By on January 4, 2010

The new look of Buick-GMC dealers
You’d have to be a fairly trusting GM dealer to participate in what The General calls its Essential Brand Elements program. After all, it’s just the kind of dealership re-branding exercise that HUMMER dealers were forced into shortly before the brand was consigned to the ash heap of history. And once again, GM is asking dealers to create ideal showcases for its brands while keeping compensation for the renovations on a highly trust-dependent basis. GM wants brand-specific dealership rebrandings complete within three years, but will only pay for them over the next five to ten years reports Automotive News [sub]. And the payments won’t be fixed either, but will rather be tied to the dealer’s annual vehicle shipments using “a seasonally adjusted formula that takes into account the price of the vehicles sold.” According to Chevy’s Sales Manager Kurt McNeil, those payments could “conceivably” cover the recommended changes over the ten-year period. Are you feeling the trust yet?

The main aim of the Essential Brand Elements program is to fulfill GM’s long-cherished goal of kicking competitor brands out of its dealer network. According to AN [sub],

dealers will be asked to give competitive brands distinct space separate from GM brands by October. And GM will ask some dealers with a particularly high-selling GM brand to move that brand to its own building. If they comply, they’ll get the cash. If not, they won’t… [Cadillac sales manager Ed Peper] says Cadillac will have a long talk, at least, with any dealers who don’t remove competitors’ brands from their showrooms. GM hasn’t decided what to do about dealers who don’t comply.

The renovations themselves run from an estimated $200k-$300k for a Chevy dealership, to an estimated $400k-$600k for Cadillac shops, with Buick-GMC dealer costs still undetermined. They involve new elements designed by San Francisco architecture firm Gensler, including entries, greeting stations, floor tile and more. Participating dealers must also agree to use the brands’ new Web site looks, retrain their sales staffs, and hand over their sales and service customer lists to GM so it can “coordinate marketing mailings.”

Of course, the timing isn’t exactly perfect, as economic conditions are currently less than conducive to major investments in auto dealerships, particularly for GM dealerships. GM’s McNeil explains:

If [customers] have all these great experiences and interactions on the Internet, and then they walk into the dealership and it’s the same old experience — we need to connect those two… it’s really one of those situations where we’ve got to get started.

To which one dealer replies:

Everyone should have a nice facility, but goodness gracious, give us a chance to figure out what the market’s going to look like

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15 Comments on “GM Offers Cash For Dealer Revamp… Eventually...”


  • avatar
    Omnifan

    “hand over their sales and service customer lists to GM so it can “coordinate marketing mailings.”

    That’s funny.  Explains why I keep getting GM Card mailings for Chevy trucks and SUVs when I originally asked about a LaCrosse.  No wonder dealers are frightful.

  • avatar
    fredtal

    Good way to get rid of dealers.

  • avatar
    bomberpete

    Shame on GM! Their dealer councils should be calling for blood. GM gives their real motives away by saying it wants “their sales and service customer lists” so it can “coordinate marketing mailings.” Essential Brand Elements is essentially telling dealers, “you scratch my back and I’ll stab yours.”
    How will this engender trust and cooperation? All a still-standing GM dealer has to do is ask any of their NADA brethren who went for the HUMMER remodel whether this is worthwhile.  Guess what the answer will be?
    Perhaps the biggest B.S. is McNeil’s statement about translating the great experience buyers have through the Internet. Those customers want to avoid any dealership experience at all — what’s the point of those upgrades except to line GM and Gensler with cash?
    I’m no dealer sympathizer, and I’m not sure why I’m so angry. I guess it’s because dealers are independent business people, not order-takers.  Most are reputable and important to their communities, and shouldn’t have to be subject to this kind of shake-down. Everyone from AutoNation and Asbury on down should tell McNeil and Co. to their Essential Brand Elements and go screw themselves.
     
     
     

  • avatar
    tgriffith

    Hey, at least GM has new cars in the pipeline. It does suck for dealers, but a consistent brand experience across GM dealers is something that has been missing forever. It’s needed and I think GM is on the right path here. The future of cars is looking up!
    http://www.cargurus.com/blog/2009/12/31/cars-coming-soon-2011-model-year-preview

  • avatar
    getacargetacheck

    This should have been done 20 years ago. It’s too late now.  The return on investment for a Cadillac or Buick/GMC dealer will be minimal.  Cadillac and Buick may have some good products coming but they aren’t game changers and both images are still in the tank here in the US.  GMC trucks would sell just as well out of showrooms that look like prefab storage sheds.  Chevy dealers would benefit the most from this program.

  • avatar
    MikeInCanada

    “…. those payments could “conceivably” cover the recommended changes over the ten-year period…..”
     
    Hillarious. Now the dealers know how the buying public feels when fed such a line.

  • avatar
    Odomeater

    Good idea to establish continuity across all dealers. can only enhance the customer experience. The pictured dealership above looks like a Buick GMC dealership.

  • avatar
    fincar1

    …and as for the small-town dealers who sell everything from Cadillac to Chevrolet, well, the hell with ’em, I suppose. Maybe Bremerton, WA, for example, doesn’t even really need a Caddy dealer – let ’em go to Tacoma if they want a CTS. Of course, then they go right past the BMW, Lexus, and Infiniti dealerships. I really think there will be some GM dealers with enough balls to say “Here’s your franchise back, and come and get your damn cars off my lot.” It’s not like being a new car dealer is such a hot way to make money these days.

  • avatar
    CarPerson

    General Motors can always be counted on to chase the unnecessary as The Next Big Thing.
     
    What’s being served up now? Dealerships carrying the same brand must have substantially the same appearance inside and out so a potential customer may potentially have the same experience between like-brand dealerships. Oh, and it’s all the fault of the Internet.
     
    Good Grief.
     
    For weekly purchases of identical products in different areas, yes.  For a destination purchase once every 4-5 years, no.
     
    To GM: spike this nonsense and use the money saved by terminating everyone even remotely linked to this stupidity to improve the sound level and fit and finish of your products until the money runs out.

  • avatar
    Odomeater

    “To GM: spike this nonsense and use the money saved by terminating everyone even remotely linked to this stupidity to improve the sound level and fit and finish of your products until the money runs out.”
    Newsflash- Fit and finish and sound level is world class on GM products.
    Once again, continuity and uniformity is the key here. Instead of a hodgepodge of hardly identifiable stores scattered haphazardly across the landscape, the General is striving for store recognition as well as brand recognition.

  • avatar
    ASISEEIT

    Let me make several points then several comments. First, the Camaro has been out for a few months.   Second, I live in southern California with 99% sunny days and the original home of the Camaro.  Third, I haven’t seen more than 5 “New” Camaros since their release. I don’t want to seem to complain about G.M. management but the Solstice and the Sky were horribly un-available with production levels WAY TOO LOW! Many people on a waiting list simply got frustrated and bought another  vehicle and I would guess many weren’t  a G.M. product. Is this another situation of production levels WAY TOO LOW? Hell when the Mustang was reintroduced they were everywhere fast!!!

  • avatar
    folkdancer

    Any pictures on what a Chevy, Buick, GMC, and Cadillac dealership is suppose to look like under the new rules?

  • avatar
    Gotta Chime In

    Surprised nobody has said it yet but this is totally rearranging the deck chairs. I see no problem with making large investments in a down market in preparation for sunny days ahead but that needs to happen with product conceptualization, development, manufacturing and distribution. For dealers, improve the customer interaction experience – don’t paint over it.

  • avatar
    brettc

    The two Chevy dealers closest to me have both upgraded their buildings in the last 2-3 years. They do look nicer from the outside. But I still won’t set foot in them because I’ll never buy a GM product.  I’m sure there are many others with my point of view. It’s just a waste of money for the dealers.
    They can even spend money on R&D and quality improvements and actually make dead reliable world class cars. But I still won’t buy them when there are so many other world class manufacturers to choose from that didn’t go to the bailout trough. Note to GM executives: You can polish a turd all you want, but in the end it’s still a GM product.

  • avatar
    Odomeater

    BrettC- You are obviously not going to be swayed as you prefer to invest in foreign economies- and that is your perogative. It is the up in the air passer by that GM is targeting here.

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