Car dealer move bad news for Olympia

Word that Toyota of Olympia plans to move its sales lot to Tumwater is bad news for the City of Olympia.

Not only does the City of Olympia lose the sales tax revenue new and used car sales generate – – but it could signal a change in the way car dealers operate locally.

Toyota has announced that it will purchase 27-acres of land in Tumwater – with I-5 visibility – – and that it hopes to open the facility early next year.

That move is a break in the monopoly the Olympia Auto Mall has held for more than two decades.

In the 1980’s – local auto dealers  – which had been located in various spots in the Olympia/Lacey area, began moving to the westside of the city and settling in the auto mall.   This was a major economic boon to Olympia which saw its sales tax revenue climb substantially.  It is that sales tax revenue of new cars that gives Olympia the ability to spend vast sums of money without a great deal of thought.   When auto sales plummeted in 2008, Olympia suffered a major loss of revenue.   Something similar could happen again now that one dealer is planning a move.

I don’t know why the Toyota dealer decided to move.   It could be a number of things – – lack of space, lack of control, better visibility or any number of reasons.

But, the break-up of the auto mall’s monopoly is underway.   That can only be good news to Tumwater and Lacey, both of whom would benefit financially if new car dealers moved into their respective municipalities.