Car dealers bring giant GM to its knees with PR push

DETROIT: A National Automobile Dealers Association PR campaign has accomplished what few organizations have succeeded in doing over the years: it has made General Motors blink.

DETROIT: A National Automobile Dealers Association PR campaign has accomplished what few organizations have succeeded in doing over the years: it has made General Motors blink.

DETROIT: A National Automobile Dealers Association PR campaign has

accomplished what few organizations have succeeded in doing over the

years: it has made General Motors blink.



The campaign, devised to counteract GM’s recently stated desire to get

into the retail dealer business, paid off quickly, with GM almost

immediately rethinking its plans.



Intended to reduce distribution costs, the formation of General Motors

Retail Holdings would potentially have seen the automotive giant buying

up as many as 10% of its 7,700 authorized US franchises over the next 10

years. The move would likely have proven disastrous for NADA members

owning competing franchises, who would have had to battle with the GM

subsidiary for market share.



NADA’s PR campaign was remarkably simple. When rumblings about the

formation of GM’s retail group first surfaced during the summer, the

dealer organization communicated a list of eight areas of dealer concern

to the company. According to NADA president (and CA-based dealer of

Buick and import models) James Willingham, GM responded in September to

seven of the eight - but the eighth was the retail bombshell.



NADA quickly went public with its concerns. Willingham and NADA director

of media/ PR Michael Morrissey scheduled a lunch meeting with Detroit’s

powerful Automotive Press Association, during which Willingham departed

from his prepared remarks and lambasted GM’s plan to enter into

’competition with its own dealers.’ He hinted that dealers would be

forced to seek relief through new laws at the state level.



Print and radio stories about the proposed move forced the company’s

hand by creating awareness of the issue among GM execs not directly

involved in negotiations with the dealers. Last week, GM chairman and

CEO Jack Smith conceded defeat, telling the trade publication Automotive

News that the plan announced to dealers was ’quite premature.’



Still, the issue is far from resolved. Both Detroit’s auto makers and

their affiliated dealers recognize there are too many dealerships to

support sales levels, given the increasingly large share of the market

captured by import brands and new business methods, such as Internet

sales. NADA’s Willingham has suggested that GM tackle the problem on a

market-by-market basis in cooperation with dealers.



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