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Amid Bankruptcies, Closings, Family Car Dealership Weathers Hard Times


General Motors has followed Chrysler into bankruptcy. In the process, both automakers are closing dealerships by the hundreds. But one group of car dealerships in a small town in the mid-Atlantic U.S. state of Pennsylvania is weathering the hard times.

They do business in a relaxed atmosphere at the Laurel Ford Lincoln-Mercury dealership in Windber, an old coal-mining town of approximately 5,000 people. General manager Frank Arcurio does not seem worried about the economic downturn. He says his dealership has a strong customer base.

"We don't pressure people. We like to sell everybody a car, but sometimes you can't," he says. "It's that type of business where, you treat people right, they keep coming back."

But managers here say their dealership's reputation for honesty and good service might not be enough in this tough economy. They also strive to keep a robust inventory of cars that they can still sell within 30 to 60 days.

Laurel's owner, Matt Smith, says it is not easy at a time when people find it difficult to get a car loan and many dealerships cannot get financing.

"We're very fortunate to have a relationship with a large bank, and we've had that relationship for 25 years," Smith says. "But that has been in jeopardy for many car dealers today. And it's forced a lot of them out of business."

Dealers like Smith say fluctuating gas prices play havoc with sales. And the pump price is up about 30 cents in the past few weeks. Last year, after gas hit a record high, sales of larger cars, trucks and sports utility vehicles plummeted.

"Trying to keep up with those changes and trying to keep your inventory balanced is very difficult," Smith says.

Still, Smith's five dealerships in town attract a steady number of customers from the Windber area, which includes a larger town nearby.

The company also does a brisk business on the Internet.

"I just sold a Grand Marquis to a customer in Dubai," says Internet salesman Scott Long.

Long pins letters from pleased customers on his wall.

His award-winning sales on the Web have totaled in the millions of dollars.

"And that's nationwide, Canada, Europe, Japan, Australia. So just about all over the map," he says.

The Laurel dealerships sell 10 different brands, but none made by General Motors. So employees here have been spared any upheaval as GM goes into bankruptcy. Laurel does sell Chrysler cars. The government steered that automaker into bankruptcy about a month ago. But Smith says he has been assured the new owners will not shutter his location.

"When we look at our place in this game, we see a very important niche in that we are the ones that connect the product the manufacturer builds with the consumer. You want to be able to have a relationship [with your local dealer] when it's time to get the car repaired and when it's time to have a need for a part or when the tires wear out."

Still, Smith agrees there are far too many dealers who lack the resources to keep their doors open in this economy. While his are not thriving, he does not put the Laurel dealerships in that category. He says his company is weathering the tough times, whether customers want the fuel-efficient models or sexy muscle cars [higher powered cars].

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