Thousands of US car dealership closures planned for the next 18 months could cut close to 10 per cent from advertising spending at newspapers, radio stations and television channels, threatening the already fragile finances of local media.

For hometown media, car dealerships are one of the largest sources of revenue behind furniture stores and other retailers, executives and analysts say. The shutdown of weaker General Motors and Chrysler dealers could devastate smaller media companies as more than $700m is seen disappearing annually.