Posted: May 12th, 2009, 4:07 am
MAY 12, 2009
<span style='font-size:14pt;line-height:100%'>Car Dealers Covet Competitors as Cuts Loom</span>
By KATE LINEBAUGH
JACKSON, Mich. -- As Chrysler LLC and General Motors Corp. compile lists of dealers that will be eliminated, thousands of owners of these businesses tensely await announcements expected later this week.
But some car dealers see opportunity amid the industry's wreckage, aiming to grab market share and boost profits by buying up struggling competitors.
Wes Lutz, owner of a Dodge store in this depressed Michigan city of 34,000, hopes he will make the cut and has been hoarding cash to expand his business if he does.
Mr. Lutz wants to buy out the other local Chrysler LLC dealer to grab the two sister brands he doesn't represent, Jeep and Chrysler. He also is looking to poach top sales people from rivals and wants to load up on vehicles as failed dealers liquidate their inventories.
"Some guys aren't going to make it through. When my peer group is wringing their hands, I set up another line of credit. I think there is huge opportunity," said the 54-year-old Mr. Lutz, whose Dodge and Hyundai dealerships abut an interstate highway connecting Detroit and Chicago.
After years of market-share declines, Chrysler, GM and Ford Motor Co. have been left with many more dealers than they need. As they scramble for sales, dealers end up competing with others selling the same models and undercutting each other on price.
Now the recession and tight credit markets are pushing many dealers over the edge. Hundreds have gone out of business over the last 15 months, including about 400 Chrysler stores since January 2008.
GM is making plans to drop 2,600 of its more than 6,000 dealers and said Monday it plans to inform affected locations Thursday. Chrysler has told the U.S. Bankruptcy Court in Manhattan it is likely to cut more than 800 dealers and could begin notifying those that will be dropped later this week, people familiar with the matter said.
Dealership closings exact a painful cost on communities, increasing unemployment and eliminating major contributors to local advertising and philanthropy. With each closing, about 50 people lose work, according to the National Automobile Dealers Association. Last year, more than 1,000 dealers went out of business and NADA predicts the number will rise this year.
Chuck Eddy, who runs a Chrysler, Dodge and Jeep dealership in Youngstown, Ohio, also sees opportunity in the industry's decline. By boosting his inventory and offering discounted prices, Mr. Eddy said he has been able to produce record sales because competitors have scaled back the number of new cars on their lots, reducing choice for potential customers.
So far this year, Mr. Eddy said he has sold about 180 more vehicles than he did in the same period a year ago, which translates into about a 15% increase in his annual sales level of 1,200 cars and trucks.
If he remains part of the reorganized Chrysler, Mr. Eddy said, "definitely there is going to be opportunity," though he added he is "saddened" that the company and the government are looking to close dealers.
In Jackson, Mr. Lutz said he hopes to take advantage of a Chrysler plan to eliminate dealerships that don't represent all three of its brands. That's why he would like to buy out the other dealer in the Michigan city, MotorQuest Chrysler and Jeep, located five miles to the east.
"In my town one of us is going away -- either me or him," said Mr. Lutz. He said he held talks last year with MotorQuest but each wanted to buy the other, so the discussions ended. MotorQuest owner Geoff Douglas declined to comment.
By consolidating dealers, Mr. Lutz said he would be able to sell more vehicles and increase the amount of profitable service work that comes through his dealership. The move also could help his pricing power because he would be competing with fewer nearby dealers selling the same products -- cutting down on "these guys nipping at you," said Mr. Lutz.
He also sees an opportunity when Chrysler dealers begin closing in the weeks ahead. That is likely to send thousands of new cars from these dealers' inventories to wholesale auctions, where they could fetch fire-sale prices.
To build up cash, Mr. Lutz has let his inventory fall to about 80 new and 80 used vehicles, fewer than he normally carries. He also has liquidated some personal assets, including real estate and stock, and persuaded his bank to extend his line of credit for his buying spree.
"I'm going to buy every car I can find with every dollar I have until I run out of money," said Mr. Lutz.
If in the end his Extreme Dodge doesn't make it, Mr. Lutz has a Hyundai store next door to fall back on. He also said he'll look to acquire another franchise -- most likely that of a foreign auto maker such as Volkswagen AG, Mazda Motor Co., or, if he has the chance, Toyota Motor Corp.
source: <a href='http://online.wsj.com/article/SB124207608000308043.html' target='_blank'>http://online.wsj.com/article/SB1242076 ... 43.html</a>
本篇报导需要关注的是一些词语上的搭配
await announcements: 等待汽车制造商的通知
see opportunity amid: 于……中见到机会
grab market share: 抓住、攫取市场份额
buy up struggling competitors: 一举买下、吃掉竞争对手
hoard cash: 聚财、积聚现金
represent the brands:成为……品牌的代理
poach top sales people from rivals: 从竞争对手处挖走高端销售人员
liquidate their inventories: 变卖存货以获取现金
line of credit: the maximum credit allowed a buyer or borrower 信贷限额
undercut each other on price: to offer to sell at lower prices than or to work for lower wages than (a competitor)，即与竞争者进行价格战
go out of business: 竞争失利出局
GM is making plans to drop 2600...it plans to inform affected locations...
Chrysler...is likely to cut more than 800 dealers and could begin notifying those...
以上两句中注意对于（组织）计划裁撤……将通知……的表述
translate into: 意味着、相当于
<span style='font-size:14pt;line-height:100%'>Car Dealers Covet Competitors as Cuts Loom</span>
By KATE LINEBAUGH
JACKSON, Mich. -- As Chrysler LLC and General Motors Corp. compile lists of dealers that will be eliminated, thousands of owners of these businesses tensely await announcements expected later this week.
But some car dealers see opportunity amid the industry's wreckage, aiming to grab market share and boost profits by buying up struggling competitors.
Wes Lutz, owner of a Dodge store in this depressed Michigan city of 34,000, hopes he will make the cut and has been hoarding cash to expand his business if he does.
Mr. Lutz wants to buy out the other local Chrysler LLC dealer to grab the two sister brands he doesn't represent, Jeep and Chrysler. He also is looking to poach top sales people from rivals and wants to load up on vehicles as failed dealers liquidate their inventories.
"Some guys aren't going to make it through. When my peer group is wringing their hands, I set up another line of credit. I think there is huge opportunity," said the 54-year-old Mr. Lutz, whose Dodge and Hyundai dealerships abut an interstate highway connecting Detroit and Chicago.
After years of market-share declines, Chrysler, GM and Ford Motor Co. have been left with many more dealers than they need. As they scramble for sales, dealers end up competing with others selling the same models and undercutting each other on price.
Now the recession and tight credit markets are pushing many dealers over the edge. Hundreds have gone out of business over the last 15 months, including about 400 Chrysler stores since January 2008.
GM is making plans to drop 2,600 of its more than 6,000 dealers and said Monday it plans to inform affected locations Thursday. Chrysler has told the U.S. Bankruptcy Court in Manhattan it is likely to cut more than 800 dealers and could begin notifying those that will be dropped later this week, people familiar with the matter said.
Dealership closings exact a painful cost on communities, increasing unemployment and eliminating major contributors to local advertising and philanthropy. With each closing, about 50 people lose work, according to the National Automobile Dealers Association. Last year, more than 1,000 dealers went out of business and NADA predicts the number will rise this year.
Chuck Eddy, who runs a Chrysler, Dodge and Jeep dealership in Youngstown, Ohio, also sees opportunity in the industry's decline. By boosting his inventory and offering discounted prices, Mr. Eddy said he has been able to produce record sales because competitors have scaled back the number of new cars on their lots, reducing choice for potential customers.
So far this year, Mr. Eddy said he has sold about 180 more vehicles than he did in the same period a year ago, which translates into about a 15% increase in his annual sales level of 1,200 cars and trucks.
If he remains part of the reorganized Chrysler, Mr. Eddy said, "definitely there is going to be opportunity," though he added he is "saddened" that the company and the government are looking to close dealers.
In Jackson, Mr. Lutz said he hopes to take advantage of a Chrysler plan to eliminate dealerships that don't represent all three of its brands. That's why he would like to buy out the other dealer in the Michigan city, MotorQuest Chrysler and Jeep, located five miles to the east.
"In my town one of us is going away -- either me or him," said Mr. Lutz. He said he held talks last year with MotorQuest but each wanted to buy the other, so the discussions ended. MotorQuest owner Geoff Douglas declined to comment.
By consolidating dealers, Mr. Lutz said he would be able to sell more vehicles and increase the amount of profitable service work that comes through his dealership. The move also could help his pricing power because he would be competing with fewer nearby dealers selling the same products -- cutting down on "these guys nipping at you," said Mr. Lutz.
He also sees an opportunity when Chrysler dealers begin closing in the weeks ahead. That is likely to send thousands of new cars from these dealers' inventories to wholesale auctions, where they could fetch fire-sale prices.
To build up cash, Mr. Lutz has let his inventory fall to about 80 new and 80 used vehicles, fewer than he normally carries. He also has liquidated some personal assets, including real estate and stock, and persuaded his bank to extend his line of credit for his buying spree.
"I'm going to buy every car I can find with every dollar I have until I run out of money," said Mr. Lutz.
If in the end his Extreme Dodge doesn't make it, Mr. Lutz has a Hyundai store next door to fall back on. He also said he'll look to acquire another franchise -- most likely that of a foreign auto maker such as Volkswagen AG, Mazda Motor Co., or, if he has the chance, Toyota Motor Corp.
source: <a href='http://online.wsj.com/article/SB124207608000308043.html' target='_blank'>http://online.wsj.com/article/SB1242076 ... 43.html</a>
本篇报导需要关注的是一些词语上的搭配
await announcements: 等待汽车制造商的通知
see opportunity amid: 于……中见到机会
grab market share: 抓住、攫取市场份额
buy up struggling competitors: 一举买下、吃掉竞争对手
hoard cash: 聚财、积聚现金
represent the brands:成为……品牌的代理
poach top sales people from rivals: 从竞争对手处挖走高端销售人员
liquidate their inventories: 变卖存货以获取现金
line of credit: the maximum credit allowed a buyer or borrower 信贷限额
undercut each other on price: to offer to sell at lower prices than or to work for lower wages than (a competitor)，即与竞争者进行价格战
go out of business: 竞争失利出局
GM is making plans to drop 2600...it plans to inform affected locations...
Chrysler...is likely to cut more than 800 dealers and could begin notifying those...
以上两句中注意对于（组织）计划裁撤……将通知……的表述
translate into: 意味着、相当于