Tooele Transcript Bulletin – News in Tooele, Utah

April 2, 2020
Car sales decline during pandemic

Local car dealerships are feeling the effects of a decrease in business during the COVID-19 pandemic, but various incentives can make the purchase of a new or used car more enticing for potential customers.

Business has declined by 200% at Bargain Buggys over the past month, and March 2020 sales were down 260% when compared to March 2019. In an effort to keep inventory moving, the dealership is selling cars at or below cost, meaning the dealership is losing money on many of its transactions.

“These are the deals of a lifetime,” Bargain Buggys general manager Brad Mackie said. “You’re not going to find used car prices at this rate for long. As soon as this clears up, everybody’s going to raise their pricing, including the auctions and wholesalers.”

Current economic factors have made it difficult for dealerships to accept trade-ins, Mackie added. Buyers are showing interest, looking at Bargain Buggys website to check out the inventory, but that isn’t resulting in sales despite taking measures to make the transactions as safe as possible through direct delivery of vehicles to customers. 

“There’s a lot of people looking at cars on the website – that’s what analytics tell us – but no one is buying and no one is coming in,” he said. “Some of the companies that are paying off trades aren’t taking new stuff. It’s not only affecting the car business, it’s affecting the financiers.”

At Tooele Motor Company, sales have declined approximately 15-20% over the past two weeks, general manager Brian Nakken said. Customers are still showing interest in making a purchase, though their motives have changed with uncertainty in the economy.

“They’re coming in saying, ‘I don’t know what the future holds. There are some uncertainties out there, and in preparation for that, if I can lower my payment,’” Nakken said. “We’ve had guests come in who maybe wanted some relief from a higher payment or a higher interest rate. We were able to provide them with a pathway – there were some 0% programs that were coming out and some deferral programs with no payments for three months or six months that guests thought were favorable for them.”

Tooele Motor Company store manager Mark Kruse noted that most manufacturers are offering incentives such as 0% financing for 84 months, and thanks to the dealership’s website, customers can look at and purchase vehicles without ever having to physically visit the dealership.

“We’re definitely encouraging any different ways that customers want to look at vehicles, or if they want us to deliver to their house with paperwork,” Kruse said. We’re trying to create the feeling that the transaction can be made without having to come (to the dealership). That’s important to us.” 

Nakken said Tooele Motor Company facilities remain open for those who would like to make their purchase in person, though safety protocols are in place to keep customers and employees safe. Each car is thoroughly sanitized, and areas of the dealership’s facilities have been marked off to maintain social distancing.

“We understand that we’re still here to do business and to take care of our customers’ needs and to serve them in those ways, but it’s very, very important that we’re providing an atmosphere that’s as safe and healthy as we can for our customers and the people that work here,” Nakken said.

Nakken is also thankful for recent legislation that will help the dealership maintain its current staffing levels.

“We’re just focused on taking great care of our guests and our people and getting through this together,” he said.

 

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