Video: Car dealers hitting on hard times

Larger screen

AUBURN, Wash. - Puget Sound auto dealers say they've never seen things this bad. 

A new national survey finds auto sales are at a 27-year low.

Dealers in the Seattle and Tacoma area are shutting their doors. Depending on who you ask, at least six dealers have gated their lots.

It's all part of a national forecast for 600 dealers to shut down nationwide. 

The economic impact goes beyond the dealers. Craig Brown is a small business owner who operates Rhino Linings in Auburn. His company sprays a thick protective coating on to the beds of pickups and other trucks, many of them new.

For days, he says there's been virtually no business.

"It's touch and go," he said. "I'm just floating right now. About all I'm doing is paying the bills, just keeping alive.

About half his business comes from new truck dealers.

KING

Craig Brown operates Rhino Linings in Auburn. His company sprays a thick, protective coating on to the beds of pickups.

"Fords, Dodge, Chevy, you name it. And that is completely gone off the map," Brown said. 

Mark Johnson is a former car dealer who provides auto dealers advice on financing and mergers. 

He says many of the buyers who qualified for a car loan a year ago won't qualify today.

"Half the people you were able to sell a car to last year, this year you're not going to get financed or make a deal with," he said. "Consumer credit and credit to the dealers kind of follow one another."

Johnson and the Puget Sound Auto Dealers Association say most of the closures are consolidations.

Dealers are closing lots and concentrating their cars onto fewer lots, but as this goes on more are likely to simply go out of business.

Lawmakers from Michigan, where GM, Ford and Chrysler are based, plan to ask the federal government to include the auto industry in the $700 billion financial bailout plan.

Their biggest concern is loosening up credit to help finance car loans.