Corvette Price Gouging: GM North America President Puts Dealers on Notice

With the introduction and continued demand for the C8 Corvette, it’s been all roses for a lot of Chevy dealers looking to cash in on the feeding frenzy over the car.

With the all new 2023 Corvette Z06 set to enter production this summer, GM North America President, Steve Carlisle has now put those dealers on notice with the following statement:

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Dear GM Dealership Team,

We are all very excited about recent GM news and product launches including the Chevrolet Corvette Z06, Chevrolet Silverado EV, GMC HUMMER EVs, GMC Sierra EV, and Cadillac LYRIQ.  At the same time, we have both been working hard to meet customer demand in a time of constrained supply of inventory due to the global industry-wide semi-conductor shortage.

Unfortunately, it has come to our attention that in connection with some of these announcements and launches, a small number of Dealers have engaged in practices that do not support a positive sales experience for our customers.  This puts our collective interests at risk and generates negative press that reflect poorly on GM’s brands and your dealerships.  Specifically, it has come to our attention that some dealerships have attempted to demand money above and beyond the reservation amounts set in GM’s program rules and/or have requested customers to pay sums far in excess of MSRP in order to purchase or lease a vehicle.

First, I want to remind you that GM dealers are obligated to ethically and lawfully sell GM Products, as stated in Article 5 of the Dealer Sales and Service Agreement:

“Dealer agrees to effectively, ethically and lawfully sell and promote the purchase, lease and use of Products by consumers…”

“Dealer agrees to advertise and conduct promotional activities that are lawful and enhance the reputation of Dealer, General Motors and its Products.  Dealer will not advertise or conduct promotional activities in a misleading or unethical manner, or that is harmful to the reputation of Dealer, General Motors, or its Products.”

Providing customers misinformation about additional sums being necessary for a customer to keep a reservation, is just one example of a tactic that reflects poorly on all of us.

Secondly, we have been advised that brokers are promoting new GM vehicle allocation.  While the majority of GM Dealers do not support such behavior, a small number of Dealers still continue to work with brokers despite the following reminders that this is a direct breach of the GM DSSA:  Bulletin #20-06 “Transactional Integrity and GM Export Policy” dated July 1, 2020, and Bulletin #21-17 “Sale for Resale or Export” dated November 22, 2021.  As stated in Article 5 of the Dealer Sales and Service Agreement:  “Dealer agrees that it will not sell new Motor Vehicles for resale” and “Dealer is not authorized . . . to . . . sell Motor Vehicles to persons or parties (or their agents) engaged in the business of reselling, brokering (including but not limited to buying services) or wholesaling of Motor Vehicles.”

GM will be forced to take action if it learns of any unethical sales practices or brokering activities that undermine the integrity that customers expect from the Chevrolet, Buick, GMC, and Cadillac brands.  For the small minority of bad actors that are engaging in the conduct identified above, this letter serves as notice that GM reserves the right to redirect your vehicle allocation or take other recourse prescribed by the Dealer Sales and Service Agreement.

If you have any questions or comments, please reach out to your Zone Manager.

Regards,

Steve Carlisle

President GM North America

Source:  General Motors

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