GM Considers Using Dealerships for Its Own Fleet Management

During an “office hours” conference call for analysts and institutional investors earlier this week, Chuck Stevens, chief financial officer of General Motors, indicated that the OEM was looking into utilizing its dealership network as fleet managers for autonomous vehicle services.

The discussion followed the recent announcement from Waymo that it was partnering with Avis Budget Group, when Stevens was asked about any conversations at GM happening about using its own dealership base.

“I would say we have done a lot of thinking around that internally, and it’s early days relative to how that business model may play out,” Stevens said, adding, “The autonomous vehicle fleet and ridesharing network will be something completely different than what’s anybody has been able to do before…So there’s a lot of thought being given around a lot of different approaches and business models.”

This idea of using dealerships for fleet management is not that wild, Cameron Krueger, managing director at Deloitte Consulting, told Mobility Finance. Dealers are an important part of the ecosystem and are not going away, but instead expanding into different areas of mobility consumption, he added.

“The dealer sells and finances, but they also have space, and knowledge, so why not become a fleet operator?” he said. “They easily could in the new mobility ecosystem. The cars have a place to park and be repaired and [dealerships] have brand loyalty.”

This was a sentiment echoed by Sam Abuelsamid, a senior research analyst at Navigant Research.

“Over the long haul, many of the existing dealers may go out of business…at least a certain proportion of them will transition,” he told Mobility Finance, adding that dealerships today make most of their profits from selling used vehicles and services, and not new vehicles.

A timeline or guarantee that General Motors will do this with its dealer network was not discussed, but General Motors currently has many ongoing mobility partnerships, including with Lyft where the two companies are planning to deploy thousands of self-driving Bolts beginning in 2018. In January, the automaker bought up Sidecar’s assets and in March acquired autonomous tech startup Cruise Automation. GM notably also operates Maven, it’s own mobility service that operates a dozen of cities across the U.S.

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