Internet to winnow car dealers

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The growing ranks of Internet-savvy car buyers will result in decreased advertising by auto dealerships within the next five years, says a new report from the E-Commerce Information Center. Also, dealers will need fewer sales people because more buyers will gather data online before going to showrooms. In addition, the e-business information service in Manasquan, N.J., predicted the number of U.S. auto dealerships will plummet to 10,000 from 22,000 in the next five years due to competitive pressures. Franchised dealers spent a record $5.3 billion in advertising in 1998, according to the most recent figures available from the National Automobile Dealers Association, a trade group in Washington.

Copyright July 2000, Crain Communications Inc.

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