Russia Report: GM retailer deals with increased demand, limited supply

The Genser General Motors dealership in Moscow is in an enviable – if not frustrating – position. The outlet moves between 600 and 900 vehicles each month. But if supply could keep up with demand, the dealer's director of sales, Nataliya Ignatova, insists they could sell around 1,200 vehicles per month during the busiest sales season.
The dealership peddles the General's biggest brands – Opel, Chevrolet, Saab, Cadillac and HUMMER – with varying levels of success. Chevy and Opel are the biggest sellers, with the Lacetti and Aveo leading the charge, followed by the Opel Corsa and Astra, which are quickly becoming a popular choice among Russia's youth. However, GM's luxury brands only account for between four and six percent of the dealership's monthly sales... for now.
With those stats in mind, it's obvious that the average Russian consumer is more interested in value and, just as importantly, availability. Last year, the normal wait for a Lacetti was six months. While this rarely caused dealerships to lose a sale (buyers might choose an equivalent Opel model instead), it speaks volumes about the demand for economical, reliable transport among Russia's working class.Ignatova admits that sales are likely to level off in the next year as the market reaches its saturation point, but that doesn't mean that a decrease in demand is inevitable – at least that's what the group is counting on. The dealership is expanding, with plans to put three more outlets online by the end of the year, at a cost of between $15 and 20 million each. Assuming consumers' appetites continue unabated, each dealership will begin to make a return on its initial investment within the next seven to ten years.
But if everyone and their mother owns a Lacetti (or Ford Focus), what can dealers offer fashion conscious consumers?
It's simply a matter of time before urbanites are ready to upgrade their no-frills transport to something with a bit more flare. The Genser consortium will be ready with HUMMERS, Caddys and Saabs, including the most expensive model at the dealership – a $120,000 Escalade."People's tastes are changing," Ignatova told us through a translator. Currently, consumers are interested in price, but style, and more recently, fuel economy, are becoming important.
The Genser dealership and its sibling sites are going to be there to heed the call when consumers come knocking. But in a market like this, Ignatova and her 50-plus sales team could deal in gerbil-powered cardboard boxes and still sell out every month.
Travel and lodging for our coverage and other media outlets was provided by GM.







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Reader Comments (Page 1 of 1)
fmfm 9:22AM (8/29/2008)
1st
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fixitfixitstop 1:12PM (8/29/2008)
more like last.
Tourian 10:22AM (8/29/2008)
So many US dealers would love to be in a position like that, especially GM dealers, but not many import brand dealers have those "issues" any more.
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Brad 10:51AM (8/29/2008)
600-900 a month!? Do you know how ridiculous that is!?
A good dealership on a good month will sell 50 new, of course ones in big cities might get 85.
Bah, how stupid is GM!
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Gary 11:31AM (8/29/2008)
Moscow streets are full as it is. I've been there. I don't know how people tolerate driving there.
DAVE 11:02AM (8/29/2008)
I knew Russia was nuts, especially with Putin as leader. Now they have a shortage of GM products. GM products ... actually in demand? I guess if you print it, it must be true.
lol
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AkulaX1 1:10PM (8/29/2008)
WTF do you know? Nothing. Nuff said
brn 12:28PM (8/29/2008)
900 sounds crazy, but we don't know how many dealers there are. If they're the only GM game in town (and within 200 miles of town), 900 is easy
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Phillip 2:38PM (8/29/2008)
In Soviet Russia, car drives you!
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Spule4 3:24PM (8/29/2008)
Maybe some of the dust covered stock at the US dealers (e.g., the Hummer dealer next to my office) could make it over there, but it appears that the Russians are even smart enough to go for the smaller/cheaper cars with the comment about 4-6% of sales being luxury cars.
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Philywilly 4:19PM (8/29/2008)
Yay Family Guy Quote!!
hahahah!
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SimbaDogg 7:27PM (8/29/2008)
GM is in a rush to close dealerships in the US, along w/ ford and chrysler...and now that they see pretty good sales, they're thinking, lets open a bunch of new dealerships in russia.
i think the record is stuck in a grove...
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