General Motors has enacted a new sales reporting policy that prohibits dealerships from selling a vehicle to a customer before it arrives at the store.
Low inventory levels driven by various parts shortages and logistics challenges created issues related to preselling a vehicle after a dealer was invoiced but before the customer received it.
As of Friday, July 1, GM no longer allows dealers to report a vehicle as sold before a customer takes possession of it, according to a memo from the automaker to dealers obtained by Automotive News. That's because reporting a vehicle as sold triggers the start of financing payments, warranties and trials of OnStar, Sirius XM and other services — potentially months before the vehicle actually reaches the customer.
State laws vary on when a dealer can sell a vehicle to a customer, and GM's policy affects dealers in states that allow a sale to occur before delivery.
As the global microchip shortage and other supply chain challenges slow delivery timelines, GM said it changed the sales reporting policy to enhance customer experience. Dealers who spoke with Automotive News on condition of anonymity largely supported the adjustment.
"They're trying to save the dealers from themselves … and from their shipping woes that they've got going on," a Chevrolet dealer from Minnesota said.
GM spokesman Sabin Blake confirmed the policy change and said the automaker has rolled out a variety of programs to protect customer pricing during the parts shortage. Such programs guarantee the agreed-upon terms of a sale before a vehicle is delivered and ensure that the incentives customers qualify for when they order or reserve a vehicle remain intact when they take delivery.