Other Editorials

Root Cause

Jim Dollinger
Thursday, May 22, 2008

Our problems have nothing to do with the number of brands in the portfolio or the number of franchised dealers. It's not the economy, fuel prices or legacy costs. It's not raw material expense or exchange rates, It's really not even the competition. The trouble is, and has been, with the marketing. The current Memorial Day Sale is a perfect example, the rebates/ incentives are mind blowing in complexity. Private mail offerings where no one knows who is on the list for $2-3,000 cash offers, or how the list was generated...(can you say collusion Mr Gerosa, now of the Al Serra Auto Plaza). There are special finance rates and "alternative" rates with varying attachments, old invoice credits which penalize dealers who properly managed inventories, differing lease factors and residuals depending on ie. reg cab, ex or crew, engine size, etc..., and even more/worse.

Figuring a car deal is much like a New York Times crossword puzzle, no exaggeration. The distress pricing ads are just now hitting, so much for "Value Pricing". GM talks from both sides of the mouth, has no credibility, alienates dealers and confuses the hell out of customers. And of course here come the pins, signs, posters, etc...who has the brother owning a print shop (can you say corruption Mr LaNeve?)????

Until the marketing changes dramatically, we will never experience a "turnaround". Walk into any GM dealership and see if the salesperson can explain stabilitrack. Who's got time for product knowledge when it takes three hours to decipher the daily dilemma of "the deal"?