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When the Fed Bails Out the BIG 3...Who Bails Out the Dealers?
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| The Senate and House got a jolt this week while debating whether to bail out the Big 3 when it was learned that we shed over 500,000 jobs in November. The possibility of additional job losses from the domestic auto industry became the main reason for
rushing to approve a bail out. Weʼll call it “Job 1”, coining a phrase from Ford. During the wonder years of post 911 rebates, 0% financing, and high margin sales of pick-ups and large SUVʼs the domestic manufacturers started adding new dealership locations like drunken sailors, diluting the value of the existing locations, lowering their sales, raising their marketing expenses for a share of voice in the over crowded print and electronic media, while forcing additional inventory on all of the locations.
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