the Carroll Shelby Children's Foundation. This is a rare chance for enthusiasts to enjoy a very special car and support a great cause."

Ford is a strong supporter of Barrett-Jackson and has sponsored its Family Value Day that kicks off the automotive lifestyle week in Scottsdale. Family Value Day was designed to attract a new generation of car enthusiasts by offering discounted tickets for adults and admitting children under the age of 12 for free.

"Barrett-Jackson's unrivaled lifestyle events celebrate America's love of the automobile," said Ford Motor Company Phoenix Regional Sales Manager, Tim Stoehr. "Their passion for the automobile has resulted in a unique venue to share our vehicles with the public. This limited edition car symbolizes our high octane relationship and gives a few lucky people the chance to own a piece of the Barrett-Jackson experience."

Over the past 37 years, Barrett-Jackson has evolved from an auction primarily attended by dedicated collectors and dealers into a retail automotive lifestyle event that is broadcast live worldwide. Shelby Cobras, GT350s and GT500s have been among the most popular cars to cross the auction block.

"We have a long tradition of selling the best Shelbys in the world because they are among the most desirable cars ever built," said Craig Jackson, Chairman/CEO of the Barrett-Jackson Auction Company. "Over the past several years, we've worked with Ford Motor Company to raise almost a million and a half dollars for Carroll's Foundation by offering new Shelby cars for sale. It was natural to celebrate our connection to these cars with a very limited edition Shelby."

From the black 18-inch wheels to the Shelby Cobra roadster hood scoop, the car is mean. The engine is upgraded with a Ford Racing package to pump out 319 horsepower and 330 lb.-ft. of torque through a high-flow exhaust system with X-pipe crossover. The Shelby GT comes standard with a five-speed manual transmission featuring a Hurst short-throw shifter; a five-speed automatic transmission is optional. The package includes a Ford Racing Handling Pack with special-tuned dampers, unique sway bars and a 3.55:1 ratio rear axle assembly. Overall ride height was dropped and a front strut-tower brace added.

"The Shelby GT was designed to deliver an exhilarating driving experience," said Amy Boylan, President of Shelby Automobiles. "In addition to the 'go faster goodies,' each will receive special badges and equipment, as well as a photo of one of these cars signed by Carroll."

Unique features of the Barrett-Jackson edition will include:

-- Black exterior with "Barrett-Jackson Red" LeMans Hood and Side Stripes

-- Barrett Jackson Edition Door Sill Plates

-- Black interior with the Shelby GT serial number plate

-- Special Gas Cap Insert

-- Autographed photo of Carroll Shelby, Craig Jackson, Amy Boylan and Steve Davis

"As someone who has been personally involved with Shelby cars for the past three decades, I'm very proud to be part of this limited edition car," noted Steve Davis, President of Barrett-Jackson. "Rarity and documentation are two of the keys to collectability, which is why only 100 Barrett-Jackson Shelby GTs are scheduled to be built. Each car will come with complete documentation and be included in the factory authorized registry."

The Barrett-Jackson Shelby GT will be displayed at the Arizona International Auto Show from November 22-25.