Automobile Dealers Finances

Car dealer Norman Gray was a fearless gambler. In business and after hours, he showed a knack for seeing where the play was going and wagering accordingly. He built Magic Ford in Valencia into the nation's fifth-largest Ford dealership, lavishing the profits on friends and charities. But he also, by many accounts, spent a fortune at racetracks and in Las Vegas.

Here's something to help arm you against the sales manager's anguished cries when you suggest that there's more air to be squeezed out of the price of that new car you're bargaining for: Last year was the best in almost half a century for the nation's independent new-car dealers. Average pretax profit was up 31% from 1997, to about $400,000 per dealership, the National Automobile Dealers Assn. says. Sales rose 6% to an average of $23.8 million per dealership, with an average pretax margin of 1.

Here's something to help arm you against the sales manager's anguished cries when you suggest that there's more air to be squeezed out of the price of that new car you're bargaining for: Last year was the best in almost half a century for the nation's independent new-car dealers. Average pretax profit was up 31% from 1997, to about $400,000 per dealership, the National Automobile Dealers Assn. says. Sales rose 6% to an average of $23.8 million per dealership, with an average pretax margin of 1.

The court-appointed trustee of Magic Ford and Magic Lincoln Mercury is seeking a judge's approval to pay off debts from trade-in cars bought from customers shortly before the two dealerships entered bankruptcy proceedings in September. Customers who turned over older cars as partial trade for new vehicles say their credit records have been hurt because the Magic dealerships failed to pay off existing car loans as agreed, according to court documents.

In an effort to prop up this city's beleaguered auto mall, the City Council has approved as much as $430,000 in loans and grants to two car dealerships. Acting as the city redevelopment agency on Tuesday, the council approved an $80,000 loan to Paul E. Hobbs' Jeep/Eagle dealership to ease its financial crunch.

The court-appointed trustee of Magic Ford and Magic Lincoln Mercury is seeking a judge's approval to pay off debts from trade-in cars bought from customers shortly before the two dealerships entered bankruptcy proceedings in September. Customers who turned over older cars as partial trade for new vehicles say their credit records have been hurt because the Magic dealerships failed to pay off existing car loans as agreed, according to court documents.

The La Verne redevelopment agency is considering lending as much as $500,000 to Person Ford to keep the dealership, the city's biggest sales tax producer, from leaving town. Last week, owner Warren Person asked the City Council, sitting as the redevelopment agency, for a loan of $500,000 in exchange for his commitment to stay in the city for at least five more years.

Car dealer Norman Gray was a fearless gambler. In business and after hours, he showed a knack for seeing where the play was going and wagering accordingly. He built Magic Ford in Valencia into the nation's fifth-largest Ford dealership, lavishing the profits on friends and charities. But he also, by many accounts, spent a fortune at racetracks and in Las Vegas.

The La Verne redevelopment agency is considering lending as much as $500,000 to Person Ford to keep the dealership, the city's biggest sales tax producer, from leaving town. Last week, owner Warren Person asked the City Council, sitting as the redevelopment agency, for a loan of $500,000 in exchange for his commitment to stay in the city for at least five more years.

In an effort to prop up this city's beleaguered auto mall, the City Council has approved as much as $430,000 in loans and grants to two car dealerships. Acting as the city redevelopment agency on Tuesday, the council approved an $80,000 loan to Paul E. Hobbs' Jeep/Eagle dealership to ease its financial crunch.