General Motors Continues Move to Unite Pontiac, Buick Businesses

DETROIT , March 9, 2003; John Porretto writing for the AP reports that even as General Motors Corp. continues its strategy of bringing Pontiac-GMC and Buick dealerships under one roof, the head of Pontiac-GMC says the brands will maintain their distinct personalities.

The idea is to increase sales and boost profits for dealers, even if it means having some overlapping products on the same car lot, Pontiac-GMC general manager Lynn C. Myers said in an interview Friday.

"This is not a merging of brands," said Myers, who's hopeful that a revamped Pontiac line will add life to sagging sales in recent years.

Myers said Buick will retain its sophisticated look, while Pontiac will cater to the sportier crowd with a focus on performance. GMC deals in light trucks.

Because of an aging product line and consumers' affinities for sport utility vehicles, Pontiac's sales have fallen from 616,000 in 1999 to 517,000 last year.

"The basic theory is this: If you give people more distinct choices, more people will come to shop and you'll sell more cars and trucks," Myers said of the Buick-Pontiac-GMC marriages.

GM, the world's largest automaker, began the so-called retail "channel strategy" in the early 1990s. It would prefer, in larger markets, to have only Cadillac, Chevrolet and Saturn -- and possibly Saab and Hummer -- in stand-alone locations.

GM emphasized its commitment to the plan last week when it named Kurt Ritter, the former Chevrolet marketing chief, to the new position of general manager of the Pontiac-GMC and Buick divisions. Ritter will oversee the two divisions, which won't formally unite.

Of the 2,766 Buick franchises at the end of 2002, 109 were freestanding. On the Pontiac side, 58 of its 2,807 franchises were stand-alone. Those stores that already were selling Buick, Pontiac and GMC vehicles numbered 736.

One of the challenges of the plan is persuading dealers in some markets to partner with others, or in some cases sell their franchises.

Jim Ball had a small Pontiac store in Orchard Park, N.Y., seven years ago when he decided to adopt GM's strategy. He bought the GMC and two Buick franchises in the market and built a 40,000-square-foot dealership for his new business.

At first, Ball admits, he was overwhelmed with the new brands and even lost money in 1997. He eventually adjusted and has seen his sales soar. Last month, he said, he sold 450 vehicles. In a good month at his Pontiac store he'd sell maybe 80.

Ball said he can understand why some dealers wouldn't want to get involved in a consolidation. Some family businesses have been around for generations. Other, older dealers may not want to take such a risk late in their careers.

"We're not forcing anyone to do this," Myers said. "It's really going to be a function of how these franchised dealers work in terms of coming together."