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Technology Stocks : Automobile technology and business management

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From: Arthur Tang12/18/2006 12:35:53 PM
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Automobile dealer business is really run by the company. You get an allocation of cars to sell. You have no choice of colors or options.

So, you can never order a new car to the specifications. Dealers have to trade with each other to get the car you want. or else paint it and install after market options.

So, if the dealers get 10 cars of the same model. Manufacturer can sell 450,000 cars a year at GM and Ford(30% market share) Chrysler with 5 cars on the lot can sell 180,000 per year off the same model.

You go to a dealer, you buy what you like. So, auto business requires large number of dealers to make money or to sell the quantity to overcome breakeven point.
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