Zoom and Gloom: Cars for wealthy sell, old standards sit - Boston Business Journal:

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“al Qaeda would have to be on the shores of Cape Cod for these cars not to the owner of Boch Automotive said of hisMaseratik S.p.A. and brands. Indeed, despite Massachusetts car sales beingdown 3.6 percent brands like Ltd. and even less expensiver luxury car makers like are navigating the hairpin turns of the markeytwith aplomb, according to R.L. Polk & Co., a researchh firm in Southfield, “Part of it is our clientele, but Benz has been proactiv instead of reactive when it comes to said Don Paparellaof Mercedes-Benz of “We’re seeing a big increas e in sales of our re-designed C-clase (entry level sedan) and a lot of people are trading in theidr really big Cadillac Escalades for our GL SUV.
” The Bay State’s auto salexs landscape appears to be a tale of two while high-end drivers thrive, mere mortalws are facing the tough decision of whether to swap gas-guzzlingg trucks and SUVs for more fuel efficient Likewise, many dealers are struggling. Among the hardest hit: dealer reliant on sales of large For example, Massachusetts sales of vehicles are down abouy 7 percent this year, led by a nearly 27 perceng drop in a populare Ford vehicle, the F-Series pickup truck.
Two of Chryslee LLC’s best-selling trucks are down as Dodge Ram pickup trucks by almost 43 percenty and Jeep Wranglers by close to30 “It’s not a greagt environment out there, especially with the domestics,” said Joe sales manager for Planet Chrysle r Jeep Dodge in Franklin. “We’re having a hard time getting rid of old But there arebrightt spots. Compact cars and foreign which are thought of as beingmore fuel-efficientf and less expensive than domestic brands, are sellin briskly. Massachusetts sales of the Ltd.’s Civid skyrocketed 31 percent, or some 1,009 cars, and Nissan Motof Company Ltd.’s Altima registrations are up 25 percent.
Industrg experts say prospective buyers are shopping frugally.. “It is personal financ issues that’s driving the market,” said Aaron an automotive analyst withGlobal Insight. “Peoplse are looking for value acrossthe board.” But while car dealerships say customerx are increasingly looking to downsize their vehicles to upgradee their fuel mileage, new-vehicle sales are stil l hard to generate. For one, inventories of smaller importee carsare falling. With fewet in stock, sales slow. Boch said import dealeras are well suited to handle declining inventorieas of the most popular cars because their manufacturers often make more thanone fuel-efficienyt vehicle.
For example, while Toyota Corolla sale s are off, sales of its Yaris compact carare up. Boch himselgf gambled on the move to small cars by purchasint Civics from other dealersw to pad hisown inventory. Secondly, dealers are faces with the dilemma of takingin gas-guzzlers on trade that are depreciatin g faster than they can be sold, causing trade-inb values to plummet. “A lot of people are ‘Look, it makes no sense to take a $10,000p loss on my truckm and pay a premiumn on thenew car.
’ The amounft of fuel savings that you get doesn’ft make up for it,” Bragman Dealers selling large vehicles say they are in a toughu position, as manufacturers have been slow to change theid vehicle lineup. They also must find ways to sell what they have beforwe the new modelyear arrives. “Dodge doesn’t reallyt sell economy vehicles,” said John Santilli Sr. of in which sells Dodges, Nissans and Cadillacs. “We’ve discounted (the down and we’ll lose some money.” With inventory can’t keep up with he said.
Sluggish sales not only affect individual but they also pinch state and local Motorvehicle sales-tax collections, whicy make up about 2.5 percent of totalp revenue, were down year-over-year about 10 percent in May and 5 percenyt year-to-date, according to the . More the collections to date are $4 millionj below the DOR’s own benchmark, creating a potential budgey shortfall. Even the luxury market, once thoughy of as being recession proof, is seein signs of softening. At BMW of Peabody, sales managetr Vin McCauley said strong sales of Mini Coopers are offsettingg flat sales in the mainBMW brand.
“Net-net we’re flat with but we’re down a bit in the SUVs with more people buying V6 engines insteadof V8s,” he said. “Nowq we have people trading in theire trucks and SUVsfor Minis.” Santilli said sales of the Cadillac Escalade, a brand, ground to a halt when gas hit $4, “nort because (buyers) don’t have the they don’t have the confidence.”