By on August 17, 2009

I’m having a little trouble seeing GM’s decision to reopen 30 to 50 terminated dealerships as anything other than the result of disorganized dithering. For one thing, the fact that it’s such a vague number shows that the reanimation dealer plan—such as it is—is a work in progress. Automotive News [sub] turns to GM’s Marketing Maven to explain the mechanics and rational behind the reversal: “Terminated dealers will get the right to make the first proposals, GM says. Mark LaNeve, GM’s vice president of U.S. sales, said the open points were created when poor-performing dealerships in good locations were targeted. Other points will be filled if GM discovers that customers are driving too far to reach a dealership, he said.” Needless to say, this is bound to piss-off some of GM’s 1350 or so officially terminated—rather than GMAC-squeezed-to-death—dealers. To which LaNeve “repeated his assertion that the terminations were fair and based on poor performance for sales, customer satisfaction and other targets.” Formula please? Hello? At least one ex-GM dealer’s not bothered . . .

In Madison, Wis., Tom Thorstad said he might apply to be reinstated, depending on what GM is looking for. Under GM’s termination plan, Thorstad Chevrolet must close by October 2010. After that date, GM expects to have about 4,100 dealerships.

Yes, what is GM looking for?

GM knows where “the critical areas” are in every city based on traffic patterns, LaNeve said. He described a critical location as one near a major auto mall and a shopping hub and having heavy traffic.

LaNeve said: “If there’s a Toyota store, a Ford store and a Honda store there, we pretty much need a Chevy store.”

Which pretty much says it all, I suppose.

Get the latest TTAC e-Newsletter!

17 Comments on “GM Dealer Plans in Chaos: Reopening 30 – 50 Closed Dealerships...”


  • avatar

    I’ll bet none of them will be Bill Heard dealerships.

  • avatar
    superbadd75

    In most markets, isn’t there already a Chevy store near Toyota, Honda, Ford, etc.? The problem is that they not only have that location, but 2 or 3 more redundant GM brand showrooms. Sales points that are selling cars similar enough in content, styling, and price point to compete against the Chevy stores. Buick LaCrosses that are too similar to Impalas, Pontiac Torrents (and soon to be GMC Terrains) that defy you to notice the difference in a Chevy Equinox, GMC Sierras that are a grill away from being Silverados, and so on. GM’s biggest problem hasn’t been sales locations, it’s been product. Period. Once again, Mark LaNeve proves his idiocy.

  • avatar
    Juniper

    30 to 50 out of 4000?
    This is just fine tuning, no issue here. That many are closing and opening for other reasons all the time.

  • avatar
    PeteMoran

    If it is important to have Chevy nearby Toyota, Ford and Honda why was it that;

    a) Said dealer was given termination notice,

    b) Found itself an under-performing location?

    Politics anyone?

  • avatar
    rnc

    Sure what’s your persuasion?

  • avatar
    Rod Panhard

    LaNeve said: “If there’s a Toyota store, a Ford store and a Honda store there, we pretty much need a Chevy store.”

    They already tried that situation. It obviously didn’t work, and he should have substituted “Hyundai” for Honda.

    McDonald’s seems to be turning a profit these days. If I were GM, I’d look at McDonald’s locations since it seems that people actually go there and have since the time that clowns rode around on flying hamburgers.

  • avatar
    Johnny Canada

    Ever get the feeling you’ve been cheated?

  • avatar
    motownr

    Shi$…meet fan.

    You’d think by now that GM would have watched the clown show currently playing at Chrysler, and steer clear of making THE SAME MISTAKE.

    Why in the world would they want to reopen this can of worms….right before Congress returns?

    LaNeve had had nine lives, but I question his sanity on this. The last thing GM needs to do is to undermine what has been a surprisingly good recent run in the press.

  • avatar
    Stu Sidoti

    IF GM closed down a dealer based upon poor performance, why would GM offer that same dealer a chance to re-open? What metric used to determine their ‘success’ suddenly changed?

    IF I follow GM’s closings rationale in the article, wouldn’t it make better business sense to find where the dealership coverage holes are, then offer that dealership opportunity to the nearest dealer whom GM determined to be successful enough to have stayed open?

    Unless of course, GM closed them for some other reason than performance. Ahem.

  • avatar
    rnc

    I imagine that some dealerships were canned to settle personal scores, i.e., “you sued us in 1980 and now that we can hide behind BK and you can’t hide behind state franchise laws goodbye, if by some chance you would like to grovel to get your franchise back we will address that at a later date.” Dealers have hidden behind franchise laws for along time the worm just turned.

    In terms of “political reasons” I would think that every dealer donates republican (or sits on the fence) so that really isn’t a consideration or one that any smart politician would even consider risking for such a small pitance “lets see I can ruin billy bob’s shop or I can run the most powerful country in the world, billy’s going down”…think about it.

  • avatar

    Other points will be filled if GM discovers that customers are driving too far to reach a dealership,

    This is my favorite. Discovers? What, they didn’t look at a map in the first place?

    John

  • avatar

    McDonald’s seems to be turning a profit these days. If I were GM, I’d look at McDonald’s locations since it seems that people actually go there and have since the time that clowns rode around on flying hamburgers.

    Unlike McDonald’s actually offers products worth buying, with vastly better customer service in the majority of cases. Maybe GM should bone up on how Ronald handles things.

  • avatar
    njdave

    I don’t think politics plays into this as much as many people assume, for the simple reason that the vast majority of businesses contribute to BOTH parties, just to make sure they can say they backed the winner, whoever that might be. This is why if you for example do not wish to vote for any candidate who takes money from the tobacco industry, for example, you find that you can’t. They give money to everybody that runs for anything, even dogcatcher. Its the same with car dealers. They want to make sure that anyone who wins owes them something. We need more than 2 parties in this country. If we had 20 parties like Israel does, for example, companies simply couldn’t afford to do this anymore. Then one could vote their conscience on social issues. It would also mean that no one party could form a governing majority in congress, and force them to make alliances with other parties, again like Israel. This I think would be closer to representing the will of the people than the two parties we have now which only really represent government and lobbiests.

  • avatar
    gslippy

    “If there’s a Toyota store, a Ford store and a Honda store there, we pretty much need a Chevy store.”

    If this is true, shouldn’t they be cutting even further?

  • avatar
    stopwhining

    Hey John Williams,

    Yes, let’s compare McDonalds with their incredibly technologically and over-regulated products to General Motors & the auto industry in the general. (note the sarcasm).

    Gotta love the monday morning quarterbacks.

    And I love GM’s product offering, something I would never have imagined 10 years ago….

  • avatar
    thanh_n

    “If this is true, shouldn’t they be cutting even further?”

    I agree. Very good observation.

  • avatar
    johnthacker

    Seems like since the taxpayers saved GM, there would be some way to find out the supposed formula via a FOIA request, assuming that GM conveyed the formula to the government at some point.

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • la834: Wasn’t there a Capri even before the Mk 1 model that was sold in the early 1960s? Similar side profile...
  • la834: Was gonna say. The cobalt “they’re using child labor to produce it!” narrative is used by...
  • MitchConner: Don’t assume everybody associated with schools like Stanford is smart because they aren’t. As for...
  • MitchConner: 1. Can you imagine some union goon making chips in Michigan? 2. Biden isn’t senile. He’s just colossally...
  • MitchConner: Folks, the reason is asphyxia from inhaling their own farts.

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Mark Baruth
  • Ronnie Schreiber