NEWS ANALYSIS: Motor dealers are better placed for sales slump than in the 2008 crisis
Many in the sector have strong balance sheets and low inventories and benefit from the multi-franchise system
Motor dealers are better placed to survive the latest collapse in new-vehicle sales than they were during the 2007-2009 global economic crisis, which was the last time the local market went into free fall, says Mark Dommisse, the head of the National Automobile Dealers Association (Nada).
Then, scores of dealers went out of business, leading to a major rationalisation of the sector. Major dealer groups bought up some stragglers and consolidated operations into stronger business units. There was also a relaxation of the single-franchise system through which manufacturers discouraged dealers from selling more than one brand. Today, many dealer groups represent multiple makes, while some individual dealers sell and service several brands from the same site, with separate mini-showrooms for each.