Merced Hyundai closes down

[XDCX]

As another reminder that the car business is still tough, new reports indicated that Merced Hyundai closed its doors today. For the full report - click here (http://abclocal.go.com/kfsn/story?section=news/business&id=7245240)

While Hyundai is often thought of as one of the hottest brands in the market it illustrates the challenges all dealers face. Merced is one of the worst areas in the nation for home foreclosures.

It's also worth noting that the dealership is part of a multi-store group - perhaps the performance of the other stores caused this store to be closed?

Still, it seems strange that there wouldn't be a buyer for a Hyundai store?

[SHACOS]

I wonder how many Hyundai stores are within the area? So, I did a search. Only 5 within 64 miles! Now I wonder the same thing. How can someone not buy this store?

[MARV]

Someone will likely because it's cheaper to buy it after it's out of business than when it's running would be my guess.

[XDCX]

Someone will likely because it's cheaper to buy it after it's out of business than when it's running would be my guess.

That's a good point.

It's certainly possible that a bank has the value of the franchise as a collateralized asset and the dealer cannot sell the franchise until the bank is paid off. If that's the case it would be cheaper for a new dealer just to buy assets after the initial dealer files bankruptcy.

[MARV]

That's a good point.

It's certainly possible that a bank has the value of the franchise as a collateralized asset and the dealer cannot sell the franchise until the bank is paid off. If that's the case it would be cheaper for a new dealer just to buy assets after the initial dealer files bankruptcy.

Then he will also get the previous staff back on his terms much easier and then be choosy on the inventory. Lot's of advantages.