The Sanatoga Post

LOWER POTTSGROVE PA – A national program that allows members of credit unions to buy new cars at a discount was adopted last week (Jan. 13, 2009) by Diamond Credit Union, 1600 Medical Dr.

Get in the car and drive.

The nationwide “Invest In America” program, of which Diamond is now a part, allows its members to save on the purchase of a General Motors or Chrysler vehicle and also offers access to affordable financing. More than 8,000 credit unions are participating, with more than $80 billion low-cost auto loans for purchases. However, the promotion is scheduled to end June 30.

It provides rebates of $500 or $1,000 on eligible Chrysler, Jeep and Dodge vehicles, in addition to most existing cash incentives that Chrysler offers on its vehicles; or it allows enhanced discounts under the GM Credit Union Member Discount Program.

Historically, credit unions offer lower loan rates than other financial institutions. According to a Datatrac survey of more than 17,000 financial institutions, the average credit union loan rate during the past two months was 5.4 percent, compared to 6.9 percent for the average bank rate.

Photo from Clipart.com

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Norco Auto Group's Sanatoga showroom in mid-September 2008, before its closure.

SANATOGA PA – Only two months after the sudden closure of its showroom at 2148 E. High St., in the heart of the village district, new controversy surrounds the Norco Auto Group Chrysler-Jeep car dealership. It and its owner, James Phillips, are among those involved in what is being called a vehicle fraud investigation to determine why taxes and title fees on some cars sold by Norco were not paid to the state.

The probe has left a small group of car buyers in motoring limbo. Their cars can’t be registered with the state Department of Motor Vehicles unless taxes and title fees are paid, and they can’t be driven legally without proper registration.

Phillips, in an interview Monday (Dec. 16, 2008), denied any wrong-doing and said he was cooperating with the investigation being conducted by the Pennsylvania State Police based in Skippack. “Norco Auto Group didn’t do anything wrong,” Phillips said. “I’m not about to, at this stage of my career, start hurting customers. I’m going to continue to work very diligently to get this situation rectified.”

A third party central to the investigation, Chrysler Financial Corp., so far has not responded to requests for comment.

The investigation focuses on what appears to be more than a dozen cars purchased from Norco between April and October 2008, according to Trooper John D’Orazio of state police Troop K. Although state taxes and title fees were collected on behalf of the buyers, D’Orazio said Monday, those monies have not been received by the state. No charges have been filed.

Additionally, D’Orazio added, some vehicles traded to Norco for new ones may have had outstanding debt – called a lien – that has not been paid to lenders.

• D’Orazio is trying to determine the scope of the problem by reaching out to the public. “I imagine there are more” buyers affected, he said. “If they bought a car from Norco” during the seven-month period, “and they still have a pink sales slip but no car registration, they’ve got a problem.”
• The trooper asks those concerned to call him at 610-410-7854. When calling they should have ready their car license plate number, vehicle identification number (VIN), proof of insurance, date of purchase, and the name of the financial institution that handled their car loan.

Phillips blames Chrysler Financial, which he claimed controlled his company’s finances during the period, for failing to make the missing payments. A Chrysler Financial representative, who Phillips said occupied a desk in the showroom since April, allegedly had final approval power over which of the dealership’s bills were paid. “The problem lies solely with Chrysler Fianancial,” Phillips added. It had “complete control of the bank accounts. They completely shut me down.”

D’Orazio confirms Chrysler Financial appeared to be in “full control” of Norco finances at the time, but noted that it blames Norco for failing to pass payments on to the state. Phone calls and e-mails currently boil down to a we-said-they-said trade of accusations, according to the trooper. “We’re nowhere near the bottom of it yet,” D’Orazio said.

Phillips estimates his dealership sold about 300 cars in the seven-month span, the majority of them financed by Chrysler Financial. The missing payment problem, he said, appears to affect only buyers who financed their cars through outside lenders, such as a bank or credit union.

Ironically, Phillips – who is an elected member of the Lower Pottsgrove Township Board of Commissioners – himself is one of the affected purchasers. “I bought a car from my dealership at the time,” Phillips said, and financed it elsewhere. Taxes and title fees allegedly were not paid on that purchase either. “I’m one of the victims here,” he said.

Related:

• Norco Auto Closes In Sanatoga

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Awful. That’s the one-word description for car sales during October, locally and elsewhere.

Maybe more took the bus.

No matter how broad a range of choices Sanatogans saw at new car dealers last month in nearby Pottstown and Limerick, or at used car dealers within the confines of Lower Pottsgrove (PA) Township, many seemed to join other Americans in deciding not to buy themselves a new set of wheels.

Auto sales in the U.S. fell 32 percent overall in October, Bloomberg News Service reported Monday (Nov. 3, 2008), to the lowest monthly total since January 1991. Reduced access to loans and a weaker economy kept consumers off dealer lots, it said.

General Motors’ dealer sales dropped 45 percent from October 2007; Chrysler, 35 percent; Nissan, 33 percent; Ford, 30 percent; Honda, 25 percent; and Toyota, 23 percent, according to a Bloomberg compilation.

Dealers apparently weren’t spending either, at least not on promotion. Journal Register Company – the Yardley PA-based firm that owns The (Pottstown PA) Mercury, The (Norristown PA) Times Herald, and several other newspapers serving Sanatoga – said Monday that its third quarter 2008 automotive classified advertising revenues were down 21 percent “due, in large part, to the continued weak automotive market.”

Will November be any better? Dealers interviewed across the country told Bloomberg reporters it probably can’t get much worse. For those who will consider buying a car this month, NADAguides.com offered these tips last week (Oct. 30, 2008):

• Deals abound; do some homework. Car dealers are moving inventory now to make room for 2009 vehicles. Pay attention to local dealer websites, newspapers and circulars for price cuts and special promotions on 2008 makes and models they must clear off their lots. Due to recent high gas prices, many larger cars are heavily incentivized with rebates and cash back offers … sometimes by as much as $10,000 or more.
• Be smart about car financing. Check a variety of lenders, including local credit unions, to find the best rates and loan terms. If financing through a car dealer, check credit scores online and bring the information to the dealership. It can help in determining available financing programs. Making a larger down payment could broaden the range of financing programs while reducing monthly car payments.
• Be flexible about the cars being considered. Research a variety of makes and models in the same or similar class to find comparably equipped cars at more affordable prices. A second, third or even fourth choice may cost less without sacrificing desired quality and features.
• Consider a used car. New cars depreciate in value as soon as the leave the dealer’s lot. Used car buyers both avoid hefty depreciation costs and usually find a great vehicle in excellent condition for less money. Those scared by buying used should check into certified pre-owned vehicles, which have gone through rigorous inspections and come with warranties.
• Pay attention to the trade-in. Research its trade-in price, and be honest with the dealer about its condition. Give the car a good detailing and repair any minor damage before visiting the dealership.

Norco Auto Group, a mainstay of the Sanatoga PA business district and at one time the second-largest Jeep-Eagle dealership in the state of Pennsylvania, closed its East High Street showroom Friday (Oct. 10, 2008). A sign posted on its doors said the company was a victim of “poor economic conditions.”

Norco Auto Group, East High Street, Sanatoga PA, displayed cars on its lots in mid-September.

Its closure came just three days after the chairman of the National Automobile Dealers’ Association (NADA) predicted that up to 700 car dealerships across the country would be forced out of business this year.

For many auto dealers, shutting down is the result of a one-two punch delivered by the current credit crisis. Dealers can’t get financing to keep cars on their lots, the NADA said, and consumers can’t get loans to buy new cars. More than 94 percent of buyers rely on financing when purchasing a vehicle, the trade organization noted. It was not immediately known what role, if any, credit crisis-related problems played in Norco’s closing.

Earlier last week, Norco President James Phillips acknowledged his company had been actively reducing the number of cars on its lots at 2148 E. High St. “Inventory’s my greatest cost, and it’s one of the things I can control,” Phillips said. As of yesterday (Oct. 13, 2008), about 80 vehicles – most of them new cars and trucks – remained on Norco’s lots. The asphalt parking area that faces East High Street, once lined with dozens of cars, was vacant.

"Due to poor economic conditions."

On three entrance doors to Norco’s glass-enclosed 40,000-square-foot showroom and garage, white signs with black print simply said “Closed.” On the door leading to Norco’s repair department, however, a sign that referred to the troubled economy added, “we apologize for any inconvenience.” There was no indication when, or if, the company would re-open.

Norco Auto Group, which also did business as Norco Motors Inc., started in North Coventry (PA) Township in the mid-1980s, according to Dun and Bradstreet (D&B) business information supplied by Manta.com. At its peak the company reportedly employed 65 people, and enjoyed annual gross sales volumes estimated by D&B at between $23 and $30 million. It moved to the East High Street location in the 1990s.

Norco, which sold Chrysler, Dodge and Jeep vehicles, was considered a “Five-Star” Chrysler franchise. According to the manufacturer, that meant Norco met or exceeded specific requirements for customer satisfaction and follow-up, and employee training.

Phillips, a Kepler Road resident who last year was elected as a member of the Lower Pottsgrove (PA) Township Board of Commissioners, is well known in the greater Pottstown area for his participation in community activities.

Annette Sykora, chairman of the NADA, said last week (Oct. 7, 2008) that the U.S. was “likely to lose up to 700 dealerships this year” because of the credit crisis and other economic factors. Paul Taylor, a NADA economist, said that number represents more than 3 percent of new-vehicle dealers nationwide, and compares with 430 closures a year earlier. “The credit crunch on Main Street is real,” Sykora said.

Dealers like Norco that sell cars from General Motors Corp., Ford Motor Co. and Chrysler LLC are having the most difficult time receiving financing, Bloomberg News Service reported last week.

Related:

• What Happened To Tax And Title Fees At Norco?

Can new computer software help older drivers become safer drivers? That’s what the Allstate Insurance Company hopes to test, using Pennsylvania as a laboratory.

Allstate yesterday (Oct. 1, 2008) launched a program it said has “potential to improve what could be the most important piece of auto safety equipment: the mind of the driver.” Called InSight, the training software helps drivers increase visual alertness and think more clearly. It will be installed on computers in the offices of Allstate agents, where insured drivers can use it.

Computer software could make drivers safer.

Local Allstate agents include Dolores Fleming, 5 N. Sunnybrook Rd., Sanatoga PA; Ryan Schauer, 3277 W. Ridge Pk. Ste B203, Pottstown; and Brian Casner, 6 Glocker Way, Pottstown.

Insight, created by San Francisco-based Posit Science, reportedly heightens “visual processing skills known to be important for safe driving.” Videos demonstrating how it works are available online.

The insurer intends to invite up to 200,000 Pennsylvania drivers, age 50 and older, to participate in the program. They benefit because Allstate may begin offering discounts to mature drivers involved in InSight exercises.

Allstate thinks it will win too, by reducing the number of accidents involving its insured older motorists. During the past three years, Allstate said, nearly 121,000 reportable accidents involving drivers between ages 50 and 75 occurred on Pennsylvania highways, killing more than 1,300 people.

What the deer hope hunters will read.

Don’t venture out for that pleasant drive in the countryside north of Lower Pottsgrove (PA) Township on Monday, Dec. 1, or Saturday, Dec. 6 (2008), the folks who sell Erie Insurance say. They’re the days that, statistically, you’re most likely to hit a deer – or have a deer hit you – while driving in Pennsylvania.

The 1st and 6th are the opening day and the first Saturday, respectively, of deer hunting season in the Keystone State. Deer are scared from their habitats by hunters’ activities, and so end up taking to the highways.

Erie knows these numbers, it says, because it’s been keeping track of deer-related automobile accident insurance claims for the past 10 years. The company purports to be the 16th largest auto insurer in the U.S. Its research also shows that:

• About one in every 100 drivers is likely to have a collision with a deer. Unlucky motorists in Pennsylvania’s Potter County, 260 miles northwest of Sanatoga, are three times more likely than Sanatogans to hit a deer. Even unluckier motorists in Sullivan County, 150 miles north of Sanatoga and west midway between Scranton and Williamsport, are four times more likely to hit a deer.
• Pennsylvania, New York, Virginia and West Virginia are states where deer-claim frequency is highest. One bright spot: deer-vehicle collisions in Pennsylvania went down slightly last year.
• Deer-vehicle crashes cause more than 200 deaths, tens of thousands of injuries, and $1.1 billion in property damages annually.

Being vigilant helps avoid accidents, an Erie spokesman notes. His advice:

1. Don’t rely on deer whistles, deer fences or reflectors to deter deer. They may work, or not.
2. Deliberately watch for deer – including the reflection of deer eyes and deer silhouettes on the shoulder of the road – when driving late at night or early in the morning.
3. Use high-beam headlights at night when there is no opposing traffic.
4. If there’s a deer on the highway, don’t assume it will get out of your way. Slow down and blow your horn to urge the deer to leave. Really.
5. If you see a deer in or near your path, brake firmly but stay in your lane.
6. If a collision seems imminent,it’s better to hit a deer while maintaining full control of your vehicle than to swerve to avoid striking a deer.
7. If your car strikes a deer, you are are uncertain whether or not the deer is dead, keep your distance.
8. If the deer is blocking the roadway, contact the state Game Commission or local law enforcement.