That is just the beginning. GM plans on cutting their dealer network in half or close to it. Most these closings will be as a result of Saturn, Saab, Pontiac and Hummer being shut down. The big hit will be coming after they file for bankruptcy in the next 30-60 days.
GM to close 1200 dealerships
Reuters
That's going to hurt although why there are several even in fairly small towns has always been a mystery to me.
That's going to hurt although why there are several even in fairly small towns has always been a mystery to me.
1 - 20 of 57 Posts
I think I don't quite understand what the manufacturer really puts into a dealership besides the license to sell said cars. I was always under the assumption that the dealership was owned by a private entity and then signed a contract/license agreement to sell a certain manufacturers cars.
You're right the dealerships are individually owned businesses but they are stuck in a no win situation with the manufacturers at this point. As the manufacturer is cancelling the contracts to sell their cars (and, very importantly, the financing system) GM is, effectively, closing the dealerships.I think I don't quite understand what the manufacturer really puts into a dealership besides the license to sell said cars. I was always under the assumption that the dealership was owned by a private entity and then signed a contract/license agreement to sell a certain manufacturers cars.
I suppose it's possible that some will switch brands but it seems unlikely in this economy.
Then maybe the media needs to change the way they report the issue. Instead of saying that GM is closing the dealerships maybe they should report that GM is canceling contracts with dealerships. May not sound as good for GM but at least it is more truthful but then again it is the media we are talking about isn't it.
It's about time they cut some of the fat off. I can probably count 10 dealerships that I see on my way into work each day. You will pass a Chevy/GMC dealership and then another two miles down the road, there will be another. It is completely pointless. I am just wondering what is going to happen with all of the land/buildings that these dealerships take up. Hopefully they won't become vacant lots. That would be more of an eyesore than all of the crap cars they sell on the lots now.
There is too many anyways. To answer to the ? Of what do they put into the dealerships other than the license, brochures, discounts, warranty work, parts inventory, employees get a lot of gm benefits, the cost of delivering the cars to different dealers for the cars to just sit there, and other things. A dealership costs GM alot of money, about 1 to 2 million a year, I read this in consumer reports, toyota spends about 5 mill per dealership every year, it is a lot of overhead expenses to get rid of.
It is smart for them to do this.
It is smart for them to do this.
GM is famous for stacking dealerships on top of each other in the same nieghborhoods - forcing GM dealerships to compete against each other for the same customers and cutting thier own throats to make a sale.
Does anyone know if GM will be buying back the new car inventories that these dealers have on thier lots - all 1,100 of them?
When our local Chevy dealership closed two years ago (they saw the demise of GM coming) GM did a buy back all of the store's new car and truck inventory - about 200 vehicles.
200 x $20,000 (average invoice price) = $4,000,000
If GM doesn't buy back these inventories the effected dealerships will be in even more trouble.
Does anyone know if GM will be buying back the new car inventories that these dealers have on thier lots - all 1,100 of them?
When our local Chevy dealership closed two years ago (they saw the demise of GM coming) GM did a buy back all of the store's new car and truck inventory - about 200 vehicles.
200 x $20,000 (average invoice price) = $4,000,000
If GM doesn't buy back these inventories the effected dealerships will be in even more trouble.
No, they have already stated they are not buying back cars or parts. They will instead help dealers try sell their stuff to other dealers. Neither GM or Chrysler will be buying anything back themselves. It would cost far too much.GM is famous for stacking dealerships on top of each other in the same nieghborhoods - forcing GM dealerships to compete against each other for the same customers and cutting thier own throats to make a sale.
Does anyone know if GM will be buying back the new car inventories that these dealers have on thier lots - all 1,100 of them?
When our local Chevy dealership closed two years ago (they saw the demise of GM coming) GM did a buy back all of the store's new car and truck inventory - about 200 vehicles.
200 x $20,000 (average invoice price) = $4,000,000
If GM doesn't buy back these inventories the effected dealerships will be in even more trouble.
I've been saying for 15 years that GM and Chrysler had to stop flooding the market with different versions of the same car under different brands. It's a terrible way to do business, trading increased market share via overproduction for lower profits and higher costs. To stay afloat, they have to be producing at capacity in all plants. It's freakin nuts.
The sad truth is they are not the only ones doing this.I've been saying for 15 years that GM and Chrysler had to stop flooding the market with different versions of the same car under different brands. It's a terrible way to do business, trading increased market share via overproduction for lower profits and higher costs. To stay afloat, they have to be producing at capacity in all plants. It's freakin nuts.
Honda Accord = Acura TSX/TL
Honda Pilot = Acura MDX
VW Passat = Audi A4
VW GTI = Audi A3 = Seat
Ford = Mercury
Nissan Maxima = Infiniti G35
Toyota Avalon = Lexus ES or GS
This is so common in the car/truck industry. It saves them a ton of money and fools so many people into thinking they are getting so much more for their money when in fact they aren't usually.
It's not such a big deal when doing it in this way, (basic, and luxury), but GM and Chrysler do it to the extreme, offering as many as 4 vehicles based on the same car, SUV, or truck. For Honda and Toyota, it's a way of reaching different markets.The sad truth is they are not the only ones doing this.
Honda Accord = Acura TSX/TL
Honda Pilot = Acura MDX
VW Passat = Audi A4
VW GTI = Audi A3 = Seat
Ford = Mercury
Nissan Maxima = Infiniti G35
Toyota Avalon = Lexus ES or GS
This is so common in the car/truck industry. It saves them a ton of money and fools so many people into thinking they are getting so much more for their money when in fact they aren't usually.
Another railcar in the speeding train-----GM execs sold their stock the day before the announcement. They had the showing of the first 2010 Camaro at the local dealership this past weekend. We went, since there was supposed to be a cookout (no food left.) If this is what GM is hoping to revive their sales with, they are in bigger trouble than I thought. This particular car was built very sloppy.:twisted:
Here's the list of Dealerships closing.
http://big.assets.huffingtonpost.com/ChryslerDealership.pdf
The are closing by June 9th.
http://big.assets.huffingtonpost.com/ChryslerDealership.pdf
The are closing by June 9th.
Haven't seen the Canadian list yet but the Globe & Mail is reporting that half the Canadian dealerships will be cut (about 350)
There are going to be a lot of mechanics, parts people, sales staff out of work over this. Anybody know anyone hurt by this?
There are going to be a lot of mechanics, parts people, sales staff out of work over this. Anybody know anyone hurt by this?
Haven't seen the Canadian list yet but the Globe & Mail is reporting that half the Canadian dealerships will be cut (about 350)
There are going to be a lot of mechanics, parts people, sales staff out of work over this. Anybody know anyone hurt by this?
No one that i know directly has been affected.
But 2 weeks ago the Pontiac Buick dealer near my house closed down. The owner had passed on last summer and his estate pulled the plug on the operation after 40 years in business.
In the last 8 months a good number of GM dealers in Toronto have shut down. GM and Chrysler have not been alone. A growing number of dealerships both domestic and import have been calling it quits in the last year.
That list is Chrysler dealers.Here's the list of Dealerships closing.
http://big.assets.huffingtonpost.com/ChryslerDealership.pdf
The are closing by June 9th.
GM is renown here in the rural Midwest for having a dealership in every wide spot in the road. In the 70-mile, two-lane back-road trip between our houses there are two, both in towns of under 1000 population, both within 30 miles from true big city dealerships.
Chrysler is cutting into some serious meat in their dealerships; GM, OTOH, will be getting rid of hundreds of marginal operations that never should have been there to begin with. "1200" is a drop in the bucket.
going to test drive a Malubu this week.
Interesting (and sad) article in "The Oregonian" about the situations closing dealerships are facing.
http://www.oregonlive.com/business/index.ssf/2009/05/oregon_auto_dealers_fight_to_s.html
http://www.oregonlive.com/business/index.ssf/2009/05/oregon_auto_dealers_fight_to_s.html
1 - 20 of 57 Posts
- This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Honda Element Owners Club
Element Owners Club is your go to forum community to discuss your Honda Element, and get ideas from your next great trip to your next Honda Element Mod.
Full Forum Listing
