GM Studies Amazon to Improve Factory-to-Dealership Vehicle Deliveries
Chevrolet Silverado pickup at GM plant in Fort Wayne, IN, loaded on train car for shipping to dealership.
MCCALL, ID – Citing Amazon as a paragon of shipping efficiency, General Motors is working on ways to improve its nationwide factory-to-dealer deliveries.
“Amazon has the best logistics in the world,” Dale Sullivan, who heads Chevrolet’s Western region, tells a dealer gathering here. “That’s where we need to go; where we can precisely tell you where a vehicle is and when you will get it.”
Amazon’s product distribution system doesn’t tackle anything the size of a fullsize Silverado pickup truck weighing 5,433 lbs. (2,464 kg). Still, GM is learning some logistical lessons from the e-tailing giant.
“We’ve had people visit Amazon,” Sullivan says at the Idaho Auto Dealers Assn. annual convention here 100 miles (160 km) north of Boise.
Shipping Cadillacs from a Detroit plant to nearby Motor City dealerships is relatively straightforward. Delivering cars cross-country to, say, IADA President David Taylor’s Cadillac store near Idaho Falls gets more complicated.
GM contracts with trucking companies and railroads to transport vehicles from 18 assembly plants in the U.S., Canada and Mexico to about 3,500 American dealers. Backups can occur during times like now when auto sales are on pace to reach nearly 17 million units a year, Sullivan says.
“We have the rail cars and trucks but not enough of them, and (transportation) suppliers are nervous about adding capacity,” he says. “It will slowly get better but not totally better.”
He covers other auto-retailing topics:
The automaker has no plans to increase its dealer count. Some markets are overdealered. “There are 11 Chevy dealers in Denver, and we probably need eight or nine. Those guys know it.”
GM is testing use of virtual-reality goggles at dealerships. “You put them on and you see a vehicle walk-around. There’d be fewer actual vehicles in showroom.
GM will continue its Shop, Click and Buy online initiative, even though it hasn’t garnered much consumer interest. Nor is it intended to undermine dealers. “We still need dealerships to deliver the car.”
Even with financial incentives, some Chevy dealers balked at GM prodding them to participate in facility-upgrade projects using a standard architectural design. The program was necessary. “We had some of the worst facilities, and we’ve changed that.”
The true measure of customer satisfaction is customer retention. “Don’t over promise and under deliver,” Sullivan advises dealers. When he receives letters from consumers complaining about dealers “it’s always about unmet expectations.” Then again, “some customer expectations are crazy.”
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