This blog reports events and interesting tidbits from Rensselaer, Indiana and the surrounding area.

Wednesday, October 14, 2009

Charlie Roberts and GM

After visiting the Chrysler-Dodge dealership, I knew I had to pay a visit to Charlie Roberts dealership. They, along with 1100 other GM dealerships, were given the heave-ho by GM a few months ago, and with that decision and the closing of the Rensselaer Chrysler-Dodge dealership, Rensselaer will very shortly be without a new car dealer.
I talked to Steve Roberts for about ten minutes on Saturday. They still have a few (about a half dozen) new GM cars on the lot, but cannot order any more. Though the contract that Roberts has with GM was supposed to run into 2010, GM is trying to cut the ties as quickly as possible. I told him that he needed to take a picture of the last new car--it will be a bit of Rensselaer history. Maybe it will be one of the three Impalas (gray-gray-black) shown below. They are three of the last new cars on the lot.
Some of the dealerships that have lost their GM backing have folded, but the Roberts' dealership will continue, selling used cars and cars picked up at auction, much like White's does at present. I wonder if it might not be a good time for Honda and Toyota to pick up some of these abandoned dealerships and reach out into rural American.

GM (and the other American auto companies) seem to think that by reducing the number of dealerships, they will cut costs but not lose much in sales. In other words, if all the people buying GM products would continue to buy GM products whether they could buy them locally or had to travel a bit to get them, GM would have the same sales but lower costs because it would be cheaper to supply 3000 dealerships than 6000. However, that raises the question of loyalty--to what are consumers loyal? Are they more loyal to the brand or to the dealership? Do they care about the reputation of the dealership, or is that not a factor in their decisions? I do not know the answer, but it should make an interesting poll question, and it allows this post to be an audience participation post. Please vote in the poll below, and if you want to explain your vote, feel free to add a comment.

When buying a car, do you have more loyalty to the brand of car or to the dealership from which you buy it?
More to the brand of car
More to the dealership
I care about both
I do not care much about either free polls

1 comment:

flatbow said...

From what I understand, GM was supposed to be closing down redundant and under performing dealerships (it doesn't make sense to have a GMC, Chevy, Saturn and Buick/Cadillac dealerships all in the same town). It seems a bit daft to close down a dealership if it's the only one in town, but then again, Rensselaer is a small market and I think car buying trends are changing. People are traveling farther and -this is the big one- using the internet to shop. A town close to me, which is well over twice the size of Rensselaer and serves a population area many times the size of Rensselaer, has lost all of their new car dealerships as well (but for different reasons, the Ford dealership merged with the one here and the GM dealership owner was caught in some embezzling scandal and was forced to close up).

I highly doubt Honda, Toyota, or any other new car dealerships will open up shop in Rensselaer. My guess is that it's simply not a large enough market. As for Toyota, I'm not sure they can afford to open dealerships in risky environments; there are some very interesting financial rumors not being reported by the MSM with this company.

It is sad to see all of Rensselaer's new car dealerships fold, but I hope the town will be well served with the remaining used car dealerships. I know I'll never buy new so it wouldn't be an issue for me!