Today is officially Freak-Out Friday for GM car dealers. As we reported earlier, GMAC is pulling the rug from under/hoiking-up the cost of dealer floorplan finance, the arrangement that allows dealers to buy the damn cars. And now Automotive News [sub] alerts us to the fact that General Motors is pulling the plug early on a certified used-car financing program. “GM had announced a financing incentive program through GMAC Financial Services that would start Oct. 1 and run through Jan. 5. The program offered 3.9 percent consumer loans for 60 months on all used models of the Chevrolet Impala, Pontiac G6 sedans and Chevrolet Silverado and GMC Sierra trucks. But on Oct. 17, GM sent a notice that it would end the program Nov. 3, McDonald said. As a result, many GM dealers worry they won’t be able to move the inventory they built with the understanding that the program would run through Jan. 5.” This is a swimming pool of not good for GM’s dealer relations, should such a thing exist anymore. “Obviously, the dealers are our customers,” GM spinmeister John McDonald dervished. “We want them to be successful, but you can’t get to the point where you’re putting yourself in financial difficulty.” Can someone please shoot John an email on that financial difficulty thing?
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Wow, not only is Chrysler self-destructing before our eyes, but GM is too…
I knew it was coming and have known for probably a decade.
But it’s disturbing to sit and watch it happen.
don’t be too harsh on McDonald, he’s just a kid following orders. he’s not able to express his own opinions, much like most of the folks surrounding Red Ink Rick. with my criticism of Wagoner, I’ve lost some as customers. words have been said like “Jim, what do you expect me to do? it’s bad enough you called for my boss’s resignation, but then you called for his indictment. I might not disagree, but can’t take delivery from you while I’m still here. As soon as I retire though, I’ll be back since you do such a great job.”
Call me heartless, but I don’t feel particularly sorry for dealers. Screw them!
With GM’s now-acute cashburn conflagration problem, they might have realize they’re not going to last until January 5th.
GM’s dealers should get out now, before it’s too late and they become the next Bill Heard.
“GM’s dealers should get out now …. ”
The only way out is to shut the doors. GM’s franchises have zero market value.
I wonder since GM and Chrysler are teetering on the verge of bankruptcy, if it would be a good time to buy Ford stock. Surely the diehard American-only buyers would have to turn to Ford then. Just talking outloud.
Not until Kerkorian finishes unloading the REMAINING 5% of F he owns at fire sale prices.
And after the October new cars sales figures.
And the post-Christmas consumer gloom reports.
And the post credit-card meltdown (aka the othe shoe dropping).
And the crippling supplier liquidiation once Government Motors goes out of business.
So if F survives until the magic year 2010, load on up (I’ve been buying natural gas providers, utilities, anything related to gaming).
It looks like whoever will stay alive until January 21st may make it. With new ever democratic congress and Obama in the White house, new money coins will be minted to save whatever should pass by natural death.
How is GM in Canada offering 0% financing as part of the Canada-wide Clearance?
All 3 of the “Domestics” in Canada don’t have nearly the amount of troubles that their US counterparts do. Add to that our banking system is very strong, and the money is there.
It’s unfortunate that the US is dragging us down.
To all you HATERS of new car dealerships. Be thankful for your careers. Sleep well at night. The family owned dealership group walked about 6 people out the door last week. People that needed their jobs.I am afraid more jobs will be lost very soon. They are gone due to lack of margins on new cars and compounded with slow used car sales. Maybe we can survive? Maybe we will not survive? This from a dealership that has been in the same family since 1966.What a shame. I’ve seen this industry go from being a polite,money making, nice place to work. Now it’s crass customers,who demand little margins, so now we are laying people off.In my 24 years, this should be gravy time,but who knows if we will make it a few more months. Watching the comments from arm chair ttac quarterbacks w/no money or personal investment make me physically ill.I say this… Back it up with your own money…back it up with your own skill. Walk people out the door and say…”sorry”. Next, to Top it off we have to listen(from our buyers) to all of your person agenda…political, religious, relationships, etc…and we really could care less. Pay us a fair profit on the new car, allow us to sell your trade for profit, service your vehicle at a fair margin. Then let’s call it a day.Maybe that’s the way it should be done.
One final note, BILL HEARD CHEVROLET DEALERSHIP GROUP… please please, don’t…RIP. Rot in HELL. Shame on GM AND GMAC for supporting these unethical people for too long. Wild rumor is that it’s costing GMAC alone 30 million low end and up to 40 million dollars to clean up Heard’s operations. I have no fact..only speculation from a GMAC source who remains off the record. Once again..if you lay down with a dog..you’re gonna get fleas. No wonder the public lacks trust in most franchise dealers.
Deepsouth, that sounds like Royal Automotive GMC/Saturn/VW/Volvo/etc. in Hoover/Vestavia, Alabama. Am I right? They did the same thing (family owned, let around 6 go) last week. Yes it is sad on a personal level, but a dealer isn’t going to get much sympathy because of dealers like Bill Heard. From what I know Royal is a fairly good dealership, but unfortunately most are more like Bill Heard than not, and with sales down across the board even the good dealers have to cut back. At least Royal is still open, for now.
Final rant…..Rodster205, Thank you for reading my post. Royal group is a clean, safe, wise, above board dealer group that runs parallel to our group. But alas, it’s not Royal. The sad part, the tragic part, that hurts me most is so simple. It’s product not price. Example, go to any Mini Cooper dealership site and try to purchase a car. Most are sold out at list or either reserved, at list price or more mind you. Meanwhile, we have product on the ground, trucks w/$7500.00 on the hood w/little interest. Even if it sells, the salesman makes ….$100.00…maybe 200.00 from the dealer. Here’s the problem….in a 40-k plus all day truck sale transaction…the salesman(and dealership) deserves much more. MANUFACTOR’Sneed to STOP THROWING MONEY ON THE HOOD IN REBATES. Pay a salesman a solid strong fee at all dealerships 2 sell your inventory. Pay your DEALERS 2 stock and sell your product. I am screaming at world.. and at Detroit manufactor’s that don’t visit the dealership. They use words like..customer thru put. None of which keep a dealership alive. TTAC often takes a large broad approach to the auto industry. They often forget the independant dealer. We are on the FRONT LINES are people too. Buyers don’t understand the seperation. They don’t care if the dealer makes profits. If they don’t the manufactor should. A healthy dealer makes for a good buying and follow up service experience. Are you listening in your glass towers? HELP US! If we don’t make it…you don’t make it! We are the face of your company to the public.