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new car dealerships

Cars Vs. Computers

The domestic auto dealers are in trouble. Again.

This Oct. 18, 2006 article on details just how bad things are for the automakers:

It's Economics 101. When there's more supply than demand, the supplier is in trouble.

That's the situation at DaimlerChrysler's (DCX) Chrysler division. People aren't buying their cars. Their dealers—including some of the country's biggest retailers, Group 1 Automotive (GPI) and AutoNation (AN), which combined own nearly 500 dealerships across the country—have stopped taking orders because of lack of demand.

I find it interesting that reports focus on supply and demand, without considering the factors that can reduce demand. Is it only economic factors that contribute to slowing sales? Are there any other factors that may contribute to declining sales in recent years?

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