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Local auto dealers are relieved by bailout news

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Posted: Friday, December 19, 2008 10:00 pm

A heavy sigh of relief swept through Lodi's car lots on Friday as word of President Bush's $17.4 billion auto loan package reached the ears of those in the industry.

"We're glad to see Chrysler and GM being helped out. If they fail, that affects us," said Geweke Ford manager Mark Meyer. He said Ford was still stable, as sales staff and customers milled about the dealership.

Meyer explained that the three companies are clients of the same parts manufacturers. Items like rubber gaskets, glass, copper parts and other items come from the same vendors. If one or both of the troubled automakers were to crumble, Ford would feel the shock through rising costs from those vendors.

"It's like a rebirth for the auto industry. We're seeing a lot of change," Meyer said of the way dealers and finance companies think about and transact business with customers.

The loans were welcome news to Lodi car dealers who were directly impacted, such as Sanborn Chevrolet General Manager Dennis Calton.

"They're going to be able to continue to produce the cars that we can sell," Calton said. Just days ago, Chrysler and GM had planned to shut down their manufacturing plants for no less than a month. But Calton said supply lines should remain open thanks to the loans.

Even though foot traffic has slowed on many of Lodi's lots in recent months, Meyer said Geweke has seen an upswing in sales.

"We've had a dramatic increase in new vehicle sales. Especially in new trucks," Meyer said, stating sales were up by about 50 percent in the past few weeks. Both he and Calton said that sales incentives and lower costs made it a "buyer's market." Other Geweke dealerships like Toyota and Kia had also seen an increase in sales numbers. "It's a real positive energy," Meyer said.

Mike Tiehm, co-owner of the Plummer Automall in Lodi, said that if the automakers had to file for bankruptcy, it still wouldn't be their end. He said that the companies would simply go into reorganization and move forward from there.

Meyer said that everyone at Geweke Ford - indeed, everyone he has spoken with in the auto trade - is hopeful about the future.

Though credit has tightened up, Geweke still works with about 10 finance companies to secure loans for their customers.

So, what if sales don't pick up for GM or Chrysler dealers? Will the government loans - which will need to be paid by March 31 if automakers can't prove the restructuring is having a positive effect - make any difference to an already ailing industry?

"Obviously, we all need to sell cars to survive. If credit doesn't loosen up enough to allow people to buy cars, we may be in the same boat," Calton said. "But I don't think that's going to happen."

Contact Business Editor Marc Lutz at marcl@lodinews.com.

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4 comments:

  • posted at 8:50 am on Tue, Dec 23, 2008.

    Posts:

    dogsI saw on tv the other night there is a lot, and I don't remember if it's in LA or the Bay Area, where they have 2,000 brand new never been drivin cars just sitting there. They are 2006 models they didn't sell. The bailout is only postponing the inevitable. They have been bailed out before.

     
  • posted at 3:58 pm on Sun, Dec 21, 2008.

    Posts:

    Dogs, I wouldn't hold my breath.

     
  • posted at 9:05 am on Sun, Dec 21, 2008.

    Posts:

    edumacation, at those prices, ever heard of Grayhound. The auto company`s want a bail out, does that mean their going to make more cars they can sell? Take a look at the new cars dealers lots around town, full of cars nobody wants. We can only hope G M and Chrysler get there stuff together and don`t need anymore money and can pay back what they owe.

     
  • posted at 2:26 pm on Sat, Dec 20, 2008.

    Posts:

    Geweke RV: I heard you are having year end clearance sales on 39 foot Fleetwood motor homes? Can you give me a deal on the fuel costs? Lets see a 90 gallon tank of diesel at $2.37/gal and 6 miles per gallon= $213.30 to get to Eugene Oregon for another $213 fill up. Do you have any Hybrid Motor Homes?

     

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