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quantum110

Are dealerships harming new car sales?

7 posts in this topic

What the hay!?! I could have sworning there use to be a section where people could ask general questions or make statements on GM a whole. Anyway do you believe GM's Dealerships harming sales buy focusing too much on their used car departments? I got to thinking about this months ago, and it popped into my mind again this morning when I turned on the TV. Every, few weeks or so the local Pontiac/GMC dealer buys a load of time on a local station to try to sell cars...but rarely do you ever see them trying to sell actual Pontiac's and/or GMC's. This morning in fact all I saw were Dodges, that included Magnums, Rams, Durangos, and Neons w/ less than 20k miles on them. I've also noticed that if you walk onto any lot a salesperson is more likely to help you in the used car sections than the New sections. I understand that these dealers make huge profits off used car sales, however, is this really fair to the Manufactures names they have on their signs? Should GM institute some rule that forces these dealers to seperate their used and new car businesses by X amount of miles? Curious to hear what people think...
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The franchise Agreements cover all aspects of cans and can't dos; however, various competition laws limit what the manufacturers can force dealers to do. I believe that is a serious flaw in the system. IMO, the manufacturers should start buying back their dealer network so that they don't work against one and the other. Get salespeople off commissions and onto salaries with perhaps a bonus contingent, and turn them into advisors. I have seen so many times that the dealers and manufacturer are not on the same page. Additionally, a lot of second generation dealer principles are spoiled brats and storm around their dealership like little babies. Daddy built the dealership back in the time when owning a GM franchise was a license to print money, and now the spawn are running the business into the ground. Times have changed. It takes a professional to run a dealership in these times. If GM is going to survive the onslaught, it will need more control of its dealer networks. A one price system would be nice, but the disclaimer "dealer may sell for less," as mandated federal or state laws creates a dog-eat-dog atmosphere that nobody benefits from. Just my opinion.
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Well... My dealer puts new cars out back and used ones out front. They are starting to rearrange, though. The used cars now sit off to the side in the back while 05s are out front and 06s are out back on the left. That makes sense for the 05s, but I never understood why used were out front in the first place...
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If a dealer has too many used cars, he can't take any more. They only have so much money (or credit line) that they can use for the used. Dealer would rather retail a used than wholesale, for obvious reasons. Also, no MSRP on used, they can price them at whatever they want. Salesmen often make more on a used car sale than new. (Everyone knows anymore what is invoice on a new car, but are clueless as to what the actual amount a dealer has in a used car)
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Franchise laws in most states don't allows this.

[post="25639"]<{POST_SNAPBACK}>[/post]


I suppose I can understand that, but how often do you see a McDonalds selling a Burger King Hamburger or Vise Versa?


There are serious Loyalty issues....

Another thing that kinda gets under my skin are dealers that sell competeing Brands...

IE Royal Buick here in Tucson...Land Rover/Hummer Suzuki/Kia and although Jaguar is upclass from Buick I would think if your Buick customer wanted to move upclass you'd direct them to a Caddy dealership. Edited by quantum110
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The franchise Agreements cover all aspects of cans and can't dos; however, various competition laws limit what the manufacturers can force dealers to do.
  I believe that is a serious flaw in the system.
IMO, the manufacturers should start buying back their dealer network so that they don't work against one and the other.  Get salespeople off commissions and onto salaries with perhaps a bonus contingent, and turn them into advisors.
  I have seen so many times that the dealers and manufacturer are not on the same page. 
  Additionally, a lot of second generation dealer principles are spoiled brats and storm around their dealership like little babies.  Daddy built the dealership back in the time when owning a GM franchise was a license to print money, and now the spawn are running the business into the ground.
  Times have changed. It takes a professional to run a dealership in these times. If GM is going to survive the onslaught, it will need more control of its dealer networks.
  A one price system would be nice, but the disclaimer "dealer may sell for less," as mandated federal or state laws creates a dog-eat-dog atmosphere that nobody benefits from.
  Just my opinion.

[post="25637"]<{POST_SNAPBACK}>[/post]


I agree with most of your post, this is interesting
" A one price system would be nice, but the disclaimer "dealer may sell for less," as mandated federal or state laws creates a dog-eat-dog atmosphere that nobody benefits from.
Just my opinion."


One of the benefits of capitolism :unsure: , some organization in all fields would always be a good thing. It has been a comfort to know our own paid public servants have been looking out for our well being and prosperity. :unsure:

The little time I recently spent at this areas largest {Oldsmobile}, Cadillac, Pontiac dealership gave me a bad taste as well as being convinced they are all totally incompetant. Be it sales, service or the managers. Some real shady stuff going on there.
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