GM buys stake in Reynolds & Reynolds

General Motors Corp. hopes to enhance its ambitious e-GM venture by buying 10% of Reynolds & Reynolds, which supplies computer systems to the auto industry in general and dealerships in particular.

GM sees many advantages to acquiring an equity stake, valued at about $200 million, in the Dayton, OH firm.

Two main advantages are:

Developing a build-to-order system which would allow custom-made vehicles to be delivered to customers in a matter of days. But that's years away, acknowledges GM.

Enhancing information and dealer management systems to improve customers' on-line and in-store experiences.

Dealers' operating costs will be lowered and customer satisfaction will improve because of die GM-Reynolds alliance, says William Lovejoy, GM vice president of sales, service and marketing.

He envisions providing GM'S 8,000 dealerships with background data on customers and their vehicles.

Reynold & Reynolds President Lloyd "Buzz" Waterhouse says dealers can use such information to establish a better relationship with on-line shoppers for when they eventually visit the dealership.

He says on-line shoppers dislike entering a dealership and being greeted like strangers, even though they've been interacting with the store's website.

He adds, "This will help provide a link between the on-line and off-line experience. So that when I walk into that dealership showroom, I'm greeted, and people know who I am[ldots]and chances are I'm ready to be sold an automobile that day.

"That's a very powerful notion. It takes cost out of the system, improves efficiency and more importantly it really builds loyalty with the consumer."

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