As the continent obsesses over automotive bailouts, interesting things are happening at the nation’s auto dealerships. After years of abuse from customers and the carmakers whose names they bear, Canada’s domestic auto dealers are struggling – and some are giving up.
The Toronto Star’s Tony Van Alphen recently wrote a detailed, touching story on the bankruptcy of Scarborough-based Davidson Chrysler, a 60-year-old, second-generation family business that did all the right things – but went bust nonetheless this October.
Over the past few years, owner Roger Davidson has faced a lot more problems than just slumping car and truck sales: Chrysler factory representatives pressing for more deliveries than dealers needed (one winter, Davidson stored 60 cars in a farmer’s field, where they were damaged by horses); incentives-based promotions that proved hard to switch off; shifty marketing tactics by rival Chrysler dealers; the automaker's exit from the leasing business, which left willing customers out in the cold; the tightening credit crunch; and finally, Chrysler’s exercise of an option forbidding Davidson to pass the business on to anyone but an existing franchisee – shutting out Davidson’s son.
Davidson calls bankruptcy “the toughest decision I've ever made in my life…. It was just an absolute heartbreak.”
Read the full story here.
Click here to watch a short video interview with Roger Davidson on the Toronto Sun website, in which he reveals one unexpected consequence of declaring bankruptcy: being unable to sleep at night.