Quality Magazine

GM Confirms New Dealer Network

August 5, 2010

DETROIT-General Motors announced that it has concluded the dealer arbitration process and that effective Nov. 1, it will have a network of about 4,500 U.S. dealerships to sell and service customers for Chevrolet, Buick, GMC and Cadillac vehicles.

The company also reported that many of these dealerships are participating in a major facilities upgrade program, with more than 300 updates already completed and about 1,000 projects scheduled through the end of 2010.

"Our dealers are the face of GM to our customers and valued members of the communities where they do business across America," said Mark Reuss, president, GM North America. "We're confident our dealer network will be the best in the business. It will be the right size with the right dealers to give our customers great service during and after the purchase.

"A strong, profitable dealer network selling and servicing the world's best cars and trucks is a genuine market advantage," Reuss said.

Although GM's new dealer network is about 25% smaller than in early 2009, it remains the nation's largest. This gives existing and potential GM customers more choice and convenience when it comes to where to buy a car and have it serviced.

"We spent a considerable amount of time and effort to work toward a mutually agreeable resolution with our dealers," Reuss said. "We're pleased that we could complete this process in what we believe is an effective and efficient manner."

During its restructuring last year, GM offered wind-down agreements to 2,064 Chevrolet, Buick, GMC and Cadillac dealers that the company determined needed to transition one or more of those brands from the dealer network by Oct. 31, 2010, when the dealer agreement expires.

Under the provisions of a federal law passed in December, 2009, GM dealers filed 1,176 arbitration cases with the American Arbitration Association to have their dealer agreements reinstated. Only 62 arbitration cases were completed with decisions rendered. GM offered 702 Letters of Intent to involved dealers, allowing them to conduct normal dealer operations as soon as they comply with the terms of the Letter of Intent. GM has reached 408 individual resolutions with other dealers, most of which call for the dealer to continue the wind-down process. Four cases were dismissed.

In June, 2009, GM had 6,049 dealerships selling eight brands, with 87 brand combinations. The new dealer body will be much simpler, with about 4,500 dealerships, with just 15 brand combinations and four brands. This provides greater operating efficiencies and increased dealer throughput and profitability, enabling dealers to reinvest in their businesses to better satisfy customers.

Reuss noted that while GM dealers traditionally rank near the top or above the industry average for customer service and sales satisfaction by third-party sources, the new network GM is putting in place would be even more focused on being an industry leader in customer care.

Dealership upgrades

GM dealerships across the country are updating their Chevrolet, Buick-GMC and Cadillac facilities to align with new branding guidelines. This initiative, which began in October, 2009, is accelerating; dealerships are now upgrading their stores at the rate of about 100 per month. Major elements of the image upgrades include customer-friendly features such as work areas with phone and lap top computer power outlets, Wi-Fi and a cafe area with refreshments.

To support this effort, GM is updating or installing new signs at Chevrolet, Buick, GMC and Cadillac dealerships across the U.S. The signs feature a more contemporary design and reflect the current image guidelines for each brand.

"Customers throughout the country will be seeing a new look at the Chevrolet, Buick, GMC and Cadillac dealerships in their communities," Reuss said. "Putting our new dealer network in place is one of the most important elements in the rebirth of GM."