This from Automotive News
LAS VEGAS -- General Motors trimmed 87 stores from its U.S. dealership count last year, a reduction of 1.2 percent. But although it still has too many dealerships, the automaker doesn't plan buyouts to reduce those numbers at a faster pace. "We don't have a lot of cash to invest in that," GM North America President Troy Clarke said Friday at the J.D. Power and Associates Automotive Roundtable. He made reference to the closeout of the Oldsmobile dealer network, saying, "GM is a company who knows what that costs."GM's cash is better spent on new product investments, Clarke said. It will handle its reduction in part by encouraging dealers to work out consolidations among themselves. GM will try to help with agreements when possible but "won't take a real heavy hand with that."Clarke described the matter of reducing dealership numbers as one of "extreme problem-solving." GM won't lay out specific targets or mandates because there's no upside, he said. GM ended 2006 with 7,036 dealerships across its eight brands, a company spokeswoman said Friday. That compares with 7,123 at the end of 2005.Asked when GM would get more aggressive on dealership consolidation, Clarke replied: "I don't know. But it's not tomorrow."
This is painful to say the least, there was a time when all of these stores would have been quite profitable and the thought of closing even one would have seemed unbelievable,
But in this day and age it seems like the right thing to do, GM seems to shows signs of promise especially at this year’s Detroit Auto show the 2008 Cadillac CTS debuted.
But there still is lots of medicine to take before it can fully return to health.
LAS VEGAS -- General Motors trimmed 87 stores from its U.S. dealership count last year, a reduction of 1.2 percent. But although it still has too many dealerships, the automaker doesn't plan buyouts to reduce those numbers at a faster pace. "We don't have a lot of cash to invest in that," GM North America President Troy Clarke said Friday at the J.D. Power and Associates Automotive Roundtable. He made reference to the closeout of the Oldsmobile dealer network, saying, "GM is a company who knows what that costs."GM's cash is better spent on new product investments, Clarke said. It will handle its reduction in part by encouraging dealers to work out consolidations among themselves. GM will try to help with agreements when possible but "won't take a real heavy hand with that."Clarke described the matter of reducing dealership numbers as one of "extreme problem-solving." GM won't lay out specific targets or mandates because there's no upside, he said. GM ended 2006 with 7,036 dealerships across its eight brands, a company spokeswoman said Friday. That compares with 7,123 at the end of 2005.Asked when GM would get more aggressive on dealership consolidation, Clarke replied: "I don't know. But it's not tomorrow."
This is painful to say the least, there was a time when all of these stores would have been quite profitable and the thought of closing even one would have seemed unbelievable,
But in this day and age it seems like the right thing to do, GM seems to shows signs of promise especially at this year’s Detroit Auto show the 2008 Cadillac CTS debuted.
But there still is lots of medicine to take before it can fully return to health.
No comments:
Post a Comment