Local dealerships take steps to attract buyers

December 5, 2008 1:27:11 PM PST
Car dealerships in the Chicago area are pulling out all the stops to try and sell vehicles during these tough economic times. Let's start with the good news: it's a great time to buy an American car. The deals are unprecedented. Dealerships are now competing to survive trying old fashioned ways and new technology to stay viable in a shrinking American car market.

Foot traffic into Castle Buick Pontiac GMC in Riverside is sparse. Not like it used to be. The dealership is looking at new ways to bring in customers via the internet. They now advertise on more that a dozen websites and their internet department tripled in staff in recent months to make sales for this dealership and their sister dealership in Villa Park. The sales manager says internet sales are keeping them afloat.

Balzekas Motor Sales features Chrysler vehicles and has been on the Southwest Side of Chicago since 1919. It withstood other economic downturns, even the Great Depression. As his grandfather and father did before him, now Stan Balzekas is making needed cuts to make sales. For instance, a brand new minivan that can have three DVDs running at once listed for $34,000, but now a customer can get it for $24,000.

"We are invigorated to maintain business, and the way we do that is by offering even better deals," said Stan Balzekas III, Balzekas Motor Sales.

With the American auto manufacturers struggling to survive, those who sell the cars are feeling the pinch.

"They've gone from having, GM say, having 60 percent of the market to having 20 percent of the market. But they still have the dealers when they had 60 percent of the market," said John Birge, U. of C. Graduate School of Business.

Professor John Birge at the University of Chicago's Graduate School of Business has also worked with the Big Three automakers. He says, as American car manufacturing consolidates, fewer dealerships will be needed.

"They're going to have to reduce the number of dealers no matter what happens, and maybe it'll be a little bit faster if there is a bailout, but even if there is a bailout, the same things are going to happen," Birge said.

As car sales slow, some dealerships will make it and some won't. Dealerships are battling for sales now are really battling for future sales. As dealerships close, those still in business will see the benefit.


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