Japan earthquake taking toll on car sales

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Seven On Your Side
June 9, 2011 2:02:58 PM PDT
The earthquake and tsunami in Japan crippled car production in parts of the country. Now dealers in the U-S are scrambling to cope with a new car shortage some are calling "unprecedented."

Two car dealerships with one problem.

The devastating earthquake struck Japan more than two months ago, but some of the effects are just now hitting American soil. Automakers aren't operating at full speed, and that means we could see a car shortage this summer.

"We are probably going to get about 70 cars a month. That would be about 30 percent down for the normal numbers that we normally get this time of year. So it's not great," said Rick DeSilva, Owner, Liberty Subaru.

The auto industry has been through tough times before, but what makes this situation so unique is that dealers don't know when things will get back to normal.

"There's still a little bit of uncertainty as far as exactly when we are going to get cars, what we are going to get, what the numbers may be, there's really not a real good forecast," adds DeSilva.

And with fewer cars to sell, there are fewer dollars to pay employees.

"I have a huge responsibility. We're responsible for people and, you know, we're also responsible for making sure people's needs are met. If you're asking let's put it this way, I don't sleep very well," said Laura Botsacos, co-owner, James Toyota Scion.

Unfortunately, there's not much these business owners can do. They don't make the cars and they can't change what's available. So they're literally watching business walk out the door.

This is a supply and demand business. So the bottom line is the bottom line. With fewer cars available, prices are rising. Edmunds-dot-com says overall car prices are up $350 since the earthquake.


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