Car dealerships hope frozen sales thaw in 2009

By Dustin Grove (grove@wsbt.com)

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Car dealerships hoping for increased sales

The government's bailout of the auto industry has car dealerships banking on a sales boom in 2009. (WSBT photo)

By Beth Boehne

Story Created: Jan 6, 2009 at 4:23 PM EST

Story Updated: Jan 10, 2009 at 12:50 PM EST

ELKHART — For Thad Naquin, this holiday season has been anything but the most wonderful time of the year.

"The last four or five months have been the most difficult we've experienced probably in our history,” he told WSBT News.

And the Elkhart car dealer has been in business for 40 years.

December sales reports are out and they don't look good. Chrysler is down 53 percent, General Motors’ sales fell 31 percent, and Ford dropped 32 percent. Japanese automakers didn't do any better. Toyota sales were down 37 percent, and Honda's are off 35 percent.

Today Naquin has an 8- to 10-month supply of cars and trucks. Like every other dealer in the country, sales have remained nearly frozen. But they are all anticipating a cash infusion in Detroit will thaw them out.

“As we go forward, we're going to see the sales accelerate and I’m sure it will get back in line in short order,” said Naquin.

This month, after the U.S. Treasury put $5 billion of taxpayer money into General Motors' financing arm, GMAC, in turn, relaxed its credit requirements and began loaning the money at low interest rates.

"The good thing is now is probably as good a time as there's ever been to consider and visit and purchase new vehicles,” said Naquin.

It isn't just automotive dealerships hoping to move cars off the lot. Indiana is the third largest state in the country when it comes to automotive employment. There are 60,000 people who work in the industry from parts suppliers to manufacturers. Many have been laid off but a bump in sales could help put some back to work.

"The question is can GM and Chrysler take advantage of the window here to act and get the house in order so they can sustain themselves and continue to be in operation?" said Naquin.

Until then, local dealerships will do what they can — providing friendly customer service and maintaining sales in the repair shop is more important now than ever — to pay the bills.

So with rebates, low interest loans and a list of other incentives, the auto industry is banking on an upswing in 2009 in an economy that, right now, remains very much down.

"With the economy slow now, everybody's watching their pennies right now,” said Brian Groning as he walked into a Mishawaka convenience store. “They want to save that money for gas, the grocery, whatever.”

But local dealers say the help from Washington has already helped them out. At Gates Chevy World in Mishawaka, the day after the first announcement that the Big Three would get financial assistance, General Manager Matt Helmkamp told WSBT his dealership saw the biggest sales of the month.

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