Harlem Finally Will Get a Dealership and It's a Whopper

NEW YORK - There has not been an auto dealership north of 57th St. in Manhattan for more than three decades, despite a population that's larger than Atlanta.

The Harlem Auto Mall is designed to fill that gap.

General Motors Corp. will help develop the $42 million, 3-story auto mall in Harlem, home to 400,000 largely minority persons who have not had community access to a car dealership in more than three decades.

The proposed 280,000-sq.-ft. location is bounded by 127th and 128th Streets and Second and Third Avenues. It was formerly a salt-storage area for winter storm use. About 350,000 vehicles drive by daily.

The announcement of the new mall drew an assortment of dignitaries including GM Chairman Rick Wagoner, New York Mayor Mayor Michael Bloomberg and Rev. Jesse Jackson, who says the proposed facility will break a “redline barrier.”

Plans are for a mall housing Chevrolet-Saturn and Cadillac-Hummer dealerships, plus two other franchises to be announced. Wagoner declines to say how much GM will contribute to the project.

Government leaders collaborated with megadealer Potamkin Auto Group and GM to clear the way for acquiring the property and provide tax abatements and incentives to make the project economically viable.

Bloomberg says that includes an issue of $21 million in tax-exempt bonds. He says the mall “will have a tremendous impact on the economic health” of the area, creating 250 new jobs with the potential for more as new franchises sign on.

Potamkin says the jobs will include high-paying sales, service and support personnel positions. Rev. Jackson has been pressuring car makers for five years to build inner city dealerships. “We are proud that GM's leaders have adopted our recommendation,” he says.

But he labels GM's effort as just a start, and says he will prod DaimlerChrysler AG and Ford Motor Co., as well as other car manufacturers, to build dealerships in the area and encourage minority ownership.

“It is not enough to be customers, but (minority residents) must also be stakeholders,” he says.

GM and Potamkin say their goal is to make that happen.

Wagoner says the Chevrolet-Saturn dealerships will be minority-owned and are being developed as part of GM's minority dealer development program. An owner of the Chevrolet-Saturn store won't be named until later.

The Cadillac-Hummer operation will be owned by Potamkin Cadillac Hummer of Manhattan LLC, an affiliate of the Potamkin Auto group that owns six GM franchises on 11th Ave. in Manhattan.

Potamkin says the Harlem store will be developed under the Potamkin minority-dealership program. There are currently seven minority partners in the group, and when the Harlem Mall is completed there will be 10 minority partners managing 21 franchises.

GM's minority-development program was established in 1972 and is the longest-running program of its type, Wagoner says. GM has 379 minority-owned and operated dealerships.

More than 88% were profitable at the end of 2002, moving up from 84% at the end of 2001 and about on par with the rest of GM's dealers. A record 18% of GM's minority dealers are members of its Million Dollar Club - which equates to earnings of more than $1 million before bonuses and taxes.

Sales by its minority-owned dealers, 72% of whom own 100% of their businesses, accounted for 236,000 vehicles and revenues of $11.6 billion last year. Those dealerships employ more than 17,000 people.

But a GM insider predicts the Harlem Chevrolet-Saturn store could generate at least 2,000 sales annually.