Pittsburgh is not Detroit, but big trouble at the Big Three automakers has scores of local companies on edge.
That's because many Western Pennsylvania businesses rely on the auto industry -- from car dealers to financiers to parts makers and other suppliers.
"There's probably tens of thousands of people in Western Pennsylvania whose jobs are dependent on the auto industry," said Lester Lave, economics professor at Carnegie Mellon University's Tepper School of Business.
The 200 or so auto dealers in the six-county region account for about 8,000 jobs, said Bud Smail, director of the National Auto Dealers Association of Western Pennsylvania and president of Bud Smail Auto Group, Greensburg.
The average dealer in Pennsylvania last year sold about $22.8 million worth of vehicles, according to the association. So dealers in Western Pennsylvania accounted for about $4.56 billion in vehicle sales that year. Their average payroll is about $1.62 million.
The U.S. auto industry, which employs about 2.5 million people, sold 16 million vehicles last year. The industry is on track this year to sell fewer than 12 million, "a significant drop," said Lave.
General Motors, Ford Motor and Chrysler executives sought $25 billion in relief last week from Congress. But lawmakers rejected it, telling the Big Three to design a better turnaround plan and come back Tuesday.
"I can't imagine they will have a plausible plan by then," said Lave. He opposes a taxpayer bailout, and believes bankruptcy would be a better long-term solution.
But a recent NADA survey said 80 percent of consumers would not buy a vehicle from a bankrupt automaker, said Smail.
"The customer wants to know whether (Detroit) would honor the warranty and purchase the parts," he said.
George Benson, owner of New Benson Lincoln Mercury in Whitehall, said sales for the past three months are down about 50 percent from a year ago because consumers are "very conservative right now." He has adjusted by cutting costs, such as eliminating a wholesale parts department and hiring part-time, instead of full-time employees.
Bill Gray Jr., president of two Volvo and Buick/Pontiac/GMC dealerships in Dormont, said sales are down almost 25 percent from a year ago. But his car-service volume is up because people are keeping their cars longer.
"We're trading sales dollars for service and parts dollars," said Gray.
Notaries and title transfer companies sense the auto industry's woes too, said Eddie Altvater, owner of Altvater's Auto Sales, a used-vehicle dealer in Robinson.
"We do a lot of off-the-street notaries, and that's down at least 30 percent from last year," said Altvater. His title work for large trucks is down a similar amount.
Area manufacturers are feeling Detroit's pain somewhat, too.
About 14 percent of the flat-rolled steel from U.S. Steel Corp. plants for the past three years went to the auto and transportation industry, said spokeswoman Erin DiPietro.
But the downturn in the economy led U.S. Steel to lay off 78 workers between the Edgar Thomson and Irvin plants Nov. 19, said DiPietro, to "stay in line with customer demand." The plants employ 1,650.
Likewise, PPG Industries has adjusted to the economic slide, including the auto industry. PPG makes coatings for vehicles from plants around the world, although none locally.
It owns 40 percent of local auto glass maker Pittsburgh Glass Works. The company produces vehicle windshields, and side and rear windows for both Detroit and the replacement glass market from plants in Tipton, Blair County; Meadville, Crawford County; and Creighton, its headquarters. The company declined to release financial data.
PPG will close a coatings plant in Ontario next year and cut 150 jobs to "help us mirror the fundamental shifts in the automotive industry," said Vice President Dennis Kovalsky.
Allegheny Technologies Inc., which operates eight stainless steel plants in the Pittsburgh region, sold 9 percent of its global output to the world's automaking industry, said spokesman Dan Greenfield.
"A lot of what we do does come out of Western Pennsylvania," said Greenfield. His company sells to parts suppliers such components as stainless steel gaskets and turbo chargers for diesel engines.
Similarly, about 8 percent, or $2.5 billion worth, of Alcoa Inc.'s output went to the auto industry last year, said spokesman Kevin Lowery. That includes such products as flat-rolled aluminum for hoods, doors and trunks.
Financiers such as local credit unions are affected by Detroit's downturn.
Allegent Community Federal Credit Union, Downtown, stimulated demand last month by discounting auto loans 1 percent and giving away global positioning systems.
"But excluding that, it's been fairly slow" since early fall, said CEO Kevin Anglemyer.
"We're seeing a little bit of a slowdown, which has something to do with the economy," said Vince Setnar executive vice president of Moon-based Clearview Federal Credit Union, the region's largest.
But drivers need to insure their vehicles, old or new, said Vanessa Paris, spokeswoman for Erie Insurance Group, Erie. It had 1.7 million auto policies in effect last month, and "has not seen a decline" in volume, she said.
"Pricing for coverage is so steady that people aren't driven to shop as much as they might be otherwise," said Paris.
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