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

Car dealers collapse as sales drive off a cliff

| Print |  Email
Archives - December 2008
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

Barrister bands

March 2014
Tuesday, February 25, 2014
IMG 4691BY LINDA BAKER

An intellectual property attorney by day, 48-year-old Stoll Berne attorney Tim DeJong is a singer and guitarist by night.


Read more...

Banishing oil burners reaps benefits for schools

News
Tuesday, April 01, 2014
04.02.14 thumb co2schoolsBY APRIL STREETER | OB CONTRIBUTOR

Three years ago, PPS set out to begin to convert the 1930s-era boilers from diesel/bunker fuel to cleaner-burning natural gas. Oregon’s largest school district has realized impressive carbon dioxide emissions reductions, setting an example for public and private institutions.


Read more...

On fire

March 2014
Tuesday, February 25, 2014
BY JESSICA RIDGWAY

A self-proclaimed “chile head,” John Ford “grows, eats and does everything spicy.” 


Read more...

Branching out

March 2014
Tuesday, February 25, 2014
DSC04185BY LINDA BAKER

A blueberry bush is a blueberry bush — except when it’s a blueberry tree.


Read more...

Green your workplace

News
Thursday, April 03, 2014
100Green14logo200oxBY OB STAFF

Learn how to green your workplace and lower your environmental footprint at the office. Oregon Business presents a two-hour "Greening Your Workplace" seminar on May 28th, 2014 at the Nines Hotel in Portland.


Read more...

Spreading the wealth

March 2014
Tuesday, February 25, 2014
HiResBY PAIGE PARKER

A money management firm broadens its reach. 


Read more...

Car ignition recalls and lean product design

Contributed Blogs
Friday, April 11, 2014
04.11.14 thumb gm-gettyTOM COX | OB BLOGGER

The auto industry is starting to share more costs across manufacturers for complex and challenging design work, like new transmission design, and certain new engine technologies. What we’re not yet seeing is wholesale outsourcing of “unavoidable waste” components to specialist companies.


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