WILKES-BARRE – GWC Warranty Corporation (GWC) and Southern Auto Finance Company (SAFCo) announce their vehicle service contract strategic alliance. SAFCo now offers, through its dealers, their exclusive GWC vehicle service contract and GAP program, providing their dealers more tools for profitability and loan customers with peace of mind when purchasing pre-owned vehicles. "GWC is known for their commitment to automobile dealers and protecting auto purchasers and lenders, which aligns perfectly with our strategic vision for expansion. Our partnership will help SAFCo expand our dealer base as we plan to open 12 states over the next 12 months,” notes Brian Switalski, President of SAFCo.

GWC Warranty announces that its corporate offices will be closed on Friday, April 1, 2011, as we move to our brand new, state of the art location in Wilkes-Barre, PA’s Coal Street Park Facility. Customers should note that emergency and essential claims calls will be returned on a limited call back basis. GWC will return to normal business hours on Monday, April 4, 2011.

A "NO WORRIES, JUST DRIVE'' Economy in 2011"
by Rob Glander, CEO/President of GWC Warranty
 
Congratulations! lf you are reading this, chances are your business has survived the worst economic downturn most of us have ever witnessed. Among the casualties were: 
-  over l-8,000 or a third of all the lndependent Vehicle Dealers that existed across the country early in the last decade; 
-  the ready access to financing that is the lifeblood of our business; and, perhaps most importantly,
- the belief that if we work hard and play by the rules everything will turn out okay in the end.

The Service Contract business suffered along with our dealers. Although we at GWC remained solidly profitable and well-reserved, the economy-driven drops in volume proved too much for some of our weaker competitors.

Fortunately, the deep freeze began to melt in 2010 and used vehicle sales, the economy, and financial markets began to thaw. Even more encouraging, 2011 promises an accelerating warm-up in the economy, resulting in an even better market for used vehicle sales through independent dealers. With employment stabilizing and consumer attitudes turning positive in late 2010, we are poised for improved sales and an easing of credit availability to facilitate those sales.

Specifically, after a 3.5% nationwide uptick in used vehicle sales in 2010, analysts went into 2011 forecasting another 6% increase to more than 39 million units. However, a strong January (which closed with over 2 million units sold for the first time since 2007) already has some of those analysts increasing their forecasts to north of 40 million.

The economy has awakened from its stupor and is growing again, driven in part by consumer spending. During the 4th quarter of 2010, purchases increased at an annual rale of 4.4%, the largest quarterly growth rate since Q1- of 2006. Consumer spending is projected to increase again in 2011.

Consumer confidence and pent-up demand, along with continuing constraints on purchasing power, are driving customers to consider purchasing a used car as opposed to a new car. A recent survey by Consumer Reports found that 71 percent of respondents are likely to consider a late-model used car as an alternative to a new car.

Also, with banks and credit unions seeking to grant loans (as opposed to searching for reasons to deny them), more consumers should be able to afford to purchase vehicles. Financial institutions have seen consumers' default rates decline and are more confident now that consumers will be able to make their payments. Accordingly, in a January survey of 1,000 banking professionals, 79% said that they expect their institution's consumer loan volume to increase or stay flat in 2011; only 5% expect a decline.

All of this promising news does not mean that any of us can sit back and relax. lf the economic downturn taught us anything, it's that the world is rapidly changing and we all must proactively participate in that change. At GWC, we have: 
- upgraded talent in our sales force to provide better service to our dealers;
- added products, including exclusionary and wrap coverages; and
- enhanced our coverages to include an entire product line insured by Assurant.

We have also made technological improvements, including a refresh of our company website (GWCWarranty.com) and the activation of GWC Facebook and Twitter accounts. As vehicle sales mirror the rest of our lives and rapidly migrate to the internet, our independent dealers have seen significant growth in internet sales. One study suggested that by late last year, dealers were seeing a 10% increase in year-over-year sales through the internet. With ever more consumers going to the internet to research, shop for and purchase vehicles, we all would be well-advised to use this technology to our advantage.

Finally, GWC recently announced some exciting local news: ln March, we will relocate our headquarters a few miles down the road into a brand new facility in Wilkes-Barre, PA. ln fact, we are moving into the new Coal Street Complex, the home of the Wilkes-Barre/Scranton Penguins. We are nearing completion on development of 18,000 square feet for our Claims Center, Contract Processing Department and Executive Offices.

More than 15 years after our founding in NE Pennsylvania, we are thrilled to have signed on for an additional long-term stay. We love the State, our employees and most of all our Pennsylvania lndependent Dealer customers and are excited about continuing to deliver on our slogan for everyone in 2011: "No Worries. Just Drive."