In 2006, General Motors launched the GM Dealer Outlet Shop program, which allows qualifying dealerships access to surplus and cosmetically-flawed collision parts to offer to its customers in order to stay competitive with aftermarket alternatives.
The pilot program, which began with only 10 dealers nationwide, now has more than 60 participants, including Cable-Dahmer Chevrolet in Independence, Mo., Rydell Chevrolet in Waterloo, Iowa, and Weir Chevrolet in Red Bud, Ill.
"The GM Outlet Shop helps collision repair facilities by offering competitively priced alternative parts that fit and perform like OEM's. They fit right the first time, which makes for satisfied craftsmen and a solid financial bottom line," said Ronald Doerr of the GM collision business line.
GM Outlet Shop parts began as original equipment parts, intended for use in the production of GM cars and trucks, Doerr said. However, due to minor cosmetic flaws or a change in new vehicle assembly requirements, these parts are made available for sale through the Outlet Shops.
Parts qualifying for the program are inspected for quality and must be dimensionally correct, having only A-grade cosmetic flaws or paint runs that require no more than an hour of labor to repair, he said.
Kevin Berry, parts manager at Cable-Dahmer Chevrolet, said he joined the GM Outlet Shop program in January and now stocks Outlet Shop bumper covers on most GM late-model cars and trucks. All the parts come primed and painted, and sometimes the parts are virtually flawless so that they can be installed without extra work, he said.
Aside from adding more dealers to the program, Doerr said the program has largely broadened its product availability.
"We are now harvesting parts from 19 different assembly plants in North America, each representing a new vehicle line, which covers all current GM production models," he said.
Parts made available through the Outlet Shop program include sheetmetal, bumper fascias, fenders, hoods, headlights, and some interior parts.
"It is a good substitute for the substitute," Doerr said. "Instead of going to the aftermarket, customers can try Outlet parts for about the same price. The parts have all the OEM attributes of fit and function, but like salvage parts, some sort of minor repair may be required during installation."
Berry said that since he started with the program in January, sales on Outlet Shop parts have taken off.
"The program is really a win-win for us and the installer," he said. "Nine out of 10 times, the customer is happy with the product, and if they are not, we send them one that they will be happy with."
Doerr said he is working with the insurance community to build awareness of the program. GM Outlet Shop parts are considered "alternative" parts and can be found under the OE Discount / Surplus tabs in some estimating systems.
To participate, a dealer must purchase a minimum amount of Outlet Shop inventory, maintain a minimum existing OEM collision parts inventory, and meet other criteria such as servicing a sufficient number of collision repair facility wholesale accounts and providing adequate staffing and delivery capabilities for the outlet parts.
