Any bankruptcy among Big Three is likely to cut into retention, making recovery even harder.
Don Wissel's love affair with General Motors cars started in 1960, when he bought a silver-gray Pontiac Catalina, a roomy car with modified tail fins and enough horsepower to gobble up miles on the Garden State Parkway. Since then, he's owned almost everything GM's made – Chevys, Buicks, Olds, Caddys, and now he parks a Yukon and a Denali in his driveway in Rumson, N.J.
"I've never had a problem with a GM car," says the retiree. "They make big cars, and I like big cars."
Mr. Wissel qualifies as a "loyal" General Motors customer – a group the automaker will need to hold onto now more than ever if it is to survive and prosper in these hard times. The specter of bankruptcy, though, may impair GM's ability to retain even these loyalists – one reason that the firm's CEO, along with the top executives of the other US automakers, returns to Washington this week to make the case for some sort of federal bailout. Their key argument to get $25 billion: They have a business plan to remain viable.
For any auto company business plan, repeat customers are essential – they're a less expensive way of making a sale than wooing a customer from someone else. But if an automobile company were to declare bankruptcy, even the most loyal customer base would probably dissipate – one reason Detroit executives appear so disinclined to go that route, say analysts.
Page 1 of 4