Dying brands: Dealers see past Saturn, Hummer, Saab
First came soaring gas prices; then came economic collapse. Now, news that GM is killing the Saturn brand, scaling back Pontiac, and mulling the fate of both Saab and Hummer. All this has Central Virginia GM dealerships reeling.
"Everybody's feeling this," says Haywood "Huddy" Hyman, owner of two Saturn dealerships, one in Richmond and one in Newport News. "It's the toughest I've seen."
Even before GM’s announcement, Hyman says, business was slow, forcing the longtime dealer to slash overhead, cancel newspaper advertising, and close a second Richmond Saturn dealership on Broad Street.
Calls to the Harrisonburg Saturn dealership– the closest to Charlottesville– were not returned, but Hyman says Saturn dealerships were taken by surprise by GM's decision, announced February 17 in a restructuring submitted to the federal government.
"I don't think this has been as transparent as it should have been," says Hyman. "I don't think we know the whole plan."
GM officials have indicated the company plans to continue making Saturns through 2011, so Hyman says he's considering his options, including acquiring rights to another brand so that his Saturn dealerships–- which employ a total of 75 people–- can survive.
For Carter Myers, owner of six dealerships in Charlottesville and Richmond, including the multi-branded Colonial Auto Center on 29N, GM's announcement stings somewhat less. Colonial sells Pontiac, he says, but that brand makes up only a small percentage of the dealership's total sales.
Myers says unless GM finds a buyer for Hummer, he believes GM will shut down that gas-guzzling, high sticker-price brand. "I can't imagine there's any market for it," he says.
And as for Saab, which is handled by the Brown Automotive Group in Charlottesville, Myers blames GM for squandering the brand identity.
"At one point, the Saab customer was close to Volvo, and a little like Subaru," says Myers–- whose daughter Liza Borches owns the Volvo dealership. "Some way or another, [GM] lost all of that," says Myers. "They didn't cultivate it."
Now, hopes for the salvation of Saab, which was founded in Sweden, rest on the chance the Swedish government steps in with funding, something Myers doubts will happen.
As for Saturn, Myers believes it's possible that China could purchase that brand, but he doesn't know if that would be a long-term plus for GM. "Then what GM has done," he explains, "is created another competitor for itself."
Regardless of the fate of GM's brands, Myers says owners of discontinued makes and models shouldn't worry about service or warranties, both of which will continue to be honored through GM dealerships. And for all the slow sales and gloomy prognosticating, another Central Virginia dealer says he's seeing hopeful signs.
"We have seen some traffic pick up in last 30 days," says Bobby May, general manager of Dick Myers Chevrolet-Pontiac In Elkton. "Lenders are starting to loosen up a little bit as well." However, May also notes that sales are "not back to what we used to be by any means."