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All around Greece, 350 car dealerships closed

24 March 2009 / 10:03:30  GRReporter
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During the first two weeks of March, the Greek car importers have sold 5 722 new cars, which is with 39% less than the sales from last year. During March 2008, they have sold 22 340 cars and according to employers in new car dealerships, sales will not exceed 12 000. According to data provided by “Imerisia” newspaper, in a period of one month, 50 car dealerships have shut down. If we add the closed dealerships from the last few months, the total comes up to 350 and other hundredths are about to bankrupt.

An owner of a still existing dealership says: “Last week, four car dealerships closed on nearby streets. Another 14 cannot bear the bank’s financial requirements and the owners will bankrupt.”

Instead of helping the owners, the credit companies keep shortening the pay off deadlines and seize cars, which cannot be fully paid off. Bank employees start surrounding the dealerships like vultures and do not care about paying off the debts.

For example, few days ago about 20 bank agents visited a dealership for luxury cars in the Southern suburbs of Athens and tried to find out what will happen with the owner’s debt, which was taken through the program Stock Finance and it accounts for ?10 million. Until not too long ago, this store had 20 Porsche’s, 5 Ferrari’s, 4 Lamborghini’s, 2 Austin Martin’s and many other luxury cars, which according to a reliable source are moved to a different place and now there are only 10 cars in the dealership.

Throughout the country the applications for seizing cars through the court are becoming more and more. Banks are trying to seize as many cars as possible, so they can secure part of their money. Among the confiscated cars, there are ones with no value. Then, the credit companies try to cover their expenses for parking, road tax, and also taxes for technical check-ups of the mentioned cars.

According to new regulations and tender documents, from January 1st 2009 the price per stay of one car for one day increases from ?1.5 to ?3. More precisely, the bank tries to sell a Citroen Xantia for ?952, Hyundai Accent for ?1000, Opel Vectra for ?1610,Citroen Saxo for ?1492 and Daewoo Nubira for ?1321.

For the first time, there is a tender for seven brand new cars, which were seized from a dealer who has shut down his firm. They are valued for a price 60% lower than the one displayed in the dealership.

Car agencies with exclusive sale rights of different brands started creating credit programs with different discounts. For example, Nissan offers 30% down payment and paying off up to 36 months interest free. Daihatsu attracts clients with a small down payment and many interest free payments for all car models. Citroen offers three credit programs – clients can buy most car models without interest or without a down payment up to 72 months. The Volvo dealership offers big discounts, which start from ?2500 and get to ?6740.

The advertising campaigns are also affected because they decreased with 38% for the first quarter of 2009. It seems that Greek car importers have lowered their advertising budgets in all mediums. In February, they have invested ?8 918 532 in advertising and during the same month in 2008 they spent ?13 886 341! This will also affect the mass communication mediums as well, because car advertising is one of the biggest income sources.

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