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Friday, September 26, 2008

Many Problems Plagued Bill Heard

Many problems plagued Bill Heard Chevrolet

Bill Heard Chevrolet, which shut down nationally Wednesday, faced a long list of complaints about the way it did business and had lost a crucial credit arrangement with General Motors' financing arm.

The Sanford dealership, one of 13 across the country, was the subject of 72 consumer complaints in the past 36 months, including 28 in the past year, according to records of the Better Business Bureau of Central Florida. That resulted in an "unsatisfactory" rating.

In a check of a dozen other large Central Florida auto dealers, the next highest complaint total was less than half that.

Complaints weren't isolated to Heard's Sanford store. The president of the Better Business Bureau of Greater Houston told Automotive News, an industry publication, that Bill Heard stores there "are the most complaint-ridden dealerships in our files."

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At one point, a staff member at the Nashville, Tenn., Better Business Bureau was assigned full time to handle complaints against the local Heard dealership.

"Clearly," said Automotive News executive editor Edward Lapham, "Bill Heard's problems extend above and beyond the economy, given the negative attention his dealerships have drawn across the country."

A key blow came in August, when GMAC Financial Services, General Motors' financial arm, refused to continue financing the inventory for some of Heard's stores.

Just like consumers, dealers must find a source of financing for the cars and trucks that they then sell. The GMAC decision meant Heard had to find financing from independent lenders in a tough credit market. A GMAC spokesperson would only tell Automotive News that the problem was "a financial matter."

From a public relations standpoint, "Heard has been a burr under GM's saddle for a long time," Lapham said.

Heard officials could not be reached for comment Thursday. A statement from the company Wednesday blamed the closings on "rising fuel prices, a product portfolio of mostly heavy trucks and sport utility vehicles, economic recession, unfavorable local market conditions for vehicle sales, the crisis in the banking and financing sectors."

In Georgia, home state of the Columbus-based company, the Office of Community Affairs sued Heard for mailing out fliers that warned consumers of an "urgent potential recall notification," requesting that recipients call for a service appointment. Yet, there was no recall.

In all, Heard has paid more than $280,000 in penalties and expenses in Georgia related to its trade practices and $183,000 in Tennessee.

Florida regulators last year slapped a $400,000 fine on the Heard dealership in Sanford, and another in Plant City, for deceptive trade practices. The 17-page statement issued by the attorney general cited offers that included "Credit Amnesty," a "Fantastic Fortune Cash Giveaway" and "Walking in Approval Wonderland" that the office found to be "false, misleading and deceptive."

Through it all, Heard's dealerships have sold a lot of cars and trucks. The company's Web site claims annual sales of $2.5 billion a year. According to Ward's Dealer Business, the Sanford store sold 5,063 new and used vehicles in 2007, generating nearly $145 million in revenue.

Ted Smith, president of the Tallahassee-based Florida Auto Dealers Association, said Heard "faced a myriad of challenges, and I am not going to Monday-morning quarterback what has happened there."


Steven Cole Smith can be reached at scsmith@orlandosentinel.com, or 407-420-5699, or through his blog at OrlandoSentinel.com/gasgauge.

Source: http://www.orlandosentinel.com/business/orl-heard2608sep26,0,521954.story