Death of the auto mall

Mark Lacter's Tuesday recession reports on KPCC keep getting better — and more ominous — as the situation worsens. Today I woke to Mark talking about the bleak picture for car dealers. Now I see a blog post by Bill Fulton at the California Planning and Development Report saying that for all those cities that bought into the sales taxes from auto malls, trouble lies ahead.

Auto sales nationwide are half what they were a year ago. Perhaps as many as half of all auto dealerships will go under in the current economic downturn. Car buyers have shifted their browsing to the Internet with amazing speed. And they're buying cars from anybody they don't have to haggle with – no matter where the sellers are.

As I suggest in my current Economic Development column in Governing magazine, auto malls may soon suffer the fate of general merchandise retail malls. Once they were impregnable fortresses of transactional commerce. Now they're beginning to wither away. So, as with retail malls a decade ago, cities will face a choice with their auto malls: They can play defense and try to maintain a strong position in the withering marketplace of car sales, or they can figure out something else to do with the land freed up by failed auto dealerships.

Another sign of the down times.

Also at CP&DR: Morris Newman has a piece on downtown Los Angeles — "although Bradley's dream never came true, downtown L.A. has become a great residential neighborhood and a significant office market. It's easy to argue, though, that developers and market forces ultimately played a bigger role than government or public policy..." — but it will cost you to read the whole thing.