GM cutting most Cadillac dealers
09-08-2009, 10:44 AM
#1
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GM cutting most Cadillac dealers
WOW Cadillac sales were already taking a beating....
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General Motors Corp. is dropping the franchises of 70 percent of Cadillac dealerships nationwide and southeast Wisconsin is no exception, leaving only two area dealerships confirmed as continuing beyond 2010 — Metropolitan in West Allis and Crest in Brookfield.
Metropolitan Cadillac, in fact, is running commercials urging customers whose dealers are closing to switch to its dealership.
“My understanding is that there are a lot of Cadillac stores closing,” said Metropolitan president Max Stephenson. “The only two that are staying open are Metropolitan and Crest.”
General Motors will not disclose the identities of dealerships that are closing. Only one area Cadillac dealership has identified itself as dropping its Cadillac status: Amato Cadillac in Glendale, which Aug. 21 became a Nissan dealership.
Metropolitan Cadillac, in fact, is running commercials urging customers whose dealers are closing to switch to its dealership.
“My understanding is that there are a lot of Cadillac stores closing,” said Metropolitan president Max Stephenson. “The only two that are staying open are Metropolitan and Crest.”
General Motors will not disclose the identities of dealerships that are closing. Only one area Cadillac dealership has identified itself as dropping its Cadillac status: Amato Cadillac in Glendale, which Aug. 21 became a Nissan dealership.
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09-08-2009, 12:01 PM
#2
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No surprise there...
GM said during bankruptcy that it would trim Cadillac to 500 dealers (from roughly 1500)
GM also said that ALL cadillac dealers would now be stand alone franchises. So, if you have a dealer who is paired with other GM franchises, unless they've made arrangements to build a new Cadillac store, they're likely toast by 2010.
It's pretty scary for Cadillacs numbers. However, I completely understand why GM is doing it. Unless GM can get it's "premium division" to turn the profit numbers of other "premium divisions" (Lexus, BMW, MB, etc) dealers aren't going to sink any money into the franchises. And the best way to run profits up fast is to decrease supply. Simple, really.
GM said during bankruptcy that it would trim Cadillac to 500 dealers (from roughly 1500)
GM also said that ALL cadillac dealers would now be stand alone franchises. So, if you have a dealer who is paired with other GM franchises, unless they've made arrangements to build a new Cadillac store, they're likely toast by 2010.
It's pretty scary for Cadillacs numbers. However, I completely understand why GM is doing it. Unless GM can get it's "premium division" to turn the profit numbers of other "premium divisions" (Lexus, BMW, MB, etc) dealers aren't going to sink any money into the franchises. And the best way to run profits up fast is to decrease supply. Simple, really.
09-08-2009, 12:16 PM
#3
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No surprise there...
GM said during bankruptcy that it would trim Cadillac to 500 dealers (from roughly 1500)
GM also said that ALL cadillac dealers would now be stand alone franchises. So, if you have a dealer who is paired with other GM franchises, unless they've made arrangements to build a new Cadillac store, they're likely toast by 2010.
It's pretty scary for Cadillacs numbers. However, I completely understand why GM is doing it. Unless GM can get it's "premium division" to turn the profit numbers of other "premium divisions" (Lexus, BMW, MB, etc) dealers aren't going to sink any money into the franchises. And the best way to run profits up fast is to decrease supply. Simple, really.
GM said during bankruptcy that it would trim Cadillac to 500 dealers (from roughly 1500)
GM also said that ALL cadillac dealers would now be stand alone franchises. So, if you have a dealer who is paired with other GM franchises, unless they've made arrangements to build a new Cadillac store, they're likely toast by 2010.
It's pretty scary for Cadillacs numbers. However, I completely understand why GM is doing it. Unless GM can get it's "premium division" to turn the profit numbers of other "premium divisions" (Lexus, BMW, MB, etc) dealers aren't going to sink any money into the franchises. And the best way to run profits up fast is to decrease supply. Simple, really.
And unless I am overlooking something, it will be a 50+ mile ride for me to the nearest Cadillac dealership once this all runs it's course.
09-08-2009, 12:19 PM
#4
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Yep.
The philosophy is simple: Lexus et al. can sell better numbers than Cadillac out of 1/3 of the dealers and because of that (profit ratio) be able to AFFORD to pamper their customers.
GM seeks this scenario for Cadillac going forward.
Not a bad philosophy... But god help 'em (GM) if they can't learn how to properly market their cars.
Maybe even further for some people as emphasis will be placed on metro areas. (We all know where the high paying jobs are now; NOT in the 'country')
The philosophy is simple: Lexus et al. can sell better numbers than Cadillac out of 1/3 of the dealers and because of that (profit ratio) be able to AFFORD to pamper their customers.
GM seeks this scenario for Cadillac going forward.
Not a bad philosophy... But god help 'em (GM) if they can't learn how to properly market their cars.
And unless I am overlooking something, it will be a 50+ mile ride for me to the nearest Cadillac dealership once this all runs it's course.
09-08-2009, 12:45 PM
#5
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I think this will help. Some dealers within an hour of me are just lumped in with Chevy dealers. Cobalts and CTS-V's sitting next to each other in a showroom/building that has been around for 30 years. One dealer "Otto" sells Pontiacs too, I guess they will now be a stand alone Cadillac dealer.
They need high end looking stores to sell their high end product.
They need high end looking stores to sell their high end product.
09-08-2009, 12:45 PM
#6
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Yep.
The philosophy is simple: Lexus et al. can sell better numbers than Cadillac out of 1/3 of the dealers and because of that (profit ratio) be able to AFFORD to pamper their customers.
GM seeks this scenario for Cadillac going forward.
Not a bad philosophy... But god help 'em (GM) if they can't learn how to properly market their cars.
The philosophy is simple: Lexus et al. can sell better numbers than Cadillac out of 1/3 of the dealers and because of that (profit ratio) be able to AFFORD to pamper their customers.
GM seeks this scenario for Cadillac going forward.
Not a bad philosophy... But god help 'em (GM) if they can't learn how to properly market their cars.
Maybe even further for some people as emphasis will be placed on metro areas. (We all know where the high paying jobs are now; NOT in the 'country')
This part is insane to me.
I see Cadillac's all over where I live... and I can guaran-damn-tee that these people are NOT going to drive 50+ miles to buy a car.
Myself almost assuredly included.
09-08-2009, 02:50 PM
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One of my big contentions with Cadillac dealers is the fact that they feel like Chevy dealers. And I hate Chevy dealers with a passion because I think they're about the most run-down, sleaziest, typical "used car" venues in which to purchase any vehicle, new or used.
If Cadillac could recreate the rich feeling of stepping into a newer Audi or BMW dealer, they'd have a winning combo, because Cadillac now has the right product.
.
If Cadillac could recreate the rich feeling of stepping into a newer Audi or BMW dealer, they'd have a winning combo, because Cadillac now has the right product.
.
09-08-2009, 03:16 PM
#9
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One of my big contentions with Cadillac dealers is the fact that they feel like Chevy dealers. And I hate Chevy dealers with a passion because I think they're about the most run-down, sleaziest, typical "used car" venues in which to purchase any vehicle, new or used.
If Cadillac could recreate the rich feeling of stepping into a newer Audi or BMW dealer, they'd have a winning combo, because Cadillac now has the right product.
.
If Cadillac could recreate the rich feeling of stepping into a newer Audi or BMW dealer, they'd have a winning combo, because Cadillac now has the right product.
.
I wholeheartedly agree... they just need to have one located within a day's drive.
09-08-2009, 04:39 PM
#10
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Location: Oakland, California
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If GM can copy the Lexus customer service model, this might not be a bad thing. One of the Lexus dealers my mom and I visited (ironically located next to a Chevrolet/Cadillac dealer) was bragging about how they were building a new multi-level temperature controlled "green" showroom down the street with a fountain, cafe and using a lot of environmentally substainable materials. I was thinking, "yeah, who's actually paying for all that." I know my neighbor takes her Lexus to a dealer that is 30 miles away, even though there's another within 5 miles. (Ok, perhaps I should clarify, Lexus sends a guy over to her house to pickup the car and leaves a loaded new Lexus RX350 as a loaner car for her use.)
If GM plans to offer similar services to its Cadillac customers, then fewer dealerships can work.
It still remains to be seen.
If GM plans to offer similar services to its Cadillac customers, then fewer dealerships can work.
It still remains to be seen.
09-08-2009, 06:55 PM
#12
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My grandpa buys a new Lexus every 2 years , and Ive worked at the dealer where he buys his cars . They hand over foot pamper their customers to the point of almost being ridiculous 
The dealership itself is also very upscale and inviting . They definately got it very right .
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