With well over 13 million vehicles recalled, and over $1.7 billion earmarked for 30 recalls, you’d think General Motors would be in fighting for its life. But for dealers’ service departments, it’s a different story.
“There’s no question that the dealers have a big upsell opportunity here,” says the service director at Vera Motors, Richard Gonzales, whose dealership sells Buick, Cadillac, and GMC vehicles.
Indeed, much of that money will be covering the cost of repairs and loaner vehicles, but it also creates an opportunity to sell other parts and boost showroom traffic while vehicles are in for a fix. “We’re getting a steady flow of Cobalts and Pontiacs and Saturns that we wouldn’t normally see,” says owner of Paddock Chevrolet, Duane Paddock. He expects the extra business to increase repair orders by up to 18 percent.
However, Automotive News reports that many dealers are frustrated by the delay of certain key repair parts, forcing halted deliveries on key models. That extra business also comes with tedious paperwork and space taken up by cars waiting for replacement parts, with some dealerships running out of space. With 2.6 million ignition switch replacements needed for the harbinger of all recalls, many of those cars are going to be sitting there until all replacement sets are finished, which is scheduled for September. This despite General Motors opening up new lines to produce the new switches.
Back four years ago, when Toyota had their own issues with unintended acceleration, Toyota dealers benefited from the warranty work and saw a spike in service business, but to some dealers, it comes with a cost—each order imposes upon the service department’s time and attention beyond the 70-minute fix that General Motors has estimated for each vehicle. According to Gonzalez, “At this point we’re not building a lot of traffic. We’re building a lot of phone calls because the parts are not coming in quickly.”
Adds service manager for Larry H. Miller Chevrolet, Cort Johnson, “My concern is that two years from now, I’ll feel the impact in service due to a negative impact on sales. This is a weird thing. We haven’t had this many recalls in history.”