These are tough times for people who sell us our cars and trucks–and some of them might go away. The National Auto Dealers Association expects as many as 700 vehicle retailers to go out of business this year, 63 percent more than closed last year. Detroit automakers, in fact, already have closed some poorly-performing dealerships.
The Missouri Auto Dealers Association expects closures and mergers here. Association President Sam Barbee says tighter consumer credit has hurt. He says dealers without foreign-brand cars and trucks are hit especially hard because foreign makes have staked out the economy issue.
But he says a lot of dealers are hurting because they struggle to get credit, too, as sales dramatically slow. He says the financial arms of the manufacturers tend to pull back because they don’t want to invest in the vehicles dealers want to buy if they don’t think the vehicles will be sold in a reasonable time.
He says dealers also are struggling because many people have traded in trucks and SUVs for more economical vehicles—-and those SUVs and trucks aren’t moving off the used vehicle lots.
Barbee says the car business is a bellwether of the economy…and the bell isn’t ringing very well.