GM Says To Dealers: No Gas For You!


Like the Soup Nazi, the General's laying down the law on dealerships in the latest missive from the bean-counting bureaucrats at the RenCen (Note — in today's episode, the part of "bean-counting bureaucrat" will be played by GM Veep of Industry Dealer Affairs, William Powell), by making it clear they'll no longer reimburse dealers for a full of tank of gas upon delivery. Instead, the Detroit-based automaker will be handing the dealership $20 for cars and $30 for trucks — which if we've calculated correctly, will mean the dealer will be able to pump just over six gallons into a car and ten gallons into a truck without dipping into their own pockets. Hmm...since the tank of a Chevy Aveo (pronounced with the em-pha-sis on whatever syll-a-ble feels right on to ya) holds 11 gallons and a Chevy Silverado holds 34 gallons — that'll be a differential of five gallons and 24 gallons in a truck. So who's gonna pick up that cost? Well, the dealer will initially...but fear not consumers, we expect you'll start seeing a "fuel delivery charge" soon added as a box on your next car purchase or lease agreement. We've got the full dealer communique just a click of the jump away — as well as the Ministry of Truth-like graphic from the General explaining which products are cars, and which are trucks. In case you're confused, the car-based HHR is a truck, but the truck-based Chevy SSR is a car.

Date: August 18, 2006

To: All General Motors Dealers

From: William E. Powell
GM Vice President
Industry Dealer Affairs

Subject: 2006 Fuel Allowance Guidelines

Effective September 1, 2006

This bulletin replaces and supersedes GM Bulletin GM 06-17 dated July 19, 2006, and Saab's bulletin dated October 1, 2005.

Due to changing business conditions and competitive pressures, General Motors must continue to examine all areas of the business and implement solutions to increase revenues and reduce costs.

One of the changes that GM is implementing is to modify the way dealers are reimbursed for the cost of fuel. Beginning with vehicle deliveries to customers September 1, 2006, GM will reimburse dealers a flat rate for fuel expense for each retail delivery. For passenger cars, dealers will be reimbursed $20 per vehicle. For trucks, dealers will be reimbursed $30 per vehicle. By implementing this change to the fuel allowance policy, General Motors will be able to continue to support our dealers and customers while at the same time reduce cost.

A table is provided on the following page containing GM vehicles broken down into two groups, passenger car and light duty trucks. The two vehicle groups are based on the vehicle segmentation classification GM uses for Polk registration data. As new vehicles are added to the GM lineup, they will be classified as cars or trucks based on the existing segmentation scheme and reimbursed for fuel accordingly. As stated above, effective September 1, 2006 these vehicle groups will be used to determine the credits to dealer open accounts for fuel allowance. This change is effective for Chevrolet, Buick, Pontiac, GMC, Cadillac, HUMMER, Saturn and Saab vehicle lines.

GM Says To Dealers: No Gas For You!


The change in fuel allowance also affects fleet orders. The Retail Amenities Delete Credit, (Option Codes V2G and TFD), will be adjusted effective with fleet orders received by GM beginning on September 1, 2006 to $20 for cars and $30 for trucks. Please take note that commitments on behalf of fleet customers, (e.g. Bid Assistance), or fleet orders received by GM prior to September 1st, will be honored at the retail amenities delete credit levels currently in effect.

While this represents a change to GM's policy, General Motors remains competitive in fuel reimbursement within the industry.

Related:
Hey Dealers! GM's Mark LaNeve Has A Great Opportunity For You! [internal]