You know we all do it. Sure, we try to patronize the local grocer, but sometimes Wal-Mart is cheaper or more convenient. If you want the cheapest gallon of milk, a quick quart of oil or even a reasonably priced LCD TV, Wal-Mart has everything you need. In the next few years though, you may be able to head down to Wal-Mart, CostCo or your basic “big box” store to buy your next car. Right now, if you want to buy a car in Mexico, that’s where people go. Well, maybe not any car,but at least one particular brand, GS Motors.

Wal-Mart, CostoCo, Sam’s and similar stores are known for their ultra efficient supply chain management. They are able to ship things more efficiently than smaller stores and thus, are able to sell them cheaper. Analysts and car makers who make ultra-cheap cars (the Chinese) will be able to utilize these amazing supply chains to market to a huge number of people (people visit Wal-Mart over 130 million times per week).

However, these big box stores will have the same problems with these cars as they do with many of their toys. Quality. In the same way Korean cars like Kia and Hyundai had very sketchy beginnings in the US, the likes of Chery and BYD will have a tough time selling to Americans who have a higher expectation of quality. Their price will no doubt fund future generations of Chinese cars that are sure to have better quality and more mainstream design.

What does this mean for dealers today? It means that a bad economy might be the least of your worries. A combination of a falling dollar (with all the “stimulus” money Washington will print out of this air) and resultant lower purchasing power of our next generation will push buyers to look for alternatives to Hondas and Toyotas. The Chinese car makers will make an absolute killing with the favorable exchange rates and domestic brands will suffer without cheaper, better built cars.

So, how will dealers “deal” with everything going against them? In this writer’s humble opinion, tax brakes are the only hope we have. Right now, the corporate tax rate in the US is the highest in the world. Makes it pretty tough to compete when you’re cars have a 35% (plus state and local taxes) premium over that of your competitors. It makes sense to most economists that killing this tax rate will allow for car companies to sell cars cheaper and hire more people to make these cars. The government will in turn make money through the income tax revenue of those employees, thus recovering the money “lost” through lowing tax income. Cheaper cars means its easier to export them to foreign nations which, again, leads to more cars sold and more revenue for the Government. So the question is this: are we going to keep killing our manufacturers and dealers by keeping the corporate tax rate high (and in turn, allowing unemployment to stay high), thus empowering China and their economy or will we lower our tax rates so our companies can compete with the rest of the world and we can take the fight overseas? The current administration and congress seem to think they can will the economy through distribution of funds into “creating” wealth. Unfortunately, the more you fight economics, the more you will suffer. And by you, I mean the American people.

Inspiration: GasGoo

It seems that no one is safe from the wake of destruction and the money pit that is known as Bernie Madoff. A recent set of documents files in the U.S. Bankruptcy Coupt in New York expose some well known names in the dealer business: Robert Potamkin of Potamkin Automotive in New York and South Florida; Robert Rosenthal, head of Rosenthal Automotive in the Washington area; Miami dealer Norman Braman; Peter Paris, a vice president of Potamkin Cadillac; the employee profit-sharing plan of Bay Chevrolet in Rockville Centre, N.Y.; and funds from the Minneapolis dealership Metro Motor Imports Inc. Bernie has been charged with milking billions of dollars form clients around the country and the world in what’s described as the world’s largest ponzi scheme (also known as pyramid schemes).

There are no actual values of the amount lost by the dealers in question, but Robert Potamkin was quoted as saying, “I lost enough to be aggravated about it. Luckily, we believe in diversification.” Apparently, several listings for the Potamkin group is the family’s charitable trust fund are in the documents. In a Friday, February 6th phone call, Potamkin said that fund may have lost $1 million. But he said his personal accounts, which also lost about $1 million, could recoup most of the loss through insurance.

In this already shaky time for dealers, a poor investment can spell absolute destruction for a dealer. Keeping your online and offline presence intact is getting harder with people like Bernie Madoff running around. Hopefully, his trial (and conviction) will serve as a deterrent from others who wish to do the same in the future.

I forgot to post this yesterday. Here’s some great stories from Friday to check out over the weekend…

- Motown Showdown: 2009 Dodge Charger SRT8 vs. 2009 Pontiac G8 GXP
- What car deserves an LS9 V8?
- Clarkson: Top Gear USA ‘canned,’ viewers ‘just don’t get it.’
- Most of Saleen sold to Michigan group
- Lawrence Marshall Chevy, Dodge, Ford: Another Massive Texas Auto Dealership Closes (thanks Cody)
- Ford Leader in Technology Patents, Study Shows
- Killer car deals out there…somewhere
- Obama defends federal car plan
- How to sell diesel to Americans
- First Look: Cadillac Converj Concept
- (F1) Bourdais stays at Toro Rosso in 2009
- Black Stig Returns from the Dead
- New coalition formed to promote diesels in the U.S.
- Citroen DS Inside Concept to debut in Geneva
- General Motors to lay off 600 at Mexico plant
- Nissan GT-R With Updated Launch Control Still Fast
- New Study Confirms Car Exhaust Increases Lightning Strikes
- GAZ-51 Custom: Russians Make A Cadillac Escalade EXT Hot!
- Thai Police Erect Fake Crash Sites To Deter Drunk Driving
- Has the auto market finally bottomed out?
- Ford says new study shows SYNC leads to fewer distracted drivers
- Shelby unleashes 750-horsepower GT500 Super Snake Prudhomme Edition
- Geneva Preview: More details on Alpina B6 GT3 come to light
- Other Perspectives: Chris Bangle – The man who saved BMW?
- BMW considering five possible variants of next 1-series, turbocharging galore

Source: Sean Martin

With all the clips and pictures around the web I’ve saved up in my bookmarks folder, I’ve decided that it’s time to get some of these onto the EasyAutoSales blog and hopefully entertain some of the audience more than some of my posts (which have been for the most part, serious due to the current state of the auto industry and economy as a whole). It’s called “EasyRides” and I hope everyone enjoys it!

As such, I’m starting out with a concept drawing of a Buick Lucern:

Buick has been known as a pretty stodgy brand in recent history. However, with recent effots via Tiger Woods spokesmanship (recently stopped due to cost) and designs that are more 21st century AD than 21st century BC. The above is a decent rendition of a modern “pimped out” Buick. It’s no 2010 Buick LaCross, but it’s forwards movement!

Tell me what you think about Buick in the forums: EasyRides – Buick Concept

What’s so compelling about the GMC name that keeps The General building Canyons, Sierras, Envoys, Yukons and the rest of the line? Would GM lose sales to Ford or Dodge if they killed the GMC line or is it something more? Is GMC the rugged workers brand? Is it something more? How does GMC fit into the rest of GM’s line?

I think the end question is: would GM kill a brand with their name right there in the title? I believe only if GM were at the end of their rope would they go so far as to kill a brand like GMC. Pontiac and Saturn have already been talked about being on the chopping block. Cadillac is growing and successful. Chevrolet is the largest domestic producer, so GM wouldn’t kill either of them anytime soon either. With all the brands in the GM portfolio, I would put GMC 3rd in line to be dropped. What do you think?

As long as the US Government keeps giving GM money, it’s something that they aren’t going to have to worry about. GM is going to keep doing what they have been doing because there’s no reason to change. All we can hope is that some people inside GM with foresight will begin to streamline their operations (keep the GMC models, just brand them as Chevys). Perhaps this will extend to other parts of their business, like branding and marketing. GM still has a stodgy image compared to Ford, and streamlining the manufacturing while expanding their media presence can only help their image and their business. Take some risks General! Show us what you’ve got!

Tell me what you think by discussing in the forums: GMC – Is It Brand Loyalty?