Want a Free Ride for the Night? GM Offers 24-Hour Test Drives - WSJ

[Klaus]

Want a Free Ride for the Night?
GM Offers 24-Hour Test Drives

By KAREN LUNDEGAARD and SHOLNN FREEMAN
Staff Reporters of THE WALL STREET JOURNAL


Looking for a new Saab for a night?

General Motors Corp. this week began offering its largest ever test-drive program, offering prospective buyers a chance to take much of its lineup overnight.

The program could rev up after May 1, when GM begins a national advertising campaign and sends out six million letters to non-GM drivers, inviting them to take the 24-hour test drive.

Drivers don't need the letter to take the Hummer H2, Saab or other GM vehicles for a spin -- although they do need to be a "qualified buyer," says Bill Mistele, GM's general director of retail strategy who is overseeing the program. GM is leaving the definition of "qualified" up to its dealers, though he suspects many will run credit checks. GM has set other limits -- drivers must be 21 years old with a valid driver's license and proof of insurance. They can't take the vehicles more than 100 miles from the dealership and they must leave their own vehicle with the dealer. They also must take their test drive by July 22.

Mr. Mistele acknowledged there was some risk to the program. "Are we going to have some people who want to get a free rental? Absolutely," he said. "But for the majority of people it's not worth the aggravation."

The emphasis on luring non-GM drivers back to the fold is a switch for GM, which has heavily promoted owner-loyalty programs of late. But GM's market share has been slipping so far this year, as it has for much of the past 20 years, despite an increase in the past two years due to its 0%-financing programs.

Its incentives seem to have lost their luster this year. Overall, GM sales have fallen 8.7% through March. The No. 1 auto maker has managed to hold on to 27% of the U.S. market, down 1.7 percentage points, the equivalent of 64,000 vehicles in sales lost to rivals.

Roughly half of U.S. car buyers say they wouldn't even consider buying a new vehicle from GM, according to GM's own research. Lately, GM has been trying to show customers it has made gains in quality and in developing fresher, more exciting products.

Many of the details for the test-drive program will be left to dealers, including whether to participate. GM is hoping dealers representing 80% of its volume will participate. Currently 2,400 of GM's 7,400 dealers are enrolled; dealers can sign up through April 22.

Some dealers contacted Wednesday said they didn't want to be tied down to the administrative hassles, and one Detroit-area dealership wouldn't let a reporter take a vehicle overnight, saying the reporter needed the invitation letter from GM.

A GM spokeswoman said the letter isn't required and that everyone is invited to take the 24-hour test drives.

Still, dealers say GM has given them incentives -- $500 per car -- for vehicles sold to the six million letter holders as well as drivers trading in non-GM vehicles. Mr. Mistele said the incentives haven't yet been finalized, but declined to comment further.

Other dealers are excited, though. Wisconsin dealer John Bergstrom plans to have more than 50 models available for overnight test drives. He said he will check for a valid driver's license, but doesn't plan to run credit checks. He is hoping people come in off the street and bring 25 of their friends with them.

Four vehicles are excluded from the program: The Chevrolet SSR and Corvette, the Hummer H1 and the coming Cadillac XLR roadster. Not all dealers, particularly smaller ones, will have a full line up in their demo fleets.

Mr. Mistele suggests customers check GM's Web site, www.gm.com/24hour after May 1 to find participating dealers. He also recommends a call to the dealership to check availability, noting that there could be a weeks-long wait to drive an H2, for instance.

Write to Karen Lundegaard at karen.lundegaard@wsj.com1 and Sholnn Freeman at sholnn.freeman@wsj.com2

URL for this article:
http://online.wsj.com/article/0,,SB1...581800,00.html

[Klaus]

Want a Free Ride for the Night?
GM Offers 24-Hour Test Drives

By KAREN LUNDEGAARD and SHOLNN FREEMAN
Staff Reporters of THE WALL STREET JOURNAL


Looking for a new Saab for a night?

General Motors Corp. this week began offering its largest ever test-drive program, offering prospective buyers a chance to take much of its lineup overnight.

The program could rev up after May 1, when GM begins a national advertising campaign and sends out six million letters to non-GM drivers, inviting them to take the 24-hour test drive.

Drivers don't need the letter to take the Hummer H2, Saab or other GM vehicles for a spin -- although they do need to be a "qualified buyer," says Bill Mistele, GM's general director of retail strategy who is overseeing the program. GM is leaving the definition of "qualified" up to its dealers, though he suspects many will run credit checks. GM has set other limits -- drivers must be 21 years old with a valid driver's license and proof of insurance. They can't take the vehicles more than 100 miles from the dealership and they must leave their own vehicle with the dealer. They also must take their test drive by July 22.

Mr. Mistele acknowledged there was some risk to the program. "Are we going to have some people who want to get a free rental? Absolutely," he said. "But for the majority of people it's not worth the aggravation."

The emphasis on luring non-GM drivers back to the fold is a switch for GM, which has heavily promoted owner-loyalty programs of late. But GM's market share has been slipping so far this year, as it has for much of the past 20 years, despite an increase in the past two years due to its 0%-financing programs.

Its incentives seem to have lost their luster this year. Overall, GM sales have fallen 8.7% through March. The No. 1 auto maker has managed to hold on to 27% of the U.S. market, down 1.7 percentage points, the equivalent of 64,000 vehicles in sales lost to rivals.

Roughly half of U.S. car buyers say they wouldn't even consider buying a new vehicle from GM, according to GM's own research. Lately, GM has been trying to show customers it has made gains in quality and in developing fresher, more exciting products.

Many of the details for the test-drive program will be left to dealers, including whether to participate. GM is hoping dealers representing 80% of its volume will participate. Currently 2,400 of GM's 7,400 dealers are enrolled; dealers can sign up through April 22.

Some dealers contacted Wednesday said they didn't want to be tied down to the administrative hassles, and one Detroit-area dealership wouldn't let a reporter take a vehicle overnight, saying the reporter needed the invitation letter from GM.

A GM spokeswoman said the letter isn't required and that everyone is invited to take the 24-hour test drives.

Still, dealers say GM has given them incentives -- $500 per car -- for vehicles sold to the six million letter holders as well as drivers trading in non-GM vehicles. Mr. Mistele said the incentives haven't yet been finalized, but declined to comment further.

Other dealers are excited, though. Wisconsin dealer John Bergstrom plans to have more than 50 models available for overnight test drives. He said he will check for a valid driver's license, but doesn't plan to run credit checks. He is hoping people come in off the street and bring 25 of their friends with them.

Four vehicles are excluded from the program: The Chevrolet SSR and Corvette, the Hummer H1 and the coming Cadillac XLR roadster. Not all dealers, particularly smaller ones, will have a full line up in their demo fleets.

Mr. Mistele suggests customers check GM's Web site, www.gm.com/24hour after May 1 to find participating dealers. He also recommends a call to the dealership to check availability, noting that there could be a weeks-long wait to drive an H2, for instance.

Write to Karen Lundegaard at karen.lundegaard@wsj.com1 and Sholnn Freeman at sholnn.freeman@wsj.com2

URL for this article:
http://online.wsj.com/article/0,,SB1...581800,00.html