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February 8, 2011 > GM considers adding dealerships in coastal states

GM considers adding dealerships in coastal states

By Tom Krisher, AP Auto Writer

SAN FRANCISCO (AP), Feb 05 - General Motors may add dealers in big metro areas on the U.S. coasts because it expects sales there to grow, two top executives said Saturday.

It's the opposite of the company's stance just two years ago when GM got rid of about 1,700 dealers across the U.S. as it headed into bankruptcy protection.

GM has been losing dealers on the coasts, especially in California, for two decades due to slow sales as people bought more foreign brands. Company officials say GM's poor products also played a significant role.

Mark Reuss, GM's North American president, said Saturday that the company's dealership footprint on the coasts was destroyed by the lack of products, the financial meltdown and GM's 2009 trip through bankruptcy protection.

The company, he said, wants to rebuild the network because its newer models, like the Chevrolet Cruze compact, are starting to sell better in coastal markets, and GM expects growth to continue as it rolls out more new products and the economy recovers.

``We know there's areas where we should be that we're not,'' said Don Johnson, vice president of U.S. sales. ``We didn't have the product. We didn't have the focus. We were irrelevant to California consumers.''

GM needs more dealers in the San Francisco and Los Angeles metropolitan areas and will look at other areas on the East and West coasts and around the Gulf of Mexico, the executives said. They gave no timetable for the changes and said they could move dealerships from depressed areas or add new franchises.

GM has only 227 dealerships in California, about the same number it has in Michigan, which has less than one-fourth as many residents as California.

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