Hummer gets its own dealerships
By Ed Garsten
Associated Press
TROY, Mich. — They look more suited to urban bivouacs, but that's the look General Motors Corp. and its Hummer affiliate are shooting for in the new Hummer dealerships opening over the next two years.
Associated Press
Models of the half-Quonset hut, half-modern showroom and service center concept were unveiled yesterday along with the announcement that the first 80 of 150 GM-Hummer dealerships will open this year.
John Bergstrom stands behind a model of a Hummer dealership unveiled in Troy, Mich., to announce that the first 80 of 150 new dealerships will open this year. In July GM will begin selling the Hummer H2 sport utility vehicle through the dealer network.
Those dealerships initially will operate out of existing facilities, then move into buildings based on the new design.
"We tried to pick up the heritage of the Hummer, but not make it military-like facility," said John Bergstrom, a dealer from Neenah, Wis., and a member of the dealer advisory board that helped come up with the concept.
Dealerships will feature a giant entrance in distressed steel in the shape of an "H", room for four vehicles in the showroom, 32-foot-high ceilings and a test track circumventing the 5-acre site.
"I look at it as an amusement park for adults," said Bergstrom.
Hummer franchises have been awarded to dealers in every state, according to Steve Hill, Hummer director of sales and service. Those winning franchises were identified as the best GM dealers in a given market.
GM bought the Hummer name from South Bend, Ind.-based AM General in 1999. It will begin selling the Hummer H2 sport utility vehicle through the new dealer network starting in July.
Customers already are lining up to buy the imposing SUVs that will start at about $50,000.
"We're virtually sold out through the end of the year," said Hill.
The dealers also will sell the Hummer H1 and subsequent new products, Hill said.
The new dealerships will cost about $1 million, not including the cost of the land and landscaping. However, dealers who balk at the cost will not be allowed to sell the pricey Hummer products.
The company plans to mirror the "market area" approach used by its Saturn division, according to Bill Lovejoy, group vice president for GM vehicle sales, service and marketing.
The market area strategy gives dealerships exclusivity in certain regions, rather than having to compete with many nearby dealers. The result is better customer service and more profits for dealers, Lovejoy said.
It's a sound way to go, according to one marketing analyst.
"The brand already has a strong image," said Wes Brown, an analyst with the automotive marketing firm Nextrend. "You want to keep that aura about it and to do that you don't want to oversaturate the market."
One approach Hummer dealers will use to maximize profits is to sell accessories as part of the initial sale, rather than as an afterthought.
Customers will order accessories such as off-road lighting, brush guards and removable steps when they order their vehicles. The accessories will be manufactured by outside companies and shipped to dealers for installation, according to Hill.
