Sonoma Chevrolet keeps GM contract

General Motors has terminated contracts with 1,100 national dealerships but the list does not include Sonoma Chevrolet, owner Dan Roseland confirmed. GM declared bankruptcy on June 1.
As part of the restructuring, the company said it would significantly reduce its retail network of 6,000 dealers. The fate of the West Spain Street lot came last week in the mail. “Every dealer in the country was sent a letter,” Roseland said. “It was either yes or no.”
The “yes” means Sonoma Chevrolet will remain part of a GM sales network ultimately numbering between 3,600 and 4,000 dealers. GM’s criteria for terminating contracts, Roseland said, included having a location too close to another dealership, low sales and a low level of customer satisfaction.
Roseland says business at his West Napa Street lot has been slow, with sales down 50 percent for the last seven to eight months. He points to the economy rather than product. “Look at the other guys, Toyota and Honda. They’re all losing money.”
A bright spot is the new 2010 Camaro, “a home run.” Style-wise, he called it “the car of the century.” The first Camaro arrived pre-sold, Roseland said, “but we will be getting more. It’s a pretty big deal.”
Other positives for the dealer include GM’s move into the small SUV category. With the Chevrolet HHR and Equinox, GM competes on price and gas mileage with popular Toyota models. And next year GM plans to be the first to market with an electric car, the Volt.
Having his lone supplier in bankruptcy has not affected the day-to-day operations, Roseland said, and he doesn’t spend too much time thinking about it. “I’m busy trying to run a business, trying to keep profits up and expenses down,” he said. “That’s how I focus my time.”
The fate of other regional GM dealers is unclear. The company does not plan to officially release a list of dealers who, if identified publicly, could lose business operating under contracts that end in October 2010. There is also an appeal process, which could affect the final list of closures.
GM said that dealers in the reduced network will have bigger growth potential and, with increased profits, will be able to invest more in operations and advertising.
All that remains to be seen. For now, for Roseland, the situation is clear. “If GM doesn’t make it,” he said, “we’re gone.”