Detroit Free Press: (Auto) Dealer demise an economic tsunami for communities

[marmar]

.....(snip).....

Dealer demise an economic tsunami for communities

Chrysler dealers learned last week that they would undergo credit checks while 25% of them, or 800, would no longer be reimbursed for rebates. GM said last month that it wanted to get rid of about 2,600 dealers by the end of 2010.

Ford Motor Co., which is not receiving federal funds, is also paring down its network of dealers to get competitive.

At least 150,000 jobs are at stake with the GM and Chrysler dealership reductions -- more than the two automakers' total U.S. workforces. And that's just the direct impact.

Indirect shocks also will be felt by bankers, insurance agencies, auto-parts stores, fast-food restaurants and newspapers, radio and TV stations throughout the country that depend on advertising revenue from local auto dealers. The average dealership, for example, spends about $400,000 a year on advertising, the National Automobile Dealers Association said.

"For every job in a dealership, there is one other job in the community associated with it," said Kim Hill, who tracks the impact of auto industry contraction on communities at Ann Arbor's Center for Automotive Research.

A variety of charities and nonprofit organizations that depend on donations from their local dealers are also likely to suffer. Dealers in California, for example, contributed more than $84,000, on average, to local charities and nonprofit groups, said Paul Taylor, chief economist for the National Auto Dealers Association. ..........(more)

The complete piece is at: http://www.freep.com/article/20090510/BUSINESS01/905100450

[OhioChick]

1. K&R

:kick:

[knitter4democracy]

2. This is spot-on. They are major parts of the community.

Ours sponsor little league teams and Girl Scout troops, and that's just the tip of the iceberg.

The reality is, Michigan's really screwed.

[Triana]

3. The whole country is screwed. The auto industry was one of the FEW major industries left here...

...and it's gone, essentially. That will effect EVERY state, not just Michigan.

They can coddle Wall Street all they want but Wall Street is NOT the entire US economy. It's only part of it.

It's a HUGE MISTAKE to keep the pacifier in Wall Street's mouth while starving and neglecting other industries in this country - ESPECIALLY the one that is/was the backbone of blue-collar jobs and our manufacturing base (what the hell is left of it). And they managed to bust the few unions left while they were at it.

This is EXTREMELY destructive to our national economy, IMO.

[Wednesdays]

4. K&R

:kick:

[Hannah Bell]

5. more trickle-down poverty for the masses.

should get real fun when the GM bankruptcy kicks in.

[FarCenter]

6. You should be able to order the car on GM's web site and have it delivered

Cut out the middleman.