GM Invests $200 Million to Help Dealers in the US image

GM will invest more than $200 million to aid dealers in the New York, California and New Jersey metropolitan areas update showrooms, move or even close them.

According to GM’s facility improvement plan, 92% of the automaker’s dealers will renovate their stores by 2016. The program is aimed at increasing sales and also gain market share in the import-heavy and high-volume California and the East Coast. GM’s first efforts are focused on California, which has 1.6 million vehicles sold annually. The US automaker also has what it calls a ‘war room’ in its Renaissance Center headquarters, which features information regarding California such as photos, operator and owner information, ideal dealership locations and sales performance.

The investments will help some dealers relocate, buy and resell dealerships and/or change underperforming operators, according to GM North America President Mark Reuss. The automaker plans to make its dealerships more inviting to customers and also be positioned in the right places.

“It changed radically from where our footprint used to be, because we’re the oldest ones out there … and we let it go,” he said. “But then, there’s a budget around that to change it.”

In 2012 GM’s market share in California was 9.8%, a decrease from 11.8% in 2011 and from 10.6% in 2010. GM’s share in the Golden State was surpassed by Ford and Chrysler. But GM says that its implemented changes over the past years have helped the company increase retail share by 7.2% in Los Angeles in 2012 and 5.9% in San Francisco.

“It’s not a one-year or two-year project,” Reuss said. “There’s no lever you can pull that will automatically double your share. It’s going to take some time.”

Source: The Detroit News