Bad Economy Adds to Newspaper Woes

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JGSullivan Interactive


Recently GM and Chrysler announced terminations of 1,100 and 789 dealerships respectively.They had been trying to reduce their number of dealerships more gradually for years given that domestic auto market share has dropped in recent years from 60% to 40%.The toll on the local economies from this rapid reduction will be significant – as many other businesses depend upon the money dealerships pump through the economy.None more than local newspapers.Auto dealerships are the top advertisers with many newspapers.Already in a fragile state, newspapers will be hit hard.


The most recent statistics from the Newspaper Association of America state that retail advertising is already down 10.7% in 2008 from 2007 levels.National, classified ad levels were down with newspapers.Shockingly even online ad revenues which have shown growth in recent years were down in 2008 from 2007 levels.Readership is down and total paid circulation is down to levels not seen since 1965 -1966 according to the NAA’s own statistics.Clearly the economy is taking a toll on newspapers and this latest news from GM and Chrysler won’t help.

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