Sales History May Prevent Dealers From Selling 2014 Corvette C7 Stingray20
As car enthusiasts all over North America are saving their pennies for the 2014 Corvette Stingray, dealerships are planning on filling their lots with the new rear-wheel-drive monster. Or so they thought.
The availability of the spotlight-stealing C7 may be limited to certain dealers, as General Motors has put a sales-volume threshold for Chevy dealers in place. From what we can determine, if a dealership didn’t meet this specified volume requirement in 2012, they won’t be able to sell the C7. For would-be buyers, this means that a bit of a road trip may be in order, should they decide to pony up for the latest Chevy creation.
This isn’t the first time that GM has taken this kind of action. However, it is the first for Chevrolet dealerships. Apparently, the criteria was for dealers to push at least 4 Corvettes out their doors in 2012. Dealers were notified of this change last January, and those failing to meet those requirements will reportedly not be able to use the new C7 as a tool to lure customers into their showrooms.
This will most likely hurt small-town low-volume dealers by limiting their appeal. On the flip side, large-volume dealerships will most likely see many orders for the ‘Vette.
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So if a small-town dealer has one Corvette in stock they actually have a 91 day supply of Corvettes.
Question: Do dealers that sold 0-3 new Corvettes last year need this new one?
I think not. If you were told a year ago that you needed to sell 4 new Corvettes to receive allocation on the new one and you did’nt get it done? Then it simply can’t be that important to that dealer. If the Corvette is simply “eye candy” on the lot or in the showroom? Go buy one at a larger dealer . If you sell that one, go buy another one, next thing you know, you might get “back on the list”.
Following on the heels of the additional service equipment requirement to sell the Volt, this is just another sign that dealerships are tiered into sales volume.
But then talking to the owner of one big dealership, all the companies car about is that you move metal from inside a box whose design and costs they specify.
Viability of the individual dealership does not appear to be a concern.
A dealer, large or small, invests a great deal of his/her own money to sell product with assurances from the factory that the opportunity is there for return on investment. Then GM changes the game on them, requiring un-needed, expensive special tools (like Volt’s $5000 battery tool), special training that is only available at distant sites, EBE/SFE/stair-step programs that result in an un-level playing field, etc. Now sales volume requirements to even stock the vehicles that are in their sales and service agreements? Even if a dealer sells 1, 2, or 3 Vettes a year, he still sells them. Without the ability to sell even one a dealer will likely lose his current loyal Corvette customers to a dealer that sold 4 or more. The loss of long-standing dealer-customer relationships is not good for anyone, dealer, customer, or manufacturer. One has to wonder what model is next?
I would think Bob Lutz should know the answer to his own question…
So are we saying here that a Chevy dealer that did not sell at least 4 corvettes cannot even order a corvette for a customer who enters the dealer and puts money down and specs one out. Ru saying that individual would hsve to travel to a dealer who is recognize for having sold 4 or more corvettes. How would the customer know which dealer to go to. Or are we saying these dealers cannot stock the Corvette on there lots. If I cannot go to any Chevy dealership and order a Corvette then that is insane; now wether a dealer can stock the vette and show them on there lot or not well then that is there problem…
The real Bob Lutz wouldn’t bash GM on comment boards.
Additionally GM has a strong business relationship with VIA Motors, and Lutz is on VIA’s board of directors and a very public face for them, so again, not the real Bob Lutz.
Back on topic. If a dealership is small enough where they cannot sell a Corvette every three months, then the demand is not there to substantiate the supply. Also since many (not all) small dealerships were closed four years ago, the remaining small dealerships who couldn’t meet this quota likely don’t need Corvettes for their business. Those smaller dealerships are usually (not always) located in less urban areas where people are accustomed to driving the larger metro areas. Those rural dealers get their bread and butter from trucks.
The fact is at 14,000 sales per year or just over 4 per dealer average, NO dealer, no matter how large or small, needs Corvette “for their business”. Even at larger grosses per unit, Corvettes contribution to the bottom line pales in comparison to large volume models like Silverado (which at 418,000 outsold Corvette in 2012 by 33 times). The fact remains that Corvette is a halo vehicle for both Chevrolet and its dealers. By taking away a lower volume dealers ability to sell them you also take away the ability of his accountant, attorney, contractor, and fellow small business owner customers to buy one from them. Breaking loyal customer-dealer relationships is not a wise move.
True. I do agree with what you’ve said. One thing the article doesn’t specify is if the dealer can special order one for a customer. It could be that the dealers who didn’t meet the criteria communicated in Jan ’12 could still order them for paying customers. This way they could get back on the list next year if they sell four this year. This article has only been presented (in online form) from one source and includes his editorial license for spinning the perception of the article. With the whole Notre Dame fiasco, I am not willing to take this one source as the whole truth until more info comes out. (Yabadabadoo alluded to this possibility.)
Now, if dealers can order for a customer, but not stock their showroom, this still allows them to sell, but only removes the “eye candy”. This approach allows GM to better match supply with demand and helps identify the areas where sales are.
If you put a Halo car like the Corvette with a dealer that can’t sell it, I don’t think it does anyone any favors, really. People will see it sitting on the lot, sure. But people will also see it ‘sitting’ on the lot and not selling. If it’s in an area where people either can’t afford it or don’t value it, then that doesn’t help anyone either. Besides this route that GM has taken, what alternative could be offered to help match supply with demand?
I rather drive a bit to a dealer with some actual Corvette inventory to look at than a local guy with one take it or leave it Corvette.
So usa1, you will walk onto a dealer lot who may stock , say 4, 6, 10, or even 20 Vettes, then plunk down your $60K+ and just buy one from stock that the dealer ordered instead of one equipped the way you want in the color you want?? Doubtful. Anyhow if I’m spending my hard-earned $60K+ I’m getting the color and options I want, not what the dealer guessed I’d want to drive. That makes your “actual Corvette inventory to look at” argument invalid for me, and I’d guess most early adopters.
Why not at least let small dealers order when just for eye candy?
I meant one
If I have a local dealer, whom I trust and from whom I’ve ordered all my previous Corvettes; then who the hell do Chevrolet think they are to tell me I have to travel to some big city wheeler dealer to compete to order a C7 from people I don’t know ! I may just keep my C6 until they come to their senses…sounds to me like unfair control of trade – is GM starting down the road to failure again ? They need to keep ”small p” politics out of their business !
It’s nothing major… my best guess is that it’s a launch strategy to ensure no C7s sit on the lot for a long time at slow(er) dealers.
I would think a small town dealer knows his market, most likely better then GM and since he is spending his own money to purchase the car to sell on his lot, GM doesnt give these cars to dealers they buy them… Good grief I doubt a dealer is going to over extend himslf with to many Vettes when most people will order them with yhere favorite color ect… Unless GM only plans on selling so many this year and they want to control what markets get that inventory.
I think the repulsive rear fascia of the C7 will hurt dealers more than anything. What the hell were the designers thinking? This looks nothing like a Stingray. Fix the hideous rear end and you’d have an attractive car that would sell itself.
As long as I can go down to my dealer, order a car, pay for it, and pick it up when it comes, I am more than happy. I could care less about them having “one in stock.” I don’t think people buying this type of car choose from whatever they have TODAY. This is not a Malibu!! I can’t imagine people just walking in off the street and deciding to buy one that day. Just doesn’t seem to fit the people who might buy this car, IMHO.
This strategy, called “Turn and Earn”, was an unmitigated disaster, sales wise, several years ago. It was under a sales exec who was shortly “departed” from GM. I don’t recall his name, having never met him, but I recall it starts with an “R”.
There were many people who simply didn’t buy the vehicle when they couldn’t get it from their local dealer. This policy is not only discriminatory against smaller dealers and the customers, it is both short sighted and detrimental to the image of GM.
We need some more “departures”.
I love the old Stingrays and seeing this one just got me all excited about the new ones. I can’t wait to see some of these out there on the road I’m sure they’ll just blow right past man. Man, that’s a good looking car!