Filed under: Car Buying, SUVs, Trucks/Pickups, Etc., GM, HUMMER
Hedging its bets - HUMMER dealer anticipates doom, pre-emptively downsizes
There's no official obituary for GM's HUMMER brand yet, but haters are lacing up their dancing shoes while lovers wring their hands. Dealers with HUMMER franchises have a lot of skin in the game, so the uncertain future is bound to give business officers ulcers. Not willing to wait around to the bitter end, Milwaukee's Bergstrom HUMMER is planning to move into the same space as the group's Chevrolet store. The HUMMER-specific Quonset hut style dealership building will be toned down and pressed into service as an outlet for Certified used GM vehicles. Other HUMMER dealers across the nation are staring down the same conundrum, being on the hook for that big, rugged showroom, test track, inventory, and staff, while the parent company looks to clamp off bleeders. Some might follow Bergstrom's lead and shove the big trucks into a corner of a showroom dominated by a more stable brand, while others are shipping inventory as fast as they can.
Moving product is a tremendous challenge when the bobbleheads on the nightly news continue shrilly about the price of fuel and you've got a lot full of low-mpg, high weight trucks that happen to be a favorite target of vandals euphemistically masquerading as "activists." Customers that do make it through the door are looking for deals, and HUMMER will spot you five thousand bucks to take an H3, PLEASE. Existing customers are looking to get out of their vehicles any way possible, even if it means a financial hit. The mass exodus isn't solely due to hysteria, when it costs over $100 to fill the fuel tank, it chafes to watch the fuel gauge's precipitously quick drop toward "E." Retail issues aside, HUMMER still offers capable vehicles with a high level of style. If you've got a boat to pull, and want to look like the Governator, an H2 could still be just the thing, and now you'll be able to find one for a song; most likely the blues.
Gallery: 2009 HUMMER H3T
[Source: Inside Line]
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Reader Comments (Page 1 of 4)
bakka 1:52PM (6/22/2008)
Goodbye.
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Cary 6:41AM (6/23/2008)
My dancing shoes are laced up, spit shined, and ready to dance on the grave of the HUMMER. And don't go getting sensitive with the, "What about the thousands of employees that will lose their jobs..." It is an unfortunate byproduct of progress. Other jobs will be created by the death of the rare and elusive American Elephant. Plus, let's face it, we need more efficient vehicles. Global warming or not, peak-oil or infinite reserves, if you want to use lots and lots of fuel daily, buy something that atleast makes you look cool, get a '90 Ferrari Mondial. It's a Ferrari, it will get you laid, and you wont be the douchebag in the hummer. You'll be the suave, earth friendly guy to the ladies, in reality, you've been in it for the p-ssy all along anyway. [That's still on topic, right?]
Rick 2:07PM (6/22/2008)
You will reap what you sow.
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PaulPaul 2:16PM (6/22/2008)
hell if i had the money (not just for the car itself, but $100 a fill up afterwards) i'd buy h2 just for the Chicago winters and 18" potholes.
what i'm really curious about is that if for some magical reason gas goes down to $2.xx would we see a return of these vehicles? or did we learn our lesson?
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Mike D 2:55PM (6/22/2008)
That's a problem I learned the hard way here in the NYC area when I got my 2005 Legacy GT. DOT does the most craptastic job of fixing roads. I was a passenger in an SUV a few months ago, that hit a 1 foot+ deep hole in the road, it went right though it, even though it was a jarring hit. Had I been in my car, I would be stuck replacing at least the bumper, suspension, wheel and tire.
Everyone thinks small cars are the answer to everything, but roads in this country are very poorly maintained. Small cars with their small lower profile tires are always just a pothole away from an expensive repair bill.
why not the LS2LS7? 3:20PM (6/22/2008)
So put higher profile tires on cars. My 8 year old car has more rubber between the rim and the road than recent SUVs tend to.
Shiftright 3:22PM (6/22/2008)
Hell Mike D, by that train of thought, we should stop funding road maintenance altogether and have everyone drive tracked vehicles. Also, maybe instead of spending money on fixing defective levees, we should get everyone to buy an amphibious vehicle or a boat. Ridiculous argument.
Mike D 3:25PM (6/22/2008)
@why not the LS2LS7: That's the problem, automakers are using these large wheels with increasingly lower profile tires. This makes your average shopper walk away because they know they are going to have issues with low profile tires and potholes.
Mike D 3:35PM (6/22/2008)
Shiftright: No, the government (local, state, and federal) needs to really overhaul their roadways, and also recalibrate their stoplights.
The parkway near me recently had the cracked pavement "fixed." Fixing it to them was randomly dumping concrete and blacktop down, and not smoothing it out. So now this parkway with a 55mph speed limit had mounds of hardened black pavement, which stick up 4-6" inches and many of the street lamps are burned out and haven't been replaced in ages. Try driving on that with a small car.
Louis Duran 3:49PM (6/22/2008)
MikeD says: "Everyone thinks small cars are the answer to everything,... yada, yada, yada"
The solution to the problem isn't for everyone to go out and buy an SUV with big tires, which in time will make the roads even worse. The solution is that government needs to fix the goddamn roads. Which means (gasp!) we may have to pay more taxes or pay less for other things, like $900 Billion in Iraq for instance.
Aprime 5:27PM (6/22/2008)
Smaller cars cause less wear and tear to roads simply due to their weight.
And don't start complaining about the roads, you've never been to Michigan or Quebec obviously, although Quebec is investing billions to fix or rebuild the existing infrastructures after what happened in Laval.
Anyhow - getting an SUV to counter potholes = vicious circle of stupidity.
I know here they put some sort of tar-like stuff the moment there's a crack to prevent further wear now, and it seems to work pretty well. Roads hold up much longer provided they do it every year... If they don't, then potholes begin to appear after a while. It's worth the cost IMO.
Concrete roads in metro areas are also a great idea, provided they're maintained correctly (not filling holes with asphalt, a guy in an Escape died because the semi in front of him drove on a lose fix and it flew right into his face) - keeping in mind that this road dates back from the 70's I believe.
Dan 6:05PM (6/22/2008)
Road wear increases exponentially with weight, a 5000lb SUV does more harm than a 3000lb car but the effects of both are utterly inconsequential compared to a 20,000 + lb school bus or garbage truck.
Talking about the government changing their priorities to keep up roads is great, let me know when you have any success with that. In the meanwhile, buying a vehicle for the potholes you've got makes more sense than buying for the roads you'd like to have.
20 years ago a typical car had 70 series tires - something like 185/70s with a 5" sidewall. Today cars have 55 or 60 series tires - but they're also 40-50mm wider so that works out to the same 5" sidewall you had before.
Soul Shinobi 8:28PM (6/22/2008)
Mike D, the Legacy Outbacks of the same generation have long travel suspension that seem to make potholes disappear. I'd trade for a Legacy Outback XT if I were you. :) Test drive one if you can.
Shiftright 2:21PM (6/22/2008)
Seriously, the Big Three thought they could keep mass producing big huge displacement gasoline V8s in overweight land barges for how long? I'm stunned by the complete lack of foresight their over compensated executives consistently demonstrate. If there was any kind of brain activity in GMs planning department, they would have begun to translate Hummer's very short but credible off road pedigree into smaller, more fuel efficient vehicles to compete with Jeep, and perhaps Land Rover, although none of them are exactly fuel sippers. Rick is right. You reap what you sow, but in the end it's the autoworkers that suffer. Good riddance
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the friendly grizzly 2:47PM (6/22/2008)
Seriously, NisYota thought they could cash in on the gravy train of big huge displacement (as opposed to small hjuge displacement) V8s in overweight land barges like Sequoias, Land Cruisers and Titans even thought the writing was on the wall YEARS ago?
(Psst! hey, bud! Wanna buy a truck factory in Texas?)
Shiftright 3:09PM (6/22/2008)
Friendly Grizzly, you are so right. My mistake for omitting the Big Japanese Three from jumping on the greedy gravy train.
Shiftright 3:11PM (6/22/2008)
Friendly Grizzly, you are so right. My mistake for omitting the Big Japanese Three from jumping on the greedy gravy train.
why not the LS2LS7? 4:09PM (6/22/2008)
You also forgot Mercedes. I think the GL was the most recent large/body on frame SUV announcement by anyone. Oh, and don't forget the Porsche Cayenne/Cayenne S/Cayenne Turbo/Cayenne Turbo S. Of course the most recent actual SUV (crossover) announcement is the BMW X6. There's a vehicle that makes a ton of sense. Of course, from the people who brought you the original X5 with less trunk space than an Impreza, maybe it does.
Not sure why people single out the domestic automakers, or any automaker. The market was buying a lot of SUVs, so the automakers, ALL THE AUTOMAKERS were making a lot of SUVs. And they all have to pay the piper now.
Soccer Mom 2:26PM (6/22/2008)
Perhaps, selling or euthanizing Hummer is for better good. As it stand now, it represents everything that is wrong with the American auto industry - bloated pricey vehicles that despite their outer size offer little interior space, horrible fuel economy and poorly designed interiors.
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AZMike 2:44PM (6/22/2008)
this is just asinine. Bergstrom seems to forget they signed an agreement with GM for the HUMMER franchise; that franchise states their requirement for a specific type of building, i.e., the quonset style of building. moving to a different location could easily void their franchise agreement.
I'm certainly no lover of any HUMMER products, but have always failed to understand the disdain they seem to bring to so many folks.
all the H2 is is a dolled-up Tahoe, and there is never even half of the dislike aimed towards those. is anyone spitting at the Nissan Armada, with it's 12 and 17 MPG economy? how about it's dolled-up brother, the QX56? why??
if economy cars are the answer everyone is looking for, then why does every one, with the exception of the Pruis (and it had a big one last year), come with a hefty rebate/dealer incentive? products that are hot wouldn't need rebates, would they?
for all those who are putting on their dancing shoes waiting for the SUVs demise, I might suggest waiting a while to lace them up.
two things to consider:
1) OPEC is meeting on tuesday, and it appears all participating countries will be increasing oil production. and,
2) the US government will soon be actively investigating the futures trader markets, and their effect on the spiraling oil prices. the oil prices this time are not being controlled by either the OPEC nations or the oil companies, but the futures traders alone.
some also forget that over 75 cents per gallon in the recent fuel increases have to do with the declining value of the dollar compared to other currencies. when the dollar goes up, the price will come down.
smart folks will see this is the best time in years to buy an SUV or pickup, as prices are the best they've been in years.
after living thru every gas crisis since the first one in 1973, one thing is crystal clear; Americans prefer larger vehicles. they may buy a teeny car right now, but when fuel prices drop, it will be quickly gone, replaced with what they want to really drive. not my opinion, just a fact.
AZMike
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