Luxury city car dealer closes as sales slump

One of Tauranga's leading vehicle dealerships, Bay Euro pean, has had to close its doors because of erratic sales amid the economic recession.
Bay European, which had the premier Jaguar, Volvo, Land Rover and Renault brands, joins a growing number of city car firms that have stop ped trading, after sales slum ped more than 40 per cent, on average, over the past few months.
``We had a drop in Decem ber, January was okay but Feb ruary was quite awful,' said Bay European franchise owner Peter Murray.
``With the likes of GE and GMAC [financing businesses] pulling out of New Zealand, it was difficult to refinance and we had to make a straight- forward commercial decision,' he said.
``No matter how you look at it, it comes back to the econo mic downturn. The sales were so inconsistent. There are a lot of brave dealers out there and they will have to batten down the hatches _ it's going to be a tough time,' Mr Murray said.
After working in the indus try in Auckland for 10 years, Mr Murray moved to Tauranga in 2004 and started Bay Euro pean, finishing up with a staff of 14. Five of them have found new jobs.
Bay European, in Kereiti St just off Hewletts Rd, stopped trading last week after selling its existing stock.
The franchise has been handed to Ebbett Group, which sells Jaguars, Land Rovers and Volvos in Hamilton.
Ebbett Holden Tauranga will provide parts and servicing at its site on the corner of Cam eron Rd and Wharf St, and is hiring three of Bay European's mechanics.
Ebbett recently closed its car salesyard in Hewletts Rd, and also gone are Craig Cole man Motors, Easy Financed Cars, Coastline Cars, Vehicle Select and David Semple Motors.
Two other established firms in downtown Tauranga are also on the brink of closing.
Jimmy Arthurs, of Coastline Cars, concentrated on used cars valued at $8000-$10,000 and under, and suddenly his financ ing lines dried up.
``I could find finance for cus tomers from 12 companies and then it was difficult getting anything for them. That affec ted my business,' he said. ``I'm now semi-retired and moving to Wanaka.'
Mr Arthurs, who operated his own business for 16 of the 40 years he spent in the indus try, said the economic climate was the worst he had seen.
``I was working in a franch ised dealership in Taupo after the 1987 sharemarket crash, and it was never as bad as this. The people I'm selling to just didn't have any money,' he said.
Mr Arthurs said the grow ing popularity of the Trade Me website had also harmed the used-car industry.
``People ring a car dealer for a wholesale price and then go straight on to Trade Me.
``That's been a killer,' he said.