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Closing dealerships will hurt everyone
Dear Editor,
As anyone who has picked up a newspaper or turned on the radio or television lately knows, two of the Detroit "Big Three" auto makers have announced plans to drastically reduce the number of dealers in the U.S. Some members of Congress have even suggested that the manufacturers reduce their dealer network to "cut costs." The question is, how will reducing the number of dealers cut expenses?
The fact is that manufacturers do not own dealerships. Independent business people do. These new car dealers have invested their money to purchase real estate, build buildings, and buy inventory, tools and equipment.
The money invested by new car dealers provides customers with the opportunity to shop locally for new and used vehicles. These same new car dealers provide warranty, recall and repair services for the motoring public.
These independent business people pay real estate tax, property tax, sales tax, FICA tax, income tax (state and local), and unemployment insurance. These dealers provide employment. They pay for their employees' training, health insurance and benefits.
The dealer is the auto manufacturer's customer. That being the case, does it make any sense to claim the manufacturer's problem is that they have too many customers?
The franchised dealers throughout Nebraska compete with each other. This competition benefits customers by encouraging better service at lower prices. The franchised new car dealer is often times the first one asked to support local charities including the YMCA, hospitals, 4-H livestock sales, and the list goes on. Nebraska new car dealers employ more than 6,000 people.
Sales tax revenue generated by dealership's sales of nearly 4 billion dollars annually help with the state budget. It is wrong to artificially designate the "right" number of new car dealers.
When I came to McCook in 1971, there were eight new car dealers. Today, there are four. The franchised dealer network will continue to evolve. The number of dealers will continue to shrink. The profitable dealers will continue; others will sell or close.
It is wrong for Congress and/or the Obama Administration to get involved to try to force dealers out of business. The closing of dealerships will hurt, not help, the bottom line for domestic auto manufacturers.
If and when a dealership closes, it affects not only the dealer but also its employees and their customers that rely on them for sales and service of the vehicles they own.
I believe the people of Northwest Kansas and Southwest Nebraska appreciate the opportunity to shop locally for their new or used vehicles. I don't think they want to drive 75 miles, or perhaps more, to get their vehicle serviced. If you agree, I encourage you to contact the members of the Nebraska Congressional Delegation below. Tell them you want your hometown new car dealer to stay in business.
Sen. Ben Nelson
United States Senate
720 Hart Senate Office Bldg
Washington DC 20510
FAX (202) 228-0012
Sen. Mike Johanns
United State Senate
Senate Russell Courtyard #1
Russell Senate Office Bldg
Washington DC 20510
FAX (202) 224-5213
U.S. Rep. Adrian Smith
US House of Representatives
503 Cannon House Office Bldg
Washington DC 20515
FAX (202) 225-0207
R. Lee Janssen,
McCook
-- Janssen has been a Nebraska new car dealer since 1971