Sammy Reagan is the kind of Oldsmobile dealer General Motors has been wanting for the past decade. Young, energetic, dedicated and optimistic, Reagan got the shock of his career Tuesday, Dec. 12, when he heard GM brass say Oldsmobile would cease to exist.
Reagan, 41, operates Reagan Oldsmobile in Omaha, Neb., one of just 63 stand-alone Oldsmobile dealerships in America. While most Olds dealers face a future of falling back on their other franchises, Reagan faces a worst-case scenario of an empty store. But that's something Reagan vows won't happen.
'I've got one egg in my basket, and now it's cracked,' Reagan says. 'My goal is stay upbeat and make sure we put another franchise into this store.'
The Nebraska dealership is only 10 years old. Reagan and his father, a Buick and Infiniti dealer with separate dealerships across town, launched the business as a new point in 1990, when Oldsmobile appeared headed for the graveyard the first time.
GM has been trying to turn the brand around since the late 1980s, reaching out to younger buyers with new import-influenced designs, such as the Aurora. Reagan's new store was a statement - a $4 million building dedicated to a declining brand he believed in.
Inspired by Rock
Reagan was inspired by John Rock, the tough-talking former Oldsmobile general manager who rallied dealers in 1992. Reagan volunteered with a group of other Olds dealers in the early '90s for Rock's program to attend a team-building exercise at GM's Saturn Corp. subsidiary in Tennessee.
Reagan's spirit grew. So did his sales. In 1993, the store was selling just one new Olds for every two used vehicles. Now new vehicles have pulled even with used ones. Three years ago, as part of GM's Project 2000 campaign to update and consolidate its national dealer body, Reagan took over the territory of his nearest competing Omaha Olds dealership.
As far as Reagan was concerned, the franchise was clicking. He sold 601 new vehicles last year, more than four times the national sales-per-store average of 127 vehicles.
He has made a profit every year since he opened and figures he has been more profitable than the average Oldsmobile dealer. He won't be specific.
He has been eagerly awaiting the redesigned Bravada next year to make Oldsmobile a serious player in the sport-utility market.
As he walked into his store last Tuesday morning to watch the GM corporate announcement by satellite feed, he was certain GM was about to reveal that it had just bought a big Internet company.
'I was horribly disheartened,' Reagan says. 'It was a real bad day for us.'
Thirty minutes after the bombshell, Reagan picked up the phone to participate in a painful irony. Reagan, who began working at an Olds dealership in Wichita, Kan., pushing a broom after high school, was just named to Oldsmobile's national dealer council. His first dealer council phone conference on Tuesday was to discuss the franchise's demise.
'I blew up,' Reagan says of his part of the teleconference. He declines to repeat what he said. 'I got it out of my system.'
A more senior dealer council member, Wally McCarthy, a Minneapolis Olds dealer since 1960, heard Reagan's angry comments in the conference call and wondered who was speaking. McCarthy offered consoling words.
'Look,' the 77-year-old McCarthy told the faceless group. 'Let's face reality. If GM makes the decision that Oldsmobile is done, then it's done. We're about to get beat in this ballgame. Instead of crying about it, let's run with the plans that Oldsmobile is offering and make the most of it. Even though we're going to get beat, let's make this a little victory and go down gracefully.'
Reagan took McCarthy's words to heart. After the phone call, he pulled together Reagan Oldsmobile's 56 employees to break the news. Some already were swapping rumors about the demise. The mood was dreary, but Reagan exhorted the group to stay positive.
'That's how we're going to win,' he told employees. 'Keep it upbeat. In a worst-case scenario, we're not closing for two or three years. And by then, we will have another franchise in here.'
Seeking another franchise
Later, Reagan considered his options. His exclusive Oldsmobile store is equipped with GM tooling and parts, and its technical staff trained on GM products. It wouldn't be a seamless transition to a Toyota or a Hyundai franchise, he thought. And then there was the used-car business. He had survived selling used cars and he could do it again.
'Everybody can kick GM, but I'm not going there,' Reagan says. 'I'd be thrilled to get another GM franchise. I'm going to get another franchise and keep going. Otherwise, I've got to sell the building.'
Meanwhile, up in Minnesota, McCarthy is thinking of his own brave face. He holds Cadillac, GMC, Chevrolet and Hummer franchises, in addition to two Oldsmobile stores. But it is the Oldsmobile lapel pin he wears on his jacket to work, and the Oldsmobile Elite ring he wears every day on his finger.
Sitting in his Minneapolis Cadillac store the day after GM's announcement, McCarthy is looking at his Elite ring that he earned from the factory for his performance in the Oldsmobile franchise.
'I'm kind of thinking about taking the ring and the pin off today,' he said. 'I don't feel like wearing them right now.'