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August 09, 2007 - Image 28

Resource type:
Text
Publication:
The Detroit Jewish News, 2007-08-09

Disclaimer: Computer generated plain text may have errors. Read more about this.

Jay Feldman

Michigan's
economy is
changing,
but two car
dealers see silver
linings in the
dark clouds.

Alan Hitsky
Associate Editor

W

hen Jerry Glassman opened his Oldsmobile dealership on
Telegraph Road in Southfield in 1969, American consumers
basically had three choices: Chrysler, Ford and General Motors.
Today, the same dealership is called Glassman Auto Group, is run by son
George, 53, and sells cars by Hyundai, Kia, Saab and Subaru.
And that, in a nutshell, is what has shaped Detroit and Michigan's economy
over the last 40 years.
The changes have been a detriment to the Big Three automobile manufac-
turers, George Glassman said, and the situation is not going to change back to
the way it was.
"People are shopping with their pocketbook now and they expect the qual-
ity to be there. More and more,' he said, "it's becoming a matter of value" for
the buying public. And brand loyalty has become a relic of the former era.
"When I was 16 or 17',' Glassman said, "everyone wanted a Cutlass
Supreme. There were limited choices, but that car stood out" General Motors
then made the mistake of broadening the Oldsmobile Cutlass brand, with the
Supreme, the Salon and the Cierra."Everything was a Cutlass',' he said.
Over the last 25 years, GM repeated the mistake in a different way across
its car lines. There were only slight changes between its Chevrolet, Pontiac,
Oldsmobile and Buick models. As the public rebelled and the quality of for-
eign imports improved, GM and the rest of the Big Three began losing market
share. One of the results: General Motors stopped producing Oldsmobiles in
2004. The brand was founded by Ransom E. Olds 107 years earlier.
So Glassman Oldsmobile lost its American base ... or did it?
The Southfield dealership sells Japanese and Korean products and the
Swedish-based Saab ... which is owned by General Motors.
There are a lot of people who still feel the need to drive domestic-made
cars. But it is getting harder to tell what "domestic" means. The Toyota Camry
and Honda Accord have very high domestic content. A number of cars
made by the Big Three are assembled in Canada with lots of Mexican and
other overseas-made parts. Further complicating the issue was the Daimler-
Chrysler merger and now the pending sale of Chrysler to a U.S. private-equity
group.

Another View

Jay Feldman is another second-generation auto dealer. His dad, Marty, is
a partner with him in Jay Chevrolet in Highland and in the new Liberty
Chevrolet dealership in New Hudson. Jay's sister. Marla, is a partner in Marty
Feldman Chevrolet in Novi.
While the family has had a happy marriage with the Chevrolet brand,
Jay may diversify in the future. He bought his Liberty Chevrolet site in 2002
— 12.5 acres southeast of 1-96 and Milford Road, adjacent to the new Lyon

28

August 9 • 2007

George Glassman

Towne Center shopping strip. It opened in 2005. He also owns an 11-acre site
awaiting development north of 1-96.
"Dealers don't acquire more stores and franchises because they have to',' Jay
Feldman said. "They do it because they want to ... The strong dealers will sell
cars and services and the weak will go away."
Feldman, who is 36, started washing cars at his father's dealership when he
was age 10, started selling cars at age 15, managing at 19, was a general man-
ager at 21 and a Chevy dealer at age 25. The opportunity to become a dealer
came through "having good relationships with General Motors," he said, "and
having people think well of you."
Feldman doesn't let bad economic news bother him. "If you read the
newspaper, it's all gloom and doom',' he said. His response is to out-work the
competition. And he sees a rosy future for selling cars in Metro Detroit, citing
the following:
•"In Southeast Michigan, there is $1 billion in retail construction going
on:'
•"The Michigan economy was great for 15 years. It was bound to have a
hiccup."
•"In Southeast Michigan, 70 percent of new car sales are leases. Every two
to three years, people will need a new car:'
• General Motors has a great product and General Motors has great new
products coming out:'
• General Motors hasn't produced a bad car in years.
To back up the last statement, Feldman distributes to prospective custom-
ers a J.D. Power and Associates report showing GM plants leading the indus-
try from 2002 to 2005 in producing cars with the fewest initial problems.
"I love the car business',' said Feldman, "and my thinking about its future
hasn't changed."

The Future

George Glassman works with his father, Jerry, "every single day. He's a val-
ued consultant and mentor:' George started at the dealership "as a kid',' but
has been active at the dealership since 1980, following graduation from the
University of Michigan and the University of Detroit Law School.
Glassman, 53, is also bullish about the future. He just believes that the Big
Three model is gone.
"The people who feel the need to drive domestic cars are the same ones
who buy foreign for their wives and families," he said.
It for that reason that GM is "doing everything in its power" to expand glob-
ally and Ford two weeks ago reported profits in all its overseas divisions, but a
loss in North America.
The biggest change, Glassman believes, is that all the manufacturers are
making deep cuts to be profitable and the cuts are hurting Michigan's middle

Auto Motive on page 34

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