Blogs > Frye on the News

Keeping his eye on the news and offering commentaries and insights on what is happening in Oakland County, around the world, on the tube and in the news.

Tuesday, June 2, 2009

Fewer dealers, few options? No, but higher prices....

I'm afraid that the answer to that will be, yes.
I don't see any other way around it. I've finally heard some of the
rumblings about this, today on a business report on CNN's Headline News.
But it makes sense. You have fewer places to buy a car, then you have
less competition to get you into the door.
Worse for us in the newspaper business is that dealerships are top
advertisers. So if we lose three or more dealerships, we lose
potential advertisers.
Even worse, though, is the surviving dealerships may feel less need
to advertise because there is less competition. Why run as many ads
if suddenly there are 30 to 40 percent fewer dealers within a 10-
to-15 mile radius of your location.
Shoppers -- who will, eventually at least, need new trucks and cars
-- will come in to see what you have going on.
So beyond the obvious lost jobs, this overall trimming of such a
substantial industry will have deep and painful impacts.
My initial thought that closing dealerships might lead to some quick
savings this summer, and I'm in the market for two vehicles by the
early fall, has been overwhelmed with the long-term impact this will
have on my community, my industry and my home.


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