Report: NADA and banks working to curb new federal oversight efforts

Filed under: Car Buying, Government/Legal

nada logoIn 2010, the Federal Trade Commission received 1,339,265 complaints. According to the National Automobile Dealer’s Association, less than one percent of those complaints were related to new or used auto sales. That relatively low number (compared to the 250,854 people who complained of identity theft) has NADA upset over the government’s decision to pursue the creation of an automotive lending consumer advocacy agency.

NADA has given its official support to the congressional Republicans who are looking to put the clamps on this new oversight group.

This agency will be formed as part of legislation that seeks to simplify auto loan disclosure forms, and the entire process of borrowing money to obtain a new set of wheels. On the contrary, NADA believes this advocacy agency could lead to financing abuses related to the level of power granted to those in charge.

NADA and banks working to curb new federal oversight efforts originally appeared on Autoblog on Wed, 25 May 2011 17:32:00 EST. Please see our terms for use of feeds.

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Breaking: Chrysler repays the rest of its federal loans… are SUVs to thank?

Filed under: Government/Legal, Chrysler, Earnings/Financials, Fiat

chrysler banner announces government dept paid off

It’s Official: Chrysler has announced that it has repaid its multi-billion dollar obligations owed to both the United States and Canadian governments. Adding up both loans plus interest, Chrysler has just shelled out a tidy $7.6 billion. The U.S. receives $5.9 billion and Canada will get $1.7 billion.

Chrysler was able to secure new means of financing, which allows the automaker to pay off its government obligations a full six years ahead of the original payment schedule. While this new financing still involves debts, it saves Chrysler an estimated $350 million per year in interest. This move also allows Chrysler to remain liquid, with more than $10 billion in assets ready to roll.

Under the direction of the U.S. government, Chrysler partnered up with Fiat, and the goal was to bring smaller, more fuel-efficient vehicles to the states. Yet as an opinion piece in The Detroit News sagely reminds us, it wasn’t really the smaller cars that helped Chrysler, but the newly refreshed sport utility vehicles. The all-new Dodge Durango and Jeep Grand Cherokee models helped push sales up 17 percent in 2010.

Regardless of how they got there, this move should serve to instill confidence in the U.S. car-buying public. Chrysler continues to add new or redesigned vehicles to its lineup and has a strong media campaign behind those vehicles. Will high gas prices slow the positive momentum that Chrysler has built up, or is this the chance for the Fiat portion of the relationship to step up and shine? Sound off in Comments, and check out the full press release posted after the jump.

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Chrysler repays the rest of its federal loans… are SUVs to thank? originally appeared on Autoblog on Tue, 24 May 2011 13:55:00 EST. Please see our terms for use of feeds.

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Report: ‘Car Czar’ post nixed as part of federal budget deal

Filed under: Etc., Government/Legal, Earnings/Financials

Ron Bloom

Last week, the government avoided a costly shutdown by cutting $38 billion from the 2012 federal budget. The American people are just now hearing what those cuts consist of, and it appears the auto industry and industry regulation have been affected.

The Detroit News is reporting that the currently vacant Car Czar posts was among the positions that didn’t make the cut. The post was last held by Ron Bloom (above), Senior Adviser to the Secretary of the Treasury, who left the job in February. The Car Czar was originally appointed to oversee the government’s investment in the industry in the wake of the bankruptcies of General Motors and Chrysler.

We’re guessing the task force position won’t be missed much by the auto industry, but a $408 million cut from a $ 2.3 billion program to research fuel efficiency technology might be. Also getting the axe? A whopping $2.9 billion from light rail initiatives and $37 million from a program that advocates seatbelt usage.

[Source: The Detroit News]

Report: ‘Car Czar’ post nixed as part of federal budget deal originally appeared on Autoblog on Tue, 12 Apr 2011 14:26:00 EST. Please see our terms for use of feeds.

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Report: BMW, Harley-Davidson among those that tapped Federal Reserve for billions during crisis

Filed under: BMW, Earnings/Financials

BMW Logo

The U.S. government’s Commercial Paper Funding Facility was established towards the tail-end of 2008. The CPFF was created to offer companies short-terms loan when traditional means of establishing credit were crumbling. Lehman Brothers had collapsed and AIG was taking expensive trips while showing the world its pocket lint, but that didn’t mean that other companies weren’t in need of cash, and Washington stepped in to oblige. According to Bloomberg, among those parties taking advantage of the Federal Reserve program were a long list of automotive clients, German automaker BMW among them.

According to Bloomberg, German automaker secured funding assistance intermittently between 2008 and 2009, with the largest single transaction a reported $3.62 billion. This line of credit helped BMW survive during a time when other automakers were getting by on life support. Some of the funds were used to expand the South Carolina facility that produces X3, X5 and X6 models. While suffering its lowest profit in a decade, BMW was still able to produce a positive cash flow of nearly $2 billion.

Taking a look at the data provided by the Feds (download the spreadsheet here – *Warning: Excel spreadsheet), we see that a number of automakers and compnaies also made use of the CPFF, including Harley-Davidson (33 separate instances totaling $2.3 billion), Toyota, Ford, Chrysler, General Motors and Mitsubishi.

[Sources: Bloomberg, The Washington Post | Image: Drew Phillips/AOL]

Report: BMW, Harley-Davidson among those that tapped Federal Reserve for billions during crisis originally appeared on Autoblog on Thu, 02 Dec 2010 18:01:00 EST. Please see our terms for use of feeds.

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CNN: Federal appeals court proclaims memorial crosses on highways unconstitutional

Filed under: Etc., Government/Legal

roadside crucifix with flowers

A federal appeals court has ruled that crosses set up alongside public roads in Utah to honor fallen state troopers are unconstitutional. The Utah Highway Patrol Association began erecting the privately-owned crosses over a decade ago, each with the trooper’s name, badge number and the state seal. Despite not being owned by the state itself, the crosses reside on public land where drivers have no choice but to see them. That, combined with the state insignia was enough for the court to decide that the crosses had to go.

Texas-based American Atheists originally sued to have the nonprofit program discontinued and won, though the crosses were allowed to remain standing as the case went through the appeals process. Meanwhile, the UHPA argued that its message wasn’t necessarily a religious one. The court sided with the American Atheists, saying that the size of the crosses and their location didn’t gel with the government’s need to remain neutral on religion.

[Source: CNN | Image: Pay No Mind CC 2.0]

CNN: Federal appeals court proclaims memorial crosses on highways unconstitutional originally appeared on Autoblog on Thu, 19 Aug 2010 14:00:00 EST. Please see our terms for use of feeds.

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