Home Archives December 2008 Car dealers collapse as sales drive off a cliff

Car dealers collapse as sales drive off a cliff

| Print |  Email
Monday, December 01, 2008

CarDealers Hundreds of car dealerships across Oregon are closing their doors because of slumping demand.

STATEWIDE At first glance, the car lot in outer Southeast Portland looks like all the others nearby, plentifully stocked with “Dealer’s Specials” and “Fresh Start Financing” deals. But while the merchandise is still on display, the business is history, or at least in hibernation.

Thirteen car lots within two miles of this shuttered business have canceled their licenses in 2008, according to Department of Motor Vehicle records. Across Oregon, 270 dealerships have gone under or on hiatus over the past year.

Sky-high gas prices followed by a severe slump in consumer confidence have sent new car sales to their lowest level since World War II. While it is harder to track used car sales in the “EZ Financing” side of town, the same fundamentals apply, and the blight is spreading. Just down the street, another lonely herd of oversized SUVs lies out of reach behind a padlocked chain-link gate.

Used-car lots aren’t the only ones taking a hit. Oregon’s largest auto dealer and third-largest public company, Medford-based Lithia Motors, is losing money and attempting to trim 29 stores from its 13-state empire. Its stock has sunk 75% over the past year.

Major new-car dealerships from Brookings Harbor Ford on the southern coast to Dick Hannah Ford near the Rose Garden in Portland have closed, and more are expected to follow as the recession deepens. One of the state’s oldest dealerships, Gibson Motor Company, which sold Model T Fords when it opened in 1921, closed in November in Junction City. Motor vehicle employment in Oregon is down 14.5%, or 4,000 jobs, from a year ago.

Greg Remensperger, executive vice president of the Oregon Auto Dealers Association, says sales are down 30%. “People who have been in the business for 30, 40 years are saying they’ve never seen anything like this,” he says.

The dealers association has been running ads arguing that it is a great time to buy because financing is available and prices have dropped. The Kelly Blue Book, the benchmark standard for auto pricing has devalued suggested prices an unprecedented six times over the past four months.

“The minute we see one or two rays of sunshine there will be a pent-up bunch of people ready to go out and buy a car,” Remensperger says. Until then dealerships will be “hunkering down to make it through.”                                                         

BEN JACKLET


Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

 

More Articles

Attack of the Robin Sages

Contributed Blogs
Monday, July 07, 2014
070714 thumb linkedinfakesBY TOM COX | OB BLOGGER

Named after the 2010 experiment by Thomas Ryan, "Robin Sages" are fake social media profiles designed to encourage linking and divulging valuable information.


Read more...

Updated: Disrupting innovation

News
Tuesday, July 08, 2014
070814 thumb disputive-innovationBY LINDA BAKER  | OB EDITOR

The New Yorker recently published a sharply worded critique of “disruptive innovation,” one of the most widely cited theories in the business world today. The article raises questions about the descriptive value of disruption and innovation  — whether the terms are mere buzzwords or actually explain today's extraordinarily complex and fast changing business environment. 

Update: We caught up with Portland's Thomas Thurston, who shared his data driven take on the disruption controversy.


Read more...

Oversight? Or gaming the system?

News
Monday, July 14, 2014
AmazonBY VIVIAN MCINERNY | OB BLOGGER

Some people think Amazon’s winking eye logo is starting to look like a hoodwink.


Read more...

Interview: Dr. Mark Goulston

Contributed Blogs
Thursday, July 10, 2014
JustListenBY TOM COX | OB BLOGGER

Tom Cox interviews Dr. Mark Goulston, author of Just Listen, Discover the Secret to Getting Through to Absolutely Anyone.


Read more...

Managing family assets: The importance of planning ahead

News
Friday, August 22, 2014
Unknown-1BY CLIFF HOCKLEY |  OB GUEST CONTRIBUTOR

When business intersects with family, a host of  situations can arise. Without a clear vision and careful planning, hard-earned investments can become stressful burdens.


Read more...

Podcast: Interview with Pete Friedes

Contributed Blogs
Wednesday, August 27, 2014

082714-thumb friedesbookTom Cox interviews Pete Friedes, author of "The 2R Manager," about becoming a Best Boss.


Read more...

Who said we should sell in May?

Contributed Blogs
Friday, July 18, 2014
BullMarketBY JASON NORRIS | OB GUEST CONTRIBUTOR

Back in May, we shared a common Wall Street quote about investing, “Sell in May and go away.” Fast forward to July and the most common question we have been getting from clients is, “When is the market pullback going to occur?”


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS