Taft Chevrolet/Buick plans to drop their New Car Franchises

[XDCX]

Originally Posted by jbellx02

It's still possible to make it in a small rural market. Population of my small city is 1320 (25000 APR) which supports two New Car Dealerships, Ford and Chevrolet. These dealerships are 40 miles from stores that have New or Remodeled facilities.

My Chevrolet dealership has been in the family for 43 years, previous family had the dealership for 54 years.

Our business model can operate with 3 to 12 employees (depending on the economy) and return 2% on sales. The facility was constructed in 1928 and consistently scores 4.0 CSI for attractiveness, cleanliness. I have the newest store in town considering the Ford Store was built in 1920.

It would be most difficult to make it without the Chevrolet Bowtie. All GM programs are voluntary (EBE, SFE, Mark of Excellence). Personally I try to buy into all that I can afford and borrow ideas from the rest. Love to have a new facility, but the numbers just don't add up.

Thanks for the post - it's great to hear from a rural dealer who has a positive outlook.

While I've heard that GM is not pressuring small dealers to drop their franchises I'm also under the impression that it's almost impossible for a smaller dealer to compete given the existence of two tier pricing.

Can a GM dealer survive in today's competitive environment if they're not receiving EBE payments? In your case the answer appears to be "yes" and I think that's great but I wonder if the majority of GM's rural dealers feel the same way?

[jbellx02]

Originally Posted by XDCX

Thanks for the post - it's great to hear from a rural dealer who has a positive outlook.

While I've heard that GM is not pressuring small dealers to drop their franchises I'm also under the impression that it's almost impossible for a smaller dealer to compete given the existence of two tier pricing.

Can a GM dealer survive in today's competitive environment if they're not receiving EBE payments? In your case the answer appears to be "yes" and I think that's great but I wonder if the majority of GM's rural dealers feel the same way?

Not sure how all rural dealers feel, but these are my thoughts.

What I would gain in Two Tier pricing would be lost in Two Tier EBE expense. My small number of new car sales would not off set multiple costs of the program. Dealers that are involved in the program have more knowledge than myself, but expenses go well beyond remodel or new structure.

As far as competitive environment, it's always been that way and will continue. Good employees will overcome any slight advantage your competition may seem to have.

[XDCX]

Originally Posted by jbellx02

Not sure how all rural dealers feel, but these are my thoughts.

What I would gain in Two Tier pricing would be lost in Two Tier EBE expense. My small number of new car sales would not off set multiple costs of the program. Dealers that are involved in the program have more knowledge than myself, but expenses go well beyond remodel or new structure.

As far as competitive environment, it's always been that way and will continue. Good employees will overcome any slight advantage your competition may seem to have.

Thanks for the reply - I think you've got a great attitude/outlook and I wish you much continued success.