This is an open letter to Rick Wagoner, CEO of General Motors.
COMMENT: A few words of advice for GM's Wagoner
An open letter
Mike Grimes, a dealer principal since 1981, is semi-retired. He is part owner of Grimes Motors (Buick-GMC-Cadillac-Honda-Jeep) in Helena, Mont.
I have been a Buick dealer for 25 years, as my father was for the 25 years before that. I have served on many dealer councils, including Buick's national dealer council. It is with that perspective that I write to you. I have no idea whether you are one to accept advice; but, as my career as a Buick dealer nears its end, I thought now might be a good time to offer some. So here goes:
The other day, my wife's good friend was admiring a new Subaru Forester, so she asked the owner how she liked it. Her response: "Well, it's nice, but our Buick Park Avenue gets five miles to the gallon better gas mileage!"
My point is that you have no reason to make any apologies for your products. GM is producing some of the best products it has ever built. We are just having a problem getting that message across.
n Be proud of your dealers and their employees because they will stick with you.
General Motors has one of the strongest dealer organizations in the world. Many of your dealers can remember times much tougher than these. They had no alternative; they had to struggle through - and they always have.
Remember, it is your dealers who move your vehicles the last five feet, and I have a feeling you understand just how important those last five feet are.
Hard times sometimes create good decisions, the ones you think about but hate to make. They also produce knee-jerk reactions that are poorly thought out - like General Motors Acceptance Corp. a few years ago pulling the floorplanning from all non-GM products, then coming back a year later, hat in hand, asking for the business back.
I am concerned about the current incentive program that gives all consumers the GM employee price. It will most certainly move a lot of product, and I realize that is your objective. As a dealer, however, I see a lag following all aggressive factory programs. More important, how do you top a program like that?
I remember when the first rebates were announced, a competitor ran ads with a big green frog shouting, "Rebate, rebate." I hated that frog. I have always believed public rebates reduce the perception of product value.
Dealing with labor unions can be a daunting task. My father and I had to do it for 50 years - although on a much smaller and more personal scale. Strikes are not good for anyone, nor are lockouts.
I know your next round of negotiations will be extremely difficult but also one of the most important in decades. As difficult as it will be, it is time that the domestic automakers stand up for what is right.
My final piece of advice will be the most difficult for you to accept. The enormous amount of time and the financial and engineering resources poured into the Saturn franchise have come at a tremendous cost to your other franchises, particularly Chevrolet. (I will not even try to talk about Oldsmobile.) The concept of a single division being GM's import fighter was flawed from the beginning.
Twenty years ago, the imports were primarily targeting the entry-level segment. Now, it is obvious they are going into every segment of the domestic market. (Trust me - I have also been a Honda dealer for 25 years.)
GM ignored the warning signs before and paid dearly. The cost of oil will not come down in the long term. Alternative-fuel, hybrids and electric vehicles will dictate the future of our industry.
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