F&I Management & Training

France has decided to loan 6.5bn euros ($8.5bn, £5.7bn) to three carmakers, President Nicolas Sarkozy has said. Peugeot-Citroen and Renault will receive 3bn euros each, while Renault Trucks, which is owned by Sweden's AB Volvo, will get 500m euros. In exchange, they had pledged to keep French sites open, the president said after talks with carmakers. The car industry is one of France's biggest employers. Demand for cars has plummeted amid the global downturn. Industry secretary Luc Chatel said the terms of the car bail-out foresaw a reining in management bonuses. "This is not a gift. It is not a subsidy. It is a loan offered at an interest rate of 6%," President Sarkozy said. Meanwhile, The European Commission said it would look very carefully at the French car bail-out. "The commission will need to scrutinise very carefully details of the subsidies, the conditions attached, to make sure of their compliance with state aid and single market rules," commission competition spokesman Jonathan Todd said. Commitments The government loans, which will run over five years, will allow Renault and Peugeot-Citroen to "prepare calmly for the future", the president said. "Renault and PSA have made a commitment... to close no sites over the duration of the loan and to do everything to avoid redundancies," he said. "I welcome this commitment since it gives us the assurance that an acute but temporary crisis will not destroy part of our industrial base and our auto industry skills." President Sarkozy also said the government would double its aid to car industry suppliers to 600m euros. Renault and Peugeot-Citroen's financial services divisions will also get a doubled state aid of 2bn euros. Both Peugeot and Renault will report their full-year results later this week.

DATED: 10.02.09

FEED: AW

The US Government is considering the possibility of placing Chrysler and General Motors in Chapter 11 bankruptcy protection.
This would help safeguard the £11.7billion in loans extended to the carmakers, reports The Daily Telegraph.
It is understood the move is one of a range of options being considered by US Government advisers, and ensure taxpayers would be paid out first if either company collapsed.
Chapter 11 allows a company to undertake rigorous restructuring measures while protecting it from creditors.
However both carmakers have in the past said a move into Chapter 11 would be unhelpful, as customers would lose confidence and many suppliers would stop working with them.

DATED: 10.02.09

FEED: AM

PSA Peugeot Citroen has welcomed the French government’s five-year €3 billion (£2.62bn) loan to support the group’s development programme for more efficient and affordable vehicles.
Renault has also been given €3bn (£2.62bn) to help support it through the recession.
The deal means that no French plants will close and all industrial decisions by the two companies will be examined by the French government for the next five years. Top executives at both companies will also have to forgo their bonuses.
To support this strategy, PSA has said it is committed to maintaining its French R&D, engineering and testing facilities.
As a result of the support package, the PSA will not close any of its French plants and over the next two year, one or more new models will be launched at each of its five assembly units in France. There will also be no compulsory redundancies in France.
President Sarkozy has also announced that local business tax will be abolished in 2010 and the government will be looking at the best way of “improving the underlying competitiveness of France's auto industry in order to improve its position within the European industry”.
PSA is now taking the following actions in reaction to the global recession:
• Speeding up payments to suppliers • Raising its contribution to the automobile industry investment fund from €100 million (£87.3m) to €200m (£175m), • Implementing the code of good practice and competitiveness developed jointly by the Committee of French Automobile Manufacturers (CCFA) and the Automobile Industry Suppliers' Liaison Committee (CLIFA)• Negotiating a special agreement with "Groupement de la Plasturgie", the body representing suppliers of plastic components, that takes into account the specific characteristics of this industry.

DATED: 10.02.09

FEED: AM

Speculation over Fiat and Chrysler teaming up has ended after the carmakers confirmed they will be working together.
Both have entered into a "mutually beneficial" partnership to roll our over the next five years, reports the Mopar Muscle website.
For Chrysler, Fiat brings the experience of fuel efficient cars and will supply the US maker with compacts, sub-compacts and city vehicles, while benefiting from a pre-establised dealer network as the trade-off.
The deal comes with no cash investments from either party, but does tap into the established networks each currently own.

DATED: 10.02.09

FEED: AM

According to BCA’s latest Pulse report, average used car values improved for the second month running in December, but remain well behind where they were a year ago. Used values appear to have stabilised in the second half of 2008, following large falls earlier in the year.In some ways the December increase was illusory as it reflects a significant shift in the mix with reductions in lower priced dealer part-exchange volume resulting in overall increased values. However, used cars currently represent exceptional value for money and the fact that values have stabilised in recent months is encouraging.While overall average monthly used car values rose in December, not every sector enjoyed the increase.According to BCA’s figures, values for fleet and lease cars fell by £125 (2.2%) to £5,471 and nearly-new values fell by just £76 (around 0.5%) to £14,100.However, average part-exchange values climbed by £31 (1.5%). With significant falls in the new car retail sector, fewer part-exchange vehicles have been reaching the wholesale sector. This relative shortage has kept values on an even keel. The latter part of the year was ‘quieter’ in terms of price swings, with part-exchange values of around £2,000.
The average performance against CAP Clean improved marginally against November, but has been sitting around the 87% mark for a number of months. The demand is much stronger at the cheaper end of the market and activity up to £5,000 is notably greater than in the £5,000 – £10,000 bracket. With finance difficult for retail customers, professional buyers continue to focus on the sub- £5,000 retail price, making cars more affordable for motorists using other funding sources (savings, credit cards etc).Following a significant 8.6% rise in October, average values for part-exchange budget cars remained relatively strong, ending at £966 – its second highest average monthly value in 2008.

DATED: 10.02.09

FEED: AM

Volvo is celebrating the appointment of several new dealerships.
Cambria Automobiles has added three Doves Volvo dealerships in Blackburn, Oldham and Preston. It already has three Volvo outlets in the south of England.
Donalds Motor Group has added the franchise alongside its Mazda outlet in Ipswich, Jardine Motor Group has added Volvo alongside its Lancaster Jaguar and Land Rover dealerships in Reading, and Hatfields has added Volvo to its Chrysler showroom in Bury.
Philip Hand, network development manager for Volvo Car UK, said: "It is immensely pleasing that so many entrepreneurial businesses are keen to bring Volvo in to their portfolio of brands.

"We think they have made an excellent decision, especially as Volvo is one of the only manufacturers to have improved its recent year-on-year performance."
Volvo ended 2008 with an 11% increase in registrations over 2007.

DATED: 10.02.09

FEED: AM

General Motors will cut 10,000 jobs globally including 3,000 to 4,000 in Europe to reduce costs during the economic crisis.The troubled automaker said it will cut 10,000 of its 73,000 white collar jobs across the world as it battles pretax losses that reached a $2.8 billion in the third quarter of 2008.In the United States, about 3,400 of GM's 29,500 salaried employees will be affected. The rest of the job cuts will impact Europe and GM's other operations around the world.

DATED: 10.02.09

FEED: ANE

Industry legend Bob Lutz, General Motors' head of product development, will retire from the company at the end of the year.The 76-year-old, who has also worked at BMW, Ford Motor and Chrysler during his career, will remain as vice chairman and senior advisor to GM CEO Rick Wagoner, the company said Monday.Lutz will be replaced as GM's product development head by Thomas G Stephens, aged 60, effective April 1, 2009

DATED: 10.02.09

FEED: ANE

Almost 300,000 motorists have had applications for car loans rejected during the past six months, according to research by online financial comparison site www.moneyexpert.com.That’s equivalent to 1,600 people every day. It is the best indication yet that there is ample demand for new and used cars, but dealers have to encourage these potential buyers to visit the showroom and consider point-of-sale finance instead of approaching the banks. In addition, training firm Martec Europe reports that its dealer clients received, on average, two more telephone enquiries a day in January compared to a year ago.“There are prospects out there,” said Martec’s Neil Pursell.

Several retailers have reported immediate success as a result of interviews and promotions with their local press, outlining why there has never been a better time to buy a car. Volvo/Jaguar retailer John Cleland in Galashiels, Scotland, resorted to placing an advertorial in his local paper after reporters decided a good news story was of no interest.“As a consequence we have never seen as much Saturday showroom traffic,” he said. “We need to get our motor trade bodies to lobby the press and media to stop putting a downer on life – we know we are in recession, help us all climb out of it.”

Daksh Gupta, chief executive at Marshall Motor Group, reports that during one week in January the company had its third best order take since it started keeping records. Marshall also sold 70 Land Rovers, Jaguars and Volvos over one weekend from nine sites.“This has definitely helped in terms of getting our sales people to be positive by reminding them of all the reasons why customers should buy now,” Gupta said. BCA UK managing director Andrew Hulme believes the industry should consider March 1 as ‘Christmas Day’ and tailor all its publicity towards the plate-change.

“A compelling, co-ordinated advertising and marketing programme supported by all interested parties is a must,” he said. “The availability of finance is a fundamental part of the equation and we must continue to lobby Government to encourage the banks to return to more normal levels of lending.“Christmas in March is an opportunity too good to miss and BCA will offer its full support.”The message is getting out.

Consumer group Which? has issued a press release detailing some of the offers that are available.Richard Headland, editor of Which? Car, said: “You could say there’s never been a better time to buy a car. The downturn has thrown the car industry into turmoil and that means there are some amazing car deals available – whether you’re looking to buy new or used.”

DATED: 10.02.09

FEED: AM

Kia Motors has become a supporting partner of this year's Red Nose Day event.
To help raise money for good causes the company has introduced a limited edition Picanto "red" to mark the occasion.
For every model sold between now and Red Nose Day on Friday March 13, Kia will donate £100 to Comic Relief - enough to send two Zambian children to school for a whole year.
Kia is also encouraging customers to 'show us their nose' by asking them to buy a Car Nose from their local Sainsbury's or at www.rednoseday.com.
They are then encouraged to take a picture of their Kia wearing its red nose and upload the image to the company's website dedicated to the day - www.kia.co.uk/rednoseday.
If they also register their details on the site they can enter a prize draw to win a limited edition Picanto Red made especially to celebrate Red Nose Day.
In addition, Kia dealerships across the country will be organising various activities to raise funds for the event.

DATED: 10.02.09

FEED: AM

A South Korean court has granted ‘court receivership’ status to SsangYong Motor (SYMC), paving the way for radical restructuring.
Court receivership is similar to US Chapter 11 status, giving SYMC protection from creditors and time to formulate and implement a corporate resuscitation plan.
Under the new arrangements, the court has appointed former Hyundai Motor president Lee Yoo-il, and SYMC vice-president in charge of finance, Park Young-tae as co-legal administrators.
The court’s decision was welcomed by around 7,200 SYMC employees and creditors, led by state-run Korea Development Bank.
Paul Williams, managing director of UK distributor Koelliker UK, said: “This is very good news after a worrying period, and I want to thank our staff and dealers for their faith and confidence in toughing it out and getting on with the job.
“Restructuring won’t be easy, but we now look forward to the continuing new model development programme and a fitter and stronger SsangYong, better able to meet the challenges of tomorrow.”

DATED: 10.02.09

FEED: AM

The British government is studying car scrapping schemes introduced in other European countries to boost demand for new models but is not certain they would work, a spokesman for Prime Minister Gordon Brown said on Friday. UK Business Secretary Peter Mandelson said in a speech on Thursday night that he was studying the initiative as he tries to revive the struggling car industry.

DATED: 09.02.09

FEED: ANE

France will unveil details of a plan to support its ailing car industry today, Monday 09.02.09
ahead of expected weak 2008 results from Renault and PSA/Peugeot-Citroen

DATED: 09.02.09

FEED: ANE

TOKYO (Reuters) -- Nissan Motor will cut production by 20 percent and reduce its global headcount by 20,000 by the end of March, the carmaker said Monday.Nissan CEO Carlos Ghosn said the company has no plans to close any factories. Nissan posted a big quarterly loss on Monday and warned it would lose money this year.For the year to March 31, Nissan now expects an operating loss of 180 billion yen ($2 billion) instead of the 270 billion yen profit it projected three months ago. Nissan, 44 percent owned by Renault, expects its net loss at 265 billion yen instead of its earlier projection of a 160 billion yen profit.Saddled with excess capacity and with sales plummeting in developed markets, Nissan has cut 2,000 non-permanent manufacturing jobs in Japan.

DATED: 09.02.09

FEED: ANE

The credit squeeze helped the Finance & Leasing Association and franchised dealers to raise the point-of-sale share of motor loans on new cars to 53.3% in November. This is up from 46.4% a year ago.

Paul Harrison, FLA head of motor finance, said: “Dealer finance has performed remarkably well over the past 12 months, and the showroom share has steadily increased.”This year the FLA will build on its initiative that is winning showroom finance back from high street and direct lenders by extending its Specialist Automotive Finance (SAF) certification from individuals to dealerships.More than 5,800 people and 444 dealerships have registered for the on-line competence test, which needs to be retaken each year. Harrison said: “We will also add an approved status to SAF to help to raise its profile in showrooms with a range of materials available to help dealership staff to talk to customers.”Harrison said a lower demand for cars meant a liquidity problem for lenders, but used car volumes were relatively stable in 2008. “The core issue for FLA members is access to well-priced funding. “This has effectively dried up, which is why the FLA has called for the government to extend its support for bank lending to non-bank lenders, including motor finance providers.”

Harrison said this month’s Bank of England decision to cut base rate to 1.5% was not fully passed on to the inter-bank rate. Whether that rate continues to fall will determine whether FLA members can acquire funds at a lower rate, and in turn pass savings to their customers,” he said.“The FLA is talking to a number of government departments, including business and the Treasury, about a range of meas-ures which will help to restore confidence in the economy and the continued supply of credit to consumers. These include support for non-bank lenders until usual funding channels return to business as usual.”

DATED: 08.02.09

FEED: AM

MARSHALL Motor Group has bought up three of the former deVries Honda sites for an undisclosed sum.
Marshall chief executive Daksh Gupta called Car Dealer exclusively last night with news of the deal.
In his 53rd day in charge of Marshall, he announced the group had snapped up the Hull, York and Scarborough sites from administrators.
‘In 2007, deVries turned over £38m with a profit of £750,000 - that’s a two per cent return on sales,’ an excited Gupta told us.
‘That’s a good business by anyone’s standards and Scarborough was number one in customer satisfaction tables.
‘This is really big news for us and shows we are committed to growing outside of what is seen as a regional group in East Anglia to something much bigger.
‘Marshall is all about sustainable growth and as a company we have zero debt. There aren’t many dealers out there at the moment that can claim that.’
Clearly, the deVries deal had buoyed Gupta and he made the announcement to Car Dealer before any other trade publication.
‘In 2007 the deVries sites sold some 2,600 cars - we are very excited and passionate about taking on the Honda franchises,’ he added.
The announcement comes the day after new car sales figures showed a 30 per cent drop in registrations in January and at a time when many dealers are shrinking.
‘We are a focussed team here at Marshall and are excited about the future,’ said Gupta. ‘It’s very important to keep the team up and motivated in these tough times and with acquisitions like this that will only happen.’
The new businesses will report to Franchise Director Mark Furniss who, like Gupta, has recently joined Marshall following the group’s decision to move from its historic regional structure to a franchise-centric organisation.
As part of this acquisition, all deVries staff working for the Honda franchised dealerships in York, Scarborough and Hull will transfer to Marshall.
Marshall has also undertaken to ensure that no customers, who have paid deposits on cars prior to the collapse of the business, are disadvantaged by the acquisition of the business.
Grant Thornton Leeds were appointed administrators of deVries on January 13.

DATED: 08.02.09

FEED: CDM