DETROIT -

General Motors offered a wide-ranging update on its used-vehicle operations Thursday, including the success of Owner Care, the special certified pre-owned maintenance program the automaker launched almost a year ago, as well as expectations on when wholesale volume will pick up to aid franchised dealers.

Larry Pryg, national manager of certified pre-owned operations, shared during a conference call that complete reports are still being generated to detail the full impact of what he reiterated is an “industry first,” the roll out of Owner Care last June.

Since GM’s dealer body helped to create Owner Care — which includes free oil changes, tire rotations and multi-point inspections for two years or 30,000 miles — Pryg indicated franchised stores are embracing the company’s revamped certified program in greater numbers.

“I think our dealer engagement has gotten better,” Pryg stressed. “In fact the last survey we did with dealers, their satisfaction with the program is up about 37 percent.”

At the same time GM unveiled Owner Care, the company also rebranded its CPO program, switching from GM Certifed Used Vehicles to the Chevrolet/Buick/GMC Certified Pre-Owned Vehicles program. Pryg thinks that move is paying dividends, too.

“That was a smart move on GM’s behalf,” Pryg emphasized. “We’re seeing some positive results there, especially in the advertising space. We get a little bit more customer activity when we’re branding it Chevrolet, Buick and GMC versus GM. That is something we know is going to work.”

The traction last year’s moves are generating is propelling GM to another milestone. Pryg estimated the automaker will turn its 4 millionth certified unit sometime during the third quarter.

“We were the first to hit 3 million. We’ll be the first to hit 4 million. That’s pretty exciting for us,” Pryg declared.

General Motors moved 29,604 CPO vehicles in March, according to Autodata Corp.. Through March, it has moved 78,322 CPO units, representing a 4-percent gain.

Pryg expects to have more concrete numbers later this year on what kind of impact the rebranding and Owner Care initiative has had on CPO sales. 

“Dealers really embraced it,” Pryg stressed. “We’re going to see some improvements in retention coming up soon. That was the key strategy behind the whole plan was to tie together customers to the dealership. 

“As we get experience with this, we’re starting to learn that in our industry we have about a 25 percent retention rate with used-car customers coming back in for service, that’s one service within a 12-month period. That lags new car a bit, so we want to make sure we bolster that up and over time we’re confident that’s going to happen,” he went on to say. “The dealers are really happy with the process.

Possible Wholesale Volume Uptick to Begin in August

Also part of Thursday’s call was Dan Kennedy, manager of GM Remarketing. Kennedy reiterated the strategy he said has been communicated to franchised dealers and auctions.

“We continue to ship vehicles around the country trying to optimize and getting them into the right markets for our dealers,” Kennedy pointed out.

“We are going to a little short on product going to the GM-sponsored auctions for May, June and July. We do expect that volumes will start to pick up in the latter half of August going into September, October and November,” he projected.

Typical fleet patterns within the rental segment prompted Kennedy to make volume gain prediction.

“If you take a look at the forecast for the rental vehicles coming back, typically we see heavier volumes in the August-September-October timeframe as they’re switching from one model year into the next model year,” he noted. “Based on the current forecast we have, conditions indicate we would see that uptick in the volume.”

In the meantime, GM Remarketing intends to execute a plan that’s in place at auctions nationwide.

“We’re doing some things for the summer months in order to satisfy the dealers’ needs,” Kennedy stated. “Rather than running two sales at many auctions sites with significantly lower volume, we’ve actually gone to one sale a month at those locations with the lower volumes in order to have some volume there that will actually attract the dealers and make it worthwhile for them to participate in the sales.

“We think it will work better for the dealers and it will definitely work better for the auctions, too,” he added.

No matter how volume might soften or strengthen, Kennedy also touched on how the automaker’s remarketing division is focused on the quality of units that are in the lanes.

“Our focus continues to be on trying to meet the dealers’ needs. We’re hearing from our dealers that through-put for them is very important — when the vehicle arrives at their store to the time they can get it out on the lot to get it sold,” Kennedy shared.

“We’ve focused on making sure our vehicles are as close to retail-ready for those dealers by doing the repairs and reconditioning and pushing as many vehicles as we can into the Front-Line Ready and Sponsor-Plus Programs,” he continued.

“We’ve got full-time people at every one of our auction sites and we ask the staff to walk every vehicle, look at every vehicle and let every vehicle stand on its own as far as what needs to be done to make it retail ready. We’ll try to do as much of the lease-based type of repairs as we can; partial bumpers and wet sanding versus going in and painting full panels and those types of things,” Kennedy went on to say.

Kennedy acknowledged there is not a specific dollar amount on how much can or cannot be spent on reconditioning.

“We’ll do what we have to do in order to keep that vehicle, if it makes financial sense, in the closed sale for our GM dealers,” Kennedy pledged. “There are going to be some that you just can’t make enough repairs to make it a closed-sale vehicle that dealers would be looking for, so we’ll move some of those vehicles over into the open side.”

“Our thought is if we can do the repairs and avoid the downtime the dealer has when they take the vehicle back to their store so they can make it available for a retail sale, there’s a benefit to them and a benefit to us,” he surmised. “If they can sell that vehicle soon, they’ll come back looking for another vehicle. If we can make it easier to do the retail side we can hopefully drive some demand on the wholesale side.”

Overall Used-Vehicle Expectations

Before Pryg and Kennedy gave their presentation, Jennifer Costabile, general director of used vehicle activities and marketing within GM Fleet and Commercial Operations, gave a broad assessment of where she thinks the automaker and the entire industry are going.

“One of our core goals for 2012 is to focus on customer retention,” Costabile began. “We know how important it is to keep customers in our family throughout the total ownership lifecycle. We have to have satisfied customers in our customer base. Our goal is to keep customers and partners in the family for the long run, not just the short term.

“The used-vehicle market continues to be strong. With the new-car market doing well, there’s a nice correlation with used-car activity,” she continued. “We think we’re going to get a lot more dealers certifying more vehicles and getting more customers into our brand, which is very exciting. 

“Especially in the back half of the year when we do see the volumes increase on both new and used, it’s going to be a busy back half of the year,” Costabile concluded.