ADDITIONAL FALLOUT ... from the Swift Dodge decision. AALA reports a clarification of the IRS' proposed regulation. To quote AALA secretary Sidney Rose, "Under the proposed rule, any automotive leased entered into after November 23, 1982 which contains any type of terminal rental adjustment (either positive or negative) will no longer be treated as a lease by the IRS. Instead, such leases (often referred to as open-ended leases) will be considered conditional sales agreements." More information on the Swift Dodge decision and the IRS proposed regulation appear elsewhere in this issue. Ellis Lyons will report further on the impacts of these two events at the AALA Convention in Scottsdale, on the 23-27 January.
AIRBAGS ARE BACK ... in the news. The Supreme Court has agreed to decide whether the October, 1981 scrapping of the airbag requirements was within the purview of NHTSA. There is also ongoing protest by members of the scrap car industry whose employees would be exposed to the poisonous sodium azide vapors found within all airbags. In related news, GSA will install airbags on the driver's side of as many as 5000 1985 model cars in the federal fleet. The Arizona Highway Patrol will install airbags on 136 of their 700 car fleet. Estimated cost of the retrofit is $600 to $700 per vehicle.
PLANNING TO ATTEND ... the NAFA annual meeting in Detroit? This years' activities begin April 17, as AFLA's annual convention in Dearborn winds down. Headquartered in the Renaissance Center, the annual meeting will once again feature the Fleet Fair on Sunday afternoon and Monday evening. Affiliates Night has been switched to Sunday evening.
ISUZU FLEET INCENTIVES ... are available for the first time to Isuzu dealers. Dealers who sell to qualified fleets will receive rebates of $400 on trucks, $150 on sedans, and $50 on distant deliveries. The program begins January 1, 1983.
MERCEDES BENZ EXPANDS ... its model lineup in late 1983 to include two smaller cars, the 220D and 220E. Introduced recently in Europe, the 220-series will offer a choice of 2.3 liter, fuel injected gasoline engine or a 2.2 liter, normally aspirated, diesel. Prices are expected to be in the range of the present 240D series; in excess of $20,000.
DECEMBER AUTO SALES ... posted a gain of 13.2 percent for the first ten days of the month. Although one of the more impressive reports in recent months, this gain still represents the second worst record for this period in the past decade. A major reason why sales did not rise higher was the exhaustion of stocks of 1982 cars which had been marketed at cut-rate loan figures. Ford Motor Company led sales with an increase of 41.4 percent, but reported that two-thirds of those sales were 1983 models which carried no discount loans. GM reported a sales increase of 5.9 percent but indicated that 70 percent of those sales were also 1983 models without discounts.
NADA CHARGED ... the auto manufacturers' credit subsidiaries with failure to reduce retail installment rates in line with a lower prime rate, calling the practice a major reason for the absence of the auto sales turnaround. In a letter to the chairmen of all four traditional U.S. manufacturers, NADA Industry Relations Committee Chairman Joseph A. Barry urged the manufacturers to study the problem on a market-by-market basis and take action to assure dealer financing at competitive rates.
AMERICAN MOTORS AND CHRYSLER ... confirmed that they are "seriously discussing" a plan which would allow AM to assemble the Chrysler New Yorker under license in its Brampton, Ontario plant. Chrysler had intended to let the New Yorker die at the end of the 1983 model year, but strong sales and a good profitability picture have enticed Chrysler enough for them to find a way to keep the model under production for at least another eighteen months.
WOMAN OF THE YEAR ... nominations are now being accepted by the National Women's Automotive Association for this prestigious award. Send the name of your nominee to the National Women's Auto Assn., 11020 Ventura Boulevard, #204, Studio City, CA 91604.
SHORT TAKES ... LMV Leasing has relocated their general offices. Their new address is 121 Freeport Road, Pittsburgh, PA 15238, and telephone number is (412) 782-6200 ... William H. Cordes, 40, chairman and co-founder of the Rocky Mountain chapter of NAFA, and safety manager for the Denver Post died on Thursday, November 25, 1982. His death followed a long illness. Cordes' survivors include his wife, three children, his mother and a granddaughter.
