Parts Time: Some dealers having trouble finding parts for discounted vehicle lines.

Current parts shortages and concerns about availability in the future, have some dealers thinking about adding Saturns, some Pontiacs and Chryslers to their “Do Not Buy” lists.

Every retailer, especially buy here-pay here dealers, in the country has a “Do Not Buy List.” The list consists of vehicles to be avoided for resale on the lot. The

reasons a certain make, model and model year vehicle are on the list are usually pretty straightforward. The vehicle may have a consistent problem with an engine or transmission, parts availability may be a problem, there may be just too many of them in the local market or the vehicle might simply require too many costly repairs.

Usually, the dealer creates this list with the help of the service or reconditioning manager and auction buyer. The list will vary widely from dealership to dealership, but usually there are consistent areas of overlap, where most dealers just won’t buy vehicles deemed unacceptable.

Lately, a number of dealers have reported problems getting parts for vehicles that hadn’t been a problem in the past, and had been reliable.

Shawn Richardson, owner of Xpress Credit Auto, a chain of buy here-pay here stores in Oklahoma, said recently his reconditioning manager came to him asking that Saturns be added to the chain’s Do Not Buy List.

“It’s really a problem,” Richardson said. “Some of the parts are crossover to other (General Motors Corp.) lines, but because Saturn has unique parts numbers we’re on our own trying to figure out if the parts from other products will work on the Saturn and it’s time consuming.”

GM Spokesperson John McDonald said on-going parts shortages have been a concern for the automaker since before it filed for bankruptcy in early 2009. As the Great Recession began in 2008 and new vehicle sales plummeted, many automotive suppliers, both big and small, went out of business. This left the manufacturers, GM, Chrysler and Ford and import manufacturers as well, scrambling to find suppliers that could fill orders.

“When the CEOs of the domestic automakers testified before Congress that there would be unintended consequences if their firms were allowed to go out of business,” McDonald said, “this is the kind of thing they were talking about.”

McDonald is quick to point out that GM is undergoing intensive restructuring of their parts distribution systems, and since Saturn, Pontiac and Hummer dealerships will no longer exist, other dealerships will become Designated Repair Centers for these vehicles. While these programs and systems get set up there will be some shortages.

“We have a legal obligation to supply parts for vehicles we sold that are under warranty,” McDonald said. “For older model vehicles no longer under warranty, it will likely become harder to find parts—especially for low volume vehicles.”

Last month GM announced a so-called “fire sale” of Saturns, Hummers, and Pontiacs to move the last of the inventory. The vehicles, however, would be sold directly to the dealer and resold to consumers as “previously titled” or used. Warranties would have to be honored by the dealership, not the manufacturer. Though the dealer will be on the hook for the warranty and the parts, the question becomes one of parts availability.

McDonald said that a latch needed for the Chevy SSR has been posted on a proprietary GM Web site open to suppliers to bid on manufacturing the part for more than 12 months. He said it becomes a matter of simple economics for the supplier. If the supplier believes he can tool-up to make the part, and sell enough of them to earn a profit, he’ll bid the job. If not, there’s no one to make the part.

He added that so many parts suppliers across the country have gone out of business, just finding a supplier with the capabilities necessary to manufacturer the needed part and meeting all specifications has become an issue. This would lead many to believe that an aggressive entrepreneur might see the opportunity and attempt to fill the need.

“The problem here is the need for capital is intense in this Texas, said he’s not surprised if someone industry,” McDonald said. “Finding capital for automotive suppliers is difficult at best in the current economy.”

Roy Carlson, owner of Mike Carlson Motors in Burleson, else isn’t buying Saturns.

“We haven’t purchased Saturns for 6-7 years,” said Carlson, whose dealerships sell about 4,000 units a year. We just found there were too many problems with them. Same is true for the Ford Focus—too many problems. And we no longer buy (Chrysler) Pacificas.”

Carlson isn’t convinced it’s a parts shortage problem.

“In my opinion, this is no different a situation than it was about 8-10 years ago,” Carlson said. “You had high demand

for parts for high volume-vehicles.

Back then it was Taurus. You couldn’t find a motor mount for a Taurus any-

where.

Todd Smith, owner of Dothan Motor Co. in Dothan, Ala., checked with his recon manager and didn’t find any problems with securing parts for vehicles they sell regularly.

“We use a variety of sources for our parts, including a company called Everdrive.com,” Smith said. “Parts from these people are less expense, though they take a few days to arrive.”

Joey Woodfin, CEO of Everdrive, based in Midlothian, Va., said his firm deals strictly in “guaranteed used parts.” The parts are taken from salvage vehicles, inspected and sold again with a three-year warranty with no mileage restrictions.

Woodfin said he wasn’t aware of any parts shortages for specific vehicles, but that his firm can supply everthing from headlights to taillights and nearly everything in between.

The Original Equipment Suppliers Association did not answer repeated requests for an interview for this story.

Travis Ford, recon manager for Xpress Credit Auto, said availability of parts for Saturns and Chrysler products has gotten increasingly more difficult—especially in the last quarter of 2009.

“Chrysler products are the worst,” Travis Ford said. “I can’t find motor mounts, ball joints and door lock actuators for most of the model years and makes I need. At least this is the case in Oklhoma City. This is for your typical sedans, nothing unusual or out of the ordinary. Getting a rear control arm is a 10-day process.”

Travis Ford hadn’t heard about Everdrive, and thought he’d give it a shot. None of his chronically short parts, such as a motor mount for a 2003 Trailblazer with a 5.3-liter V8, or the parts he needed for Chrysler Stratus or Pacificas were available from Everdrive.

“That Trailblazer has been on the lot for 60 days,” Travis Ford said. “I’ve got to wonder if GM’s supplier has quit making them.”

Some of the accouterments offered on some of the high-end vehicles have also been in short supply, according to Travis Ford. He can’t find DVD screens for Honda Accounts, and some of the SUVs. Heating elements for heated seats are an issue as well.

McDonald said he understands the concerns a used car dealer would have over parts availability, but that the auto-

motive manufacturing industry is far different than it was just 36 or even 24 months ago.

“There will be supply issues going forward, but GM is not the only manufacturer facing this problem,” McDonald said.

Tom Kontos, executive vice president, Customer Strategies and Analytics

ADESA Auctions, said he was not aware of any parts shortage issues, but noted that if dealers, and more importantly, consumers feel they will not be able to get parts or not be able to get them in a timely manner, there will be hit to the value of the vehicles at both wholesale and retail levels.

“Think of it in terms of the it full-size SUVs took when gas hit $4 a gallon,” Kontos said. “They could take a double-digit percentage hit, perhaps as much as 15 percent.”

Carlson is not that concerned.

“At some price, there is alwayhs somebody willing to step up to the plate and buy the unit,” Carlson said. “They’ll find the parts, and someone will find a way

to produce what’s needed, if there’s a demand.”