Anonymous asked in Cars & TransportationBuying & Selling · 1 month ago

are car dealerships having a hard time right now? why a major , long time car dealership in my area sold off to someone else?

4 Answers

  • 1 month ago
    Favourite answer

    Worldwide new car sales fell off a cliff this year. 

    COVID-19 meant far fewer people were driving, trips averaged shorter distances, and in the USA alone over 20 million people lost their jobs. 

    Winter is now coming, COVID-19 will be with us next year as well, and so there are not merely far fewer potential purchasers for new cars, but those who could still buy are tending to put off major spending commitments until they feel that it’s safer to do so.

    Add to that the existing tendency of people treating new cars as mere commodity goods which they’re happy to buy simply by ordering on a website and it makes the traditional bricks and mortar dealership model far harder to sustain. Some manufacturers are even considering moving over to direct sales, avoiding traditional middlemen dealers altogether. Just as Tesla has done; they do have showrooms but they’re not dealer franchises.

    The other pressure on traditional dealers are the immense car supermarkets which sell new and used cars at fixed prices, often with the convenience of driving away the same day. Those places use the “pile it high, sell it cheap” strategy, but doing that requires an immense location and a truly immense amount of financing to invest in stocking thousands of cars on a single site. 

    Car supermarkets are also ideal partners for the online-only dealers as even they need somewhere to store, prepare, and deliver the vehicles they sell, and the car supermarkets are happy to sell that way paying the online retailer a fixed fee plus maybe a small added commission on any finance sold with those vehicles. The online retailer is happy because they get to sell stuff without ever having to invest in stock, storage, vehicle preparation and workshops.

    The writing is on the wall for all traditional new car franchise dealers unless they make major changes to move with the times. 

  • Anonymous
    1 month ago

    They can sell for many reasons.

  • Anonymous
    1 month ago

    They probably wanted to retire and sold their business.  Car dealers, if run right, are money makers.

  • 1 month ago

    Maybe the owner got old and decided to retire.    Or died.  Or found an easier way to make money.

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