So a few assumptions to start off this post:
- Real estate values go down as the number of neighboring houses go vacant. Said differently: desolation is a downward spiral.
- Retail follows a similar pattern: empty malls suffer because nobody wants to be the only store in an otherwise empty mall.Â Or: retail success relies on network effects.
- The North American auto industry is in serious trouble, has a history of acting like malls (by cramming lots of dealers together along single streets), and now faces perilous uncertainty as potential closures threaten to devalue locations, and lessen the valued network effects they relied on by being located together.
If I haven’t made any unfounded or dubious assumptions so far, then I have an idea that might be worthy of consideration.Â Last night on my way home from portland, I happened across Mike, the Rapha-clad editor/photograper of Velodramatic.Â We’d emailed in passing, traded blog comments, but had never met in real life.Â The flight back to San Jose we shared an exit row and rambled on about bikes, cameras, and blogging.Â One of the ideas we discussed that stuck with me: turn the soon-to-be-empty auto dealerships into bike dealers.
So imagine, if you will, the inevitable closing of a few big auto dealerships.Â What if instead of leaving them vacant, part of the government bailout was set aside to help finance bike shops opening locations in auto malls?Â Big, bright showrooms, lots of parking, the option for test tracks of all kinds (tarmac and dirt), and the chance for cars and bikes to share an audience.
Let’s not kid ourselves: it’s unlikely that someone buying a car is going to buy a bike instead just because they see a bike shop nearby.Â And a cyclist isn’t likely to drop their interest in a new bike because the new Ford Focus is across the street.Â But maybe, just maybe, they’ll be thought of as complements.Â The opportunity for bike rack sales, for cross promotions, for awareness that both cars and bikes share the same roads, for peaceful driver and cyclist co-habitation, and for a captive audience that is primed to change their transportation (whether bike or car).
The upside here is more for the bike shop than the car dealerships, at least on the face of it.Â But the downside of having an empty dealership across the street can’t bode well for a car dealer.Â And who knows, what if you could tack a $2000 bike onto your car financing, walk across the street, and pick one out?
The existing buildings, infrastructure, parking, and locations are all pretty good for bike dealerships – the only catch being that they’re clearly bigger than necessary.Â If there was a way to make them affordable to bike shops who currently suffer in tiny locations with terrible parking, it could be a solid and lasting assist to both car and bike dealers.