There have been several stories recently about General Motors' plan to use the Internet to sell cars with the help of franchised dealers.
GM's online car-shopping program, Shop-Click-Drive, which it has been piloting and plans to roll out nationally by year end, allows shoppers to buy vehicles from start to delivery from participating dealership Web sites.
This could be the beginning of a slippery slope for GM.
In 1999 GM, following a Ford initiative, decided it could circumvent the franchised dealer and own dealerships so it could control the transaction. It was a complete disaster for Ford and was just as bad for GM.
GM discovered quickly that although it was good at manufacturing cars, it didn't know much about retailing. It was an expensive lesson in what not to do.
It made a lot of sense then and still does today for franchised dealers to stay out of designing, engineering and building cars and trucks. And it makes an equal amount of good sense for GM to stay far away from retailing.
A big problem GM seems to have is that no one around remembers its mistakes, so it is quite possible for GM to make the same decisions and somehow hope for a different result.
A certain amount of institutional knowledge is probably very helpful from time to time when you are running a huge corporation.
The Internet has altered the dynamics of the automobile business. It has changed the way cars are designed, engineered, built, marketed and retailed.
The technology revolution is touching every aspect of this business. But the fundamentals seem to remain the same.
The Internet must make it very enticing for manufacturers to reason that they can simply cut out all retail relationships and deal directly with the customer.
It doesn't work that way. The franchised dealer system has been around for a long time, and it has been around for a reason. It works. I guarantee you that when the next group of manufacturers decides to sell cars in America, probably the Chinese, it will want to use the franchised dealer system.
I don't know exactly what GM is planning. If it is trying to distribute information about its products to potential customers, then it might make a lot of sense. If GM is again exploring the retail business and is poking its nose under the tent, then it should go back and study its own recent history.
That could be a slippery slope, and it's something GM doesn't want to try - again.