Although a deadly ignition switch scandal, followed by a hurricane of recalls that led to 29 million cars in need of servicing, should have spelled trouble for dealerships, the situation is actually reversed.
According to many dealership owners, what looked like “great adversity” – with nightmarish visions of angry owners – has actually become a great sales opportunity. Customers that bring for repairs their old cars many times actually drive away with a brand new purchase.
“In many cases these are customers we haven’t seen in a long time or have never met before,” said Robbie Long, service director for the Raymond Chevrolet dealer, outside of Chicago. “People just don’t want to see us that often.”
“Aside from the bad publicity, which is never fun, we welcome recalls,” adds Don Lee, president of Lee Auto Malls in Maine.
Taking the GM recall for example – although the situation also applies to all other brands – the action gives way for many dealership opportunities: fix the recalled part ( paid by the automaker, so also brings a small profit), make more service and repairs, sell a new car and in the case of a loaner car, again profit from GM when a customer gets an exchange car.