Dissection of a car dealer’s bubble

When we analyze the financial meltdown of 2008 and 2009 and the ensuing Great Recession, Wall Street is the first place to come to mind, and rightly so.

But while bankers were heaping bad debt upon worse, some North Country business people were applying similar practices to their ventures here.  Last summer, we reported on the near-total collapse of the Hacketts retail chain, fueled by the deep debt owed by its parent company, Seaway Valley.

Today there’s a report in the Watertown Daily Times about businessman P.J. Simao and the demise of his DealMaker car dealerships.  It’s a fascinating read that reflects how all was not as it seemed in the mid-2000s.

Ten years ago, DealMaker began humbly as a used-car lot on Arsenal Street. Within five years, it had grown into owning a cadre of new-car franchises across Northern and Central New York, with thousands of cars in its inventory and about 200 employees.

The name “DealMaker” could be seen on billboards, in countless TV ads and as the sole sponsor of one charity event after another. It was not uncommon in Jefferson County to hear someone connected to a nonprofit fundraiser say, “Maybe P.J. will help us.”

But by 2007, internal friction began to develop between the company’s two owners, Mr. Simao and Mark V. Picarazzi. Near the end of the year, an investigation of the company’s business practices was launched by the state. Soon after, the company began to slowly unravel.