Reader comments
Car dealer sees losses accelerate

feel bad.... but what about all those big profit months?

Another individual who failed to plan for the eventual downturn. Leveraged to the hilt and now finds it was a bad bet. Boo hoo.

so did he spend all his profits on fancy house and fancy car or did he sock some of it away. Seems like you only wanted to tell part of the story, why not all of it. Just like home buyers he kept leveraging himself, stupid is as stupid does.

Dude,

How many cars would you have to sell to cover a one month $170,000 loss? Get Real! Your comment shows that you didn't give it much thought. Dealers are definitely hurting right now. Too many people don't understand that it is tough. When your inventory depriciates by 30-40% in one month like it did late last year you are going to take heavy losses. Maybe if your company goes down and leaves you without work you will realize that it is very difficult out there for many dealers and other businesses as well. I used to sell cars and never in our history did we have a year end gross profit of $170 K.

...in a fast-moving economy that depends on shady home equity loans to finance your high-priced cars.

Business needs to learn to NOT rely on credit to pay its month-by-month expenses. If not, it's a Ponzi, not a business.

If I were this guy, I would get out of the high end business for awhile. He's figured out how to make money when it's on the upswing, so he should take a step back, find a way to handle the downswing then shift again when things turn around.

The article stated that this dealer STARTED his car business with a home equity loan, not that he RAN his business on it. My brother owns a car dealership. Unlike other small businesses, banks aren't real eager to loan a guy capital to BEGIN a car business--they are very risky. The Small Business Adminstration also wants to see proven track record in the industry before they'll lend to the effort. How does one get financed to BEGIN a business? That's right, you do what you have to.

Businesses whose 'business model' rely on debt are hurting, but that's inevitable. There is one thing that our society needs to learn about debt:

Debt = Risk

I'm heartened that the commentors recognize that it is the business debt that is hurting this business owner's bottom line, not the economy or his customer's lack of credit.

I hope we all see how buying a TV or a vehicle on credit is the same as the above situation.

I am a fellow car dealer. I know Jared. He's an exceptionally good, honest kid. He's also an excellent car guy with a really good head on his shoulders. He's doing the right things, but like most of us, didn't have a crystal ball, and hasn't perfected his fortune-telling abilities. He is now, evolving in reaction to the market. He has regretibly had to lay off employees, has slimmed down his inventory, is buying cheaper vehicles, and will make it through this mess unlike so many of his colleagues. Run a multimillion dollar small business on 2-3% profit margins, then pass judgement, alright?

I bought a car from them. Biggest mistake I ever made. that car was nothing but problems I've owned it for a year and have already spent about 3000 in repairs. Never buy a car from specialty automotive

Wow, I'm shocked by the number of people on this string who are so quick to assume that this guy just made bad decisions and deserves what he got. A huge portion of our economy is based on small businesses just like this one, all of which must assume some amount of risk to operate. As business' ability to assume risk dry up in this economy, more and more people are going to be out of work, leaving them in the same boat as this guy.

I have bought 4 cars from Specialties, and can say that "Anonymous" is either lying, or confused. Jared is the most honest dealer I've known, and will bend over backwards to keep his customers happy. Unlike other used car dealers, Jared utilizes expensive tools (like an elcometer that measures paint thickness to tell when a panel has been repainted) when buying a car to make sure the car has not been in a wreck.

I have nothing but praise for the way Jared and his employees do business

If car dealers are hurting so much (and I know that they are), maybe the legislature could see it in its heart to allow dealerships to remain open both days of the weekend?

It sounds like Anonymous had some bad luck with a vehicle he bought from "Specialty Automotive." The article is about Specialties Automotive Group; two different dealerships. News break though, your seller did not manufacture the car, just resold it used. That warranty you bought (but likely didn't) should have covered any unexpected (to both parties) repairs. So, you bought a used car, opted out of the warranty, and now want slander a respectible business man...not cool.

My experience with Jared and his dealership was excellent, and I have only ever heard/read positive comments from others who feel the same. He and his staff are first class in every way--ethical, hard-working, and bent on customer satisfaction. If anyone can survive and thrive-- it's Jared. Best of luck to you!

I'm saddened to hear about the troubles Specialties and Jared are going through. I love the SUV I bought for my wife from Jared. It's been a great car and Jared was MUCH better to deal with than any dealer I've ever worked with before, and that's an understatment! I appreciate the time Jared personally put in with me to get me in the car I wanted with no pressure, no slimeball tactics, etc...and I did get it at a great price! I hope he can weather the storm because I'm already planning on buying my next car from him in about a year.

And, for what it's worth, that's what car dealers do! They finance their cars with a flooring line! You think LHM and the other big dealers are paying cash for their inventory? Nope.

The problem is very real. If you don't believe me, just try to sell your own, personal vehicle right now at a figure even close to book value. Good luck with that! After you've tried that for about 90 days, in which time, the value of your car has dropped another $1,500-$2,000, then pretend you have not just 1, but over 100 of those, plus overhead, employees' wages, benefits, advertising, etc.

What, no luck after 90 days? Well, don't worry, at 93 days the bank will come get everything and you and all the employees that depend on you are out of a job! What was that old "cast stones" thing again?

There may have been many big profit months but he did not fail to plan. If you talk to even the large dealers out there you would know they are feeling the pain that Jared is having, the public sees less of the effect. As someone in the credit business I am seeing the slowdown as well. People dont want to borrow money right now. This has to mean dealers are selling less, I know I am loaning less. It is hard times for many people and it is unfortunate that some are making assumptions about a person or a business they have never had a relationship with.

These negative comments are ridiculous and unwarranted. Specialties is an upstanding member of our community and have always done right by me as well as others in their dealings. Shame on you for thinking they didn't plan for the down turn. The entire global market didn't plan for it, so why would you expect a local dealership to do so? They are clearly making the best of the situation that they can. I personally applaud their efforts and will continue to buy cars from them. Specialties should hang in there as this is what is helping to keep our economy from going even farther in the tank.

I find the disparaging comments in this string to be misguided and uneducated. Jared started his business with his personal equity, similar to 90% of the companies in existence today. Jared�s problem came about due to banks (including the bank I work for) changing credit policies based on knee jerk reactions with no notice to small business. Imagine having your credit cards, your home equity line of credit and all other bank lines drying up with no notice. How long can you last with the cash in your account and having your salary decreased by 70%? Something tells me most would be in bankruptcy in a very short time frame. By the way, Jared is just one victim identified in the article. There are hundreds of other dealers, including Larry Miller, who are having the same issue.