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GM & Chrysler dealer reduction information


Barney Eaton
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Today on Public TV, I watched the show linked below.

Outraged (Show #1605) on Autoline This Week

We have all heard stories about both GM and Chrysler closing dealerships and probably know of dealer locations in our own area that closed. For some reason this did get some publisity but not much indepth study by the media.

This Autoline program will be of interest to you as a taxpayer, former employee of a closed dealership, or just an interested car person that know of closed dealers.

Below is a link to one of the people on the Autoline discussion, Tammy Darvish.

She has written a book telling the story from her view and information. If your monthy car books have not arrived and you need something to read, you can click the SIGTARP Report on the first page and view both the government summary and/or all 45 pages of the report.

- OUTRAGED | Tammy Darvish

Like all government actions, it appears some things happened that both the auto makers and the government would like to keep quiet.

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OK Buick People: Many American people in a real position of power don't have a clue of what they're doing. Example: A new car dealership houses five businesses under one roof.

1. New car sales. This could include fleet, lease and financing.

2. Used car sales. This could include retail and wholesale.

3. Parts sales. This could also include after market items.

4. Service department.

5. Body shop.

Now, if an owner can't seem to make a profit from this they probably don't know what they are doing. The point being this, these people (the owners) represent the factory and are subject to certain rules, the biggest is making a profit. If the factory can't support a dealer that is struggling they are not doing their job. This doesn't mean babysitting a bad dealer, it just means that the franchisee needs to be in compliance with the franchise agreement, ultimately, to make a profit.

Unfortunately the factory really doesn't know the difference between a profitable dealer and a looser. They have abandoned many good dealers especially in today's times. They have also allowed many very bad stores to remain open when they needed to be the ones to close.

The banks are also major offenders of not knowing the difference between a credit worthy person and one who isn't credit worthy. The Bush administration put in place the "Patriot Act" as easy as taking candy from a baby yet the government doesn't have the brains to sanction banks with loan modification.

I can not see the difference with two major American businesses Auto and Banking, making such poor decisions. Mitch

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In proportion to it's market share at the time, and with no government involvement at all, Ford cut nearly as many dealerships (~600, all selling brands that still exist) in the last 5 years as GM (~1100, which includes quite a number of dealerships that sold defunct brands like Pontiac and Saturn). Chrysler cut ~800 dealerships, about double the other two in proportion to market share.

I live in Butler County, OH, population 368,000. 14 months ago we had 3 Ford dealers. Now we have one. One of the 2 they closed had been around since 1915. The other dealership (Fairfield Ford) told it's employees on a Friday as they clocked out that it was their last day, effectively giving zero notice to employees or customers. The Cincinnati area has lost 5 Ford dealers in the last 3 years.

This practice may be despicable, I certainly agree that it is :mad:, but it is pervasive in the industry right now and not limited to any government involvement.

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Regarding dealership closings . . . Ford and others have desired to use "Toyota numbers" as justification for what they did and where they desire to be in the future. This is not the first time they've tried to follow Toyota's lead in things, as they all heavily studied Toyota's production system in the middle 1980s in an attempt to lower their "days to delivery" of just-ordered vehicles.

In the more recent times, they've used the Toyota numbers of number of dealers in particular regions and the number of vehicles they sell as "the gold standard" . . . IF you can call it that. All in the name of "dealership profitability", they claim, which they also perceive as being good for their parent corporations and franchisers. What they fail to fully understand is how Ford, GM, and Chrysler came about and how Toyota entered the marketplace in the 1960s!

Ford's heritage included a good deal of agricultural products, namely Ford tractors and farm implements (parts of their corporate empire which they sold-off in the earlier 1970s). As a result, they used their line of products to put full-corporate-line dealerships in very rural areas. This put Ford trucks on a huge number of farms in the earlier parts of the 20th century, which also had Ford tractors and farm implements too. The same dealership sold Ford cars, Ford trucks, and Ford tractors. The full-line-coverage helped them stay profitable, but then too, they weren't that large of an operation compared to a "town" dealership. These rural dealerships, no doubt, were major economic influences to their particular areas. Plus, there usually was NOT a nearby Chrysler or Dodge dealer to contend with and very possibly NOT a General Motors dealership either. But, as these small-town dealerships had lower operating overhead, they could also sell vehicles for less than their larger big-city associates could. So, a frugal customer might justify driving 50 miles to save $50.00 on a new vehicle back then.

Ford, like GM and Chrysler, also had good coverage in the metro areas. In the larger markets, it was competition which kept prices at "good" levels for the consumers, generally. In these larger metro markets, it was not unusual for different neighborhoods to have their "neighborhood" car dealers. But in smaller towns, there would be just one.

Now, some might claim that Ford had multiple dealerships on a corporate level in even the smaller (but not rural) towns. How? If a town was big enough to have well-off people, there usually was enough demand for Mercurys and Lincolns, in addition to Fords. There would be a Chrysler, Imperial, and DeSoto dealer, with the Plymouth and Dodge dealers being separate (until Chrysler Corp re-arranged things circa 1962, after DeSoto was deleted, Dodge was free-standing, and Chrysler dealers got Plymouth to replace DeSoto).

On the GM side of things, the Chevy dealers usually were by themselves. Cadillac was always by itself and usually just in the larger cities. The remaining Buick, Oldsmobile, and Pontiac dealerships might be single in the larger cities, but with differing combinations in the smaller towns. GMC was usually paired with Pontiac. GM seemed to rely more upon the bigger cities/town as their main focus, tending to carve out that part of the car market, leaving the other areas to Ford. Just like Ford, there were many Chevy stores in one of the larger towns, but multiples of the other GM lines might not happend until the city was of a particular size. Funny thing is that even back then, every dealership usually was around for many decades and had the trappings of prosperity!

Yes, dealership profitability was important back then as it is now. Yes, there was some pricing overlap between the various GM divisions, so all of the divisions were somewhat competing with their corporate associates. But, remember too, much of this internal competition made GM a better company as everybody was trying to out-do the other divisions in some manner. With multiple dealerships for the same brand in some areas, it was also GOOD BUSINESS to have things this way! It also kept the closer-together dealerships on their toes, so to speak, to "get that deal before another similar dealership did".

Having many dealers was also a benefit to the customer AND the corporation. Many now claim that too many dealers in a particular market area drive down dealership profits and put more strain on them to remain profitable. This can be true, BUT . . . if a customer can't get that deal they want at one dealership, they could drive another 10 minutes to another part of town and possibly get the deal they wanted (How many times do you reckon that second dealership's salesperson would bend over backwards to get a deal after hearing a "tale of woe" about how the customer was poorly treated by the other salesperson/dealership? That second salesperson would be a hero for the customer, their dealership, AND the corporation!) End result, the CORPPORATION got the sale, without regard of which dealership it might have come from.

In the World of Toyota, they made their entry into the USA car markets via particular Ports of Entry and then proliferrated to the larger metro areas FIRST, and then usually stayed put. No real expansion into "Small Town USA" until the last decade or so. Rather than having a multitude of Toyota dealerships in the metro areas, there typically were very few. As Toyota developed their reputation for long-running powertrains (although the bodies, paint, and trim might need attention after only a few years of existence), the "cult following" resulted. A customer who wanted a Toyota would have to drive 100 miles or so if they weren't in the immediate metro area of a dealership. As they considered Toyotas to be "special" AND they wanted to own one, they'd do that and not complain . . . nor complain for not being able to special order a color or trim combination they wanted, but either taking what was on the lot or taking nothing at all. Or waiting until the "Next Load from Japan" was received, but then no real guarantee that what they desired would be on it.

End resuilt was that a typical big-city Toyota dealership would sell more cars per 1000 citizens in the area than many other domestic dealerships. Discounts on the price of the vehicles were generally not as deep as for the domestics, either. Supply and demand? BUT, remember too that dealerships need to generate a certain amount of revenue to pay the bills and be profitable . . . whether that money comes from service work or higher new vehicle transaction prices.

Now, from my observations, the automobile sales industry is an industry which typically tolerates a much higher degree of mediocrity than many other retail operations in our society. AND, by observation, the general public tolerates that situation quite well, for some reason or another.

There is another issue in the whole bunch of things which started happening in the earlier 2000s. Looking back, GM's finances were in more fragile orientations than many wanted to admit to, especially at the corporate level. How'd this affect the dealers?

In the dealership realm of things, there's a "money train" which operates from the dealership to the corporation and back to the dealership. In the most basic form, the dealership puts money on the train to purchase vehicles, repair parts, and other things from the manufacturer. The manufacturer ships the dealer what they've paid for, plus other financial monies related to the sale of vehicles or other parts purchase allowances. Rebates on new vehicle sales (rebates which can be sent to the new vehicle purchaser or assigned to the dealership by the purchaser) are in that mix, too. When everybody involved's financial health is good, the train runs "on time" with all of its cargo (financial and otherwise). If a dealership might get behind on their payments to the corporation, then the corporation can delay shipments until payments are made. IF the corporation might get behind on their payments to the dealership, the dealer has no option but to endure this situation or find ways around it.

With fewer dealerships to pay, the corporation can pay more dealerships from a somewhat finite financial resource rather than spread the same amount of money more thinly. In that respect, the remaining dealerships are happier, understandably. Until they receive all of the assigned rebates and other allowances, they haven't made all of the money on their car deals or other operations.

The proponents of the fewer dealerships orientations have already pointed to the fact that fewer dealerships makes the remaining (larger size) dealerships more profitable. This is good, but they also fail to understand who's paying those bills . . . the customers. Customers have fewer dealership choices within a particular brand of vehicle, so it's not unusal for them to feel THEIR costs are being increased with higher purchase transaction prices. Many claim that competition is better for the consumer, but then we've just witnessed how the choices of the customer have been diminished. Sales points and potential customers have also been diminished in the process, too! The chances of a customer potentially finding a vehicle salesperson, a service consultant, a parts department salesperson, or a dealership body shop estimator they like and want to deal with has also been diminished within each particular brand of vehicle.

That set of dynamics makes it more critical for each person in the vehicle sales/service operations of a particular dealership to totally satisfy their customers. Sure, it's to their advantage to do this, but it's also to the vehicle manufacturer's advantage too . . . moreso with fewer chances the corporation will have to share in the purchase profits of vehicles.

But then customers seem to be used to decreased choices in their vehicle purchase activities. MUCH fewer exterior colors. MANY fewer interior trim color options. Engine, transmission, axle ratio choices of old are now generally tied to the vehicle's trim options. USA brands have followed the import brands' "option package" approach in many areas. Although at a 1999 Oldsmobile activity I attended, the fact that the customer would know what the leather interior on an Intrigue GL would cost as an option, it was hidden in complex option packages on the competing Nissan Maxima.

Considering that each manufacturer has data on which dealership is doing well and which ones aren't, plus that each manufacturer has "divisions" which handle non-performing dealerships (one way or another), it was amazing how much these particular overseeing operatives apparently were not doing their job! GM had been advocating combinations or orchestrated buy-outs, on an opportunity basis, of local dealerships for many years, but apparently had not pushed things very hard. Obviously, although their data indicated non-performing dealerships near better dealerships, they also felt that more sales points were an asset to the corporation to move more vehicles.

In so many cases, we never heard what constituted a "non-performing dealership", NOR how much it cost the manufacturers to keep "a dealership" franchise in force for such a "non-performing dealership". Was it "a cost" of potentially-lost vehicle sales or "a cost" of supporting that dealership with factory sales reps to help each dealership do as well as it could? Several different orientations, there!

Or was it because particular dealerships didn't jump to comply with corporate directives on facilities upgrades or to go along with "factory requests" to purchase more vehicles than the dealer really felt they needed OR could sell in a reaonable amount of time (minimizing their floor plan expenses)? The federal hearings I watched were quite informative in these areas!

Unfortunately, it seemed that too many federal and manufacturer operatives took the orientation that if the dealer was as good as the dealer claimed it was, they could continue to exist with used car sales and service operations. Kind of interesting how "jobs lost" was not a real consideration back then, but NOW "jobs" is a big subject in many areas!

A key issue seems to be that "numbers" are more important than considering the ultimate customer and keeping them as a customer of the particular manufacturer. With so many Chrysler dealerships which were closed being in more rural areas (where many customers for Dodge/Cummins diesel pickups live!), it's become more difficult for these loyal Chrysler customers to have a reasonably local factory sales/service/warranty repair center for their vehicles. Even so, distances are not quite as great as they are for many of the more popular import brands (Hyundai, Honda, KIA, Mitsubishi, Toyota, Audi, and others). All it takes is for one dissatisfied customer having to pay tow truck bills to get their broke vehicles to a dealership for repair before they "jump ship" to a more readily-available Ford or GM dealership.

As things have played out, though, some of the flaky things in the closing of Chrysler Corp franchises have not ended up quite so flaky. Stronger regional dealers of other brands or existing Chrysler Corp dealers have taken over some of the formerly-closed sales points. In some cases, import brands took advantage of the recently-closed dealership facilities to use for expansion of their own.

As flaky as some of these things might have seemed, it appears it was more of a leveling activity, somewhat cyclical in nature, which we are now recovering from. New dealerships are being built to replace older ones. Import brands are expanding into the gaps left by domestic manufacturers . . . in product and product sales venues.

Just some mixed thoughts . . .

NTX5467

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Many of the points covered above are in the 1/2 hour Autoline program that I have linked.

What seems to have happened, both GM and Chrysler terminated dealers "for other reasons" and in one case noted on the program gave the franchise to someone connected to the goverment bail-out program.

My local dealer is a Chevy, Chevy truck (including medium duty), Buick and former Olds, and Hummer dealer. GM ask them to give up the Buick brand to a dealer 6 miles down the road and they refused. Within the year, their Buick franchise was not renewed........had they not taken some action, that Buick franchise would have gone to the other dealer.

Their Chevy franchise was never challanged, I have been told they are #14 in the nation in Chevy sales and #1 in Texas for Corvettes.

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For many years now, since the late 1980s, GM has had "sales channels" which they sought to put in place, on a claimed "opportunity basis". The channels were Olds, Pontiac, GMC and Chevy, Cadillac, Buick . . . originally, for us, then Buick and Olds swapped and that's how things ended up. With Olds gone, that left Buick and GMC and Chevy and Cadillac, in our case. Then Cadillac got a separate sales facility, but still uses the same unified service dept.

It always seemed strange to me that Chevy and Cadillac would be in the same sales channel, until you figure the "SUV" connection. MANY mechanical parts would be the same as the similar Chevy parts, which would make sense as the Buick and GMC SUVs are very similar platforms, although some also have Chevy versions. So one possible orientation regards parts inventories of the dealers.

There have been a multitude of alleged connections in how the dealer closings happened, and why. In many cases, the allegations have been proven to be more myth than fact. Sales history, CSI history, and capitalizatoin were some of the factors, as I understand it. Plus, this gave Chrysler the muscle to push for their version of unified dealerships, with all brands under one roof. I guess nobody realized that a typical Chrysler owner is not a Jeep customer, so why should the Chrysler customers have to trip over Jeep customers? But it's all in the execution of the plan, I suspect.

Just some thoughts,

NTX5467

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OK Buick People: This story reminds me of the little boy on the ranch that notices that cattle rustlers are at work and promptly proceeds to tell, of all people, one of the rustlers about the rustling.

This woman in the video wants to expose the factory's bad behavior (irresponsible power brokering) to the United States Senate and Congress..who are are professional irresponsible power brokers themselves and work only for things in their best personal interest. Good luck with that. That might be an incurable disease.

Don't franchises have agreements with the factories? If so, I would think the lawyers would be salivating at the chance to take a case like that. And, I guess there is almost no solidarity amongst dealers because every one is for him/her self. Another incurable disease. Mitch

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You can bet the factories have MORE lawyers than a dealer would have, and I would guess the franchise agreement gives the factories lots of OUTS.

I would also bet that if you ATTENDED YOUR store, and produced strong growing sales, well, they wouldn't want you to go away. I'm sure there are exceptions though, huh?

Dale in Indy

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An unfortunte orientation of the bankruptcy situation was that the prior franchise agreements lost MUCH of their clout. Not unlike bankruptcy having detrimental affects upon existing pensions of employees and/or existing union contracts. As it's the parent company's finances which are being "rearranged" (the word "restructured" is getting "old" to hear!) to allow them to delete "loads on their profitability" and become profitable in the future, what the company wants, it usually gets.

That last item, "what the company wants, the company usually gets" was very operative in the dealership closings. Some ambiguity existed as to why some were cut and others weren't, which allowed the many conspiracy theories to surface and flourish. It would have been nice to see each dealership's scorecard in the evaluation process, but the corporation might invoke privacy issues in that respect. And, I don't know that we ever saw the dollar figure which it allegedly costs the manufacturer to keep a dealership "on the books"--another key factor that never was really explained, but used as a reason to desire a smaller dealer body.

Certainly, there were many small-town dealers which were cut, for better or worse, who'd usually been in business for ages, even 2nd or 3rd generation dealers. Obviously, they had a reasonably loyal following, but you can probably bet that their existing Chrysler product might well be the LAST one they'll buy, having to drive over 1 hour to the nearest Chrysler dealership to buy one or get repair work done on their existing one.

Another issue was that after appeals were allowed, Chrysler only reinstated a handful of cut franchises. GM, obviously seeing the uproar it was causing, decided to review their "cut list" and reinstated many "with conditions". After all, if Chrysler cut as many dealers as they did, it would mean MORE potential customers for GM, even in the boondocks!

Now, IF a cut Chrysler dealership was as good as they claimed they were, with a long-time and loyal customer base, after getting rid of all of the factory-mandated diagnostic equipment and such, there could still be "life after franchise deletion". As with GM, most of the Chrysler-specific diagnostic equipment has corresponding items in the consumer tool trade. Scan tools, etc. Plus several sources to obtain factory service bulletins from, too. End result is that they could keep taking care of their customers, for the most part, aside from factory warranty work (although they COULD, as a convenience, transport the customer's vehicle to the nearest dealership, possibly striking a deal with the particular dealership in the process, which would be mutually beneficial). So that would take care of the service side of things.

For "vehicles", as a used car dealership, the former-Chrysler dealer could go to vehicle auctions to procure vehicles. They might also make deals with other "friendly" dealerships to broker vehicles to them from the factory Chrysler dealer auctions (where the allegedly best vehicles would be).

So, you take the settlement money from the manufacturer and re-fit the service department with tools and such from outside sources. What can't be done, as "computer flashes", can be arranged with dealers still in business. The balance of factory warranty repairs could be "handled", not unlike what used car dealers used to do when they'd buy "executive cars" at auction which still had some factory warranty left . . . they'd have to take them to a new car dealer to get that stuff done for the customer. For other repairs, OEM-level parts could be procurred from local sources or as a new-wholesale customer for the larger dealers in the region. ALL of these things are doable, with a little additional effort, BUT it seems that few "cut" dealers really wanted to make those operational changes--they just closed things up and let the real estate sit vacant.

The reality is that whatever lawsuits which could be brought already have been. FEW were won by the former dealers, for whatever reason(s). Trying to revisit many of the perceived inequities of the whole manufacturer "orchestrated" bankruptcy activities would probably not result in any changed verdicts. Just more legal fees . . . which serve to make lawyers (on both sides of the aisle!) richer. Trying to legally prove "power broker" conspiracy theories MIGHT be possible, but not very probable . . . at this time. Any "tracks" of such things would have become very cold, I suspect.

At times, it seems that the "people in high places, above the cloudline" are in their own protected world. They will have their salaries and pensions and whatever else, no matter what, it seems. They don't have to answer questions many would like to ask, unless they might want to. In many cases, it seems that their allegiance lies with their stockholders and creditors rather than the people "in the field" who sold and serviced their products, contractually, for them. OR the loyal end-users of their products, who are now somewhat inconvenienced to keep using the particular products.

ONE thing which many operatives seem to have forgotten is . . . Customers Have Options. In prior times, it might have been which of the local dealerships to patronize (as both were somewhat conveniently located to the customer), but in more recent times it might well be "Should I look at other brands of vehicles? From a dealer that's near my residence or work? Even if it's a different brand of vehicle than I've driven for the past decades?" When manufacturers seem to orchestrate the abandonment of some of their customer base, especially in non-metro areas, the possibility that they'll lose those particular customers increases exponentially, I suspect, as they test the loyalty of the particular customer to the particular brand of vehicle.

Just some thoughts,

NTX5467

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What seems to have happened, both GM and Chrysler terminated dealers "for other reasons" and in one case noted on the program gave the franchise to someone connected to the goverment bail-out program.

Not at all. The franchise was given to an N.A.D.A. official. Again shady, but hardly government related.

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I would also bet that if you ATTENDED YOUR store, and produced strong growing sales, well, they wouldn't want you to go away. I'm sure there are exceptions though, huh?

Exception: In the case of Fairfield Ford, it was a sizable suburban dealership, with (I'm guessing) an inventory of about 200-250 cars and a 8-10 car showroom. It took a week to get all the cars off of the lot. They must have had a sizable business, as they were advertising for salespeople just months before they were shut down.

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"Good sales" might buy a dealer some points, BUT if the custome retention rate is not good, customer satisfaction index scores are marginal, warranty repair averages are higher than zone average (for particular labor operations), and possibly failure to maintain the dealership property in a reasonably nice state of repair . . . then too many "Aw ___s" in the equation.

In many cases, the inequities involved were that terminated dealers had already complied with Ford's Blue Oval Certification, GM's Customer Focus Incentive program, or Chrysler's 5 Star Certification programs . . . which relate to implementation of manufacturers' "best practices" in how things are done and also other upgrades in facilities and such. Meeting manufacturer-generated sales goals didn't seem to matter, either, in some cases (which was brought out in the Congressional hearing I saw on C-SPAN late one night, being replayed). End result was that some dealers had been doing everything "right" according to the manufacturers AND evidenced by their compliance with the manufacturers' "image and special shop tools programs", but were cut just as if they hadn't done these things. And THAT's where the manufacturer's operatives stopped talking, or used the "They're costing US money to carry on the books as a dealer" (side-tracking, it seemed) comments. It was the "They're costing us money" comments which were never really explained, at least from what I heard or read.

IF a dealer hadn't gone to the effort, trouble, and expense to comply with the manufacturer's image programs (relating to facilities) and their other certification programs (relating to sales and service operations), then they would have very possibly been "out of compliance" with their franchise agreement . . . AND prime candidates for termination or franchisee replacement. BUT, that wasn't the case in all situations of terminated dealers . . . some it was, though.

What WE might have seen as "good" and "viable" might not really have been quite that good, when the accounting and capitalization issues were figured in.

Just some thoughts,

NTX5467

Edited by NTX5467 (see edit history)
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Business is business...and the taxpayer is getting the 'business' done to him and her. We will NEVER see all of OUR money come back to us, and even if it did, the thieves in DC are at least as bad as the ones in Detroit. The fact is, everything that comes in one door goes out the other doors, windows and the mail in DC.

The car companies can do what they want, just like Kmart, Sears, Best Buy, Circuit City, Montgomery Ward and a dozen others....only WE didn't help subsidize it.

The fact is, we are lucky it was Pontiac killed and not Buick. But, if the Chinese stop buying Regals, look for Buick to get the axe.

There is NO loyalty in any business any more. Buy what you want, drive what you want....the classic Buicks are light years from what wears that logo today.

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Reatta Man,

With all due RESPECT, I'm not sure what you mean when you state. " THE CLASSIC BUICK'S ARE LIGHT YEARS 'FROM' WHAT WEARS THAT LOGO TODAY" The word "FROM" puzzles me, are you saying that the CLASSIC BUICK is light years AHEAD, or light years BEHIND, what wears that logo today?

I just want to understand your comment.

Thank You,

Dale in Indy

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Pontiac wasn't killed. It died. :(

And yes it took a lot of money to give the remaining/still viable parts of GM a second life, money that may never be paid back directly (auto workers do pay income tax, however). Maybe it might have been a good idea to see what kind of Hyundais would have been built in the Bowling Green Assembly Plant, or what kind of office park would have replaced it. Just try not to forget that those were the only two options left by 2009, and nobody liked either one.:(

Blaming anybody but GM for being in that position, or for the consequences thereof, is like finding an excuse for an addict. It's just not helpful.

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Pontiac wasn't killed. It died. :(

And yes it took a lot of money to give the remaining/still viable parts of GM a second life, money that may never be paid back directly (auto workers do pay income tax, however). Maybe it might have been a good idea to see what kind of Hyundais would have been built in the Bowling Green Assembly Plant, or what kind of office park would have replaced it. Just try not to forget that those were the only two options left by 2009, and nobody liked either one.:(

Blaming anybody but GM for being in that position, or for the consequences thereof, is like finding an excuse for an addict. It's just not helpful.

_____________________________________________________________________

No, it was killed, and corporate had been trying since the late 50's to do so. Pontiac survived until the mid 70's buy dedicated people in the division, which broke out of the mold the corporation had prescribed for it...sales told the story and corporate laid off for awhile until those key people left the division. Those people if left alone would have made the division even stronger. I blame GM because GM tells the division what to build and the price structure it conforms to, and as time went by Pontiac-Olds became just part of the commonality of GM cars, a blur in the GM line up with Buick and with a blurred price structure. Buick is last to go because of the China connection. In the end there will be just Cadillac and Chevrolet. GMC will be the big truck division Chevy will be the little truck division. Sadly this mimics our society here in America.

D.

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As for my comment about the Buicks we all love and preserve being light years from the Buicks of today, it was more of a character statement.

Buicks looked different, drove different, had unique engines, transmissions and features than the "corportate bean counter" Buicks of today. Add to that the fact that every car has a rounded front end, rounded swooping headlights, a highly raked windshield, a "center stack" where there used to be a unique Buick-only dashboard, and you get the drift.

Can we/should we go back to the uniqueness of the Buicks of the past? Probably will never happen, as long as every car manufacturer worships at the altar of CAFE and Federal rules seem to be mandating accomplishments that aren't even science fiction right now (CAFE standard of 61MPG by 2025 when a hybrid Prius gets 51 MPG now; trucks must get 30 by 2025).

So, the Buick of 1965 was 95-99% Buick. Now a Buick is 80% GM, 15% GM worldwide, and 5% Buick.

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Can we/should we go back to the uniqueness of the Buicks of the past? Probably will never happen, as long as every car manufacturer worships at the altar of CAFE and Federal rules seem to be mandating accomplishments that aren't even science fiction right now (CAFE standard of 61MPG by 2025 when a hybrid Prius gets 51 MPG now; trucks must get 30 by 2025).

So, the Buick of 1965 was 95-99% Buick. Now a Buick is 80% GM, 15% GM worldwide, and 5% Buick.

___________________________________________________________________

Most people who have studied GM knows that from the thirties to the late 50's, plus the influence into the early 60's that Harley Earl's favorite car was Buick. Buick, Cadillac, Olds in that order got preferential styling treatment and anyone can see that. Chevy being a volume vehicle this did not effect, Pontiac on the other hand suffered in many ways.

Buick of 1965 was 50% corporate.... Canopies, transmissions, rear ends, brakes, electronic's being most evident.

D.

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I concur that Pontiac was near-death when the GTO was reintroduced. Pontiac was something of a mis-mash of other platforms used by other GM divisions--NOTHING which was uniquely Pontiac, other than adaptations of the double-kidney grille that BMW didn't like. This also made Pontiac the least-invasive line to delete.

If you look back a while, the Aztec was the last "unique" Pontiac . . . which is also the model which many younger-generations remember when you mentioned the word "Pontiac". Not Catalina/Bonneville, GTO, Tempest, well maybe Firebird, but usually Aztec. If you want to go farther back than that, then look to the earlier 1980s when Pontiac tried to do a bold move and downsized the Bonneville to the "Malibu"-size platform, perceiveing they'd be the first GM division to downsize in a flaky economy . . . but no other GM division followed. The "damage control" was the Pontiac Parisienne as the shamed Bonneville stayed around as a mid-size vehicle, later to be a "differently-styled" full size fwd Pontiac . . . which had the fog light switch on the overhead center console, the traction control (as I recall) a good arm's length from the driver, and (in one model year) speed-rated Goodyear RS-A tires paired with rear drum brakes (rather than rear disc brakes). Some things were just out of whack, compared to other vehicles, but they got fixed in the nicer-looking last-gen Bonneville.

NOW, consider that somebody had to approve all of these "different" things for them to happen! If "Pontiac" had been the innovative "Pontiac" of the middle 1960s, in the 1980s, I suspect things would have been different, but then "somebody" obviously didn't want it to be that way . . . ultimately determined by just whom was incharge of Pontiac back then. In the case of Oldsmobile, it appeared that post-1992 (after John Rock retired) there was a "parade" of people through the Olds management's offices . . . no real long-term continuity as each new manager had their own ideas of what Olds should be, seemingly without regard to what Olds had been. They were trying to breathe new life into Oldsmobile and ended up "killing the patient" as they tried new things . . . like a new logo that nobody knew what it was AND that danged "brand management" where the "Brand" took a backseat to the "Model" of the brand each vehicle was a part of. Focus on "Intrigue" being an Oldsmobile rather than the vehicle being identified (with the Oldsmobile name and logo!!) as an "Oldsmobile Intrigue".

In the 1960s (for example), each division had to do the normal "battles" to get things approved (as mentioned in the DeLorean book on GM, circa 1981). But a key difference was that almost everybody in their particular divisional management and engineering areas understood the DNA of EACH BRAND and did their best to maintain that AND keep their products appropriate for the demographics of their loyal customers AND try to "one-up" the other GM divisions in the process. Many have not understood this internal competition inside of GM being beneficial, BUT it certainly WAS beneficial in all respects. The products showed it, too!

As I recall, the original Aztec show vehicle was a GM minivan with monster tire/wheels, special paint, and futuristic interior designs. Certainly different! But really saleable?

Regards,

NTX5467

Edited by NTX5467 (see edit history)
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No, it was killed, and corporate had been trying since the late 50's to do so.

On Feb. 17, 2009 GM, having already borrowed $9.4 billion in T.A.R.P. funds from the government on Dec. 18, 2008 under the Bush Administration, came back to the government asking the Obama Administration for an additional $2 billion loan. Asked for a business plan as part of the application, they submitted a plan to reduce Pontiac to a "niche division" which would still be in business but making cars in limited quantities at least for an interim. ( Pontiac will be a “focused niche brand” )

After review by T.A.R.P. officials the plan was summarily rejected.

On Mar. 29, 2009 President Obama and GM CEO Rick Wagoner "agreed" that Wagoner should resign immediately, and GM was given 60 days to restructure the company to prove viability.

On April 24, 2009 GM announced the scrapping of Pontiac, and got the $2 billion. ( GM prepares to announce Pontiac closure next week - Autoweek ) It kept them afloat long enough to organize it's eventual bankruptcy in July.

Contrary to trying to kill Pontiac, in the end GM tried too long to keep Pontiac. Among many other things, it cost Rick Wagoner his job.

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Contrary to trying to kill Pontiac, in the end GM tried too long to keep Pontiac. Among many other things, it cost Rick Wagoner his job.

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Most Pontiac people will tell you Pontiac was killed after 1981. Merely a ghost of itself, like Oldsmobile a corporate car. Yes they kept the names, but the soul was gone and so was loyal support.

D.

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