Santa Rosa's new Chevy men

These days, buying a new auto dealership may not seem like the safest bet.

Sales of new cars are tumbling. Two of America's top automakers, General Motors and Chrysler, have filed for bankruptcy. Hundreds of dealerships are shutting down.

But to Todd Barnes, purchasing the local Chevrolet dealership gives new life to his car showroom on Santa Rosa's Auto Row.

"We made an aggressive move to ensure our future in Sonoma County. Moving forward, this will help us provide a more financially sound business," Barnes said.

The move is part of a game of musical chairs under way on Auto Row.

The most visible sign is the empty Santa Rosa Chevrolet showroom at the north end of Auto Row. At the end of May, Barnes completed a deal to buy the Chevrolet franchise in Santa Rosa and moved it south, opening Platinum Chevrolet inside his Saturn dealership at the opposite end of Corby Avenue.

Barnes is betting the deal will ensure the dealership he owns with Bob Benson will survive a shakeout altering the face of the U.S. auto industry.

General Motors is shedding Saturn, one of the casualties as the automaker retools and aims to emerge from bankruptcy with fewer brands. It will continue to make vehicles under its iconic Chevrolet brand, which has adorned a diverse range of vehicles from Corvette speedsters to Silverado trucks for 98 years.

"The automotive industry is kind of in turmoil. We're in transition. We're trying to get stronger and ride it out," Barnes said.

New car sales have plummeted during the economic recession, and the drop-off deepened during the first three months of this year. Sales plunged 42 percent in the Bay Area and 43 percent in California in the first quarter, with the nationwide decline reaching 38 percent during the period, according to the California New Car Dealers Association.

Dealers are shuttering showrooms across the United States. On the North Coast, Pellini Chevrolet in Sebastopol and the Chrysler-Jeep-Dodge dealerships in Asti and Ukiah have closed over the past year.

Saturn of Santa Rosa already was suffering through a nearly 40 percent decline in sales when GM announced plans in December to stop making Saturns, Barnes said.

"For me, it wasn't an option to shut down," he said.

Instead, he offered to buy Santa Rosa Chevrolet.

But the dealership's owner received a more attractive offer. San Rafael real estate investor Angelo Ferro agreed to sell the business and the 6-acre property to neighboring Manly Automotive Group, which wanted to move its Honda business into the larger Chevrolet site.

The deal fell through, however, when GM wouldn't approve Manly's proposal to sell Chevys out of his smaller Hyundai dealership.

Ferro then agreed to sell the land to Manly and the dealership to Barnes and Benson.

Still, taking ownership of the Chevrolet dealership required the deal to be done before June 1, when GM filed for bankruptcy. GM took only 12 days to approve the dealership transfer, compared with the typical one to two months.

Within days, Barnes had doubled his inventory of new cars for sale and significantly bolstered parts supplies.

Platinum Chevrolet is carrying about 120 new Chevys and 30 new Saturns compared with the 75 or so Saturns before the deal was done.

With more cars to sell and service, Barnes added eight workers from the former Chevrolet dealership, bringing the employee ranks to 42, about the same as a year ago.

The move opens the dealership to a far wider pool of potential buyers because Chevrolet makes a broad array of cars and trucks compared with Saturn's five models of cars and small sport utility vehicles.

"It will more than double sales," Barnes said.

Selling Saturns, however, remains a challenge on two fronts.

First, Barnes must find a new Santa Rosa lot within the next several months because GM doesn't want Chevrolet sold side by side with Saturns. If a suitable location can't be found, Barnes hopes to keep on site the few remaining Saturn models for buyers to look over and test drive. The full inventory will be stocked in Fairfield.

The second challenge for Barnes is the long-term future for Saturn. GM is expected to sell Saturn to Penske Automotive Group later this year. But the new owner must find a manufacturer to supply cars to dealers after GM ends production in 2011.

Barnes is confident Roger Penske will succeed with Saturn where the former race car driver has in auto retailing and truck leasing nationwide.

"I believe we will come out stronger," Barnes said.

You can reach Staff Writer Michael Coit at 521-5470 or mike.coit@pressdemocrat.com.