Thursday, February 19, 2009

GM Sheds Some Brands: Good News or Bad?

According to Edmunds.com, the Los Angeles-based auto research firm, the number one question on consumers' minds (as it relates to GM) is "What happens to my warranty and service cost in the short and long term?"
And the answer is, that GM will probably honor the warranty, even if the brand goes away. After all, they want to keep GM customers happy and coming back for more GM cars, when their Hummer or Saturn finally dies. Philip Reed, Senior consumer advice editor at Edmunds.com addressed this question in yesterday's WSJ. He also said other dealerships would pick up the warranty work at "comparable" prices.
But he didn't directly address the fact that GM also announced they will be closing the Saturn and Hummer dealerships, and quite possibly other GM dealerships as they prepare to shrink and become profitable again. This is good news for the aftermarket. As long as repair shops know what they're doing, and perform the service at a comparable rate, they should be able to generate additional business for their shops as these changes take place. And where will the good GM/Saturn techs go? They'll bring their expertise to the good shops.

Another comment about the Saturn line that came out in the WSJ yesterday is the potential for a Saturn made in China or India. According to the report, the Saturn Dealer Council would be open to selling vehicles made by Indian or Chinese makers that would be sold as Saturns. GM did not comment on any spinoff plans.

1 comment:

Baron's Life said...

Too early to predict what's going to happen to the big 3 in Detroit and how it is all going to affect the aftermarket and the independent repair shops...but you raise some good points here..Food for thought.