Camry, Corolla, Prius.
They are not only three of the five best-selling cars in Los Angeles, but also a huge reason why Longo Toyota in El Monte has been the nation's largest automobile dealership for more than a decade.
But as the massive 64-acre dealership basks in the prosperity of Toyota Motor Corp., many of its competitors are not faring so well.
Galpin Ford, the North Hills dealer that had long held the No. 2 ranking on the list of L.A.'s top auto dealerships, slipped into the third spot for the first time in more than 10 years. Its new car sales dropped 17 percent over the last year. Longo, meanwhile, saw its sales climb 6 percent in that same period.
Galpin remains the country's largest Ford dealership, but it is struggling as Ford Motor Co. and its Detroit contemporaries face a drought brought on by sagging sales and a glut of dealerships.
"The domestic dealers are in for a long hard slog," said Mark Rikess, chief executive of Burbank-based Rikess Group, an auto dealership consultant. "There's just too many of them and not enough customers coming in the door."
Ford recently announced plans to eliminate about 200 of its 4,200 U.S. dealerships this year and hundreds more over the next few years.
General Motors Corp. has about 7,000 dealerships and Chrysler, which is owned by Cerberus Capital Management LP, has about 3,700 and both companies are looking to cut back. Toyota, meanwhile, has just 1,400 dealers across the country.
"There's a consolidation taking place," Rikess said. "When you've got so many dealerships, then none of them are making any money."
But closing dealerships is not easy. The law prevents car companies from shutting dealers down, leaving the automakers with two primary options: buying out dealerships which can be costly or waiting for the dealership to close on its own.
A relic of the days when domestic vehicles outsold foreign brands three or four to one, the abundance of domestic dealerships has exacerbated the troubles for American automakers as domestic brands have lost their luster over the past few decades. And today, the dealers are paying the price with what had been their core demographic: drivers between the ages of 25 and 40.
"They've really lost that generation," Rikess said. The baby boomers that fueled the growth of Detroit's automakers have moved on to luxury brands, he said, while younger consumers are increasingly opting for foreign rides.
In fact, only four of L.A.'s top 25 auto dealerships sell domestic cars.
And though Galpin remains a leading Ford dealer, its numbers have fallen dramatically. In the past five years, new car sales dropped a whopping 34 percent to 7,080 units, while its revenue decreased 19 percent to $324 million.
To try to stop the bleeding, Galpin started selling Honda cars last year in the hopes that the popular Japanese brand will boost sales.
Galpin did not return repeated calls for comment.
Rise of Toyota
Longo President Tom Rudnai said he owes his company's growth largely to the success of the entire brand.
"I don't know if it's so much Longo as it is Toyota," he said. "We're very confident in Toyota. The product has been phenomenal."
The automaker outpaced all other companies to start the year, becoming the world's top-selling car brand. With 2.35 million vehicles sold worldwide in the first three months of 2007, Toyota for the first time beat General Motors for an entire quarter.
Toyota still trails Ford and General Motors in U.S. sales, but the foreign brand is gaining on its domestic rivals. With 13.4 percent of the U.S. market share, Toyota recently surpassed Chrysler for the No. 3 spot and has its sights set on No. 2 Ford, which owns 16.4 percent of the market.
And as Toyota has risen, so too has Longo. In the past five years, Longo's new vehicle sales have climbed 30 percent to 25,207 cars, and its annual revenue jumped 33 percent to $728 million.
The company has benefited not only from a relative decline in the appeal of domestic vehicles, but also in the rise of the so-called "green movement," Rikess said. Low-emissions, high-mileage vehicles have gained in popularity recently, and Toyota's Prius has been the most high-profile of hybrid vehicles.
With 10,029 sold, the Prius was the fifth most popular car in Los Angeles last year.
"They've been able to position themselves because of the Prius as the green automobile manufacturer," Rikess said. "And more people than ever are trying to be green."
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