Tom Thorstad, the third-generation general manager of Thorstad Chevrolet, 1702 S. Park St., finds the family-owned dealership challenged these days due to the problems of General Motors.

Thorstad believes his dealership has a good chance for survival because of its focus on service over sales and the fact that there's no debt on its 1970 building.

Thorstad Chevrolet was started by Thorstad's grandfather, Clarence J. Thorstad. After World War II, the elder Thorstad became truck manager for Hult Capital Garage and bought the Chevrolet dealership 20 years later. The dealership was renamed Thorstad Chevrolet when it moved to its current location in 1970.

When Tom's dad, Ron Thorstad, took over the service department in 1970, he made customer service a priority, and it since has become an industry standard.

Tom Thorstad's career at the dealership began when he was a pre-teen, shadowing the maintenance man and doing a lot of painting. He began working full time at the business in 1997 and became general manager in 2000. His father is semi-retired, but Tom describes him as "still an invaluable boss."

Q: Why has the dealership remained on the South Side when other Madison dealerships have moved to the edges of the city?

A: Many dealerships tend to be sales-based organizations. To do that, you want to follow the population and be in highly visible areas, so you see them setting up along the Beltline or off the Interstates. It's also easier to get land outside of the central city.

Our dealership was always a servicing dealer first and a selling dealer second. What I mean by that is most of the focus was put on the service operation and growing the parts operation. My father's philosophy was always that you don't need to sell the cars for a whole lot of money. You can have a very thin margin because the more cars that are on the road, the more opportunities you will have to bring these customers in for service, to treat them right and to make them long-term customers and grow the business that way.

By being in a central location, you're able to serve both sides of town and you're in a very good location for people who work Downtown. Park Street is a gateway to the city ... .

The other reason is that we have a good tract of land and we have a building that's paid for. If you're going to move a dealership, it's going to tremendously increase your capital costs.

By saving those capital costs, we're able to invest in our people, to invest in training, to be able to keep people on when times get a little tougher and to make sure that the equipment inside the building is as modern as you can get.

Q: What are the most popular models these days and do you think declining gas prices will revive interest in larger vehicles?

A: Actually, just about everything is still selling, although it's selling less. Chevy trucks are absolutely the best on the market with the ride, the handling and the capabilities of them. The Impala's been a great performer for us and the Malibu has been just phenomenal with the reception to it.

People still like the safety of larger (cars) and utility vehicles. We've had tremendous advances in automotive safety, from anti-lock brakes to air bags everywhere to engineer-designed crash zones, but you can't get past the physics of it. The larger, heavier vehicle is going to protect its occupants better.

This fall, we saw kind of an upsurge of truck sales. But I think that people understand that the gas price fluctuations are not going away, so I think the move to find more fuel-efficient vehicles is really going to be with us for the long haul. We have eight models that get more than 30 miles per gallon on the highway.

Q: How will your dealership be affected by the grim news we've been hearing about General Motors?

A: I was never here for the heyday of General Motors, so as long as I've been in this position, they've been forecasting our demise. It certainly is dire. It's not just the GM employees, the Ford employees or the Chrysler employees, it's the retirees that outnumber them. It's the suppliers that outnumber them, it's all of the downstream. It's people that work the lunch counter across the street from the plant. It's the people that cut their hair.

You're going to see a number of dealership closings all across the country, including a few in Milwaukee. You're starting to see layoffs within dealerships here.

Our philosophy is that we want to adapt to the market without any layoffs. My father's philosophy and mine as well is that you want to keep people employed until you're at the last dime.

Because of our focus on service, we can survive pretty well on few sales. We will last a long time because we repair the vehicles that are already out there. Franchised dealerships that have access to the GM training have the ability to withstand the sales drop.

We also don't have tremendous building costs or huge mortgages. Because of the age of our building, the cost cutting we've done, where we are in the central city and our focus on service, I think we're poised pretty well to weather the storm.

Q: What do you believe is the long-term outlook for the auto industry? Are we going through a rough patch or a major realignment?

A: This is not just a bump in the road. I don't know yet about a major realignment, but change is coming. I believe that GM will be around. With the dealership network that makes up GM, these are family businesses and they will find a way to stay around.

We'll see dealerships go out and we'll see the manufacturers shrink down. I think the government will step up in some fashion. If there was a catastrophe with one of the domestic auto manufacturers, it would cause a spiral that would affect everybody.

I think it's positive because I think we have too many dealers. The manufacturers have to retool for what society needs now. It'll be an opportunity for all of us to streamline.

TOM THORSTAD

General manager, Thorstad Chevrolet

Address: 1702 S. Park St.

Web site: www.thorstad.com

Employees: 105

Annual revenue: $40 million

Age: 34

Education: Bachelor's degree in business, psychology and military science, UW-Whitewater.