A couple looks at the Chevrolet Traverse. General Motors said on Friday that it will reinstate about 600 dealerships. (AP Photo/Lisa Poole)
Associated Press | General Motors Co. will reinstate more than half the dealerships it
targeted to drop from its network.
GM executives said Friday that about 600 dealerships out of the 1,100
seeking to stay with GM will receive letters giving them the option to
remain with the automaker.
The Detroit automaker last year told 2,000 dealerships it would revoke their franchise agreements in October 2010 as part of its restructuring. The company has said it needs to shrink the number of showrooms to keep the remaining ones healthy.
The dealerships, who say they have been treated unfairly, have been appealing the decision.
The cuts to GM’s 6,000-dealer network were designed to compensate for much lower demand for cars and trucks, but some dealers have argued that lots that are still profitable are at risk, and that the automaker hasn’t offered enough details about how it’s choosing which businesses to shutter.
GM and Chrysler, which has slashed 789 dealers, have said they would reconsider the cuts. The decision was a compromise meant to avoid federal legislation that would require that the showrooms be kept open.
Under the revised plans, dealerships would get face-to-face reviews, binding arbitration and faster payments to help dealers slated for shutdown.
Congress-brokered talks between dealer groups and the automakers began in September. But those talks stalled over disputes about the review process for targeted dealerships and other issues. Looming over the fight has been the threat of federal legislation to deal with the closures. Lawmakers warned that if a deal wasn’t reached, that legislation would move forward.
The White House has opposed the legislation over concerns that it could hurt GM’s and Chrysler’s efforts to rebound from their government-led bankruptcies.
Perhaps Pontiac ??
Government Motors doing the bidding of powerful Democrats!
Next they’ll decide to bring back the Chevy Vega.
You can bet there were some political back room deals
make on this move.
You can also bet that the American taxpayers are going to be subsidizing this move.
Hang on a minute, and let me do the math…..yep, 1.5 million new jobs “saved or created”!
any chance tracking the location of these dealerships? I’m guessing they may fall into certain congressional districts.
AS LONG AS D”ANDREA BUICK STAYS CLOSED ON WESTERN AVE ILL BE HAPPY.
I was thinking about new names for GM cars, hip new cars..I was thinking “chevette?”
This is exactly why the automakers are always teetering on collapse. They’re losing money, so they make cuts, close plants, layoff workers. The second they turn a profit, they go right back to spending too much. They don’t seem to understand that the profits they are making are temporary, if not already over. Toyota will start regaining it’s market share and the government is out of free money for tax incentives. It must be horrible to be an employee in the auto industry.
The corporate tax structure is a huge problem for small business. If the corporation profits, the profits must be spent, or the government takes a huge chunk of it. Thus, big bonuses, and too much spending. That is how the government thinks they keep the economy growing – by forcing corporations to spend their profits. Then when there is a dip in the economy, there is no money in the corporation to get through hard times. We all must play by the government’s corporate tax structure and the structure sets up the corporations for failure.
Good news that means GM is regaining strength with sales. Toyota can stick it DE.
Good news that means GM is regaining strength with sales. Toyota can stick it DE.
How can they do this? It’s simple. GM is now part of the government, and everyone knows the government can add workers even in the worst of recessions.
Reinstating dealerships to sell cars no one wants to buy. Good luck GM.
Reinstating dealerships to sell cars no one wants to buy. Good luck GM.
Great to see an American car company doing something like this. Now if only those who buy Japanese and Korean cars would wake up and buy American, unemployment would be way down.It warms me up when I pass an unemployment office and see all those foreign cars in the lot. Those are the people that should lose their jobs.
So many posters out there are absolutely cluesless with your “government motors” trype. When was the last time you could buy a 500+ HP Cadillac or Corvette? Even the Camaro was brought back with a V8 with almost 400HP. Why don’t you all pick up the latest copy of Baron’s (if you have any idea what that publication is all about) and read about their take on the resurgence of GM.
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So let me guess, the legal liability of getting rid of these dealerships was too much. It is just GM not understanding small market dealerships. They depend on the repeat customer and do not have an endless supply of customers to rip-off.
@cadman: Your point is invalid considering the number of Toyota and Honda plants right here in the US.
GM isn’t doing well enough to keep these dealers open. This is a political decision made in Washington, not a business decision.
It’s probably a combination of things. Toyota’s electronics issues are probably helping a bit.