GM Screws Its Dealers on CPO

Robert Farago
by Robert Farago
gm screws its dealers on cpo

Today is officially Freak-Out Friday for GM car dealers. As we reported earlier, GMAC is pulling the rug from under/hoiking-up the cost of dealer floorplan finance, the arrangement that allows dealers to buy the damn cars. And now Automotive News [sub] alerts us to the fact that General Motors is pulling the plug early on a certified used-car financing program. “GM had announced a financing incentive program through GMAC Financial Services that would start Oct. 1 and run through Jan. 5. The program offered 3.9 percent consumer loans for 60 months on all used models of the Chevrolet Impala, Pontiac G6 sedans and Chevrolet Silverado and GMC Sierra trucks. But on Oct. 17, GM sent a notice that it would end the program Nov. 3, McDonald said. As a result, many GM dealers worry they won’t be able to move the inventory they built with the understanding that the program would run through Jan. 5.” This is a swimming pool of not good for GM’s dealer relations, should such a thing exist anymore. “Obviously, the dealers are our customers,” GM spinmeister John McDonald dervished. “We want them to be successful, but you can’t get to the point where you’re putting yourself in financial difficulty.” Can someone please shoot John an email on that financial difficulty thing?

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  • Deepsouth Deepsouth on Nov 02, 2008

    To all you HATERS of new car dealerships. Be thankful for your careers. Sleep well at night. The family owned dealership group walked about 6 people out the door last week. People that needed their jobs.I am afraid more jobs will be lost very soon. They are gone due to lack of margins on new cars and compounded with slow used car sales. Maybe we can survive? Maybe we will not survive? This from a dealership that has been in the same family since 1966.What a shame. I've seen this industry go from being a polite,money making, nice place to work. Now it's crass customers,who demand little margins, so now we are laying people off.In my 24 years, this should be gravy time,but who knows if we will make it a few more months. Watching the comments from arm chair ttac quarterbacks w/no money or personal investment make me physically ill.I say this... Back it up with your own money...back it up with your own skill. Walk people out the door and say..."sorry". Next, to Top it off we have to listen(from our buyers) to all of your person agenda...political, religious, relationships, etc...and we really could care less. Pay us a fair profit on the new car, allow us to sell your trade for profit, service your vehicle at a fair margin. Then let's call it a day.Maybe that's the way it should be done.

  • Deepsouth Deepsouth on Nov 02, 2008

    One final note, BILL HEARD CHEVROLET DEALERSHIP GROUP... please please, don't...RIP. Rot in HELL. Shame on GM AND GMAC for supporting these unethical people for too long. Wild rumor is that it's costing GMAC alone 30 million low end and up to 40 million dollars to clean up Heard's operations. I have no fact..only speculation from a GMAC source who remains off the record. Once again..if you lay down with a're gonna get fleas. No wonder the public lacks trust in most franchise dealers.

  • Rodster205 Rodster205 on Nov 02, 2008
    Deepsouth, that sounds like Royal Automotive GMC/Saturn/VW/Volvo/etc. in Hoover/Vestavia, Alabama. Am I right? They did the same thing (family owned, let around 6 go) last week. Yes it is sad on a personal level, but a dealer isn't going to get much sympathy because of dealers like Bill Heard. From what I know Royal is a fairly good dealership, but unfortunately most are more like Bill Heard than not, and with sales down across the board even the good dealers have to cut back. At least Royal is still open, for now.

  • Deepsouth Deepsouth on Nov 02, 2008

    Final rant.....Rodster205, Thank you for reading my post. Royal group is a clean, safe, wise, above board dealer group that runs parallel to our group. But alas, it's not Royal. The sad part, the tragic part, that hurts me most is so simple. It's product not price. Example, go to any Mini Cooper dealership site and try to purchase a car. Most are sold out at list or either reserved, at list price or more mind you. Meanwhile, we have product on the ground, trucks w/$7500.00 on the hood w/little interest. Even if it sells, the salesman makes ....$100.00...maybe 200.00 from the dealer. Here's the a 40-k plus all day truck sale transaction...the salesman(and dealership) deserves much more. MANUFACTOR'Sneed to STOP THROWING MONEY ON THE HOOD IN REBATES. Pay a salesman a solid strong fee at all dealerships 2 sell your inventory. Pay your DEALERS 2 stock and sell your product. I am screaming at world.. and at Detroit manufactor's that don't visit the dealership. They use words like..customer thru put. None of which keep a dealership alive. TTAC often takes a large broad approach to the auto industry. They often forget the independant dealer. We are on the FRONT LINES are people too. Buyers don't understand the seperation. They don't care if the dealer makes profits. If they don't the manufactor should. A healthy dealer makes for a good buying and follow up service experience. Are you listening in your glass towers? HELP US! If we don't make don't make it! We are the face of your company to the public.