General Motors‘ stop-sale orders on several of its recalled vehicles are causing headaches for dealers trying to sell them. According to Automotive News, dealers have been instructed to stop delivering several high-volume models due to safety defects, and it is negatively affecting their ability to earn quarterly recall incentive bonuses.
GM currently has a stop sale order on the Chevrolet Cruze and Malibu sedans, Chevrolet Suburban and Tahoe SUVs, and the Chevrolet Traverse, GMC Acadia and Buick Enclave crossovers. Dealers are allowed to sell these models, however customers aren’t allowed to take delivery or even test drive the car until the defects have been repaired, something which can’t happen until a fix procedure and parts arrive.
Under the Standards for Excellence incentive program, GM dealers must sell at least one more vehicle than they did during the same time period last year, in addition to meeting a customer satisfaction rating target. AN says many dealers have become more dependent on the bonus, which can range from $10,000 for small dealers to $150,000 for bigger operations, due to shrinking profit margins across the entire industry.
General Manager of Ourisman Rockmont Chevrolet in Rockville, Md., Dug Dugger, told AN the stop sale cost his store 15 sales in May.
“On a lot of these stop-sales, the customer just moves on,” Dugger says. “I think it’s especially tough in a high import market like D.C., where the customer has so many other options.”
Dugger noted his dealership has managed to qualify for their SFE bonus in the past two quarters, but he doesn’t believe it will happen this time around. GM said they are taking the stop-sale order’s effect on SFE bonuses into consideration on a case by case basis, but expects most dealers will hit their target due to strong second quarter sales.