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Hamilton loses GM franchise

November 06, 1998

Hamilton loses GM franchiseBy BRYN MICKLE / Staff Writer

photo: KEVIN G. GILBERT / staff photographer




A major shake-up is on the horizon for the new-car market in Hagerstown.

A new General Motors marketing strategy will dismantle Hamilton Pontiac-Cadillac on Nov. 16., leaving the dealer with Nissans only.

Hoffman Automotive will take the Cadillac franchise and Sharrett Auto Place will get the Pontiac franchise.

The deal also calls for Hoffman to take over Sharrett's Oldsmobile franchise, creating the potential for Hoffman's yearly sales figures to approach $100 million.

Hamilton will continue to sell Nissan cars and trucks at its Frederick Street lot in Hagerstown.

"We were kind of the odd man out," Hamilton President Richard J. Hamilton said.

Hoffman Automotive owner Robert Suddith, the big winner in the new arrangement, expects to sell 500 to 600 more cars each year. He now sells 1,200 to 1,400 new and used cars at his Hagerstown dealership on Edgewood Drive.

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"I'm thrilled and excited," said Suddith, who noted that Hoffman originally sold the Cadillac line when C.W. Hoffman opened the dealership in 1925.

"I'm sure C.W. Hoffman is rolling over in his grave with a smile on his face," he said.

GM told the dealers to work out the details of the transfer, according to Suddith, who said the other two dealerships will buy Hamilton's GM franchise rights.

Hamilton would not say how much money his dealership will receive, describing it only as a "modest" amount that is "nothing compared to the value of the asset."

Paul Perryman, the principal dealer of Sharrett's two Hagerstown dealerships on Dual Highway and off U.S. 40, said he would not comment on the deal until it is finalized on Nov. 16.

A longtime GM dealer whose father began selling Pontiacs in Hagerstown in 1961, Richard Hamilton said GM told him two years ago that the family-owned dealership did not factor into the automaker's Project 2000 plans.

Hamilton said GM officials told him its marketing strategy called for only two GM dealers in the Hagerstown area, one to handle Pontiacs, Buicks and GMC light trucks and one to handle Chevrolets, Oldsmobiles and Cadillacs.

Hamilton said GM told him his downtown Hagerstown location was not the best for the company's interests, leaving Hamilton with little choice but to sell.

"This is a GM-driven plan," Hamilton said. "It's what GM wants, not what we would have chosen."

A GM spokesman declined to comment on the Hagerstown changeover, but said GM's goal is to shrink the number of dealerships to reduce competition and to place GM products in locations with the highest likelihood of sales success.

While GM products represent about 35 percent of Hamilton's business, Hamilton said he does not anticipate a corresponding drop in business. He said he does not expect to lay off any of his 60 employees.

Hamilton sold about 700 new cars last year and averages about $25 million yearly from a business that includes new and used car and truck sales, a service department and a body shop.

Hamilton said he is sorry to lose the franchise.

"I think it's stupid," he said. "It's typical of large corporations. They're sitting in Detroit and they have no idea how it is on the ground."

Hamilton's father, William C. Hamilton, said he was distressed by the loss and said he would have celebrated his 35-year anniversary as a Cadillac dealer next May.

"I'm sorry to see them go," he said. "They're sort of like my babies. They're my children."

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