Closing dealerships

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I know the owners of a couple of auto dealers in the area. One is a CHEVY ONLY store and the other is FORD trucks ONLY NO for cars. (the ford truck dealer used to also rep sterling trucks but since Daimler has axed the brand they will no longer have any trucks to sell)

BOTH of these dealers have their own financing and flooring banks. They buy their units from the manufacturer basically outright and then an independent bank covers the flooring on the vehicles in inventory.

Now they both have their own advertising and have even shied away from using GMAC and FMC lately for other means of financing.

They pay the manufacturer for the inventory they stock and the orders they place.

Now as far as I know neither one of these dealerships is being shut down any time in the future.

I can understand shoddy dealers with poor service getting shut down but as far as the small dealers with minimal overhead that are maintaining a profitable enterprise.

Its beyond me how they could pull the rug out from under these independent businessmen.
 
Unions ruined manufacturing in this country. Mexico should send the labor unions a thank you card.

Approved!

Yes I do listen to AM radio and watch Fox news once in a while. It is about the only way to find out anything that is not obama approved. Now those "mainsteam" media outlets are great for blind obamy worship. I think unions are a disgrace and will kill any business they touch sooner or later. How's that extremely pro-union Mighigan economy these days?
 
Originally Posted By: Dualie
Its beyond me how they could pull the rug out from under these independent businessmen.


Nothing more than the left getting involved in private business. Welcome to socialism.
 
The new car brand legitimizes the used car business. Would you rather buy a late model loaded SUV from Downtown Chevrolet or Bob's dirt lot Corral??

If a business is mostly selling used cars and using my brand name... it would be like an employee of mine doing his own stuff on company time. I would keep him around if he's getting the work done... and cut him loose if underperforming.
 
Originally Posted By: milwaukee
Originally Posted By: Dualie
Its beyond me how they could pull the rug out from under these independent businessmen.


Nothing more than the left getting involved in private business. Welcome to socialism.


Well, who screwed things up for the past 8 years to cause this problem? I'll give you a hint. There was a republican pres and congress for a long time.
 
Originally Posted By: John K
Where do the savings come in for the manufacturers by closing dealerships? I just don't get it. If a dealer can't sell cars, they are stuck with the inventory. If they eliminate dealers, isn't that removing some storage for the the cars, i.e., won't that alone cut future number of cars manufactured? Can somebody 'splain this concept to me.

Even eliminating brands seems to cost a lot of money. I guess the whole concept is too big for me to comprehend.


It's called "consolidation." Here, some of the biggest GM dealerships in the country are actually expanding and buying up properties in anticipation of a near term larger inventory.

Less dealerships means less excessive discounting of cars in the cut throat competition and profit loss. One of the reasons for instance that Honda (at least) has the highest profit per unit sold is that they rigorously control the number of Honda dealerships in your town and try to insure they have just enough for coverage, but not too many so huge inventories do not remain stagnate...
 
Along with the other things mentioned less dealers means the customer will probably be in worse shape in cutting a good deal. It will probably make the surviving dealers a little more greedy.

My questions are what happens to the dealer that was getting by, maybe making some money in the shop and used car dept. Do they tell him to make a hike? We had this conversation over a few beers last night and no one had an answer. What happens to the inventory? Is this what happens when you borrow from the Devil?

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the textile industry moved to the south in the 50s, destroyed my home town in MA by doing so,, never did recover from it. Supposedly it was the unions fault, so they moved to NC where no unions and the labor laws were pro owners.

well, guess what, overseas manufacturing with lower labor came along and they just packed their bags left NC,SC and moved overseas. Corporate ethics no longer exist, all about the bottom line only. Yes, have to make a profit but it does not need to be excessive nor expected to double every quarter as stockholders have come to demand. Seems to always come back to greed
 
Originally Posted By: cousincletus


Well, who screwed things up for the past 8 years to cause this problem? I'll give you a hint. There was a republican pres and congress for a long time.


This is an OIL site with a few forums like this one about other automotive topics. It is not a political soap box for you to spew your left leaning agendas and views. However a response is in order.

WOW! Talk about a bunch of bull in the quote above and your other leftist comments in this thread. Do you have a poster of Nancy Pelosi and Hillary in bikini's, sitting on Obama's lap, on your wall or what? You have GOT to be joking laying all this on the GOP right? Seems to me there has been a left controlled Congress and Senate for a long time as well.
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Oh wait, that is what the left does. They go along with whatever is popular at the time and then if it doesn't work out they are suddenly against it. You can not run a country based on gallop polls or which way the wind is blowing on any given day. You have to do what you feel is right and have some integrity even if it means losing votes come the next election. That is how the GOP governs. The left governs by election year polls.

The left can not lay all the blame on Bush and the GOP for the economy, the war in Iraq, etc... They were right there with the GOP, as they were losing seats left and right so they migrated to the middle voting wise, until things started going bad( no political party at fault - just happened )then suddenly they were against "it"( whatever "it" topic you wish to use )from the begining. What a bunch of idiots! Do you remember all the Dem's out on the lawn singing God Bless America showing support for President Bush going into Iraq? So Bush was lied to and given bad info about the WMD's. However, he should have known and because he didn't he is evil. The lefties that voted for it can claim they were mislead and it absolves them of any responsibility for their actions though. Ah heck, they can lie and say they voted against it and our leftist media will not call them on it so our dumb arse voting public will believe it. The left lies and the media swears to it( or covers it up ).

Have I got it right? That seems to be party doctrine. Deny, duck, and cover and it is backed up/covered up by the media for the most part. I seem to remember a certain left President who was a master of that not too long ago.
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It's ok, the left is in complete control right now and rapidly taking our country down a road towards socialism and communism with their out of control spending, we aren't out of money because we can just print or borrow more, and let's take everything from the rich and give it to the poor mentallity. They are also undoing the things Bush and the GOP set in place to protect our country from another 9/11. Let's see the Liberals spin this when it all blows up in their face and people realize just how much money we are going to owe plus the HUGE mess our country gets into with these socialist policies. Let's see them blame Bush and the GOP when terrorists hit our country again because the left is worried about the civil rights of terrorists and has let them all go back to their countries to do it to us again.
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Our grankid's, grandkid's, grankids are going to be paying this mess off. Don't be surprised if in 2010 the GOP doesn't start taking seats back as people vote out the left and their irresponsible and out of control spending and asanine policies like letting known terrorists go with an apology for how they were treated. I can't wait to see the left spin that.

The most recent left wins can be attributed more to anti Bush votes( voting against a politician because he is a member of the same party as an outgoing President you don't like is a stupid reason to vote for another politician )than support for these current policies. The left is going to dig their own grave. Hopefully there will be a country left for the GOP to save.

The left is a complete joke without an ounce of integrity in any of them. The GOP made some mistakes sure but our country is( was )safe because of Bush's policies and the economic collapse is squarely on the watch of BOTH parties. Nothing Bush or the GOP did caused this collapse. Frankly nothing the Dem's did caused it either. Lack of action by both parties when energy went nuts is a big factor but neither side caused it. They just didn't do anything to head it off before it was too late. Oh, and throwing billions upon billions at those who DID cause it, with no accountability for how the money will be used, is not the answer.

I will keep watching FOX news thanks. Why don't you continue to worship Keith Olberman on MSNBC and his nut job liberal rantings and ravings. They seem right up your alley.

Liberals.
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Originally Posted By: bretfraz
I feel the Force Of The Ban Hammer in our midst.


It's coming.
 
Originally Posted By: bretfraz
I feel the Force Of The Ban Hammer in our midst.


Why? I merely responded to the comments the other member made disapraging the GOP. No personal attacks there. Just general comments about the left and the stuff they say as in the members post I commented on.
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Unless Obama owns the site I see no reason why I should be banned for what I posted? No swears or personal attacks.
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EDIT - Ok I went back and reread it and the poster comment was out of line. I try not to make such comments as they are infantile but I get really ticked off at leftist rhetoric like has been posted in this thread and I got upset. I should not have made that comment however. Thought I had gone back and altered it to say... Do you have a poster of Pelosi, Hillary, and Obama on yor wall or what( j/k
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)? I tried to go back and edit out what I had but I was timed out. So to the member I quoted my apologies for THAT comment as it was too over the top. The rest of it I see no reason for a ban or apology.
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Originally Posted By: ADFD1
Along with the other things mentioned less dealers means the customer will probably be in worse shape in cutting a good deal. It will probably make the surviving dealers a little more greedy.

My questions are what happens to the dealer that was getting by, maybe making some money in the shop and used car dept. Do they tell him to make a hike? We had this conversation over a few beers last night and no one had an answer. What happens to the inventory? Is this what happens when you borrow from the Devil?

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Back on topic......

If a dealer is not performing up to the requirements of their dealer agreement, then, yes, they can be terminated. I'm sure this was the fundamental reasoning behind the recent dealer reductions.

The inventory is taken back by the automaker and either resold at auction to other dealers, or redistributed amongst the dealer network.

Can't speak as to business dealings with the Devil but who knows what he does to you when you don't hold up your end of the bargain.
 
Originally Posted By: bretfraz
Originally Posted By: ADFD1
Along with the other things mentioned less dealers means the customer will probably be in worse shape in cutting a good deal. It will probably make the surviving dealers a little more greedy.

My questions are what happens to the dealer that was getting by, maybe making some money in the shop and used car dept. Do they tell him to make a hike? We had this conversation over a few beers last night and no one had an answer. What happens to the inventory? Is this what happens when you borrow from the Devil?

AD


Back on topic......

If a dealer is not performing up to the requirements of their dealer agreement, then, yes, they can be terminated. I'm sure this was the fundamental reasoning behind the recent dealer reductions.

The inventory is taken back by the automaker and either resold at auction to other dealers, or redistributed amongst the dealer network.

Can't speak as to business dealings with the Devil but who knows what he does to you when you don't hold up your end of the bargain.


Thanks for making that a little clearer, it is all about allocation and metal that moves out the door. What happens to the repair shop, and used car lot if they were profitable? Can they still service Chrysler or GM products? Or do they close that too, and only sell used cars since the Franchise can't take that away from them? I tell you it must really suuuuuuuuccck to get that notice that your out of business.

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Originally Posted By: ADFD1


Thanks for making that a little clearer, it is all about allocation and metal that moves out the door. What happens to the repair shop, and used car lot if they were profitable? Can they still service Chrysler or GM products? Or do they close that too, and only sell used cars since the Franchise can't take that away from them? I tell you it must really suuuuuuuuccck to get that notice that your out of business.

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Once the dealership officially has it's franchise revoked/terminated they can no longer sell new vehicles nor can they perform warranty work. They can sell used vehicles and do service work paid for by the customer just like any general repair shop.

What I will find interesting is how this situation is handled. There are delers that have been shut down that actually buy their vehicles outright. They do not fianance through Chrysler to put vehicles on the lot. Once they officially have their franchise terminated what do they do with those new vehicles on the lot? Chrysler will not be buying them back( bankruptcy court will not allow it as I understand it )and if they have no rights to sell new vehicles how do they move them?

My guess is either they will be allowed to sell them by Chrysler( they just can't get more new ones to sell )or they must sell them to another dealer.
 
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That's what I figured, so they'd be pretty much dead unless they had one heck of a used car business. A few short years back no one could have imagined this. I think we're in the eye of the storm now, waiting to get hit by the second wave.

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