Greenspan recently lowered interest
rates again, which spurs car-buying
and leasing. If President George W.
Bush's tax-cut proposal passes, in
whatever form, the resulting freed-up
cash may help begin to stir activity at
car dealerships.
Even though car sales were down
about 3 percent in January compared
to January 2000's blistering pace, the
drop wasn't as bad as analysts expect-
ed. It was the industry's second best
January in a decade. While total
industry sales topped 17 million in
2000, they are expected to fall off to
16-plus million this year.
The prediction upsets the gloom-
and-doom crowd, which appears to
have forgotten that anything above 15
million is regarded as a highly success-
ful sales year.

active in the business. With Tamaroff
Dodge, Tamaroff also is
DaimlerChrysler's only Jewish dealer
representative in the Detroit area —
he loves to drive a Dodge van.
Ford, Lincoln and Mercury no
longer have any Jewish dealers.
Glassman and Tamaroff are basking
in the glow of record sales and strong
profits. Industry experts apparently
underestimated the ability of dealers to
adapt to the rapidly changing market-
place. They overestimated the willing-
ness of consumers to make a $20,000-
plus purchase over the Internet with-
out kicking tires and even delighting
in the traditional face-to-face by-play
with salespeople.
An industry survey last year showed
new vehicle buyers were 85 percent satis-
fied with their dealership experience.

Tamaroff Buick in Southfield

"Dealers seem to be getting spoiled
by these 17 million years," said
George Glassman, vice president of
Glassman Oldsmobile-Saab-Hyundai-
Kia in Southfield. "There's nothing
wrong with a 16 million-plus year —
we've had much worse." Agreeing is
Mary Tamaroff, chairman of the
Tamaroff Auto Group in Southfield,
who foresees "a great year in 2001, the
same kind of year we had in 2000."
Tamaroff founded his Buick dealer-
ship in 1969, the same year that
Glassman's father, Jerry, started his
Oldsmobile operation. It makes the
two the senior Jewish car dealers in the
Detroit area, and they're both still

3/23

2001

8

Glassman's biggest challenge is what
to do after the demise of the
Oldsmobile brand. Just after he signed
a new five-year franchise agreement
with GM in December, the company
announced it would phase out Olds
over the next two years.
"We had no inkling of that happen-
ing," Glassman said. "Dealers learned
about it by closed-circuit telecast the
same day the news media reported it.
"Now, GM is negotiating a cash set-
tlement with us; their transition teams
are working with each dealership. We
may keep selling certain Olds models,
like the new 2002 Bravada, for up to
five years, and GM will continue mar-

keting support for those cars and pro-
vide parts for service work."
Glassman prefers to remain a GM
dealer in some way, and won't com-
ment on whether a lucrative Cadillac
franchise is a possibility. Because of
the ongoing negotiations with GM, he
also won't discuss the dealership's sales
figures for last year, or whether the
Olds phase-out announcement already
may be turning off prospective Olds
buyers.
"This issue obviously will affect our
entire sales year," he pointed out, "and
we need a reasonable resolution with
GM as soon as possible."
Glassman agreed with Tamaroff that
the old-time, stand-alone GM dealers
are in trouble. Both of the retail veter-
ans have fortified their dealership
operations with foreign car franchises.
"The growth of Saab (owned 100 per-
cent by GM) has been explosive, espe-
cially the '95' wagon," said Glassman.
"It's finally acceptable in many circles
to drive a foreign car now. We're
happy to be partnering in this global
marketing effort. The imports are sav-
ing a lot of GM dealers.
"Sales of some Hyundai and Kia
models are up 50 to 80 percent over
last year, because buyers are seeking
well-designed and well-made vehicles
as alternatives to various domestic
makes. However, in the long run, the
sales of any vehicles this year probably
will be most impacted by gas prices ...
whether they start rising again or
remain stable. And we'll get our fair
share of the leasing, service and body
shop business."
Tamaroff has some advice for
Glassman and GM on how to get rid
of the current inventory of
Oldsmobiles: "Re-badge them and sell
them as Buicks," he suggested. "With
the car going out of business, old-time
Olds owners may not want to buy
them anymore, even with the current
heavy incentives, but I'm sure they
would buy them as Buicks that's a
flourishing name plate."
An important part of Tamaroff's
strategy this year will be to promote
the new Buick Rendezvous SUV to be
introduced in April. "It has a great
engine and there was a lot of customer
excitement about it at the Detroit
Auto Show," he said. "And since the
fad of buying cars over the Internet
has died down, it will bring more

business back to the showroom where
it belongs. The long-time customers
want to see a vehicle up close before
they buy it. I don't see a diminishing
of SUV sales."
The dealership sold or leased close
to 1,000 Buicks last year as the "new
car business continues to be propelled
by leasing," according to Tamaroff.
"One of the problems of leasing now
is that the residuals (value of the vehi-
cle) are coming in too low after the
lease ends. But leasing will continue to
be an important part of our business."
Tamaroff also sells Honda, Nissan,
Isuzu and Daewoo, with a total of 290
employees. His son, Jeffrey, operates
Jeffrey Buick in Roseville.
"There's nothing wrong with
Americans buying imports because
most of the vehicles have 90 percent
North American content anyway," the
elder Tamaroff said. "Many of the for-
eign car companies have become
Americanized, with plants in the
United States."
Maury Feuerman doesn't need much
convincing about the value of a for-
eign car franchise. His father, Arnold,
was a Lincoln-Mercury dealer for 45
years in Roseville before he died in
1999.
But a few months ago, Maury
opened a stand-alone dealership in
reverse ... Arnold Hyundai in the same
city. Sales jumped in January and he
predicts a good year in 2001 despite
the over-capacity problems in the
industry. "The supply is somewhat
greater than the demand," he said.
"I shifted to a Hyundai-only fran-
chise because the demographics for
those customers fit better in my loca-
tion," he explained. "Roseville is a
`Wall-Mart' type of community. We
really take care of our customers ...
give them reasonable prices, great
value for their money, an excellent
warranty and good service, and that
keeps them happy.
"Switching franchises was a change
in culture for all of us, but it's worth
it. We had too many problems before
with the domestic manufacturer, chas-
ing numbers and dealing with too
many layers of management.

Supply Side

Profit-wise, the automotive manufactur-
ers came out of 2000 in pretty good

