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NADA Headlines (Aug. 12, 2010)

G.M. Chief Stepping Down After Report of Strong Quarter

DETROIT — In a surprise development, General Motors’ chairman and chief executive, Edward E. Whitacre Jr., announced Thursday that he would step down as chief executive on Sept. 1 and be succeeded by Daniel F. Akerson, a G.M. board member and a managing director of the Carlyle Group. Mr. Whitacre said he would stay on as chairman until year end, when Mr. Akerson would assume that role as well. “I believe we’ve accomplished what we set out to do,” Mr. Whitacre said. “We’re going to have a smooth seamless transition here.” Mr. Whitacre, the retired chief of AT&T, had previously expressed a desire to leave once G.M. stabilized, but the timing of his announcement was unexpected, as was the choice of Mr. Akerson, a former chairman of Nextel Communications, as his successor. Read more from The New York Times.

GM Reports $1.3 Billion Second-Quarter Profit

DETROIT—General Motors Co. reported Thursday a $1.3 billion second-quarter profit in stark contrast to a year ago when the auto maker lost nearly $13 billion as it slid into bankruptcy. Revenue soared 43% from a year ago to $33 billion for the April-through-June period as GM increased sales around the globe and commanded higher prices for cars and trucks sold in the U.S. The profit is GM's largest since 2004 and first time its has two money-making quarters in a row since that time. The auto maker lost money from 2005 through 2009 and has been living off a $50 billion U.S. government bailout since last year. Read more from The Wall Street Journal.

G.M. Said to Be Close to Stock Offering

DETROIT — General Motors could file for an initial public offering of stock as soon as Friday, allowing the government to begin selling its stake in the automaker within several months, people briefed on the matter said Wednesday. A week ago, G.M.’s chief executive, Edward E. Whitacre Jr., said the company was drafting the paperwork and would file a stock registration in “the near future.” The automaker is also making progress in lining up a $5 billion credit facility from several major banks to help provide an additional backstop, the people briefed on G.M.’s plans said. The actual offering is not expected until November or later. Read more from The New York Times.

Car Dealers Make Most of Less on Their Lots

Here's an unexpected result of the Great Recession: Washington area auto dealers don't have enough new cars to sell and are begging automakers for more. In the past, dealers would take out big loans to buy lots full of cars, giving them months of inventory and buyers an abundant selection. But credit dried up as the recession took hold, hurting dealers and customers. Now, automakers face an uncertain economic recovery and the prospect that dealers won't be able to get loans. Dealers say automakers are being stingy in parceling out new vehicles, leading to emptier lots and sometimes frustrated customers. Jerry Jaffe, general manager at Jaguar, Land Rover, Lincoln & Mercury in Bethesda, said his customers in the past had a "feeding-frenzy mentality." In 2004 his dealership sold 70 new Jaguars per month and stocked 100 to 120 of the English luxury cars. Now he sells 20 Jags per month and has 35 to 40 on hand. With fewer cars to go around, his customers are more conscientious. Read more from The Washington Post.

Report: Overall Consumer Spending Tepid in July

NEW YORK -- American shoppers dug in their heels in July, bad news for the stalling economy and worse for struggling retailers. Excluding gasoline and autos, U.S. retail sales rose a meager 0.1 percent last month from June, according to figures released Thursday by MasterCard Advisors' SpendingPulse, which estimates spending in all forms including cash. "It's growth, but it's pretty weak growth," said Kamalesh Rao, director of Economic Research for SpendingPulse. Bright spots remained in online sales, electronics, airlines and lodging as Americans devoted their limited dollars to summer travel. Clothing, jewelry and luxury sales were weak. Read more from The Washington Post.

4 Ford F-150 Engines Set to Lift Pickup Sales

Ford's U.S. pickup sales gains are already double those of the rest of the auto industry, but the Dearborn automaker is expecting an even bigger boost after it offers four new engines in its 2011 F-150. Ford is promising a 20% overall fuel economy increase with its new engines, which are expected to begin arriving at dealerships by early December. "We know that GM and Toyota customers in particular tend to prioritize fuel economy highly," Doug Scott, Ford's truck marketing manager, said Wednesday at a news media event in Dearborn to show off the new powertrain lineup. "And we know from the research that more of them are willing to switch brands for a significant improvement in fuel economy." Ford's new engines include a 3.7-liter V6, a 5.0-liter V8, a 6.2-liter V8 and a turbocharged EcoBoost 3.5-liter V6. Read more from the Detroit Free Press.

NADAFrontPage Spotlights State and Metro TIME Dealers of the Year Each Week

A new TIME Dealer of the Year feature has been added to NADAFrontPage.com to highlight a different state or metro winner each week. The new “Weekly Spotlight” features photographs and detailed profiles of the TIME winners. The TIME Dealer of the Year program honors NADA members who exhibit exceptional performance in their dealerships and a dedication to community service. The 2011 national winner will be announced at the NADA Convention & Expo in San Francisco on Feb. 5.

Opinion: GM Done Fighting with Dealers Over Closures; Now Fighting Over Facility Upgrades

By Jim Henry

General Motors declared it was finished with its retail channel makeover and in the same announcement, announced a makeover of the actual dealerships themselves. The twin agenda items illustrate the ambivalent relationship between car companies and their dealers. The car companies make most of their money selling cars to dealers. The more the dealers pay for cars relative to how much it costs to build the cars, the better for the factories. Obviously, dealers pay for their own dealerships. So when a car company announces, “a major facilities upgrade program,” like GM did last week, the car company doesn’t always add, “a major facilities upgrade program… which the dealers carry out at their own expense.” The point is, dealership upgrades are a perennial flash point. Read more from BNET.