UPDATE: GM Not Discussing Plan to Combine Dealerships, Yet
Yesterday, we told you that General Motors was going to announce the plan to combine dealerships to create “GM Collections
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Comments
Reilly
In theory this is a wise business move, but to the Aveo-Cadillac point it could mean that (by virtue of the number of Chevrolets sold) you have $10,000 buyers and $100,000 buyers drinking from the same coffee machine. Although we all think the world is full of love, it's not.
Iain
Not sure this is going to work: M-B has kept Smart very separate from MB dealers, BMW keeps Mini separate (although in some cases on the same lot they do not share showroom space), and VW keeps Audi very separate, not to mention Bentley. And Toyota has entirely different dealers on different lots for Lexus.
While it may make sense for Chevy/Pontiac/GMC to combine, GM has tried hard to build Cadillac as a separate viable brand. The Aveo/Caddy example you cite will be the root of the problem.
Would you buy a $100k Audi in the same showroom as a VW Rabbit? Lexus LS in the same showroom as a Corolla/Matrix?
The Stig
Bad idea for all the reasons noted above. In Ann Arbor there is a Chevy/Hummer/Caddy/Saab dealer that all share showroom and sales space. The dealer was formally a Chevy and Nissan store. The environment is not becoming of those shopping the higher end models IMO, especially with the nice Lexus, Benz, BMW, and Infiniti dealerships right up the road. I've visited there to look at the new CTS, and didn't get the treatment that I got (or expected) at the Lexus or Infiniti stores. It was what I expected if I was shopping Malibu or HHR. Not unpleasent, but it sure didn't say "luxury treatment for luxury buyers." If GM wants Cadillac to be a viable alternative to these brands, sharing space with 'lower' end brands is NOT the way to go about it.
southern
I won't buy another Cadillac from an Aveo salesman and all that that infers.
Even if the Aveo experience is upgraded, it will inevitably mean that the buying experience across the lines, will seek a level of mediocrity.
I must say, that at least at this time, my Cadillac buying experience (2 weeks ago) was First Rate.
Please don't mess that up.
Corco16446
Nope. You're just going to confuse buyers if you are selling Chevys and GMCs on the same lot
Clint
Like others have said, GM has way too many brands and tiers to make this idea totally logical. I agree the move will do little to promote the Cadillac brand as "premium."
However, if you look at how successful CarMax is, as well as the American tendancy to make rock bottom prices a very important factor in purchasing (see WalMart), this idea does hold some water.
Russ Bellinis
I would agree with all of the above comments, but there is an even bigger problem with combining the dealerships. It would work to combine dealerships only in small towns. The plan expressed was to combine dealerships in big cities, the only way they could physically combine all of those dealerships and use less property would be to use prohibitively expensive, super high rise, parking garages. Most of the property used by auto dealers now is taken up with storage lots. You would also have difficulties with marketing used cars (I refuse to use the term "pre-owned"). If I'm in the market for a new car, I go to the new car dealer of choice. If I wanted a specific late model used car, I need to cruise the "boulevard" and check out what is on the various dealer's used car lots. Where would dealers display used cars?
jhinton
I think people are overblowing the snob effect of combining dealerships. First, not all high end brands use separate. The local M-B dealership also has Infinity and will have a Smart dealership sharing the same showroom.
I'm also been to the highest volume Lamborghini dealership in the US. They sell over 100 Lamborghinies per year and the Lamborghinies literally share the same floorspace with Dodge products. When I was there, they had 4 new Lamborghinies on the floor and a Dodge Neon right next to a $300,000 Murciélago!
Jesda
Cadillac Hummer and Saab need to be separate from the other GM brands, and more upscale. If they can keep that consistent, then combining the rest won't matter.
Russ Bellinis
Combining the dealerships still doesn't address the issue of inventory storage. Unless G.M. decided to reduce sales of each brand by 70% in order to combine them into one dealership for all 8 brands, they don't save any significant space by combining them. That also does not address the issue of 8 dealerships turning into one dealership would require GM to buy out all of the dealerships they were replacing. I think GM already learned the hard way about the cost of buying out dealerships when they had to compensate all of the Olds dealerships when they discontinued the Oldsmobile.
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