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Old 04-15-2009, 11:37 PM   #1
XDCX
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Default Is GM sending out Termination Letters?

A news report from Reuters indicates that GM has identified poor-performing dealerships and has started sending Termination Letters to the target dealers. GM has concluded that they cannot reduce their dealer count fast enough based on attrition alone.

Given the genuine fear dealers have about a GM bankruptcy filing, receiving a Termination Letter may not be such a bad thing.

Here's a link to the news report: http://uk.reuters.com/article/motori...nnel=0&sp=true
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Old 04-16-2009, 03:31 AM   #2
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It's going to get very interesting from here on in. According to another Reuters report GM is considering dropping Pontiac and GMC. http://www.reuters.com/article/GCA-a...53F0AD20090416. if this happens it would seem that Buick would fold into Cadillac,Buick can't certainly stand on its own. All I know and can surmize from this is that a lot of dealers are going to get screwed and be heading for the bankruptcy court. The question is whether a GMC customer will settle for a Chevy. I know in our area most won't and that is probably why we outsell the Chevy store. A lot of sleepless nights ahead for us GM dealers.

Last edited by dgale; 04-16-2009 at 04:20 AM.
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Old 04-16-2009, 07:27 AM   #3
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But the real difference between Chevy and GMC is just marketing? So isn't it a question of front loading the potential customers with reasons why GMC and Chevy are exactly the same?

I would think this would solve the issue.
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Old 04-16-2009, 07:35 AM   #4
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I think most GMC customers might say they'd never buy a Chevy, but given a choice of a Chevy or a Ford I think they'll soon be driving Chevys.

The differences in the two are purely marketing.
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Old 04-16-2009, 08:22 AM   #5
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The question is whether a GMC customer will settle for a Chevy. I know in our area most won't and that is probably why we outsell the Chevy store. A lot of sleepless nights ahead for us GM dealers.[/QUOTE]



If the consumers only choice is Chevrolet then that would be the route they would go. It gets back to Chevrolet vs Ford instead of building a product that competes with another product they already build..........
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Old 04-16-2009, 08:50 AM   #6
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Quote:
Originally Posted by dgale View Post
It's going to get very interesting from here on in. According to another Reuters report GM is considering dropping Pontiac and GMC. http://www.reuters.com/article/GCA-a...53F0AD20090416. if this happens it would seem that Buick would fold into Cadillac,Buick can't certainly stand on its own. All I know and can surmize from this is that a lot of dealers are going to get screwed and be heading for the bankruptcy court. The question is whether a GMC customer will settle for a Chevy. I know in our area most won't and that is probably why we outsell the Chevy store. A lot of sleepless nights ahead for us GM dealers.
That Reuters' article fits perfectly with the other news reports suggesting GM needs to make big cuts in their dealer network.

Concerning Buick, based on what I've read the only reason GM would keep that brand is because it's huge in China. For the U.S., I agree with your assessment that there's no way a Buick dealer could survive as a stand-alone and they would likely be added to the Cadillac dealer network.

Sadly, I think there are many sleepless nights for all GM and Chrysler dealers. Everyday it appears that bankruptcy is a more likely outcome.
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Old 04-16-2009, 08:59 AM   #7
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The worst part of all of this is that we dont really know what is going on. We hear it in the press just like everybody else, and are left to speculate on the future of GM as well. This could very well be true or complete speculation by the press in an attempt to keep bashing GM
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Old 04-16-2009, 09:41 AM   #8
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The worst part of all of this is that we dont really know what is going on. We hear it in the press just like everybody else, and are left to speculate on the future of GM as well. This could very well be true or complete speculation by the press in an attempt to keep bashing GM
Has GM done a better job communicating with their dealers than Chrysler?

We've all been critical of Chrysler's last two Conference Calls - has GM done anything different or better?
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Old 04-16-2009, 09:51 AM   #9
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No they both suck. I mentioned that meeting I was at with Kate Hardy from GM. Well it was just before the last deadline with the Gov. Her statement was that GM was confident that they were going to get the green light from GM and that all was rosy. Well she got that one wrong. GM has no clue just like Chrysler has no clue what is really going to happen. They are just living day by day and hoping for the best while trying to placate the entire dealer body.
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Old 04-16-2009, 10:00 AM   #10
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Not to be cynical,but perhaps these reports are deliberately being sent in order to encourage some dealers to terminate their franchise agreements. Who knows, look what other actions GM has done, curtailments,delays in rebates, all of which have certainly driven some dealers out of business. Makes you want to really examine and question everything.
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Old 04-16-2009, 10:38 AM   #11
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The sad thing is having to read everything in the news and not from GM. The communication so far has been less than stellar. Our field reps claim they know nothing and I tend to believe that they are telling the truth. Seems like everything coming out of Detroit is coming through news outlets instead of from the Manufacturer to the dealer. I actually have to feel sorry for the reps that go into the dealerships. My rep was in yesterday and I was asking him a few questions and he really quick replys. He told me it because he has almost 20 dealers that he calls on and has had to repeat the answers (non-answers) to each one of them as we are all asking the same questions. Now the media is reporting about closing stores as early as June 1st and nobody knows which ones so the default thinking will be that each employee (not dealer) will think it could be the store they are working at. I may be way off base but like the line from the movie Roadhouse: "Its going to get worse before it gets better"
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Old 04-16-2009, 02:31 PM   #12
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Well as I speculated GM has come out and said that this report is not true. I sure hope so.
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Old 04-16-2009, 03:53 PM   #13
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Well as I speculated GM has come out and said that this report is not true. I sure hope so.
Here's a news report where GM refutes the story about eliminating the Pontiac and GMC brands. They also refute that there's a plan in place to terminate target dealers on June 1st. Here's the link: http://www.autoweek.com/article/2009...NEWS/904169983

The report also indicates that GM will have a Conference Call with journalists tomorrow to provide an update on their restructuring plans.
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Old 04-16-2009, 04:08 PM   #14
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Originally Posted by dgale View Post
Makes you want to really examine and question everything.
I totally agree. It's reached the point where you have to examine everyone's motives and try to read between the lines.

The Chrysler dealers have learned this the hard way with Cerberus and Nardelli. A year ago at this time the Chrysler dealers were invited to a theater-event where they were told the future was bright and the product pipeline was full of exciting new vehicles. They were told that Chrysler was meeting all of their internal targets and if the dealers could survive for 18 months they would be well-rewarded. So much for that forecast.

It's just like Wall Street - look at how many CEOs were lying about their company's prospects right down to the final day.
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Old 04-24-2009, 09:26 AM   #15
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Around here they are calling for 1400-1600 GM stores to close nationwide. Some say it will happen fast, others like me, think it will take a few years and a whole lot of lawsuits. I don't buy the GMC thing, but I do believe that Pontiac is doomed. They need to split Pontiac up and spread the models around to Buick and Chevy. We have been trying to acquire Pontiac but lately are not so sure it would be a good move. Look at the line up and future plans and that's all you need to see. At least Buick has a plan and thank god for that Chinese market keeping it alive.
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