News / Economy

Dealers Say GM Customer Anxiety Rising, Sales May Take Hit

A group of Chevrolet Camaro cars for sale is pictured at a car dealership in Los Angeles, California, April 1, 2014.
A group of Chevrolet Camaro cars for sale is pictured at a car dealership in Los Angeles, California, April 1, 2014.
Reuters
An ignition switch defect linked to deadly crashes and mounting recalls are raising anxiety in General Motors Co. showrooms, according to dealers who increasingly are fielding calls from customers concerned about the safety of GM cars.
 
The Ancira Auto Group in San Antonio, Texas, expected a banner March after a strong February, but it came up 28 vehicles short of its goal of selling 200 cars and trucks, Vice President April Ancira said in an email.
 
GM Chief Executive Mary Barra on Wednesday endured a withering attack at a U.S. Senate hearing that opened with accusations that the company fostered “a culture of cover-up”, and Ancira said the bad news centered on the ignition switch issue contributed to her group's sales miss.
 
“It will take some time for the brand to gain back the customers it lost,” she said. “But I have got to believe that General Motors will use this opportunity to really focus on improving the safety of their product.”
 
Interviews with more than 20 U.S. GM dealerships this week revealed concerns that sales would be pressured, even in a recovering auto market. Dealers also made clear there's an escalating number of jittery current GM owners, and demands for repairs threaten to clog some repair facilities.
 
“They are calling for information. People are a little confused about what they need to do. There are a lot of these cars out there,” said Al Belford, fixed operations director at Ed Bozarth Chevrolet in Las Vegas, which has been getting about 50 customer calls a day for the last three weeks.
 
Jacqueline Aguilar, service coordinator at Brickell Buick GMC in Miami, said the dealership handles was getting up to 40 calls a day between 2 p.m. and 6 p.m.
 
Holland, Michigan's DeNooyer Chevrolet has been getting 10-15 calls per day, sales manager Dominique DeNooyer told local television, adding that the dealership was finding the “influx” of people challenging.
 
Since February, GM has recalled 2.6 million vehicles due to concerns about ignition switches that unexpectedly turn off engines during operation and leave airbags, power steering and power brakes inoperable. And so far this year, GM has recalled a total of nearly seven million vehicles, or about the same number recalled in the previous four years combined.

Toyota's recall of 2010
 
In January 2010, Toyota Motor Corp recalled nearly 2.6 million vehicles in the United States and Canada to fix sticky accelerator pedals. The recall and the controversy leading up to the decision punished sales.
 
Less than two weeks after the recall, Toyota reported a 16 percent drop in January 2010 U.S. sales. Sales fell again in February before rebounding in March. Still, the automaker's U.S. market share hasn't regained its peak of 17 percent, set in 2009.
 
In contrast, GM's numbers improved in March, the month after the first stages of the recall were announced. Dealers delivered 256,047 vehicles in the United States in March, fueling a 4 percent increase in total sales from year-ago levels. Retail sales were up 7 percent and GM said it gained retail market share.
 
Overall, the auto market is in recovery mode, and a lot of dealership executives, are staying optimistic, including Brad Sowers, owner of Jim Butler Chevrolet in the St. Louis suburb of Fenton.
 
“I'm still in the mode that it's going to be a good year for us and the marketplace has cars that are 11 or 12 years old and rates are really low,” Sowers said.
 
“Our sales have been average,” said James Mardenli, general sales manager at Cerrone Chevrolet Buick & GMC Truck dealership in South Attleboro, Massachusetts. “April should be a good month in terms of sales because April, May, and June are usually the months where the most cars are bought.”
 
But Morgan Stanley analyst Adam Jonas wrote in a research note that his uncle, a car dealer in Canton, Ohio, was concerned.
 
“I think April's gonna hit rock bottom for us. We know we'll get through this, but are just hoping this issue passes as soon as possible,” Jonas quoted his uncle as saying. Jonas didn't name his uncle or respond immediately to a call about the discussion.
 
At GM dealerships near the major U.S. cities of Boston, Cleveland, Los Angeles, Miami, and San Antonio, managers agreed they were spending a lot more time allaying customer concerns.
 
They reported offering more rental cars, agreeing to more trade-ins and telling customers to lighten their key chains.
 
Several dealership executives conceded the bad news is distracting their teams from making their sales pitch in the showroom.
 
Some customers, however, don't want to wait weeks for their cars to be repaired. GM has offered some incentives for trade-ins and dealers say the offer is being taken up.
 
Andy Sweis, general manager at Jennings Chevrolet in the north Chicago suburb of Glenview, Illinois, said the dealership has taken in about a half a dozen Chevy Cobalts for trade-in since the recall

You May Like

Photogallery South Africa Bans Travelers From Ebola-stricken Countries

South Africans returning from affected West African countries will be thoroughly screened, required to fill out medical questionnaire, health minister says More

Multimedia UN Launches ‘Biggest Aid Operation in 30 Years’ in Iraq

Move aims to help thousands of Iraqi religious minorities who fled their homes as Kurdish, Iraqi government forces battle Sunni insurgents More

Video African Media Tries to Educate Public About Ebola

IT specialists, together with radio and TV reporters, are battling misinformation and prejudice about disease More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Gaza Conflict, Hamas Popularity Challenge Abbasi
X
Scott Stearns
August 21, 2014 9:20 PM
The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls for Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid

World Currencies

EUR
USD
0.7492
JPY
USD
102.27
GBP
USD
0.5960
CAD
USD
1.0950
INR
USD
61.300

Rates may not be current.