Dealer Dathan Wilson has kept a secret from his customers for nearly a year. His Cadillac franchise in Stillwater, Okla., was one of General Motors Co.'s wind downs.
But this month, the automaker offered to reinstate Wilson's Cadillac franchise. Now, he can tell customers asking about new Cadillacs, "Stick around, and I'll probably be getting them shortly."
GM had envisioned a future of big, glamorous Cadillac stores to compete with global luxury brands. By reinstating small Cadillac dealers across the nation, GM is reversing course, letting stores like Wilson's Chevrolet-Cadillac outlet -- aimed mainly at mass-market customers -- take care of a few Cadillac owners, too.
Wilson was selling five or six Cadillacs a month and had stocked only 20 Cadillacs at his peak.
In Oklahoma, Wilson is one of more than a dozen Cadillac dealers that GM decided to cut, leaving the state with seven, dealers say, all in major cities or along U.S. highways. GM's reversal puts small Cadillac dealerships back in business, but it also irks some continuing dealers who were counting on less competition.
For instance, Bob Moore Cadillac in Norman, Okla., agreed to build a $4 million-plus store in exchange for escaping a GM wind down, General Manager Mike Denney says. Now, GM will reinstate many of Denney's competitors.
"There has to be some resentment toward those small, dilapidated Cadillac stores who are getting to sell a high-end luxury brand like Cadillac," Denney says. He called the GM reversal "spineless."
But Wilson, a 23-year Chevrolet dealer, says his Chevrolet-Cadillac building has had the preferred GM image since he built it 10 years ago, and GM has told him he won't have to update it during the current round of dealership remodeling.
Wilson says his Cadillac franchise could produce more sales with more time and a better economy. He had been selling new Cadillacs for only one year -- all during the U.S. recession -- when, in the spring of 2009, GM said it would pull his Cadillac franchise before November 2010.
"I never had it up and running for a good run in a good economy," Wilson says.
He says Stillwater is the second fastest-growing town in Oklahoma, home to 50,000 people and Oklahoma State University. It's about an hour from both Oklahoma City and Tulsa. The median household income is at least $70,000.
Wilson, 51, was fighting his wind down through arbitration. But since wind-down dealers weren't allowed to order new vehicles from factories, he sold out of new Cadillacs last summer.
"It was kind of embarrassing to have a customer come in and ask, 'Where are your new Cadillacs?' " he says. "I'd pretty well dance around the situation, tell them we were out and then try to get one from another dealer."
But he had a hard time getting customers the vehicles they wanted, and none of those potential Cadillac customers bought a Chevrolet from him. One bought a Lexus, he says.
John Holt, a Cadillac-Chevrolet dealer about 45 minutes outside Oklahoma City in Chickasha, had a similar experience. One of his customers bought a Jaguar three weeks before GM said it would offer him reinstatement for his wind-down Cadillac franchise.
"He said, 'If I'm going to go to Oklahoma City, I might as well buy something like that,' " Holt says. "He didn't want to buy a Cadillac if there wasn't a Cadillac dealer in town."
Letting small dealerships like Holt's and Wilson's back in likely will add more sales to Cadillac's total. Through February, Cadillac's 14 percent increase in 2010 sales lags the gains of Buick, GMC and Chevrolet.
As part of its plan to cut 1,350 dealerships and another 650 franchises at dualed stores, GM had planned to slash its Cadillac franchises by two-thirds from January 2009, leaving it with about 500 by the end of this year.
Despite losing new-vehicle customers, Wilson has continued to see five to eight Cadillacs a day in his 25-bay service area.
If he agrees to the conditions GM outlines in his "letter of intent," he says he'll be ready to mend his relationship with GM and get back to turning those owners into repeat Cadillac buyers.
"Go from zero to hero," he says. "That's the car business."