Kevin Vanatta is a General Motors dealer in Newberry, Michigan, which is a community of almost 3,000 on the upper peninsula of that state. His store is somewhat remote in that the next closest dealership is almost 70 miles away. Kevin has been in the automotive industry for 38 years and has been a dealer for 20 years. He is active in his community and his store is an integral part of the Newberry community.
He recently had an opinion piece published in AutoRetailNet. I asked him if I could post it here and he graciously consented.
In my opinion, what GM has done should be against the law because it creates two tier pricing for dealers. What I mean by that is if dealer A chooses to go with the program he is going to get a “kick back” for hitting certain levels of achievment, thereby creating a pricing differential. It can be argued that the “kick back” money is to be invested in the facility upgrade, but what if it isn’t? Instead it could be used to assist in getting a car deal done, thereby giving dealer A an advantage over dealer B that didn’t go with the program.
Secondly, as an independent business owner, I should be allowed to “do it my way.” That is why I have chosen to be “independent.” If I wanted someone to tell me what to do and when and how, I would have gone to work for someone else. If the manufacturer wants to buy me out to have their say, well it can talk to me in $$$$$.
I am not against a certain type of look or the thought that any manufacturer wants to standardize, but I can assure you that when the client is looking at buying a car or requiring service that he or she really doesn’t care what color the tile is. Customers simply want to be taken care of in a courteous, professional manner by someone that can understand their concern or need and help them to be satisfied in a timely fashion. I believe that customers want to feel like the dealer they are doing business with will be there long-term, to take care of their ongoing needs.
Lastly, and equally as important, if not more so, is that not all facilities/communities/areas of responsibility are created equal. The investment for my facility is not much less than a metro dealer who has many more potential clients in their marketing area, although yes, he has more competition. What is the real question that is being asked by the manufacturer when he requires us to use its styling ideas? Is it really trying to make or keep the customer happy, or is it just to create a look? My choosing at Newberry Motors to upgrade my business plan to satisfy GM’s requirements would price me out of the market and put me out of business, because no upgrade is going to grow the number of potential clients in my area.
One of the requirements of EBE and the GM Sales and Service Agreement that came out of the bankruptcy is that I can not have any other new brand on my lot, which is Chrysler in my case. In 1992, when I became a GM Dealer, they approved the fact that I could have Chrysler products on the same lot and sold out of the same showroom, but under the protection of the bankruptcy court they slid this little legalese in there. What will happen if or when push comes to shove? i don’t have an answer at this time but i’m thinking it may be quite ugly!
EBE has put me and many other smaller dealers between a rock and a hard place, when all we hope for is to have a manufacturer partner that will be a real part of our team and be in business with us for the long haul.
Kevin has stated the feelings of many small, rural dealers. I appreciate his honest and sincerity. I am often asked if I fear retribution from General Motors be speaking out. I haven't given that a whole lot of thought because when something is unfair or wrong, I feel compelled to speak out.
I certainly welcome other comments in this space. If you are interested in a formal post, just send it to me. You are also welcome to comment below.
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