Sporty store is a no-go at GM
Bonuses end; chagrined Chevy dealer faces big hit, won't back down
Just as the U.S. auto industry was heading into a deep recession in 2008, Chevrolet dealer Marc Heitz opened a $20 million dealership in Norman, Okla., modeled after outfitter Bass Pro Shops.
The log building features a vehicle showroom with a 45-foot waterfall, a huge aquarium with big bass and local fish species and, to entertain kids, an arcade and imprints of animal tracks on the concrete floor.
Outside, bear and elk statues guard a giant picnic area, two dog runs, a cistern for collecting rainwater and a 110-foot wind generator that supplies 3 percent of the store's electricity.
Only one problem: General Motors says the store fails to comply with Chevrolet's new facilities standards.
To keep getting about $250,000 per quarter from GM in dealer-excellence incentives, Heitz said he would have to install that familiar blue cladding and gold bowtie on the facade of his building to make his store look like thousands of Chevrolet stores across the country. He would need to cover the animal tracks on the showroom floor with gray tile.
That's the word he received from Chevrolet sales chief Don Johnson after Heitz appealed for a compromise during Johnson's Sept. 28 visit to the store.
"It would be like putting socks on a rooster," said Heitz, 47, who grew up on a dairy farm in Norman.
In a prepared statement, Chevrolet spokesman Tom Henderson said the company tried to reach an accord with Heitz but the dealer chose not to comply with its facilities standards.
Heitz said he is more befuddled than angry. Customers love the store the way it is and use it for birthday parties, charity events, barbecues, running their dogs or just relaxing.
"We were looking to create a wow experience," he said, adding that he has sold more new vehicles than any other Oklahoma Chevrolet dealership in four of the past five years. The store sold 1,900 new vehicles in 2011.
It isn't unusual, he said, for fishermen passing on the busy Interstate 35 freeway nearby to exit briefly to donate an especially large, live striped bass for the aquarium.
"Then they'll call their buddies on the phone and tell them to come down and see it," Heitz said.
He said he trusts that people who experience the store are more likely to want to buy vehicles there and then return to have them serviced.
For instance, Leroy McGuire, an oil business owner in Odessa, Texas, drives 500 miles to buy Corvettes at Marc Heitz Chevrolet. Since his wrecked Corvette was serviced at the store years ago, he has bought 12 Corvettes there.
GM and other automakers renewed a push for facilities improvements more than a year ago. The efforts have caused friction, prompting a study released by the National Automobile Dealers Association in February that concluded that manufacturer facility renovation programs cost too much and produce uncertain results.
Heitz said he appreciates that Chevrolet's facilities program promotes brand awareness and modern dealerships. But he said he does not understand why Chevrolet wants to mess with the good thing he has going in Norman, the home of the University of Oklahoma.
GM continued to pay Marc Heitz Chevrolet, a perennial Mark of Excellence winner for achieving high standards, its Essential Brand Elements payments through the first half of this year.
The incentives, which are pegged to vehicle sales and meeting quality benchmarks, were $750,000 for the store last year.
This year the store was collecting about $250,000 a quarter until right after the Johnson visit. That's when Heitz was informed that Chevrolet would not be paying him the $253,000 he said he had earned in the third quarter of this year.
Chevrolet has made it clear to all its dealers that facilities compliance was required for dealer excellence payments, the Chevrolet statement said.
"We cannot make EBE payments, which are intended to defray the costs of image compliance, to a dealership that has chosen not to complete an image compliant facility," the statement said.
Heitz said he offered several compromises to Chevrolet to prevent covering his unique facade. He said he pledged to build an outdoor display using all the required cladding and materials and to install the specified gray tile in the store outside of the showroom, such as the service area. He said GM insisted on its current standards.
So, facing the loss of $1 million a year in bonus money, what is Heitz going to do? He'll keep his store the way it is and forgo the payments, even though he knows that will mean his in-compliance competitors will have more leeway to sweeten their new-car deals. The eye-catching architecture of his store is worth it, he says.
"If I did what they asked it would be less for my customers, less for GM and less for my employees," Heitz said. "I couldn't do it."
Heitz said he overcame many hurdles originally to get the store the way he wanted it. When he bought the 16 acres for the store, he had to buy out 13 homeowners to accumulate the land.
When real-estate agents failed, Heitz banged on doors to make offers and see what it would take to get the homeowners to move. In one case, he said, he bought out a $46,000 mortgage on a property worth at most $10,000 and purchased the family a $130,000 home outright.
He's pleased with the result of his efforts, and thinks the unique atmosphere he has created is good for business.
Heitz, an avid duck hunter, said car shoppers and ducks are more alike than they know. He said both are more likely to land somewhere when they see others already there.
He said: "When people see other people on our lot, they're comfortable stopping."
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