General Motors dealers are not the only ones chagrined about company plans to take control away from local dealer marketing groups.
The local media in each market, particularly TV stations and newspapers, are scared to death.
Advertising dollars from local car dealerships can represent up to 60 percent of a newspaper's budget.
Local TV stations make from 25 percent to 40 percent of their money from local dealers. In rural markets, some stations depend on the dealers for up to 70 percent of their ad dollars.
But with GM - not dealers - in control of the money, local media see their budgets falling faster than a man on a bungee.
GM will not negotiate, media salespeople say. The rate is what GM says the rate will be - no ifs, ands or buts about it.
So upset are the executives at the Television Bureau of Advertising, the New York City association that represents local stations across the country, that they have asked members to join with dealers to try to stop GM's plan.
'Local stations will lose if GM takes control of advertising,' says Ave Butensky, the feisty president of the bureau. 'For local stations to win on a long-term basis, the dealers must win. GM is quick to pull the plug.'
The stakes are high for the media. But GM is not their only worry.
Dealers spent about $5.1 billion on advertising last year,
up from about $3.8 billion in 1987. Escalating advertising budgets contribute to distribution costs, which all manufacturers frantically want to decrease.
Dealer consolidations at Ford and big dealer conglomerates, such as Auto-Nation USA run by billionaire H. Wayne Huizenga, also are threats to the media.
'Consolidations of dealers are not good for the media,' says Kevin Berry, vice president of local sales and marketing at the Cabletelevision Advertising Bureau in New York. 'We'll be hit, but newspapers probably will get smacked the hardest.'
Kathy Jackson is editor of Automotive Marketer, a new member of the Automotive News Group that will cover automotive marketing, advertising and media. The first issue is Feb. 8. She can be reached at (313) 446-0371, or e-mail [email protected]