Long-time family-owned business Mel Rapton Honda to sell dealership in Sacramento
Move comes as car sales plunged last year due to manufacturing and shipping issues
Move comes as car sales plunged last year due to manufacturing and shipping issues
Move comes as car sales plunged last year due to manufacturing and shipping issues
Mel Rapton Honda is transitioning into new ownership this weekend. The dealership's sale comes amid a tough year for consumers as prices keep surging.
Dave Rapson, professor of economics at UC Davis, said there are two factors driving the car price surge nationwide.
"It's not just new cars that are expensive, but it's used cars, and the reason for that is that those two markets are linked. So, when the price of new cars goes up by a lot, people might start looking for substitutes," Rapson said.
The COVID-19 pandemic contributed to a reduction in car production in 2020, which continues to affect used car demand and supply today.
"Basically there was a large contraction in supply in 2020 and in 2021, as demand for travel and services, and as people started returning to the office, now people started to want cars," Rapson said.
Cox Automotive reports that new car inventory in the U.S. was down more than 50% this summer, compared to the same time in 2019.
Although co-owner Katina Rapton said their decision to sell is personal and they're retiring to spend more time with their families, she recognizes that consumers have had to pay a lot more this year as issues like the supply chain, transportation and worker shortages have all come together.
"The supply chain situation has hurt us a little bit — not so much hurt us, but hurt business and the consumer. Supply goes down, demand goes up; prices typically go up," she said.
Record high prices were reported in September.
Mel Rapton Honda's transition will happen this weekend and includes all three locations. Their 100+ employees will be able to keep their jobs as long as they meet certain requirements like passing a drug test.