Some Chevrolet dealerships halt Volt sales due to tool costsWed, 02 Jan 2013
Some Chevrolet dealers have stopped carrying the Volt after deciding that their sales didn't justify an additional $5,100 for tools to service the plug-in hybrid.
Last month, General Motors notified Chevrolet dealers of the added cost for tools, among other requirements, to keep selling and servicing the Volt.
The math didn't work for Allyn Barnard, owner of Jim Barnard Chevrolet in Churchville, N.Y., near Rochester. Barnard, who has sold five Volts since the car's launch two years ago, decided to quit the Volt authorized dealer program.
Barnard figures his sales and service revenue from those five sales have enabled him to break even on the nearly $5,000 he spent nearly two years ago on Volt tools, training and charging stations.
"Going forward, the profitability would be really hard for us to justify the expense of the repair tools," Barnard says.
Some dealers believe that GM is raising the requirements to be a certified Volt dealer because it wants a smaller network that would steer more Volts to bigger-volume dealers and regions. GM spokeswoman Michelle Malcho says that's untrue.
"It's pretty standard" to require dealers to buy tools to service certain nameplates, Malcho said. Last year, Volt dealers spent $1,800 to $2,800 on tools.
She would not say how many Chevrolet dealerships have quit the Volt program since dealers were informed of the extra cost, but said they account for less than 1 percent of the Volt's sales.
This year, 2,614 Chevrolet stores were certified to sell the Volt. She said 70 percent of Volt sales are generated by the 300 highest-volume dealerships. On Jan. 1, 2012, Chevrolet had 3,079 dealerships, according to the Automotive News Data Center.
Through November, Volt sales more than tripled from the year-earlier period, to 20,828.
As of January, GM wants Chevrolet service technicians to remove and ship sections of the Volt's 435-pound battery pack to GM for repair, rather than shipping the entire pack. To do that, they need a $4,735 battery depowering tool to drain the battery before removing a section. The device accounts for the bulk of dealers' additional costs.
John Holt, owner of John Holt Chevrolet-Cadillac in Chickasha, Okla., near Oklahoma City, says he also has sold five Volts since he began carrying the car, in 2011. But he decided to buy the tools and remain a certified dealer, partly because he wants to sell the Cadillac ELR plug-in hybrid, due out by summer. The ELR's powertrain will be based on that of the Volt.
"I've heard that a lot of the nonmetro dealers have opted out" of the certified Volt program, Holt says. "But with the new Cadillac coming, I figured I'd be foolish not to buy the damn $5,100 tool."
EDIT: Thanks to a comment by all-star commenter, Zzoott Zzootticus the headline has been changed.
By Mike Colias- Automotive News