Auto dealers consider trimming their inventories.

Publication: The Dallas Morning News (Dallas, Texas) (via Knight-Ridder/Tribune Business News)

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COPYRIGHT 2005 The Dallas Morning News

Byline: Terry Box

Feb. 26--Industry giant AutoNation Inc. has tightened its supply of new cars and trucks -- a prospect that makes some manufacturers wince. The Florida corporation, the country's biggest retailer of new cars and trucks with sales last year of $19.4 billion, has cut inventories by about 25 percent at its 385 dealerships. That means buying fewer cars and trucks from automakers.

The Big Three have already cut production at some factories because of slow sales -- including a decision last week by General Motors Corp. to close the assembly plant in Arlington for two weeks in March.

But some dealers and industry officials say AutoNation's approach makes good business sense at a time when the domestics' market share is falling and interest rates are rising.

"I've argued that it's time for the old [inventory] target of a 60- to 65-day supply of cars to be tightened," said Paul Taylor, chief economist of the National Automobile Dealers Association. "We can do a...

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