Ford Profits and Problems
Despite record profits at CA Ford Dealerships, the American auto brand is still having issues that they must continue resolving. They are the only one of the American auto giants that didn’t look to the government for financial assistance when the economy took a nosedive. Both Chrysler and General Motors are now working on repaying financial debts to the federal government. Ford has managed to survive by mortgaging assets and cutting ties with places like Mazda CA to become the best possible line up of vehicles that they can. Some critics are wondering if their attempt at becoming a trusted name like Subaru Outback San Jose is really what is behind their increased profits and sales success.
Some auto analysts are proposing the idea that their success is based solely on the failure of other brands. For those consumers who are loyal to buying American products, the financial peril that has placed a shadow over Chrysler and General Motors might be increasing the amount of people coming to Ford. They didn’t have to seek financial help and that helps their image shine a little more brightly. Also, think about all the recalls that the import brands have gone through. Consumers might be more interested in buying from a company with a solid reputation.
However things play out in the next couple of years, Ford needs to make sure that they are treating their employees fairly. Their contract with the United Auto Workers union expires in the next year or so. GM and Chrysler brands aren’t gone forever and it is likely that the financial boost they received has helped them get back on their feet. The UAW is well aware of Ford’s increased profits and ability to pay off debt that they have been demonstrating. The folks at the UAW likely want to be treated accordingly, and Ford should start thinking long-term about how to ensure they have workers in the future.
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GM Closes 500 Dealerships
Why is it that General Motors still isn’t experiencing the sales growth that places like Infiniti Boston Norwood are? In recent months, sales have increased by around 10% for most auto brands, but GM has only experienced 6% growth. They recently announced that if you were planning on using a Chicago Bad Credit Auto Loan to purchase your new GM vehicle that you would have a smaller selection of stores to choose from. That is because more than 500 dealerships closed up shop at the end of October, an action that has been in the making since GM filed for bankruptcy back in Spring 2009. The decreased amount of dealerships should not affect the business at Buick GMC Dealer Birmingham.
The dealership closures are the result of the Obama administration and a stipulation of the government bailout. There were a total of 2,039 dealerships that were labeled to be closed during the bankruptcy terms, and very few remain open of that original number today. Some lawmakers in Congress oppose the closure, saying that the economy is strengthening back up and there is no reason to close so many businesses and lose so many employees. Plus, if these dealerships are soon to be allowed to reopen, think of the image they will have to rebuild for themselves.
GM dealerships that are nearby the ones that have closed report an increase in sales. It is hard to say whether or not that increase in sales comes from a recovering economy or from a lack of competition. Either way, an increase in sales and profit is great for the dealerships who survived the effects of the bankruptcy. Also, remember that Pontiac, Saturn, and Hummer were all under the GM family umbrella and those brands are no longer in production. Those loyal shoppers are likely to turn to other GM products in the future.
