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Business Center

Jan 20, 2010 11:48 AMPublication: The Southampton Press

BMW dealership an empty lot waiting for a buyer

Jan 20, 2010 11:48 AM

The car dealership long known as Country Imports, now BMW of the Hamptons, has not received delivery of a new car from its automobile suppliers since late summer and is now against the ropes, kept on its feet almost entirely by its service and parts department.

A proposal to bring in a private investor to purchase the dealership, along with its sister Mini Cooper dealership and two other adjacent properties, is in the works, though it is not yet clear whether the move will resurrect the BMW dealership.

The BMW of the Hamptons inventory has dwindled to barely a dozen new cars from the 2008 and 2009 model years and a handful of pre-owned vehicles. A new car has not been delivered to the dealer by BMW since August.

“Right now, we’re just sort of working, not knowing whether we’re going to be open tomorrow,” a longtime employee of the dealership, who spoke on condition of anonymity, said this week. “Supposedly there’s a deal that was supposed to be completed by the 20th, but nobody knows the status of that right now. Everyone is anxious, not knowing if they’re going to be heading down to unemployment tomorrow.”

Michael Caruso, owner of BMW of the Hamptons, did not answer several requests for comment this week. In November, the state Department of Taxation and Finance seized two other Long Island car dealerships owned by Mr. Caruso for failure to pay more than a half million dollars in sales tax.

BMW of the Hamptons’s former manager, Jonathan Miller, who left the company in October, said the dealership’s slide began more than a year ago when it was caught in a “perfect storm” of credit problems. Mr. Miller explained in a phone interview this week that the company had long used North Fork Bank as its credit base for purchasing new cars from BMW. In 2006, North Fork was bought by Capital One Bank, which does not offer loans through automobile dealerships as a matter of policy, Mr. Miller said. That sent the dealership looking for a new financial backer just as the credit crunch, and downturn in the automobile market, began in early 2008.

“It was right at the time when the car market went south, and we had a hard time getting a new bank to floorplan us,” Mr. Miller said. “So we just couldn’t get new inventory. It was the perfect storm, and we got caught in it. For a year and a half, we sat there watching [Mr. Caruso’s] dealership taken out from underneath him.”

The dealership is in line to be sold to Goldman Sachs partner Jonathan Sobel, according to several people familiar with the deal, for approximately $7 million. Mr. Sobel would purchase the four properties Mr. Caruso owns, including the two car dealerships, a house and a showroom now used by Mercedes-Benz of Southampton. Mr. Caruso sold the Mercedes franchise three years ago for a reported $8 million to luxury car dealer John Burns, who is constructing a new dealership building on County Road 39 near the Elks Lodge.

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Well lets look at facts.
The dealership was run by Micheal the son of the owner and it was run INTO THE GROUND.
If he did not owe TWO MILLION DOLLARS IN SALES TAX TO NEW YORK STATE maybe he would have been able to get a bank to floor plan his cars.
If he did have a good credit standing I am sure BMW would have financed his cars.But when you run a car delarship into the ground and do not pay your New York State sales tax what bank would want to do business with you???
The Country ...more
By oldguy (60), hamptons on Jan 26, 10 4:28 PM
If there was ever a market where a BMW dealership could thrive, it is the Hamptons. I have purchased and leased vehicles from Country Imports/BMW of the Hamptons as well as Storms Motors (Jeep/Porsche/Audi) over the past 20 years. The contrast in management is absolutely amazing. Storms takes care of its customers, greets them properly, and generally does a fine job of doing everything a customer should expect from a high-end car dealership. BMW of the Hamptons has been erratic. Sometimes, ...more
By stinu3578 (1), East Hampton on Jan 27, 10 10:50 AM
Leased a BMW in 2007, Manhattan (Wall St branch) provided a better quote than Southampton. I gave SH a shot because its my hometown and employs childhood friends, but the cheesy up-island managers and sales people were a turn off. I guess they were spoiled by all the lay up business for decades from summer people who want Southampton around their license plate.
Lets face it, this was bad mgt all around, most of the cars are leased through BMW finance. Chase would finance a revolver for inventory ...more
By smacw (239), New York on Jun 28, 11 10:42 AM
8k run & 3 mile walk, Agawam Park, Southampton Rotary Club fundraiser