Free Webinar: Consumer Benefits and Scams The Come With Auto Industry Collapse

Free Webinar!

Tuesday June 2, 2009

12 – 1pm Eastern

Details about the auto industry collapse dominates the news but, as a practical consumer or business person, what does this mean for you and how can you benefit? What are the opportunities and scams every consumer needs to be aware of?

Brenton Grant, President of Automotive Consultant Service 8 (www.acs8.com), will be hosting a FREE webinar for anyone looking for answers. During this session we will discuss:

* Dealership closings and purchasing opportunities
* Factory warranties and options–is your vehicle still protected?
* Financing issues and the tricks the pros won’t tell you
* The truth about auto parts availability after bankruptcy (and preventing price gouging)
* Repair scams — red flags every car owner should be aware of
* When to repair and when to buy
* Is this the time to add/modify a fleet?

This event is FREE. Webinar link and call-in details will be sent after registration. For more information about this event, please email info@ewisecommunications.com or call 404.644.2779.

2008 Worst Car Year Ever –But light at the end of the tunnel?

High gas prices, the mortgage crises, the financial market meltdown, and a recession the size of which we haven’t seen in decades created a perfect storm of epic proportions for the auto industry in 2008. Sales slides were steep running from a third to half of what they were a year ago. Chrysler and GM have of course taken incredible hits. Even Nissan, Honda and Toyota sales stagnated with Toyota announcing it’s first ever reported loss as a publicly traded company.

News this week that the economy could stage a recovery later this year, and stronger than expected sales for Ford and Toyota point to a pinprick of light at the end of the tunnel. First quarter sales in the US were certainly boosted by zero percent financing. And with gas prices half of what they were this time last year, a economic recovery in the auto industry could be just around the corner too.

GM Making Initial Steps to Reinvent Brand, Company

GM’s Vice President of Sales and Marketing Mark LaNeve told Car & Drive in an recent interview that GM has the market research which shows that consumers have four main concerns that they want addressed before they will consider buying a new car: “the solidity of the car’s warranty, its safety, the buyer’s own ability to make new car payments, and worries that new cars lose their value quickly.”   GM feels that its current 5-year/100,000 mile warranties reassure consumers, and OnStar gives it a tremendous advantage in safety features over its competitors.

To address the last two concerns, the automaker has developed the Total Confidence program.  This program is additional reassurance to auto buys, because it take over car payments on behalf of the buyer for nine months if the buyer loses their job. “Nine months, all our studies show, is plenty of time to find a new job and resume making the payments,” LaNeve tells C&D.  Buyers worried about their new cars losing their value, can take heart as the program includes an “equity protection clause.  Under the Total Confidence program, buyers can trade in their new car on another GM vehicle, and GM will cover the difference between what a buyer owes on a vehicle and what it is worth, up to $5,000.”

It’s this kind of messaging and goodwill that American car buyers need to see coming from Detriot.  Images of automaker CEOs asking for hand outs have been burned into the American psyche.  But programs like GMs Total Confidence program offer a valuable and needed counterpoint.

1Q09 GM sales slump – Ford and Toyota make gains – Ever Wonder Why?

First quarter auto sales data shows that while GM sales continued to slump, Ford and Toyota made significant gains. Keep in mind that Ford accepted NO bailout moneys and Toyota is Japanese owned. Could it be that American car buyers are steering clear based on principled, ethical reasons – not supporting a company asking for a hand out? Or could it be concern of more practically matters, such as future availability of parts and dealership for repairs, or issues of warranties?

And what happens with GM and Chrysler? There is much talk of them being “smaller, leaner” companies. But could such significantly smaller companies continue to complete with a much larger Ford and Toyota who are already picking over the bones of these all but busted companies? Only time will tell for sure, but remember – American’s love an underdog, not a loser.

Fiat Fiasco

As part of the automotive bailout package, the United States government gave both Chrysler and General Motors an ultimatum: Come up with significant cost savings and restructuring plans to prevent or delay falling into bankruptcy. Chrysler was given an additional 30 days to comply – GM was given 60. It seems this disparity may be the death knell for Chrysler, but time will tell.

Prior to this governmental ultimatum, Chrysler had been in talks with Fiat about a possible merger. Those talks had broken down. But, in light of the 30-day deadline, Chrysler seemed to enter panic mode and restarted those merger talks. Within hours after President Obama made his announcement, Fiat CEO Sergio Marchionne flew to the US to participate in the negotiations with Chrysler. It seems again that these talks have become mired because Mr. Marchionne and the unions have reached a virtual impasse over contract re negotiations. Chrysler corporate officials have also looked askance at the bigger share of Chrysler that Mr. Marchionne as now asking for. While both sides are playing hardball with each other, time is running out for Chrysler to secure a deal and present its plan to the government.

Chrysler needs this merger to survive. If Chrysler should fail, the union and the workers lose. Without it, Chrysler will most likely end up in bankruptcy. Perhaps though, once Chrysler has reorganized within its bankruptcy filing, it will emerge as a new, leaner company, without all the excess baggage they are currently fighting to keep.

Dear GM

In amongst all the news about the automotive industry of late, it was reported that you are considering selling your patent for the 4.5-liter diesel engine. Please don’t; this could be a catastrophic mistake. Wake up! Can’t you see that this could be the basis of an overall redesign?

Such a knee-jerk reaction, brought on by our economy and gloomier forecasts, would defeat GM’s current turnaround plans. This innovative engine design showcases your engineering talent and prowess. Although currently out of production in GM models, these engines are:

• Easier to repair
• Cost less to repair
• Have increased fuel efficiency

Selling this patent would have dire effects. Remember Cadillac selling its cylinder cancellation technology back in the ‘80s. While the cylinder cancellation concept was right, a technical bug hastened the car company’s decision to jettison the technology before the bug could be worked out. Cadillac’s premature decision resulted in other manufactures making cylinder cancellation the concept of choice for engine displacement system to conserve fuel in almost every engine in the market today. With fuel economy at the top of new car buyer’s lists of must haves, followed quickly by low and easy maintenance, the reintroduction of the 4.5-liter diesel engine could be the pivot point in GMs recovery.

Come on GM, lace up those boots and run for it!

Show Us the Books

Car companies are still trying to dig themselves out of the current recession, asking for billions in support funds and promising leaner, more efficient, restructured organization. Like other companies, many hope that the car manufactures take this restructuring opportunity to weed out non-essential employees and broker better deals with the unions.

Some may argue this is painfully poor timing, while others say that this is the new way, a necessity. For years these companies have seemingly mismanaged their books, their companies, their relationships with America. While much of the backroom paper pushing and mice-type is best handled by the experts, transparency is the theme of the day. If the car companies want the American people to fund a bail-out of such staggering size, they need to put their cards on table. They need to show us who and what is being reorganized and why.

It may be ugly. It may be painful. But I say, show us the books.