Dealers pare budgets, reduce inventory amid slump

Matt Wagner, SBJ ReporterThe top dogs at two of Springfield’s largest car dealerships say they’re looking at ways to cut expenses and boost their online presence after finishing 2008 on a low note.

Lynn Thompson of Thompson Buick-Pontiac-GMC-Cadillac-Saab and Tony Stubblefield of Reliable Toyota, Lexus, BMW, Scion Superstore said sales plummeted at the end of ’08 after a strong start. Both dealerships are now bracing for what lies ahead.

Even amid declining sales, Thompson said new and used car sales managed to post a modest 3 percent increase in 2008 over 2007. Still, he’s reduced his new car inventory to $8.5 million from $13.5 million and is cutting back on all forms of advertising except the Internet this year.

Stubblefield is likewise looking at ways to save money in anticipation of an ongoing sales slump that began with a 40 percent drop in business last quarter. His advertising strategy – a stronger, or perhaps smarter, online presence – mirrors Thompson’s.

“We’re optimistic about the near-term future,” Stubblefield said. “We know that there’s probably a few rough months ahead of us. … Even in the best of times, February’s not fun to be in the car business.”

Thompson said GM is looking to reduce the number of its dealers to about 4,700 from 6,800, but he’s not interested in selling. He said the Springfield market isn’t among those in the country he considers “over-dealered.”

Stubblefield, on the other hand, wasn’t so sure the Springfield area would escape the consolidation trend. He said Reliable is exploring at least one prospective deal, but he was reluctant to provide details.

“We look for product lines that have good synergy with what we currently offer,” he said. “We are looking at something that might bear fruit hopefully not too far in the distance.”

Do you think area dealerships will be forced to consolidate in the face of the recession? Post a comment in the Responses area below.

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