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Local car sales go clunk

BY MICHELLE BORYCA | OCTOBER 06, 2009 7:20 AM

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Car dealers have hit a road bump one month after the end of the popular Cash for Clunkers program.

Auto sales plunged 41 percent nationwide in September, the first month after the federal Car Allowance Rebate System’s discount incentives came to a halt after processing nearly 700,000 clunkers.

And Iowa City dealership sales’ crashed, too.

The biggest problem in September was lack of inventory, which limited the selection for customers still looking for a car, said Pat Lind, the general manager at Carousel Nissan, 809 Highway 1 W.

“By the end of October, we will be back to normal stocking levels,” he said.

With increased July and August sales, Carousel Nissan sold every Mazda on its lot. And fellow Iowa City dealer McEleney Autoplex experienced the same problem.

“We’re back to about half our normal stocking levels,” said Patrick Eads, the vice president of the dealership at 1600 Highway 1 W.

More sales in July and August, which left car lots sparse, caused a drop in September sales.

Chezik-Bell Ford, 2343 Mormon Trek Blvd., also saw a decline in sales compared with the previous year’s numbers.

Chad Ohly, the general sales manager, said Chezik-Bell Ford’s sales fell roughly 50 percent from August to September. The dealership sold approximately 30 percent fewer cars than an average September.

“I think people who hadn’t even thought about buying cars got excited about getting a stimulus check for a car,” he said.

Chezik-Bell Ford completely sold out of its Focus, Fusion, Escape, and Mariner inventories. But the slow sales in September allowed the dealership to restock the 46 vehicles it sold under the program, Ohly said.

But not all local dealerships are suffering from a lack of car sales following the Cash for Clunkers program.

Coralville used-car dealer McGurk Meyers, 404 Second St., sold close to 40 units — consistent with past months’ used-car sales, said owner Jeff Carr.

And Carr expects his business will continue to thrive.

Carr was pessimistic about future sales four months ago, when he received notification that his contract with Chrysler would be terminated.

But standing in his used car lot on Tuesday, he said he is optimistic.

While dealers cleared out their lots by selling new vehicles at discounted prices, Carr was busy filling his lot with used ones.

Because the Cash for Clunkers program required the traded-in cars’ engines to be disabled, it made the search difficult for used-car dealerships.

“We were out there pounding the pavement, trying to find used cars,” Carr said.


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