GM bulks up for growing fleet battle
Hopes hinge on mid-sized pickups, 4G service
DETROIT -- Dealers know General Motors fleet chief Ed Peper as a guy who loves the combat of automotive sales.
He's about to get some fresh ammunition for his arsenal.
This fall, GM will roll out the Chevrolet City Express small cargo van, a rebadged Nissan NV200 that will fill a key hole in GM's fleet lineup to match the Ford Transit Express and Ram ProMaster.
GM also plans launches during the second half of the year of entries that could do brisk fleet business, and in segments in which its two main fleet rivals, Ford and Chrysler, don't compete: the Chevrolet Colorado and GMC Canyon mid-sized pickups, and the Chevy Trax small crossover.
Peper: Touts mobile hot spot
But Peper, 52, says his biggest weapon might not be a vehicle at all but a technical innovation: the introduction of 4G LTE broadband connection across most GM vehicles for the 2015 model year.
The service will provide a mobile hot spot to as many as seven wireless devices through the OnStar system at speeds about 10 times faster than the 3G service that is widely used today. Peper believes the technology provides an especially strong selling proposition for fleet customers, such as construction and pharmaceutical companies, whose employees often use their vehicles as their offices.
"Imagine the benefit for somebody at a construction work site who has to run seven different laptops all at once," Peper said in a recent interview.
GM is combining the 4G service with a new telematics system that will give fleet operators real-time tracking of fuel consumption, route optimization, maintenance, unsafe-driving alerts and other information from across their vehicles on the road.
GM contracted in March with the Telogis Inc. system, which also is offered by Ford.
Peper says the built-in OnStar connection gives GM an advantage that should allow it to offer fleet customers more management solutions down the road.
"We have told our customers that we think it's one of the biggest differentiators in the entire fleet and commercial industry, this ability to extract this data," he says.
Peper, who became vice president of GM's fleet and commercial sales in January 2012, hopes the tracking service and fresh lineup entries will help GM continue to wrest back fleet market share that eroded over the past two years. GM's fleet business comprises sales to rental agencies, commercial customers and government buyers.
GM's share of the U.S. fleet market slipped in 2013 to 27.8 percent from 29.2 percent a year earlier, according to the Automotive News Data Center. Through the first half of the year, GM's fleet sales rose 2 percent vs. flat sales for the seven largest U.S. fleet sellers and slight declines for leader Ford (down 4 percent) and third-place Chrysler (down 2 percent).
Peper is popular among dealers, who know him best from the four years he spent as head of Chevrolet from 2005 to 2009.
As brand chief, Peper was known for rallying the troops, sometimes through monthly video sales reports to dealers in which he often would remind them of the importance of beating Ford.
He says he has applied that same gusto to fleet sales. "This part of the business is all about customer relationships."
Brad Sigmon, fleet coordinator for Randy Marion Automotive, which sells Chevrolet, Buick-GMC, Cadillac, Ford, Subaru and Isuzu trucks across six stores in the Charlotte, N.C., area, says the Colorado and Canyon pickups could be a hit among fleet buyers who want good fuel economy. He said the last-generation pickups, which were phased out two years ago, were popular with a wide range of customers from chicken farmers to auto-parts retailers.
"If they get the price point right," Sigmon says, the Colorado and Canyon are going to be "great-selling" vehicles.
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