Who You Calling A “Clunker”?
Angelo Frodella, at his used car lot, says the market for used cars is a tough one right now. Photo courtesy A&J Bros. Auto.
I’m a huge Jeremy Piven fan. I’m pretty much convinced that Entourage is one of the funniest shows on TV right now. When I heard he was coming out with a new movie, The Goods, I got really excited. Piven plays a sleazy used car dealer named Don Ready who uses unorthodox methods to sell off all the junk cars he can.
Seems like a timely topic.
In the era of the Cash For Clunker program, used cars are getting a lot of guff. In this federal initiative, older cars are turned into metal pancakes for a government incentive of around $4,500 towards the purchase of a brand new, fuel efficient one.
But the question needs to be asked.
Is the “mom and pop” car lot going the way of the Oldsmobile?
We hit up a small used car dealer to find out how they felt.
Angelo Frodella owns A & J Brothers Auto Sales, a small used car dealership in Daytona Beach, Florida. For the most part, the cars he sells are below $4,000 and he’s feeling hit hard by the program. “It’s tough. Small used car dealers are pretty slow after the program came out,” he said, “a lot of the cars we’d end up selling are prematurely ending up in the junkyard. Big business is doing well, but the mom and pop dealerships are dropping like flies.”
Check out more of our interview after the jump!
Other dealers are apparently hurting too. In Daytona Beach, the mecca of auto racing, used car lots are closing up shop left and right. “Everyone around here is pretty slow right now,” Frodella said, “we’re not even getting much new inventory, because a lot of people are taking advantage of the Clunkers program.” In the program, the cars traded in have their engines completely disabled and are towed to the junkyard, where they are sold off for parts.
According to Frodella, used car sales were pretty hot before the program started. His customers wanted to reduce their debt and cut their spending, so they would turn to an older model car rather than purchasing a brand new one outright. However, these days, his customers can purchase a brand new car outright for almost the same price as one of the cars on his lot.
He remains optimistic, though. “Ultimately, when new car dealers are doing well, we do well too. Eventually, we’ll be feeling the positive effects of the program. It’s gonna be hard to wait this out though. I feel like they forgot about us in Washington. There are tons of small dealers on the brink of collapse and this might be the thing that pushes them over the edge.”
It’s no secret that the car business is hurting right now. We’re hoping things pick up, not just for Mr. Frodella, but for small business owners everywhere. It forces us to ask that big question, though: is Main Street being left out of the conversation? Is it up to us to make sure that all of our bases are covered and that someone is standing up for the ‘little guy’?
this is pretty interesting, just a reminder that any one conversation has a limited scope and any action we take has unintended consequences.
I don’t think Obama meant to shut anyone out, but I’d say (re)using old cards is a good practice…where exactly do those clunkers end up?
maybe we need a used car dealership scrap metal trade-in rebate