General Motors Dealer Agreement: Understanding the Terms and Conditions
General Motors (GM) is one of the most popular automobile companies in the world. If you are planning to become a GM dealer, you need to understand the terms and conditions of the General Motors Dealer Agreement. This agreement outlines the obligations and responsibilities of both the dealer and GM. In this article, we will discuss the key terms and conditions of the General Motors Dealer Agreement.
1. Franchise Agreement
The General Motors Dealer Agreement is a franchise agreement. This means that the dealer is authorized to sell GM vehicles and parts, and use GM`s trademarks and branding in exchange for following certain rules and guidelines. The franchise agreement is a legally binding document that outlines the obligations and responsibilities of both parties.
2. Sales Targets
As a GM dealer, you will be required to meet certain sales targets. These targets are based on your dealership size and location. You will be required to sell a minimum number of vehicles each year. Failure to meet these targets can result in penalties, reduction in incentives, or termination of the agreement.
3. Financial Obligations
GM dealers are required to maintain a certain level of financial stability. This includes providing proof of financial responsibility, maintaining adequate insurance coverage, and maintaining a minimum level of working capital. Dealers are also required to pay fees for advertising, marketing, and training programs.
4. Training and Support
GM provides training and support to their dealers to ensure that they meet the company`s standards. As a dealer, you will be required to attend training sessions and follow the company`s guidelines for customer service and support. GM also provides technical support and assistance with marketing and advertising to help dealers promote their business.
5. Termination and Renewal
The General Motors Dealer Agreement typically has a term of five years. At the end of the term, the agreement may be renewed upon agreement by both parties. GM also has the right to terminate the agreement early for certain reasons, such as failure to meet sales targets or failure to follow the company`s guidelines. In the event of termination, the dealer may be required to return any GM-owned property and assets.
In conclusion, the General Motors Dealer Agreement is a complex document that outlines the obligations and responsibilities of both the company and its dealers. As a GM dealer, it is important to understand the terms and conditions of the agreement in order to maintain a successful and profitable business. By following the guidelines and meeting the sales targets, dealers can expect to receive support and assistance from GM to help them promote their business and meet the company`s standards.