As Dealership Ranks Fall: Hyundai, Kia Among Those Opening Showrooms

August 13, 2010
Chevrolet dealership

Chevrolet dealership

The next time you're out shopping for a new vehicle, you could find your options considerably more limited than last time. The reason: due mostly to the economy but also due to other changes in the industry, the ranks of dealerships have been culled over the past couple of years like never before.

In 2009, the number of U.S. dealerships fell by about eight percent—more than 1,600 in all, with 986 of them Chrysler dealers—but historically, according to the Detroit Free Press, the number of dealerships has fallen by about one percent per year.

Even this year, the number U.S. dealerships is expected to shrink by another two or three percent. Just in the first half of this year, we've lost another 258 dealerships (though many of them were through existing GM and Chrysler termination agreements).

Of course, much of it has been due to financial woes and trimmed-down product lines, with General Motors closing its Saturn and Pontiac stores, among others; Chrysler cutting its dealership body; and Ford just this spring announcing that its Mercury brand—along with some Mercury-exclusive dealerships—has reached the end of the line.

The news isn't all bad. About new dealerships opened in 2009, reported the Detroit News, with most of those Volkswagen, BMW, Hyundai, and Kia outlets.

One other reason might keep the decline from staying so steep for so long: With a number of soon-to-arrive niche green vehicles—such as Coda, Fisker, Aptera, and Think, which have models among those outlined in Green Car Reports' Electric Car Buying Guide—an era of smaller, specialized dealerships might not be gone yet.

[Detroit Free Press; Detroit News]

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