GM gears up to compete against fast-lube chains

General Motors intends to pit its dealers against fast-lube chains by promoting stand-alone quick lubes. The program is scheduled to begin Jan. 1.

Goodwrench Quick Lube Plus sites, which will be owned and operated by dealers as a separate business, will have two to four service bays and will be built on the dealership lot.

The business is designed to recover the money that dealers have lost to quick lubes.

"Fewer than two out of 10 customers go back to the dealer to have their oil changed, and convenience is an overriding factor in where they choose" to take their cars, said Rod Johnson, manager of new business initiatives for GM Service and Parts Operations.

"If dealers place lubes in a high-visibility area near the street and run them as a separate business, they can compete with the local Jiffy Lube."

Until now, GM's dealership fast lube program has been in the dealership service department with a guarantee to change the oil in 29 minutes.

Prefabricated buildings

Under the new stand-alone lube program - which will be available to the approximately 4,000 dealers participating in the existing GM fast lube program - dealers buy a prefabricated building through GM, hire personnel and buy equipment.

Oil changes must be performed in 12 minutes or less and often without customers leaving their cars.

The dealer fees and factory assistance have not been decided, though there likely is to be an enrollment fee and co-op advertising allowances.

Randy Romanoski, owner of Sheboygan Chevrolet Oldsmobile Cadillac Inc., in Sheboygan, Wis., who set up a Goodwrench Plus Lube on his lot Oct. 1, is one of the first dealers to adopt the program.

In the first month, his oil-change business jumped 50 percent to about 1,500 a month from 1,000 a month, and 30 percent of the new customers drove nonGM vehicles.

"I was really surprised to see a positive cash flow in the first month of operation," Romanoski said. "I didn't expect to see that that quick."

Opportunity to show off

Johnson said the on-site lubes will help dealers spot customers' other repair needs and show off the dealers' new-vehicle inventory to prospects who come in for an oil change.

GM already has helped set up two stand-alone fast lubes at dealerships in Pontiac, Ill., and Sheboygan, Wis.

Two others are being built in Louisiana, and two more are planned for Michigan and Georgia.

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