UPDATE 1-Dealers say GM customer anxiety rising, sales may take hit

Thu Apr 3, 2014 12:50pm EDT
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(Adds comment from General Motors in 5th and 6th paragraphs)

By Tim McLaughlin

BOSTON, April 3 (Reuters) - An ignition switch defect linked to deadly crashes and mounting recalls is raising anxiety in General Motors Co showrooms, according to dealers who are fielding more calls from customers concerned about the safety of GM cars.

The Ancira Auto Group in San Antonio, Texas, had expected a banner March after a strong February, but came up 28 vehicles short of its goal of selling 200 cars and trucks, Vice President April Ancira said in an email.

GM Chief Executive Officer Mary Barra on Wednesday endured a withering attack at a U.S. Senate hearing that opened with accusations that the company fostered "a culture of cover-up." Ancira said the ignition switch issue contributed to her group's sales miss.

"It will take some time for the brand to gain back the customers it lost," she said. "But I have got to believe that General Motors will use this opportunity to really focus on improving the safety of their product."

GM spokesman Jim Cain said the company is aware that some dealers are worried about how the recall might affect sales.

"Time will tell," Cain said. "In the long term, we will be judged on how we take care of customers. We have advertising incentives and other tools to use if there's evidence that sales in the short term may be impacted. But we haven't seen that."

Interviews with more than 20 U.S. GM dealerships this week revealed concerns that sales would be pressured, even in a recovering auto market. Dealers also made clear there's an escalating number of jittery current GM owners, and demands for repairs threaten to clog some repair facilities.   Continued...