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GM Dealers Must Feel VERY Threatened . .

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GM Dealers Battle Toyota
March 27, 2007
By Steve Miller/Brandweek

Ads for Toyota's Tundra are driving the controversy.
DETROIT A number of General Motors dealers, who believe GM's corporate ads aren't aggressive enough, have banded together to take Toyota head-on as GM continues to lose sales to its Japanese competition.

Local dealer radio ads, being distributed nationwide, take issue with Toyota positioning itself as an American car company. Further, a lengthy e-mail chain prompts dealers to challenge claims Toyota makes in its Tundra "See-saw" ads showing the truck hauling a load of cinderblocks up a steep ramp.

GM has been retooling, again, as its vehicle sales shrank 8.7 percent to more than 4 million units sold last year, per sales tracking firm Autodata in Woodcliff Lake, N.J. Toyota sales jumped 12.5 percent to 2.5 million vehicles during the same period.

While GM's corporate ads concentrate more on pomp, dealers are left to slug it out in the trenches, said Lou Kaltenstein, president at Norris Auto Group, Middleburg Heights, Ohio. "We'd like to see corporate be as aggressive as we are, but in this litigious society, I can see why they are not focused in that direction. In a perfect world, they would be doing the same things we do."

In one 60-second radio spot, written and directed by Mark Frost, general manager of Jim Ellis Chevrolet in Atlanta, a voiceover says, "Toyota recalled more vehicles last year than it sold. The reality is Toyota contributes more to our staggering national trade deficit than any other manufacturer, and those American-built Toyotas are mostly American assembled from imported parts. Folks, the reality is Chevrolet is better for you, your pocketbook and America."

An internal GM e-mail, obtained by Brandweek, reads: "This Georgia dealer probably obtained legal approval for the [radio ad] by holding the script out of his car window as he drove by the lawyer's office."

Still Terry Rhadigan, a GM rep, noted: "I don't see anything in there that I could, on a purely factual level, quarrel with." As far as reeling in the ad dealer efforts, he said, "dealers are independent businessmen. They have that autonomy."

Toyota rep Chad Harp said the claims are "so far out of line, it's ridiculous. Last year, we recalled a little over 600,000 vehicles and sold 2.5 million in the U.S."

Frost, who once had a Chevy Silverado parked on top of a crushed Toyota Camry in front of his dealership, is preparing other radio spots, which he plans on sharing with the GM dealer network. Of his most recent ad, he said, "I didn't run it by a lawyer at all. Because everything that is said is true." Dealers and GM "corporate people" supporting his work have sent him hundreds of e-mails, he said.

The Tundra, Toyota's remodeled entry in the full-sized truck segment, also has sparked a stinging series of e-mails through the GM dealer network that accuses Toyota of making false claims in its ads for the truck from Saatchi & Saatchi.

One missive debunks the notion that the Tundra can haul 10,000 pounds as advertised. "Many of you have commented on how well done the spot is visually," the e-mail notes. "However, here are the actual facts to share with people: The [voiceover] at the beginning of the spot says, 'It's tough pushing 10,000 lbs. up a steep grade.' Myth: Toyota would like the audience to believe the trailer is 10,000 lbs. Fact: It's a 5,000-pound truck pulling a 5,000-pound trailer. A little slight [sic] of hand? You bet."

Providing dealers with this kind of material to share with customers in the showroom is a way of "leveling the playing field," said Kaltenstein.

Toyota and its agency, however, stand by the ad. A Saatchi senior producer released an affidavit stating that the Tundra trailer bed was indeed filled with 10,000 pounds of cinderblocks and he certified "that at no time during the filming of this commercial was the Toyota Tundra truck modified or assisted to carry any object loaded."

"We knew that something like this was going to happen," said Harp, noting that the claim "is a bit bolder than some things we've seen in recent history. [Still], Automotive Marketing Consultants, Vista, Calif., verified the capability of the new Tundra to perform the tasks of the commercial based on their testing."

"Based on what I've heard, there is nothing in these [accusations] that is untrue or is unfair," said GM's Rhadigan. "It's a function of the Tundra being the new kid on the block and trying to intrude on a space in which we've long dominated."

Toyota's Tundra sales last month were only about 10,000 compared to the Chevrolet Silverado selling 59,000, per Autodata.

Still, more attacks will keep coming from the dealer level. "The thinking, flawed or not, is that you must jar these people out of their 'Toyotas are better' mentality in order for them to put Chevrolet on their shopping list," said Frost.

Kaltenstein agreed: "It is time to call a spade a spade . . . It's kind of like the movie [Network] where the guy says, 'I'm mad as hell and I'm not gonna take it any more!'"
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