Local car dealers cautiously optimistic about the future

Posted 4/7/09

“We had our best month ever in March,” said J.P. Jones, manager of Fremont Motors in Powell.

Sales so far this year, though, are flat — just equal to last year at this time, Jones said.

“We are exactly where we were …

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Local car dealers cautiously optimistic about the future


According to national news reports, March was a dismal month for car sales.In Powell, though, while the outlook may not be exactly rosy, it's not dismal either, and one local dealer reports having a very good month in March.

“We had our best month ever in March,” said J.P. Jones, manager of Fremont Motors in Powell.

Sales so far this year, though, are flat — just equal to last year at this time, Jones said.

“We are exactly where we were last year,” Jones said.

At Garvin Motors, Marty Bratt said the current troubles with the economy and in the auto industry have had a minimal effect on sales.

“It's not anywhere near as bad as it is nationally,” Bratt said.

Another Powell dealership, American Auto, however, is being pinched a little, according to owner Curt Perl. Perl, whose business is entirely based on used cars, said the number of sales are not down this year, but the company isn't making as much money on them.

“We're paying more for vehicles and making less on them,” Perl said. “Our sales figures are on track, but our gross profit is down.”

Perl said his company recently went to Arizona to get a vehicle for a customer. He said he wouldn't have done that in the past, but current conditions make such efforts necessary.

“Everyone is working twice as hard to sell vehicles,” Perl said.

Bratt said used car prices are up because they are in shorter supply. Fewer new car sales mean fewer trade-ins, he said, and, as a result, supply and demand are bringing higher prices.

However, Chuck Guschewski of Lander, who owns several Fremont Motors outlets in Wyoming, including those in Powell and Cody, said the good month the Powell dealership experienced in March was due to good sales in all departments, used cars as well as new.

“It defies all logic,” Guschewski said. “I can't explain it, but I'm not complaining.”

Guschewski added that the successful month was confined to the dealerships in Powell, Cody and Sheridan.

Fremont outlets elsewhere in the state did not have the same success, which he attributed to a decline in fleet sales, which are not a big part of auto sales in Park County. He also noted that drilling activity in southwest Wyoming is slowing, meaning fewer jobs.

The ability of potential buyers to obtain credit is a factor in sales, and better credit ratings are necessary to obtain financing.

“If you don't have a good credit rating, you can't get a loan,” Perl said.

Perl added that some buyers are “upside down” with their current vehicles, owing more on them than the vehicles are worth. That prevents them from trading for a lower-priced or more fuel-efficient vehicle to save money.

But buyers with a good credit rating should have no problem, according to Bratt. He said he can obtain financing from Toyota, GMAC or through several regional banks.

“If you're qualified, I have plenty of sources of credit,” Bratt said.

While things look alright now, there are concerns about the future, principally because of uncertainty about gasoline prices, the shaky future of American manufacturers and the general state of the economy.

Bratt said the “wild fluctuations” in gas prices over the past year have made it impossible to predict what will happen in the auto market. Gas prices influence the customer's choice of what to buy and may cause them to delay purchasing a vehicle.

“I talk to people in the energy business all the time about what gas will do,” Bratt said. “So much depends on gas prices.”

Perl said he is very concerned that gas prices might climb again, because much of the used-car business is in bigger vehicles.

“I'm hoping and praying that gas doesn't go to $4,” Perl said. “A lot of used-car dealers sell more pickups and SUVs, and if gas goes up, people don't buy them.”

The situation of American car manufacturers raises mixed feelings among the dealers.

“It's really going to be scary while (General Motors) and Chrysler reorganize,” Perl said. “I think GM will come back, but the period between now and then is scary.”

Perl added that he is having some difficulty obtaining financing to carry his inventory, and is planning to reduce the inventory at his Powell and Cody outlets by 20 vehicles by June 1.

“I have no idea of the future, but it doesn't make me smile,” Perl said.

Guschewski said the situation is causing “enormous uncertainty” in the market, but also indicated that he thinks General Motors, at least, will survive.

“It's pretty hard to picture a world without GM,” Guschewski said.

Jones said he believes there “will be some resolution to the difficulties,” and he is “cautiously optimistic” about the future.

Bratt echoed that optimism.

Bratt said he isn't sure what to think about the problems of General Motors, one of two franchises at Garvin Motors.

“After some pain with GM, I think we're going to end up with a better company than we have today,” Bratt said.

Bratt also indicated that he has confidence in Garvin's other franchise.

“We've got a great company in Toyota; we'll be all right,” Bratt said.