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Subscribe to this threadGM to accelerate dealer consolidation
(Page 1 of 1)
cowboy bob @ Feb 10th 2008 4:53PM
What am I missing here? Doesn't the very existance of several dealerships, offering the same product, help the consumer? Does this also not help the manufacturer in the benefit of selling more vehicles from, say three dealerships that reduce their selling price (hence, their profit) to "move" more vehicles? One guy selling things, cars or tomatoes, will always ask more money if there is no competition. I saw this happen here when Ford bought back three area dealerships, and went to a "corporate store". Within a year the new set-up was offering less for trades, and less "dealer markdown". Guess what happened! Within another year, Ford sold the corporate store to a private dealer, and also franchised anothe dealer six miles down the road. Guess the sales figures didn't pan out as expected "eh? Duh!!!!
Mallory @ Feb 11th 2008 1:27PM
Too many dealers mean they spend scarce resources competing with each other instead of brands from other companies. It also means that the Buick dealer selling 100 cars per year doesn't have the same resources as the Toyota dealer that sells 1600. That includes advertising, marketing , promotions, as well as money for the best mechanics, top salespeople and clean, modern facilities.
For GM to be healthy it's dealer network must be healthy, and right now there are about twice as many dealerships as there should be for GM to be healthy.