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NADA battle plan: Tackle auto industrty crisis on 3 fronts

November 17, 2010

By Ray Scarpelli Sr., Metro Chicago NADA Director

Our industry is at a crossroads. We’re facing unprecedented challenges. But the NADA is actively engaged on the three most significant fronts—in Washington, in the media and in the dealership—in an effort to help get the auto industry back on the right track.

In Washington:

• NADA Chairman Annette Sykora testified Nov. 19 before the House Financial Services Committee, along with Detroit CEOs Alan Mulally, Rick Wagoner and BobNardelliSykora offered a Main Street perspective and supported the OEMs’ request for bridge loans.

• A call to action was sent to all dealers, asking them to urge their Congress members to act swiftly to support an economic stabilization package for the automobile industry. NADA members can locate their members of Congress by contacting the Capitol switchboard at 202-224-3121. If you have additional questions, call the NADA’s Legislative Affairs office at 800-563-1556.

• Sykora sent a letter to President Bush—hand-delivered to the White House by NADA President Phil Brady —urging the president and Congress to act quickly to implement further steps to assist the retail auto industry.

• Sykora also wrote to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, urging them to help preserve dealer viability as they consider requests for government intervention to support the ailing auto industry.

• The NADA met with Treasury Department officials to advocate the use of theTroubled Asset Relief Program to secure both retail and wholesale (floor-plan) auto loans.

• The NADA supports legislation—sponsored by Sens. Barbara Mikulski (D-Md.) and Chris Dodd (D-Conn.)—to provide tax incentives for vehicles purchased Nov. 12, 2008, to Dec. 31, 2009.

• The NADA has asked Congress to fund state "cash for clunkers" programs to encourage consumers to upgrade their older cars to more fuel-efficient models.

The association also is working with the Small Business Administration on a proposal to gain access to more working capital for dealers, and has met with financial service trade associations—the Independent Community Bankers Association, the Consumer Bankers Association and the American Financial Services Association—to increase dealer access to credit. We have participated in discussions with some 40 lenders regarding how to effectively approach Treasury. Dealers in Connecticut recently met with Sen. Dodd, chairman of the Senate Banking Committee, to seek his support. And the NADA is sending letters to each Detroit Three CEO, requesting input in the development of the plans they present to Congress. To read this letter in full, visit  

In dealerships:

• The association has launched a free, confidential telephone hotline service to help members who need assistance with financial and operational issues including frozen capital, cash flow, absorption, warranty administration, accounts receivable, and aged inventory. To schedule a call with a consultant, or call 888-672-5147. The dealer will be asked to submit financial information for analysis and will receive a consultation within 24 hours.

In other NADA news . . .

• The U.S. Treasury Department warns dealers about cases where individuals are using counterfeit documents that appear to be issued by the Treasury Department to purchase or attempt to purchase vehicles from auto dealerships or pay off debts. The department has been investigating two such cases—one in Arizona and one in Indiana. The types of notes and bonds may or may not be referenced as "U.S. Treasury" bonds or promissory notes. However, they are identified as "personal promissory notes" and/or "private offset bonds," and often contain the name Treasury Secretary Henry Paulson on the document.

The only type of paper bond issued by the U.S. Treasury that a citizen can purchase today is a U.S. savings bond. All other Treasury bonds are electronic transactions only. If you have information about any Treasury-related fraudulent activities, please contact the Office of Investigation’s hotline at 800.359. 3898, or e-mail Additional information about this and similar fraud schemes is at the Treasury Department Web site, <​/span>

In other legislative news . . .



• George McGovern, a prominent member of the Senate for years and the 1972 Democratic presidential nominee, has joined business groups opposing legislation that would eliminate the secret ballot requirements for union representation. Employees at a business such as an auto dealership would be able to organize by collecting a simple majority of employee signatures. "I believe in the secret ballot as a very important part of our democracy. When we elect a president, sheriff or member of Congress, we walk into the voting booth and pull the curtain free of anyone trying to twist our arm," McGovern said in a recent interview.

The NADA opposes the card check legislation—the Employee Free Choice Act, H.R. 800—and  supports efforts to defend the rights of workers to a secret ballot free of intimidation by unions. "Currently, the NADA is working with the Coalition for a Democratic Workplace to oppose this anti-business legislation," said David Regan, vice president of NADA legislative affairs. With increased Democratic majorities in both the House and Senate, organized labor will renew its push to pass the legislation next year. President-elect Barack Obama has previously indicated support for card check legislation. Last year, H.R. 800 passed the House but fell short of the 60 votes necessary to overcome a procedural hurdle in the Senate. For more, visit, or call the NADA’s legislative office at 202.547.5500.

• The NADA recently proposed legislation, announced last month by U.S. Sen. Barbara Mikulski (D-Md.), which seeks to stimulate the struggling economy by boosting retail automobile sales. At a news conference in a suburban Maryland dealership, Mikulski proposed granting a tax incentive for consumers who purchase a new car or truck. New-vehicle buyers would be able to temporarily deduct sales and excise taxes as well as interest on auto loans from their income taxes. "It’s simple, it’s targeted and it’s timely," Mikulski said of her proposed bill. NADA Chairman Annette Sykora, who also spoke at the conference, pointed out that auto sales are in a free fall. "We must restore consumer confidence. This legislation would provide the right kind of incentives to jump-start auto sales,"Sykora said. "Now is the time for Congress and the White House to implement a stimulus package that is focused on ‘Main Street.’ " Sykora noted that since auto sales make up almost one-fifth of the nation’s retail economy, a boost in new-vehicle sales could help lead an economic recovery. The "Auto Ownership Tax Assistance Amendment" would make interest payments on car loans tax deductible for the remainder of 2008 through the end of 2009. Prior to the 1986 tax reforms, taxpayers were able to deduct auto, credit card and other types of debt from their annual tax bill. The NADA’s legislative office encourages all dealers to reach out to their senators and representatives and urge them to support the "Mikulski-Bond Auto Ownership Tax Assistance Amendment." The NADA strongly supports Mikulski’s amendment to boost retail auto sales and other measures, which is cosponsored by Missouri Sen. Kit Bond (R). For more,