Auto part stores

As the economy has collapsed, various industries have taken it on the chin one after another. The latest, and most spectacular collapse, has been General Motors. Once the greatest corporation on earth, it was said in the 1930s that "What's good for GM is good for America," it's now entered Chapter 11 bankruptcy in a last-gasp effort to save the hundreds of thousands of jobs that are reliant on it.

Those hundreds-of-thousands of jobs aren't only the GM workers themselves, but folks who work in related industries like auto part stores. GM may be located primarily in the midwest, but their cars are sold throughout the world, and the world's biggest market is the USA. GM cars are everywhere in this country, and cars - all cars - break down. Hence you need to replace certain parts, and there is a whole industry based upon that need.

This industry is now suffering as people buy fewer and fewer cars. Up until 2008, Americans purchased about 15 million cars per year. In 2008 they purchased nine million. That's a 40% drop - an indescribable, unimaginable abyss that has decimated GM and Chrysler, crippled Ford, and even taken a good chunk out of Toyota and Honda.

The losses are staggering - GM has lost sixty BILLION dollars over the past two decades - that's more than their entire profit from the eight decades preceding it. Since the drop-off in the amount of cars has been so precipitous, the drop-off in the need for replacement parts has mirrored it. Auto part stores are suffering now, just as auto makers are. It's hard to imagine any industry thriving when demand tumbles that much.

The good news is that auto part stores like Napa, Advance Auto Parts and AutoZone all seem to have had better business models than the auto-makers they in part relied upon. Part of that is that, while folks are buying fewer cars than before, that doesn't mean they're driving less. So they're holding onto their old cars, which will of course need repairs at a higher rate than newer cars would, which means auto part stores can actually find and somewhat exploit a new market.

The other side of that coin is that people are less willing to spend, so bargain hunting is the new American pasttime. Prices have dropped as the various chains are competing for a smaller, more thrifty customer base. If you're part of that customer base - and chances are , you are - you should do some shopping and negotiating before you make any purchase, no matter how large or how small.

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