WEEKLY POLL

>> PAST POLL RESULTS

Most Popular
Latest Issue

U.S. firms sink on supplier list

Toyota slows the rush into Miss. crossover plant

Cadillac marketing director Vanzura leaving GM

Chevy Traverse, Ford Flex face off this year

Factories punish rogue exporters

U.S. firms sink on supplier list

Clarke: Buyers don't know Saturn brand

Factories punish rogue exporters

Lamborghini picks L.A. for U.S. HQ

May 12, 2008

Automotive News

LATEST JOB LISTINGS

F&I and Accessory Consultant:
JRSI
Nationwide Positions Available, United States

Dealership Consultant:
Morrison, Brown, Argiz & Farra, LLP
Miami, FL, United States

Automotive and Process Engineers:
REHAU, Inc.
VA, United States

Sr. Brake Application Engineer:
Bosch
Farmington Hills, MI, United States

Sales Manager:
Confidential
Cleveland, OH, United States

Marketing Manager, Collector Car Group:
AutoTrader.com
Atlanta, GA, United States

Controller:
Waschke Family of Dealerships
Cook, MN, United States

Aftermarket, F&I Sales Trainer/$160 -$250,000 Per Yr.:
Mountain States Sales Sales Training
paramus, NJ, United States

Classified Ad Sales Manager:
Crain Communications
Detroit, MI, United States

Sales Manager for Luxury, Denver Metro Dealership:
Mountain States Sales Training
Cherry Hill, CO, United States

Keith Crain

Automotive News publisher and editor-in-chief

>> Send us a Letter to the Editor

SEARCH OUR KEITH CRAIN ARCHIVE

Published Date :

From:
To:

KEITH CRAIN
Watch your car-truck inventory
It seems so simple. Just make sure that your dealership doesn't stock too many vehicles that are rapidly losing their appeal.
And that applies to your used-car inventory as well.
The factories are having a hard time adjusting to new customer tastes. But the U.S. dealer has a lot of options, not the least of which is to simply say no. There will be plenty of inducements to encourage dealers to buy vehicles in which the U.S. consumer has lost interest.
The manufacturers can't shut off their production lines overnight. They are committed for years, and it's expensive for them to realize that the automobile market is sensitive to the increased fuel prices. Fuel prices started rising in the early 1970s and — except for an occasional temporary reprieve

12:01 am U.S. ET | May 12 [SUB]

KEITH CRAIN
Is it real, or is it just temporary?
By Memorial Day, we will probably be paying about $4 for a gallon of regular gasoline. Don't even think about how much we'll be paying for premium.
Sales of pickups and SUVs are already suffering. How much of that is because of the slowdown of the economy and how much is because of fuel costs is anyone's guess, but I'm putting most of my money on fuel.
Americans are stunned when they go to the pump to fill up. We've seen a rapid rise in the cost of crude oil and a corresponding price rise for gasoline and diesel fuel.
It hurts consumers, but they have options. For example, they could drive less. But airlines and trucking companies don't have a lot of choices.
The high cost of crude is going to hit us in a thousand big and small ways.

12:01 am U.S. ET | May 5 [SUB]

KEITH CRAIN
Don't be surprised to see Ghosn in N.Y.
I can only imagine the folks at Cerberus looking at one another and wondering how they ever got involved in the automobile business.
What appeared to be a simple, straightforward means of making a quick few billion dollars has turned into a nightmare of losses.
They thought they knew everything. Well, it looks like they never realized how complicated and complex the automobile business is. Outsiders can't figure out why you might need 30 or 40 years to learn how this business works. It's not something you learn overnight.
I'm sure both Bob Nardelli and Alan Mulally have learned that lesson well during the past few months. But they at least have tried to surround themselves with experts who know a lot more about this business than they do, and one would hope they are

12:01 am U.S. ET | April28 [SUB]

KEITH CRAIN
The age of fuel innovation is here
One of the basic reasons that we don't have much in the way of oil reserves is that there was no point in searching for oil when you had 10 years of development ahead of you. That may not be the case any longer, but it was very real for many years.
The same is true for many automotive innovations. If we hadn't had the two oil crises in the 1970s plus the emissions laws from Congress, we would still be driving around in polluting vehicles with carburetors, vehicles that get 10 mpg, and we wouldn't care because fuel would be a quarter a gallon.
There would not have been a push to improve mileage and generally make autos safer, cleaner and more fuel efficient.
But rising gasoline prices and stricter emissions standards have led to the investment of tens of millions of

12:01 am U.S. ET | April14 [SUB]

KEITH CRAIN
Time to go back to the basics
This isn't the first time the U.S. automobile industry has seen a sales downturn.
Although it's tough for factories to cut back production in a downturn, it's fairly easy to stop ordering cars from overseas manufacturers.
Most American auto dealers have become accustomed to seeing swings in the retail market over the past few decades. I pity dealers who have never seen a downturn. They might have thought that the market would be going up forever.
Many U.S. car dealers have endured shrinking sales and market share for years, so this might not be anything new for them. Still, several import-brand dealers thought each month would bring in even more customers.
Well, it's time to go back to the basics.
This is a great opportunity for dealers to look at the

12:01 am U.S. ET | April7 [SUB]

KEITH CRAIN
It's time to break the glass ceiling
It wasn't too long ago that Barbara Vidmar, a successful dealer from Colorado, became the first woman to head a major dealer organization.
She was chairman of the American International Automobile Dealers Association in 2000 and did a great job.
I thought that might open the floodgates of opportunity for more women to take leadership positions in the automobile business. Well, not much happened until this year when the National Automobile Dealers Association elected Annette Sykora, a car dealer from Texas, as its first female chairman. A move that was long overdue.
Even so, only five of NADA's 64 directors are women, a lot fewer than there should be on a board that represents the entire dealer population in the United States.
It hasn't been that long since

12:01 am U.S. ET | March31 [SUB]

KEITH CRAIN
Chinese cars? Dealer beware
Everybody knows that the Chinese are coming and that they'll be looking for dealers and possibly distributors.
The challenge is that no one knows who's coming. It's anybody's guess which automaker will show up on our shores with a real car and a real distribution company.
Not long ago, our old friend Malcolm Bricklin had a plan. He wanted interested dealers to invest millions in order to sell cars built by Chery Automobile, which was supposed to make everyone happy and rich. But the Chinese weren't very cooperative, and Bricklin's project seems to be in limbo.
Now the story is about Chamco Auto, which has signed 37 dealers — for franchise fees of up to $300,000 — to sell Chinese vehicles, some of which were going to be assembled in Mexico.
Right

12:01 am U.S. ET | March24 [SUB]

KEITH CRAIN
It's time for dealer-factory collaboration
Ford has decided to get the ball rolling and has offered some of its U.S. dealers the opportunity to fold their tents.
But Ford doesn't have enough money to buy out all the dealers that need to be eliminated. Nor does anyone else for that matter.
Ford, General Motors and Chrysler all have way too many dealers in the United States. Each automaker knows how many dealers it needs and where it needs them to be in the years ahead. The challenge is to get it done without breaking the bank.
With all the information available today, factories know about customer trends, population trends and other demographic information that tells them where to put dealerships. Information about how the population has shifted is available to everyone.
So the Detroit 3 can determine

12:01 am U.S. ET | March17 [SUB]

KEITH CRAIN
GM, Ford should bring Euro cars here
I just filled my gas tank, and the price per gallon was a lot closer to $4 than to $3. It looks like the entire nation might have to pay $4 a gallon for regular gasoline before long.
It will make Congress seem a lot smarter for passing its idea of an energy bill.
Certainly, one of the reasons for a slowdown in sales is that consumers are well aware of the increasing price of fuel and are waiting to see whether it is temporary. Or they are simply buying smaller vehicles.
It makes the Geneva motor show more relevant.
Europeans have paid high fuel prices for decades, and, because of that, they want smaller cars and now even smaller SUVs.
Ford, General Motors' Opel and many other manufacturers around the world have been designing and building small, fuel-

12:01 am U.S. ET | March10 [SUB]

KEITH CRAIN
Doug Fraser was a great leader
These days, we give Ron Gettelfinger a lot of credit for what he and the UAW did during the last contract negotiations. Gettelfinger deserves every bit of that credit.
But he, the UAW and, most important, the Detroit 3 owe a great deal to Doug Fraser, the leader of the UAW during some of the union's earlier challenges. Fraser died recently at the age of 91.
Fraser understood that you must have a successful company to have well-paid workers.
I got the chance to know Fraser during a long, drawn-out study of mass transit in Detroit. He was chairman of a task force and study group that was looking into the issue, and I was asked to serve on his committee. It was a task that I enjoyed with Doug at the helm.
The study lasted a year or so. I got to know Fraser quite

12:01 am U.S. ET | March3 [SUB]

KEITH CRAIN
Hail, Geneva; spring must be near
Next week, the European auto community and other interested parties will descend on Geneva for the 78th annual Geneva International Motor Show. Other than the North American International Auto Show in Detroit, Geneva is the only major international motor show held every year.
And unlike the famous groundhog in Punxsutawney, Pa., the Geneva show really is the annual signal that we've all survived another winter and spring is at hand.
What began as a quaint motor show in a small hall on the other side of town is now held near the airport at the Palexpo exhibition facility — which, with a new expansion, now goes over the freeway and onto airport property.
Geneva is always an interesting show because it's held in neutral territory. Switzerland doesn't produce automobiles, but

12:01 am U.S. ET | Feb.25 [SUB]

KEITH CRAIN
Dealer is makers' best voice in D.C.
Not many folks think this year is going to be a barn burner for car sales in the United States. Most people think it probably will be something around a million less than in 2007, which is still good.
But it didn't matter at the National Automobile Dealers Association gathering.
I love going to the annual NADA convention. Sure, lots of folks have lots of problems, but the best part is getting a pep talk from everyone about how great the business is these days.
You can't be a pessimist for long when you hang around a lot of car dealers. They are the most upbeat folks I know.
Besides having the opportunity to say hello to a lot of friends that I see only once a year, I think it's fun to hear a lot of people who believe that the car business is going to be great

12:01 am U.S. ET | Feb.18 [SUB]

KEITH CRAIN
Franchise system is alive and well
Every now and again, there is an attack on the automobile franchise system.
It hasn't happened in a while, and most manufacturers seem happy with the way things are working.
Sure, the Detroit 3 have too many dealers, but basic economics will help correct that.
Dealers will probably have to help themselves. GM, Ford and Chrysler have so many problems of their own that they're not going to have much time or money to address the question of how many dealers there are and where.
It could get interesting as the number of Detroit 3 dealers declines. It's possible that the auto companies will be preparing dealerships all over the United States for the next wave of manufacturers from overseas.
If you lose a Ford or Chevrolet or Dodge franchise and are still

12:01 am U.S. ET | Feb.11 [SUB]

KEITH CRAIN
It will be painful for some dealers
Just about everyone agrees: The Detroit 3 have too many dealerships. For the companies and the dealers to prosper, there must be bold moves by some dealers and their factories.
Because of everything that goes with being an automobile dealer for one, two or even three generations, it will be painful for some to give up their franchises.
Most states have laws that protect franchised dealers from almost any reduction that a manufacturer might want to impose.
Another option is for the manufacturer to buy dealerships and close them. That could get expensive. An effective reduction likely would take far more money and time than any of the Detroit 3 can afford.
We all remember the Oldsmobile fiasco. Whether or not it was thought out, it took lots of money and a long

12:01 am U.S. ET | Feb.4 [SUB]