Word: carful
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Chrysler and GM will force 2,000 car dealerships to close. This event has elicited a great many opinions from industry experts. The consensus is that the most damage to the car companies will come from the anxiety facing potential customers who may buy automobiles at these dealers and expect to have them serviced there. The car buyers will not want to drive long distances in order to find a dealer who sells the brand that they want. They will buy a Toyota (TM) or some other brand because they know that continued service is virtually assured. They...
...very low-priced new cars are added to the most depressed market in decades, it will create a nearly perfect way to destroy sales for The Big Three just as new models for 2010 are being introduced. It is hard enough to attract new buyers to the car showrooms without having an auctioneer from Sotheby's down the block taking rapid fire bids on Jeeps and Pontiacs. This will just increases the panic that car buyers feel about the reliability of their local dealers. In order to sell newer models, dealers will have to offer deep discounts and incentives...
...car industry will hit a post-bankruptcy tipping point around Labor Day. Chrysler will be several months into its Chapter 11, and, unless there is a miracle like one seen at Lourdes, GM will be in court within two or three weeks. It will appear to the public that the car industry is burning to the ground. Desperate dealers offering prices that defy logic will only heighten the sense that the American car business is just hanging on to the ledge...
...government and the two big U.S. car companies faced a balancing act between cutting the size and complexity of their distribution networks quickly or doing it in a more orderly fashion. Customers might have been encouraged to stay if the manufacturers offered special financing on cars owned by shuttered dealers. It would have been a good way to pick up or save a new car buyer. It would have created some goodwill. GM and Chrysler could also have introduced customers to dealers that are staying open in their part of the country. They could have offered a year's free...
...car industry, and more particularly the American car industry, has always favored blunt force in building and marketing cars. Make V8-powered cars that get poor mileage and sell them to people who don't need heavy four-wheel drive cars. Make claims that no one builds a better car even if all of the industry research says otherwise. Market cars by having women in bikinis sitting on the hoods. Toyota never had Miss September sitting in one of its cars, at least not that the public ever knew...