Tuesday, April 24, 2018

Low-Overhead Auto Brokers Are Changing the Game for Traditional Dealerships


Green and white balloons float above Jeep Wranglers and Dodge Challengers inside the Manhattan Jeep Chrysler Dodge Ram dealership on 11th Avenue near West 48th Street. In an adjacent outdoor lot, red-white-and-blue streamers flutter above used models.

Court papers, however, tell a less cheerful story: In March the franchisees filed for Chapter 11 bankruptcy protection, citing a debt of more than $22 million to their chief lender. The filing included a related Alfa Romeo Fiat dealership a few blocks away.

The bankruptcy was the second to hit Manhattan's auto row in less than a year. A nearby Jaguar Land Rover dealership that included Maserati and Ford franchises went bust in July with debts of more than $60 million. It sold at auction in September.

Industry experts said the two bankruptcies point to the growing pressures of a changing automotive retail landscape.

On the one hand are escalating rents in an expensive Manhattan neighborhood. On the other is increasingly intense competition from a little known but rapidly growing part of the industry: automotive leasing brokers, who market themselves on the web and base their operations in modest quarters rather than inside a sleek 11th Avenue showroom.

Click here for the full article. 

Source: CRAIN'S New York Business (via Empire Report New York) 

No comments: