Another one for Portland Oregon.
Premiere Ford, Beaverton Mitsubishi latest to close
by Jeff Manning, The Oregonian
Tuesday December 09, 2008, 10:15 PM
A dismal year for local auto dealers continued this week with the demise of two more dealerships and the layoff of more than 100 employees.
Premiere Ford in Gladstone shut down last Friday, putting 56 people out of work. Premiere owner Joe Khorasani said he intends to close his Beaverton Mitsubishi dealership later this week, idling another 45.
"We'd been trying to sell the store in the last couple months," said Khorasani, who bought Premiere Ford three years ago. "No one has the appetite to buy a dealership right now. It's a brutal, brutal time."
Ford Motor Co. will divvy up the approximately 150 new cars on the Premiere lot among other local Ford dealers. Those dealers will honor the service warranties of Premiere Ford customers, Khorasani said.
Khorasani said his two other operations -- Hyundai dealerships in Gladstone and Hillsboro -- will remain open.
Years after getting his start as a lot attendant at Ron Tonkin Chevrolet, Khorasani has never seen such a confluence of negative trends: wildly fluctuating gas prices, the stock market declines, mounting layoffs, and an inability by some dealers and consumers alike to get financing. Those factors have combined to drive many dealers out of the business.
"It's terrible," Khorasani said. "It's not a matter of trying to make a profit. It's a matter of survival."
Three years ago, Khorasani had five dealerships, 330 employees and annual sales of about $275 million. Now, he's down to two dealerships, 60 employees and annualized sales (based on the past three months) of between $20 million and $25 million.
"We had a good business plan, we cut expenses," Khorasani said. "But if we can't get money from our finance company, we can't make it."
It's ironic, Khorasani said, that the Big Three automakers are going hat-in-hand to the federal government for enormous loans to stay alive when their own finance companies won't loan money to their dealers. Khorasani shut down his Lincoln-Mercury dealership on Southwest Canyon Road three months ago.
The closure of Khorasani's Ford and Mitsubishi stores brings to 21 the number of Oregon auto dealerships to close this year.
Khorasani said he still owes about $30,000 in commissions to his sales staff at Premiere Ford. But he won't be able to pay them until the sales close, which he estimated will be about Dec. 20.
Customers of Premiere Ford or Beaverton Mitsubishi with questions can get additional information at 503-353-0800.
-- Jeff Manning