Car Dealer Lawyer

After the earlier reports that GMAC had pulled Bill Heard’s floorplan financing, it was not a huge surprise to learn that his stores closed their doors yesterday.  But watching interviews of some of his technicians on the news last night brought home the reality of 2700 people suddenly losing their jobs.  Looking at those technicians reminded me of how it felt to wake up with a job and then find out that your employer had closed.  I also remember what it was like to have to drive home and tell my wife that I no longer had a job.  Regardless of how you feel about Bill Heard’s stores, an overwhelming majority of the people who lost their jobs yesterday were just hard-working people trying to support their families.  So while we all look at Bill Heard’s situation with varying degrees of interest, please take a few moments to think of the people who just lost their jobs in a very tough economy.

So what happened to Bill Heard?  I wonder if we will ever find out.  All I know is that the store near me seemed to “rock” and sold a lot of cars for a long time.  The market has been brutal for Chevy dealers, but you would think that Bill Heard would be able to hang on for awhile in a tough market.

If nothing else, this situation illustrates the downside of debt.  When stores are making money, everyone wants to give you money.  Buy other stores - lots of blue sky?   No problem!  Spend a few million to comply with your manufacturer’s architect de jour?  Here’s the money - no problem!  If the economy gets bad, guess who’s no longer your friend.  When you need the money to keep the doors open, they’ll yank it.  It seems like a lot of fundamentally sound businesses are closing because they relied on financing to operate.  Sometimes its absolutely necessary.  But if you paid off your floorplan instead of buying that 5th store, I bet you’re smiling now.