August 17, 2010

As Business Improves, Dealers Increase their Giving
An informal Automotive News survey conducted in July shows that 70 percent of the 132 respondents reduced their donations during the worst of the recession. But the good news is half of that group has restored some or all of that support. Click here to see survey results. Dealers regularly sponsor causes and events such as youth sports, marching bands, shelters for battered women, and hospitals. Many give away new or used vehicles. Between Jan. 1, 2008, and Jan. 1, 2010, the recession took out 13 percent of the nation's dealership franchises, according to the Automotive News dealership census. In a survey of 132 dealers, about a third said they donate more than $50,000 annually to charities and causes in their communities; almost 20 percent shell out $100,000 or more annually. Click here to see how much dealers are donating. Bill Wolters, president of the Texas Automobile Dealers Association and the Automotive Trade Association Executives, says his state has 1,263 dealers, a loss of 165 since 2007. But he says he has not heard of any surviving dealers scaling back on giving to their communities. Wolters says the community does not fully understand the importance of dealers' giving. "Not in the least," he says. "Texas is not unique; it's all over America. It's what car dealers do." Click here to read Automotive News entire report on how dealer giving was impacted by recent economic conditions.

In Some Classes, Buyers Are Not Ready to Give Up Their V-8s
Cars around the world are making do with fewer cylinders to save fuel. However, the New York Times reports that this is America - land of cheap gasoline and home of the brave V-8. So the question nags: how low are we willing to go in the cylinder count, especially for models that stake their images on power and prestige? Jesse Toprak, vice president for industry trends at TrueCar.com, said that automakers will largely test America's small-engine appetite in safer categories. But in cars above roughly $40,000, some buyers are still likely to resist. Among luxury brands here, Audi has enjoyed the most 4-cylinder success, thanks to notably silky turbo versions in models like the A4 sedan. While every luxury automaker is scaling down power plants to meet mileage and emissions regulations, Audi executives say Americans will favor larger cars with muscular engines as long as they enjoy vastly cheaper gas than most of the rest of the world. That notion may be supported by BMW's recent experience with the introduction of a 6-cylinder version of its flagship 7 Series sedan, the 2011 740i, which Americans have been slow to embrace. For more on Americans' resistance to smaller engines in their luxury vehicles, click here.

Volvo Creates a 'Team' to Handle Its Advertising
Two weeks after its ownership changed hands from U.S. car giant Ford to Chinese powerhouse Geely Corp., Volvo is restructuring its ad agency relationships to mimic what other global auto manufacturers have: a dedicated unit to serve its marketing needs. As much as such structures are continuing to generate interest among car makers, their names are hardly becoming more creative. Ford has Team Detroit, Lexus has Team One, Mazda has Team Mazda, and now Volvo has - you guessed it - Team Volvo. According to Advertising Age, Team Volvo will be an integrated unit consisting of creative resources from Havas' Arnold and Euro RSCG 4D, as well as SapientNitro. Media-buying duties, which are handled by Havas' MPG in the U.S. and WPP's Mindshare in Europe, China, and elsewhere, won't be part of the new setup. Team Volvo will be based in Amsterdam, where it will have 30 people, but it will also have offices in Boston and China. Initially it will work out of Euro RSCG 4D's offices in Amsterdam, although Volvo is in negotiations for a new space. Volvo chose Amsterdam as the location for the unit because the city is situated in the same time zone as Volvo's corporate headquarters in Sweden. Click here for the latest from Advertising Age on Volvo's plans to market its vehicles.

Porsche Takes a Big Step into Green
Porsche is going electric. It started modestly enough last year with the big Panamera sedan's automatic start-stop system, which shuts off the gasoline engine as the car pauses in city traffic. Start-stop is a sort of minimally invasive hybrid technology and so cheap and effective it will be as common as heated seats within a few years. Now comes this car: the 2011 Cayenne S Hybrid, Porsche's first production full parallel hybrid. With a combined gas-electric output of 380 hp, an eight-speed transmission, 0-60 mph acceleration of 6.1 seconds, and the capacity to "sail - which is to say, free-wheel - at speeds up to 97 mph, the Cayenne S Hybrid feels a lot like the Lexus RX 400h hybrid SUV, only interesting. Click here for a photo gallery. According to Dan Neil at the Wall Street Journal, because of its full-hybrid architecture, the Cayenne S Hybrid can glide eerily along in all-electric mode up to 37 mph for short distances, an ethereal version of the big German truck, the Flying Deutsch-man. EPA cycle fuel economy numbers are not finalized but figure on about 23/26 mpg, city/highway. Click here to read Neil's complete review of Porsche's latest foray into electric vehicle technology.

Cars of the Cash Kings
Jay-Z made an estimated $63 million last year. Diddy made $30 million. But when it comes to cars, Forbes reports that the coolest thing for the top hip-hop stars is to hide it - sort of. Kanye, for instance, had the Platinum team black out the grill and wheels of his Range Rover Supersport. And Jay-Z, despite his earlier, well-documented love of Ferrari F430s and Pagani Zonda S's, has gone the underground route, riding around in a Maybach 62 and rapping about "slamming Bentley doors", revealing his preference for a ride that's relatively low-key compared to other choices in that price bracket. The urge to go incognito extends even down the price-scale. Take Eminem. Sure, his $63,000 Hummer H2 is considered a luxury vehicle, as far as SUVs go. But the car will be around the corner before most gawkers even realize that the reserved rapper is behind the wheel. Ludacris famously gave away his 1971 Buick Oldsmobile convertible last year because he was tired of being recognized in it all over Atlanta. Of course, not all rap artists are playing it quite so low. Akon drives a $200,000 Lamborghini Gallardo, and T.I. (before he landed in jail) drove a $500,000 Mercedes-Benz SLR. Click here to see Forbes' list of rappers' favorite rides. To read the full rundown, click here.

Are You Spending Too Much on Credit Card Processing Fees?
In order to close the deal, you must be able to easily and securely accept any type of payment from your customers. And with statistics showing that Americans made 20.2 billion credit card purchase transactions in the U.S. in 2009 alone, this could mean your credit card processing fees are adding up fast. (Source: Nilson Report, Feb. 2010) So how can you cut costs? Through the AIADA BankCard Program, administered by Financial Transaction Services (FTS), dealers can quickly and easily identify savings based upon their current credit card processing needs. FTS' team of dedicated professionals will analyze what cards the dealership group is accepting and how they are being processed - and will come up with a rate structure that is guaranteed to save the dealer money. The dealer's AIADA BankCard representative will provide a written cost savings and review this document in full detail to clarify and answer questions. Some dealers are saving as much as $2,500 per month when compared with their former plans. Switching to the AIADA BankCard Program is simple: there are no contract terms, no equipment to buy, and no hidden fees. To learn more call (877) 235-1503, email aiada@ftservice.com, or click here.

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