Dealers could boost service revenues over GM recalls

Article by Christian A., on May 27, 2014

The huge number of vehicles that General Motors has so far recalled for safety issues seemed like a bad news for dealers. So far this year, GM has recalled 13.8 million vehicles in the United States, although some vehicles were counted more than once due to multiple issues. The recalls covered 2.6 million Chevrolet Cobalts, Saturn Ions and other small cars for faulty ignition switches tied to 13 deaths.

On the other side, such recalls could mean a thriving business opportunity for dealers too. After all, a large chunk of $1.7 billion that GM has allocated so far to cover the cost of 30 recalls would be for repair work and reimbursement for loaner vehicles at dealerships.

Likewise, service advisers will have the opportunity to sell other parts or components to vehicle owners whose units are up for recall repairs. Richard Gonzales, service director at Vera Motors in Pembroke Pines, Fla., told Automotive News that there is no question that dealers will have a “big upsell opportunity” when recalled vehicles come to their shops.

Despite the opportunity, the barrage of recalls represents unpleasant news for dealers. After all, the huge number of recalled vehicles means that a large amount of parts needed to fix them.

So far, dealers are experiencing delayed repair parts and cramped lots as they have been compelled to stop sales of several key models.

Cort Johnson, service manager for Larry H. Miller Chevrolet in Murray, Utah, remarked that he is worried that negative effect of the recalls on vehicle sales would also lead to lesser service revenues at his dealership “two years from now.” [source: automotive news - sub. required]

If you liked the article, share on:

Comments

Recommended

Tesla Motors may soon revive its plans to offer battery swapping services using a new approach. This comes as the carmaker was discovered to have filed a patent months ago...
by - September 21, 2017
There is indeed very good news for fans and enthusiasts of Mercedes-Benz’s AMG GT range: a Black Series is coming to town. This was according to a report by Australian...
by - September 21, 2017
We all know of the standard M4 and the more powerful M4 GTS model, but in between those two models is the newest M4 CS. The CS trim comes with...
by - September 21, 2017
Hyundai has unveiled to the global public its latest sedan that elegantly combines luxury and performance in one innovative package under its Genesis luxury brand – the new Genesis G70....
by - September 21, 2017
A lot of people have been questioning BMW’s design direction lately, albeit the beautiful Z4 concept and the alluring 8 Series concept are excluded from this narrative. This began after...
by - September 20, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries