GM Offers Cash For Dealer Revamp… Eventually

Edward Niedermeyer
by Edward Niedermeyer

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

Edward Niedermeyer
Edward Niedermeyer

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  • Brettc Brettc on Jan 05, 2010

    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.

  • Odomeater Odomeater on Jan 05, 2010

    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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