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GM failing to keep Hummer, Pontiac and Saturn buyers
13 May 2011 - The Wall Street Journal is reporting that General Motors has been unable to hold onto the loyalty of new car shoppers who formerly owned vehicles from one of the automakers now-defunct brands. Hummer, Pontiac and Saturn owners are now turning outside of the GM family for their new purchases.
Despite the fact that GM has offered up to $1,000 to those customers during January and February, around 71 percent of Saturn owners traded their vehicle for another brand this year. Likewise, 70 percent of Pontiac drivers opted for a different make when it came time to replace their vehicle in 2011.
While 23 percent of Saturn drivers switched for a Chevrolet, 35 percent turned in their keys for a Honda, Toyota or Ford product. Speaking of Ford, the report notes that Blue Oval is suffering from similar woes when it comes to Mercury customers. Those buyers headed towards other automakers at a rate of 65 percent this year.
In addition to incentives, GM works with its dealers to target potential defectors. It sends notices of special deals they can get and reminders encouraging them that GM has new Chevrolet, Buick, Cadillac and GMC models that they could consider when shopping for new vehicles.
GM dealers also are contributing to the effort. At Harry K Chevrolet Buick, in Chamberlain, S.D., every time a Pontiac owner drives in for service, the repair shop called the sales department. A salesperson then arrives to pitch the owner on purchasing a GM car or truck.
"Hopefully with the breadth of the Chevrolet line and new vehicles from Buick, we can bring those owners into the fold," said owner H. Douglas Knust. Even with the effort, he said, keeping customers will be a challenge because Pontiac owners may not find what they want in a Chevy.
Despite the defections, GM's overall sales are rising amid an economic recovery. The auto maker has gained market share so far this year—in large part because it now concentrates on its Chevrolet, Buick Cadillac and GMC brands. In the first quarter of this year, GM had U.S. market share of 19.4%, about flat with the 19.6% it held in January 2009, just before GM announced it would unload its other four brands.