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But this one was kind of interesting from a Bay Area perspective:
http://www.insidebayarea.com/crime/ci_11595167?source=rss
In 2008, 128 new-car dealerships closed in California, compared with only 20 closures in 2007, according to the California New Car Dealers Association. Just this week, the association found that registrations of new cars and light trucks statewide declined 23 percent in 2008, compared with 2007.
In Contra Costa County, new car vehicle registrations are down 25 percent from last year. Some of the hardest hit areas include East County, where registrations are down nearly 31 percent, and West County, down 27 percent. Alameda County registrations were down 24 percent in 2008 from the previous year.
In dealer-heavy cities such as Concord, auto sales reports show sales are down nearly 25 percent from mid-2007 to mid-2008. In fiscal year 2006-07, Concord's auto and transportation sales tax revenue was $7.1 million; in 2007-08 that number dropped to $6.2 million. Already this year, all sales tax revenue is 16 percent lower than what city leaders predicted last summer.
About 30 percent of Walnut Creek's $20 million total sales tax revenue comes from auto sales. So far, aside from a Pontiac dealership that went out of business — since replaced by a Smart Car dealer — Walnut Creek has not seen any of its 13 dealerships close, Pokorny said. He credits the city's location.
So cities are being hit hard too. What's kind of interesting to me is that some places have chosen to give their dealerships bailouts:
few cities in California, such as Victorville northeast of Los Angeles, have recently bailed out dealerships, loaning them money to get them through the tough times. Both Walnut Creek and Concord city managers said that isn't something either city is considering.
It's too late for some dealers, like Peninsula Dodge Hyundai in Redwood City, which shut down abruptly before Thanksgiving. Likewise, Good Chevrolet in Alameda, Ford dealerships in Dublin and Oakland, a Volvo dealership in Pleasanton and a Dodge dealership in Brentwood also have closed.
That also details a few more I wasn't aware had closed. Geez, the count is up to FIVE Ford dealers that have gone out of business in the last 6-8 months within 30 miles of my house. However, that still leaves what I would estimate to be a half dozen. Maybe the lesson from all of this is that there were just WAY too many domestic dealerships.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
AutoNation Layoff Guarantee
AutoNation Inc., the largest U.S. vehicle dealership chain, plans to cover six months of car payments for buyers who become unemployed. Starting at 33 dealerships in Florida, AutoNation plans to roll out the policy to its 232 stores nationwide. The coverage will be free with any vehicle -- new or used, leased or financed.
http://online.wsj.com/article/SB123741176818476591.html
Looks like they are taking a page from the Hyundai playbook. The Assurance program has arguably helped Hyundai very little, depending on which source you read. Still , it looks like Auto Nation will not be going down without a fight...
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
i threw out the paperwork after one my kids damaged the new front bumper.
Both of them were emphasizing that they are NOT NOT NOT going out of business.
The Ford dealer was pushing great used car deals....
The Chevy dealer was the interesting one. As proof that he wasn't going out of business, he said, he'd just taken delivery on 420 new cars from Chevy.
Anyone care to decode what that means for me, please?
Anyone care to decode what that means for me, please?
Why, confidence my man, confidence! Either that or really generous flooring from GM? :surprise:
Conversation on the Audi lot while I was closing the deal last week was interesting. They are selling cars, no two ways about it. But for the month of March, only two units of all of their sales have come from their lot. Everything else, including mine, was coming from another dealer's inventory. Mine's coming from VA! They are running lean, with no more than a few examples of product in each line. Exception was the A3 2.0T AM6, but only in select colors and two configurations.
I was told that they simply aren't taking delivery. Stock is sitting portside.
At least at this stand, the people who are buying aren't settling for stock-on-hand choices; they want what the want they way they want it. Certainly true for me. I've spent six years in a car I love, but with colors I really hate, inside and out. I thought it wouldn't matter to me at the time.
Guess what? It matters.
Well he has reduced his stock so much that one of the lots and showrooms is standing completely empty! It also creates the interesting situation that despite having a separate dedicated lot for Mazda, the Mazdas are sitting amongst the Chevys on a lot down the street that doesn't have a Mazda sign! It's all quite confusing. :-P
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Incidentally, I have had the best experiences with salespeople on Audi lots, and that's consistent from stand to stand. Very much in contrast to most of the rest of the industry, these people know their stuff, and are into it. Questions answered with real info, no side-stepping or disinformation, and when they don't know, they look it up! What a concept!
The Lexus lot in Pleasanton was a typical joke. Ask about sport package availability on an IS350, and I'm met with "oh they aren't making the sport package this year because of all the 'sporty' upgrades they made". Then she hands me a brochure that outlines the sport package and its relative benefits.
Uggghh.
my take is this: the dealer bought a bunch of new cars at an AUCTION and probably paid much less than they do for a manufacturer delivered vehicle.
in other words, the invoice is vaporware.
just a guess.
And that tidbit made the news today.
"In January, the going rate for a 2007 model of the Ford Explorer was $11,600. In March, the same make is listed at $13,850. And that change gives auto dealer Jeff Liccardi reason to smile.
"I think the worst is over," says Liccardi, a third-generation auto dealer who sells new and used Ford vehicles in Watchung, N.J.
Used cars are rising in value as budget-conscious U.S. consumers flock to this segment of the market amid an economic slump. This is good for dealerships, like Liccardi's, because it boosts the value of their stockpiles of used cars. It also brings relief to lenders of auto loans and leases at a time when the auto industry is struggling to make ends meet amid tumbling sales of new cars."
Higher Used-Car Prices Improve Prospects For Auto Lenders (CNN)
Automotive News | March 23, 2009 - 12:01 am EST
In a dismal year when industry sales slumped 18 percent, only a few dealership groups managed to boost revenues.
According to Automotive News' annual survey of the nation's top 125 dealership groups, just 16 increased overall revenue in 2008. Some credited solid service-and-parts operations, while others reported strong increases in Internet-related sales.
...Retailers with a heavy concentration of domestic franchises have bled most heavily during the 2008 sales meltdown. And dealership groups with lots of stores in former fast-growing states such as California, Arizona and Florida have been especially vulnerable.
At the 11th-largest company, David Wilson Automotive Group of Orange, Calif., whose 16-store network of import and luxury brands is concentrated in California, revenue declined 24.6 percent.
"It used to be a wonderful thing to be selling cars in California and Florida," said Paul Taylor, chief economist for the National Automobile Dealers Association. "But right now Texas is the only really bright spot among the largest states."
...AutoNation Inc., the U.S. market's biggest retailer, suffered a 19.1 percent decline in revenues. The Fort Lauderdale, Fla.-based company has decreased its reliance on revenues from ailing domestic brands. But almost half of AutoNation's dealerships are in Florida and California, which are reeling from depressed housing markets.
Penske Automotive Group Inc., of suburban Detroit, the nation's second-largest dealership group, had a smaller-than-average revenue decline of 11.7 percent. The group operates a higher percentage of import and luxury dealerships than AutoNation does, and Penske's dealerships are scattered over a broader geographic area.
Eighth-ranked Lithia Motors Inc. of Medford, Ore., experienced a double whammy. Its dealerships are clustered along the West Coast, and it has a concentration of domestic brands. Lithia's revenue dropped 21.3 percent.
One major player, CarMax Inc. of Richmond, Va., is absent from the top 10 list of retailers. Used cars generated the bulk of its $7.9 billion sales; only five of its 99 stores sell new vehicles.
http://www.autonews.com/apps/pbcs.dll/article?AID=/20090323/ANA06/903230342/1078- &template=printart
(registration link)
The article mentions again something I have strongly suspected: domestic-brand dealers are harder hit in this whole thing. There were WAY too many of them prior to the "meltdown".
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
The Associated Press
LIGONIER, Pa. - The brother of a car dealer who died of a heart attack while burning several cars on his lot has been found dead in a car parked in the woods near Ligonier.
The Westmoreland County Coroner is investigating the death of 51-year-old Randolph Graham whose body was found Saturday morning. Graham's wife reported him missing Thursday when he failed to show up for work or come home.
Police say Graham was apparently distraught over the death of his brother, 61-year-old Gregory Graham on Feb. 17.
Records showed Gregory Graham owed $720,000 in state and federal taxes on the business when he died burning cars there. His brother, Randy, had been general manager of the dealership, Graham Colonial Motors.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
The recession's impact on dealers was not the major cause of his decisions.
"Nationally, the United States lost about 900 car dealerships last year, according the National Automobile Dealers Association. About 66% percent of the dealers that closed last year were single-brand dealers.
The losses are greatest among dealers selling Detroit brands, said Appleton.
"They're all suffering the same way. The problem is that it's much worse for domestic dealers," he said. "Volumes have dropped more substantially and access to capital as been curtailed more dramatically."
Car dealers face extinction (CNN Money)
You go a bit further north where i grew up and the Pontiac-Buick-GMC guy went belly up.
I've got a few on my radar to guess who's next.
Amazingly there still is a small old time BPG dealer in Red Bank. I knew the daughter of the owner a little in college. Don't know if she's still in that biz and no idea how long they can survive with that little place.
Catch the picture of teh dealership. They don't make 'em like that anymore.
i know the previous owner. he sold maybe 5 years ago.
he and his kids are probably pretty happy about that.
Kia will pay off up to $4K in credit card debt if you buy a car (well, that's what they say but they mean they'll roll it into your car loan).
Dodge will give you two Dallas Stars (Hockey Team) tickets and a $20 restaurant gift certificate just for test driving a Dodge Truck.
Dodge also mentions that they have 'over 200' new 2008 (2008's Drive Great!) in stock for immediate delivery and that they'll give you up to $15K off sticker on a Chrysler 300.
Going down on more dealership up where I grew up. The BPG guy folded maybe two weeks ago and now the Saturn dealership is consolidating down into one dealership instead of two twenty miles apart.
Actually, that's a pretty good deal if the interest on the car loan is small and you have a psychopathic interest rate on the credit card. It would require a person with a good deal of discipline to take advantage of it. However, most people who have in excess of $4K of credit card and would seek such a deal have little discipline.
I like that idea of $15K off a Chrysler 300. I'd take a 3.5 V-6 Chrysler 300 as a replacement for my aging Park Ave.
As for $15K off Chryslers? I'm sure that's $15K off a loaded 300C with a $40K price tag. The 3.5L 300's probably get $5K off, not $15K.
Funny thing is, you see the common thread running through this whole saga of Ford and GM dealers taking it on the nose, but you see very few Chrysler dealers disappearing. My local dealer did a middle-of-the-night number about 18 months ago, and the SF dealer closed last year, but apart from that I haven't heard of or seen any Chrysler dealers going under.
Maybe Jeep sales are propping them up.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
The local one is on my watch list.
Strangely enough we are getting a new dealership in town (I've mentioned this before) - Hyundai.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Now, if only they would make some product people want. I drive small things as a rule, in part because I actually care about driving and can't be bothered with anything bigger than compact. They have nada for me. For the Mrs., who spent many enjoyable years in our Dodge and Chrysler minivans, they lost her loyalty with the current generation of truly hideous product, serviceable as it may be. She ended up at the Lincoln stand, and is loving her MKX. Not my cuppa, but then I only have to drive it once a year down I-5 to Disneyland!
When Plymouth went away, I think a lot of Chrysler dealerships started picking up Jeep. I wonder if the dealers were hurt much by losing the Neon and the Voyager? The Voyager was re-badged as a Chrysler for a short period, but it never sold as well as the Plymouth Voyager did.
I know that few tears were shed over the loss of the Plymouth Breeze, but I swear, as soon as it was gone, it seemed like the Chrysler Sebring got cheapened.
it does kind of help their dealers.
That being said, I am 100% sure that many SMB owners are going through tough times, not just auto dealers.
In mass there are not that many Buick, Pontiac, GMC dealerships. Hopefully with the evaporation of Saturn and SAAB they will have more leeway. :sick:
Why would they? There are still way too many of them, and way too much competition in the marketplace from other brands and even GM's own brands. And Saturn and Saab hardly sell any cars anyway.
And it looks like Saturn may not evaporate, it may be bought and continue to operate.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
That worked for Dell computers for a long time...now they are selling through dealers instead of shipping everything direct.
Marxist named Saul Alinsky advocated your belief.
Capitalism may not be perfect, but it does enable competition to purify the market by being efficient and cost concious.
As for eliminating "the bull" - why take the sport out the buying process for the buyer who is capable of handling "the bull".
"If you are afraid of "the bull" stay out of the pasture."
I repeat, I hope when the smoke clears, the automakers will be able to sell directly to us. When I want to buy a car, I want to buy a car. If I wanted bull, I would go to a rodeo.
My last four new vehicles I bought via the Internet email. I send the same email to all the dealers in the area I want to buy from and take the best deal. I will not drive to a dealership without a solid offer via email in my hand. I do like to test drive and will use the closest dealer to do that. It will be a totally separate venture. I am not going to pay MSRP for ANY vehicle and I explain that in my initial email. All were straight forward and painless. Two were out of state and I carried a cashiers check with me to pick up the vehicle. I really like buying a vehicle long distance as it gives me a chance to have a little vacation and get used to the vehicle. I have rarely used the same dealer for service where I bought the vehicle. I started buying from dealers via phone in 1974 when I could not get a decent deal from the Dodge dealer in Anchorage. And prefer not sitting in a cubicle while some lame salesman keeps going to ask his boss what they can do. I only do that now for amusement to walk out when they give me some line of crap about not being able to sell for the price I have set. Be confident that you know what the vehicle is worth and don't let them BS you.
I don't want to order from a factory and not test drive the vehicle.
You are in the majority. I have felt that way several times. The worst part is you usually end up on the short end of the stick. The salesman and some unknown person in another room play you like a fiddle. They know while you are sitting there for 20-30 minutes you are wanting that car and they have the upper hand. When you have two or three offers with the VIN and additions in an email you know what you are getting. You don't like the offers you can counter from the comfort of your own home. I do understand your frustration and have been there.
You know the salesperson is out back having a smoke, not talking to the floor manager, while you are cooling your heels.
For fun, next time the salesperson leaves the box, tell your significant other that you hope to get the car for $xx,xxx dollars (and make it a pricey number). Half the time the salespeople turn the phone on so they can listen to you in the office while you yak in the "privacy" of the box . Then just imagine what number is going to come back to you. And then imagine the look you'll get when you walk out, lol.
(Ok, bit of an exaggeration there, but it has happened occasionally per dealer tales I've heard).
Closing in New Zealand:
Luxury city car dealer closes as sales slump (Bay of Plenty Times).
Jackson, California Ford dealer closes - " In all, job loss locally in auto sales now amounts to around 100 in the severe recession." (mymotherlode.com)
Question? Will AAA extend the range for towing with less dealers to take your stalled car to?
If you walk in with the attitude you seem to have I can see why this would happen to you.
In your "perfect world" you would still have to deal with a human being who just might treat you like crap too!
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
And minimize the other guys
Whose enterprise has made them rise
Above the guys that criticize."
Personally, I like the price "battle" and the game of buying a car. The negotiations on my last purchase lasted a few hours, and it was a fun game...in the end I got the price I wanted, and the dealer was able to move a unit and get his profit no doubt.
I think the positives of family vs corporate stores depends on how much of that extended family are given positions at the dealership. When every cousin and brother in law is given a job...maybe not the most effective business.
My mother just bought a car...I suspect she paid their asking price, or very close to it. She wanted no hassle, and a good warranty, and doesn't care to play the game.
A lot of that "enterprise" that people are supposed to adore is less than ethical...
You hit the nail square on. Buyer's attitude is not to be ignored, however the cool and experienced salesman knows how to handle all kinds of "expert" customers who have done their homework.
You & I are not on the Right coast dealing with the type of car salemen carfan describes. All of the salesmen I've dealt with have been relaxed, knowledgeable, patient, and professional. One of the best was at Pacific Lincoln Mercury, Seattle. Another was at Walt Johnson Lincoln Mercury, Portland.
You can negotiate a purchase professionally when the buyer respects the dealership.
One salesperson is still checking in with me but not in a harassing way.
Still, it seems like it would be nice to have a central big empty box full of cars where you could look at, sit in and test drive them with no sales pressure. Just some folks handing out keys, brochures and info. If you could compare across a bunch of brands, so much the better. Then you'd go online and place your order.
I think this could be a good niche business for some of the car rental places in the larger markets. Stock a wide selection of new cars and rent them out for long test drives. Dealers could send hot prospects to the rental place and pay the tab.
Don't try to put this on me. My parents raised me with respect and taught me to behave myself when shopping in someone'e place of business. I am also a lifelong car enthusiast who did tons of research about the particular cars I wanted before going to the dealer, so I went in there knowing what I wanted, and knowing plenty about it. I also went in every time with a smile and a ton of enthusiasm. Nothing put a car nut like me in a better mood than actually going to PURCHASE a car!
And nine times out of ten my enthusiasm and goodwill were crushed by the shenangans of you and your salesmen buddies.
So don't try to talk to me like I am a child who has no idea what's what. I know you car salesmen, and the reputation you have and the way people DREAD dealing with your ilk bears me out.
Direct sales from the automakers YESTERDAY please.