By on June 4, 2009

“It’s our obligation to be open and transparent in all we do to reinvent GM, particularly with the American taxpayer as our largest investor.” That was the second sentence out of GM CEO Fritz Henderson’s mouth in sworn testimony before the U.S. Senate re: GM’s dealer cull. When pressed by Senator Rockefeller, Henderson reluctantly promised to release the list of all the dealers sent their walking papers by the corporate mothership. And then . . . nothing. In fact, behind the scenes, GM is desperately trying to quarantine/suppress the information.

The Dow Jones newswire tells the tale:

General Motors Corp. (GMGMQ) and their dealers are negotiating with U.S. lawmakers about congressional demands that the company provide a list of dealerships slated to be shut. Top executives at the auto maker and representatives of dealers were in discussions Thursday with staffers from the Senate Commerce Committee to find a compromise. Among the issues is whether the list should be made public, a move opposed by dealers because of the stigma associated with such a list.

“It would just be a devastating financial effect if their names were released,” GM spokesman Greg Martin said.

The logic: many of the doomed dealers are scheduled to remain open through the fall of 2010. If customers knew their GM dealer was terminally ill, they might not decide to buy a car from them. And we wouldn’t want that, now would we?

In other words, GM expects the US government to collude in deceiving customers, whose tax money is helping to “reinvent” GM. Come to think of it; as a veteran GM Death Watcher, this sounds like the same old GM to me.

[If anyone has this list, please send it to farago@ttac.com. I personally guarantee confidentiality.]

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22 Comments on “GM Backtracks on Promise to Make Cull Public...”


  • avatar
    dwford

    Which is worse, outing the dealers, then giving them only a few weeks to dump their inventory or keeping the list private, allowing the dealers time to wind down their operations in an orderly manner. This gives the dealers a year to find another use for their land/buildings, eliminate inventory, right-size their staffs etc.

    I want to know who is going to close (just to be nosy), but I understand why they don’t want it out.

    I assume the list includes every Pontiac, Saturn, Saab, and Hummer dealer, then a select number of dealers from the remaining brands.

  • avatar
    Happy_Endings

    There is, of course, the Huffingtonpost.com list that has been posted a few times here. It has links to newspaper articles saying a certain dealer is on “the bad list”.

    http://www.huffingtonpost.com/2009/05/15/gm-dealerships-closing-se_n_204031.html

  • avatar
    lutonmoore

    Robert, if you ever start charging money for this website, I’d suggest you fix it so that folks could use their own sign ins and passwords.

  • avatar
    lutonmoore

    This has really soured me on GM and Chrysler. I’d really like to check out a V-6 Camaro. But not with all this crap going on.

  • avatar
    Droid800

    Question: Do all of the dealers on the list know they’ll be closed?

    Considering that GM has notified a little more than half of the dealers that they’ll be closing, part of it might be that they don’t want dealers to find out that they’ll be closing from the local press instead of GM.

    The ‘deceiving customers’ angle is pure BS; most, if not all, of the dealerships are being closed because of poor sales, poor customer service, or because they overlap with another local dealer. In all likelihood, they don’t have any customers to deceive, and even if they do, there are other local dealers available to pick up the slack.

    Whether you like it or not, there are legitimate reasons for not releasing the list, but you’re letting your hatred for GM blind you from them.

  • avatar
    cardeveloper

    Legitimate reasons like allowing customers to buy cars from somebody that will not be around in a few months to support them?

  • avatar

    Droid800

    Think of this from a customer’s point-of-view.

    Would you buy a car from a GM dealer slated for closure?

    Would you feel betrayed—as a customer and a taxpayer—if you found out AFTER you bought the car that the dealer knew it was history and didn’t tell you?

    What if you ASKED and they LIED?

    Henderson promised transparency. Transparency—telling the truth—isn’t easy or fun or safe or even profitable in the short term. But it’s what GM’s CEO told us to expect. In front of the Senate, no less.

    Anyway, if this is the “new” GM, if this is your definition of “reinvention,” then you can have it. Oh wait, we BOTH have it. Bummer.

  • avatar
    oboylepr

    “……most, if not all, of the dealerships are being closed because of poor sales, poor customer service, or because they overlap with another local dealer.”

    How come then that all of them are not being closed?

  • avatar
    Happy_Endings

    Whether you like it or not, there are legitimate reasons for not releasing the list

    Whether you like it or not, there are legitimate reasons for releasing the list. Some customers will avoid GM altogether because they don’t know which dealers are staying and which are going.

  • avatar
    Dr. No

    I’m familiar with GM’s agreement. It’s very one-sided. The dealer has no choice but to sign. Unbelievable bend-over provisions.

    On which dealers slated for termination: The dealer likely will NOT tell the employees before he/she has to, because the dealer has iron to sell and telling will weaken his/her ability/leverage to purchase another franchise to replace the terminated GM franchise.

    One other thing: If there are going to be employee layoffs, there is a WARN notice requirement that obliges the dealer to inform his employees of such layoffs. I believe this is a federal law.

  • avatar
    Dangerous Dave

    I checked the list at huffingtonpost and found my local small town Chevy dealer on the list. Checked some customer reviews on the place through a local review service and they were rated 5 stars. I guess their major sin is having a Nissan dealership next door.

  • avatar
    Patrickj

    The big sin in this cull, in urban areas at least, seems to be sharing buildings with import dealerships, or owning a nearby import dealership.

    http://projects.washingtonpost.com/2009/auto-closings/249/

  • avatar
    Droid800

    Well yeah. A lot of those dealers, since they already have an import dealer, don’t carry the full line (in Chrysler’s case) of Chrysler, Jeep, and Dodge. Part of the point is to get rid of those dealers since they’re not selling enough to make it worthwhile.

  • avatar
    HarveyBirdman

    Perhaps this has been discussed before in previous threads, but I can’t help but wonder if GM initiated this dealer cull prior to C11 simply so it could avoid having to make the list public. Could they have seen Chrysler’s bad press and thought the fallout wouldn’t be as bad if people couldn’t tie their local dealerships to the GM cull? I can’t think of any other reason all this started prior to filing C11, though I believe RF and others had some opinions (which I may subconsciously be parroting here).

  • avatar
    commando1

    “Would you buy a car from a GM dealer slated for closure? “

    IF I was in the market for one of their cars, YES I would,. I’d be hovering over it like a buzzard.
    There will be plenty of other dealerships to do the warrantee work.

  • avatar

    @ lutonmoore:

    WordPress has an option to change your password. I think it’s under “site admin” at the top.

  • avatar
    superbadd75

    I can see how buying a car from a dead dealer in a small town would be a big deal. Once your dealer’s closed, you could easily have to drive an hour or more to a new dealer for service. In urban areas, however, there are usually multiple dealerships in a small area, making the drive to a new one much easier.

    I got curious and went to one of the cancelled Dodge dealers in my area (Dallas Fort Worth), and was blown away by the amount of traffic the place had. I expected them to be busy, but it far exceded what I had in mind. The showroom was packed, the front porch where cars were on display, was packed. All offices were occupied, and they had brought salespeople down from their other stores to help manage the flood of people. It was a madhouse, and they were seriously moving some metal. People didn’t seem to mind one bit that this place was going down, they were looking for deals! And the deals were good, too. One deal that really struck me was a Ram 1500 (last Laramie on the lot) for $14,000 off list, another was a nice Charger R/T for $8,000 off. The Challengers were even discounted, but only slightly. Over all, this place seemed to be really trying to get rid of their stock, and the customers weren’t concerned at all about Chrysler’s misfortune. It was quite a scene. I’m going to go down Saturday, I think, to check out the last weekend there and see what it’s like. If they have any cars left.

  • avatar
    joeaverage

    I figure the dealers nationwide ought to be renting storage lots this summer in Tornado alley and keeping their fingers crossed that “acts of God” helps them out…

  • avatar
    joeaverage

    “It’s our obligation to be open and transparent in all we do to reinvent GM, particularly with the American taxpayer as our largest investor.” That was the second sentence out of GM CEO Fritz Henderson’s mouth..

    As a citizen stockholder then I recommend that we fire the top 50 management people -no golden parachutes- and start over.

    Then we go on an education program to show people the dangers of doing too much trade with China which leads to fewer American jobs in manufacturing, and China having too many American dollars. That begins to address the consumer’s guilt in this trainwreck. Identify which big-box retailers have played the biggest part of decimating American manufacturing in search of the absolute lowest prices. Those low prices weren’t really that low long term were they? I’d rather have a 401K than a 29 cent savings at the store.

    Then we help people learn to manage their money. First lesson: money to spend = income – bills. Never spend more than you have. This important lesson can be applied at the store, at the car dealer, or at the mortgage agent’s office.

    Tune in tomorrow for lesson number two. (Preview: Excessive greed is bad…)

  • avatar

    I see why they wouldn’t want to release it. I would expect some of these dealers are not going to wait until the end of this time frame, but for those who do, it would be impossible to sell anything except at a loss. That said, I would feel cheated if a dealer that I bought a car at closed. Though, to be honest, there are so many here that I wouldn’t have any issues finding another for services, if needed.

    Oh, and who’s the woman?

  • avatar
    joeaverage

    Prob because it would give the consumer too much ammo. Customer goes to a closing dealer and demands a price reduction on a new car or parts b/c they think the dealer is up against the wall.

    Humorous turn of events from my last new car purchase in ’99… (not a GM, but all sorts of dealer insanity and tricks attempted).

  • avatar
    gslippy

    If they can’t bring themselves to follow through on the cull, and if the politicians meddle with the mathematical realities of business closures by saying “not in my district”, then the eventual demise of “New GM” will be accelerated.

    Same old GM, different day.

    Hey, at least Chrysler released their list, and at least they have a plan (Fiat, etc.). Not so GM.


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