Capital-area dealers uneasy over shutdown

WASHINGTON — Gridlock here isn't just a political problem.

Auto dealerships in the capital region are beginning to sense the economic effects of the partial government shutdown as the standoff over budgets and President Donald Trump's proposed border wall enters its fifth week, with little hope for a speedy resolution.

Local retailers say it's difficult to measure the sales impact, but they expect slower traffic in the days to come after federal workers missed their first paychecks Jan. 11.

"We've had some anecdotal evidence" of a pullback by buyers who work for the federal government or contractors, said a general manager at a northern Virginia dealership that doesn't permit employees to talk to the press.

"It's really hard to peg," this person said. "Could it be the weather? Could it be interest rates rising? It's definitely something we're keeping our eye on."

The Washington area had a significant snowstorm two weekends ago.

Rob Smith, vice president of Fitzgerald Auto Malls in Maryland, noted that January is typically a slower sales month for dealerships, and the shutdown covers only about a quarter of the government.

But he and other dealers said it is starting to affect business.

Michael Beyer, co-owner of Beyer Automotive Group in northern Virginia, said, "We've had people say, 'I've got to put off buying a car now until I get paid again.' " He said sales are slower than last January.

Beyer is among the area retailers trying to make it easier for customers who work for the government, and are short on cash, to get their vehicles serviced.

"For people who can't afford to pay for service during the shutdown, we'll extend them credit until they get paid," Beyer told Automotive News. When their retroactive pay kicks in, they can settle with the dealership.

Fitzgerald dealerships for a decade have offered customers the option of financing repairs they can't pay for all at once, Smith said.

John O'Donnell, CEO of the Washington Area New Automobile Dealers Association, said, "Most dealers have not seen a slowdown in their service business," though they're seeing some softening in new-vehicle sales.

"It looks like the pattern is that affected government workers are taking the time off to go get their cars serviced," he said, but that could change the longer the shutdown lasts.

The nation's capital and surrounding Maryland and Virginia suburbs are home to one of the largest concentrations of federal workers. Tens of thousands of area employees at nine unfunded agencies are on furlough or working unpaid in essential functions, as are many private-sector contractors at those agencies.

Trump has signed legislation guaranteeing workers back pay when the government reopens.