June 22, 2015
Obama's Trade Agenda Rises Again
This week, the Senate is expected to pass a "fast-track" bill that would pave the way for major free trade deals like the upcoming Trans-Pacific Partnership, which would strengthen the economic and strategic ties of 12 Pacific Rim countries composing around one-third of the world's trade. According to National Journal, that deal would be the most significant since NAFTA and is only possible if a small crew of Senate Democrats join Republicans to pass the so-called trade promotion authority bill limiting congressional debate on trade deals for the next six years to an up-or-down vote. To get there, the pro-trade, largely coastal-state Democrats want assurances. They want to make sure that related bills, including one helping workers displaced by such deals, will be taken up and passed afterwards. Senate Majority Leader Mitch McConnell said last week that even though his fellow Republicans have major reservations about the trade adjustment assistance bill, "the votes will be there to pass it" in order to get TPA done. The goal is for Obama to sign both bills by the July 4 recess. Click here locate your senators and then call and tell them to support the trade promotion bill in the Senate this week. For the latest on this weeks’ anticipated trade vote, click here.
U.S. Auditor Finds Sweeping Problems at NHTSA
A year-long government audit finds sweeping problems at the National Highway Traffic Safety Administration (NHTSA) and says the agency failed repeatedly over a decade to discover the General Motors ignition switch defect now linked to more than 110 deaths. The scathing 42-page report by the Transportation Department's Office of Inspector General says that NHTSA, the nation's auto safety regulator, fails to carefully review safety issues, hold automakers accountable for safety lapses, carefully collect vehicle safety data, or properly train or supervise its staff. And it says NHTSA rejects most staff requests to open investigations into suspected defects, reports The Detroit News. "Collectively, these weaknesses have resulted in significant safety concerns being overlooked," the report found. The report makes 17 major recommendations for widespread reforms. The agency's new administrator, Mark Rosekind, who took office in December, has agreed to "aggressively implement" them by next June. In a letter to the inspector general, Rosekind said NHTSA already is addressing many of the problems cited in the audit. He told the inspector general that NHTSA has a new training plan for staff to gain proficiency in new automotive and investigative technologies. For more on an audit finding serious problems at NHTSA, click here.
Sergio to BMW, Audi: Here Comes Alfa
Sergio Marchionne's risky, $6 billion plan to turn Alfa Romeo into a premium brand begins with three new models that will arrive by the end of 2017, reports Automotive News. Those vehicles—and five more scheduled to follow by 2018—represent a huge undertaking for Fiat Chrysler Automobiles, although one that may finally be gaining traction. FCA is set to show its new Giulia midsize sedan this week and will follow with a midsize SUV and flagship sedan. The products are the opening salvos in an effort to overhaul Alfa and increase its global sales from 70,000 vehicles last year to 400,000 by 2018. About 150,000 of the sales goal are expected in North America. The challenge is enormous, and so are the risks for Marchionne. FCA's CEO is counting on Alfa's relaunch to move the group out of Europe's fiercely competitive mass-volume market and gain a foothold in the fast-growing American luxury market. The broad strokes of the relaunch plan were unveiled by Marchionne in May 2014 and include eight new models between 2015 and 2018, not including the low-volume 4C coupe and 4C Spider. For more on Marchionne’s plans to turn Alfa Romeo into a premium brand, click here.
Subprime Auto Sales Bubble? Not So, Say Experts
As U.S. auto sales have surged to a near-record level, critics have suggested the boom is being fueled mainly by sales of new vehicles to buyers with subprime credit ratings. Now, reports CNBC, new data from Equifax shows the fear of a subprime car sales boom is unfounded; there is no bubble in auto sales to those with a weak track record of paying their bills in time. "I don't see a bubble in subprime lending," said Dennis Carlson, Deputy Chief Economist for Equifax. "We're not seeing a spike in subprime loans." Carlson and analysts at Equifax ran the numbers on auto financing for new and used cars in the first quarter of this year. Their conclusion: the percentage of auto loans being written for subprime borrowers has increased slightly but not by enough to be concern. In the first quarter of this year, 23.9 percent of the 6.66 million auto loans issued went to those with subprime credit profiles, according to Equifax. This was a slight uptick from 23.2 percent in Q1 of last year and in increase of just 3.9 percent from 2010 when auto sales bottomed out in the U.S. For more on Equifax’s findings on the health of the auto lending market, click here.
Survey: Acceptance of Alt-Fuel Cars on the Rise
A couple of online surveys that indicate consumers are getting used to the idea of electric cars crossed his desk last week, writes Mark Phelan at The Detroit Free Press. He asked car-shopping website Autotrader to ask its visitors: do they think alternate-fuel vehicles should look unique, like the Nissan Leaf, or should they look like regular cars? The results surprised me. More than half, 51 percent, said they want alt-fuel vehicles to look the same. Another 31 percent didn't care. Just 17 percent want alt-fuel cars like hybrids and EVs to look somewhat or a lot different. According to Phelan, this suggests that EVs, hybrids, and other alt-fuel vehicles are moving out of the early-adopter stage and into the mainstream. From the days when the first Honda Insight and Toyota Prius caught drivers' eyes, it was widely assumed that their drivers were self-consciously "green," and they wanted the world to know it. Coincidentally, Autopartswarehouse.com asked visitors to its site what they think of alt-fuel and zero emissions vehicles. A whopping 86 percent said hybrids and EVs are here to stay and 55 percent said they'd consider buying one. For more on research into consumer attitudes toward alternative fuel vehicles, click here.
Around the Web
July AutoTalk Webinar: Take the Bull's Eye Off Your Business's Cyber Liability [Register]
2017 Audi A4 Spy Shots [MotorAuthority]
5 New Cas That Everyone is Steering Clear Of [CheatSheet]
Do You Know Which Buyers Are More Likely to Negotiate on Price? [CBT News]