Car dealers in Grand Bahama are gearing up for this year’s auto show with a renewed sense of urgency and purpose.
With a stagnant economy and sky-high duty on imported vehicles, sales are “totally dead”, according to Larry Albury, general manager at Freeport Jet Wash Auto Mart. The auto executive estimated that sales are down approximately 80 percent in recent years.
“Auto sales are totally dead. When the government changed duty rates, it killed it. It stuck a knife in our heart and we died,” he said.
The strong language comes ahead of the seventh annual Grand Bahama Auto Show next weekend.
In an effort to revive the industry, the show has moved to the Circle Mall to take advantage of an air-conditioned, indoor venue that’s close to other entertainment and amenities. Albury told Guardian Business that the hope is that local residents will come out and appreciate the new cars. That said, he knows that dealerships face an uphill battle.
Under the previous administration, the Free National Movement (FNM) increased the duty on cars by more than 20 percent on various types of vehicles. The result “blew the industry out of the water”, Albury explained.
What has kept the dealership alive, he noted, are bonded vehicles, or those on special order where companies subsidize the purchase.
“They killed the golden goose. Every Bahamian wanted a new car. Even if they lived in a small home, they want a brand new car. It killed the industry overnight, and it had a domino effect on the treasury,” he said.
The general manager explained that he’s been forced to lay off employees recently due to the low demand.
Ford and Dodge have become “luxury vehicles” in Grand Bahama because they have larger engines. Therefore, they attract even higher duty, driving up the overall price.
Whitfield Bain, vehicle sales manager at Quality Auto, also expressed hope that the move to Circle Mall will inject some enthusiasm and confidence into the market.
Guardian Business understands that Quality Auto has managed somewhat better than Freeport Jet Wash due to its vehicles with smaller engines, such as Hyundai and Toyota, which subsequently keeps the cost a bit lower for consumers.
Nevertheless, all auto dealers on Grand Bahama are hoping for a breath of fresh air this coming weekend.
Branch manager at Commonwealth Bank in Grand Bahama, Rupert Roberts, is certainly looking to do his part to boost sales.
He told Guardian Business that the bank wants to “make it happen” by offering some of the most competitive financing in years.
While loans are conducted on an individual basis, Roberts said a rate of 6.5 percent is available for qualified applicants. Down-payments are also flexible, according to the banker.
“The problem is the high level of unemployment,” he added. “We just need to make sure they can pay. What we find is your customer might be employed, but he or she is helping to support people that are unemployed. Cash flow is just less flexible all the way around.”
Arrears are on the rise, he told Guardian Business, although they have also been kept in relative check due to a rigorous selection process.
“We haven’t been as aggressive, but we hope the auto show will bring out people who have put off buying because of the economic outlook. We hope they’ve reached a point where they need to replace a vehicle.”
The Commonwealth Bank executive said he was aware that auto dealers were trimming their profit margins.
“And we’re hoping to offer competitive interest rates to help boost sales,” he said.
By Jeffrey Todd
Guardian Business Editor
