The Displaced Dealer

The Displaced Dealer (continued)

As we approached our destination on the outskirts of town
there in front of us was a large older building that housed a
Ford dealership. It was Sunday so it was closed, but there
were a number of people on the lot looking at vehicles. We
drove about a mile further and came to the center of town. The
streets were lined with small quaint shops selling all kinds of
trinkets, antiques, etc.


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By George Toth
Sales Manager/AutoPro Training Solutions
Email g toth @automotivedealersnetwork.com

George has 25 plus years of retail dealership experience. He has
held dealership management positions in parts, service, body
shop, new cars, used cars, finance and general management.
His five years training experience includes service, parts, sales,
finance, CRM, new and used management.

SUPERIOR DEALER SOLUTIONSsm

Small town America, where it all started, a nice little bedroom community. As we went through the town, stopped to
shop in a few of the stores, I wondered where the Chrysler and/or GM dealer was. As we started to head out a different
way, I saw a Chevrolet store. The problem was: this one had no inventory and was obviously closed. Most likely a
victim of the bankruptcy of GM. The building was not anything fancy, much like the Ford store. The building was
perhaps 35 years old. I got to thinking 'Why are these dealers getting thrown to the wolves?' The small town dealers I
have known loathe debt and are usually financially sound. Considering how quickly fortunes can change in the
automobile business it is a matter of survival for them.

e you

seen facts and figures relating to the so

called cost of the dealer

the manufacturer?

Has either Chrysler or GM justified this action? Or was this something that the politicians have

demanded? Can you hear the crickets chirping? Nobody seems to want to talk about anything

related to this. After thinking about it the dealer has pretty much

bsorbed

the costs of

communications with automakers. The dealer is a cash cow for the lease of signage, parts sales,

special tools, promotional material, factory programs, and they subsidize advertising through dealer

ad groups. What about the loss of market share? If an automaker loses 100 units from a small

market, how many dollars does that cost the automaker? Help me here, where are the costs to the

automakers? To make matters worse it appears that NADA is having a feud between the haves and

the have not’s. I just hope the dealers and ex

dealers can come to a meeting of the minds, it would

be a shame to see NADA end up like this.

As we left the town, I never did get to look for the Chrysler dealer. It occurred to me that in order for that Chevrolet
dealer’s customers to get warranty work or factory trained techs to repair their vehicles they would have to go to the
next town twenty five miles away. I wonder how many customers will be wiling to drive that far to get repairs on their
vehicles. How many will be willing to go that far to shop for a new car? Now, the Ford dealer is sitting in the cat bird
seat. It appears he is the only dealer left in this town to help support the community. That mega dealer twenty five
miles away is sure not going to be lending his support to this community. I am sure he will advertise in the town, but
only sparingly because of its size. Did GM and Chrysler make a huge mistake taking out these dealers? What effect
will this have on the market share for the two domestics that have pulled the plug on so many dealers? Why are the
imports starting to expand into these smaller markets? Do they know something Detroit does not?

nnn

Mark LaNeve insists that the dealers were all held to the same standard, but nobody has ever

seen the criteria. Chrysler insists adding the closed dealers back into the system will put them

under. Nobody has presented any kind of facts about the costs involved. Am I missing something

here? Or is there some kind of agenda? Why are Chrysler and GM opening points in areas that

it was so important to close during the bankruptcy process? That being said there are some

stores that are not viable

and giving those dealers a fair exit strategy is the right thing to do.

Let’s say a store in downtown Detroit would most likely not be viable today. But if the dealers do

not cost the automaker, and at this point they have been unable to provide any facts that they do,

why not let the free market take care of these points. If the point does not sell enough cars the

costs of technology moving forward will eliminate the marginal ones. Even that dealer is a cash

cow

with

parts sales, sign leases, vehicle sales, special tools and more

hy not let them exit the

market on their own terms? This all leaves me at a loss for words, something my wife says is

impossible.