By on October 25, 2010

Ohio Republican Reps LaTourette and Boehner have officially requested that President Obama suspend GM’s dealer wind-down agreements until the Special Inspector General for TARP (SIGTARP) completes an investigation of the government-approved GM and Chrysler dealer culls. The representatives focused on the fact that SIGTARP’s initial report on the dealer cull, which had criticism for GM, Chrysler and the government task force, wasn’t publicized until after arbitration for culled dealers ended. WKYC quotes the representatives’ statement as saying

There is too much at stake to proceed in an atmosphere where dealers were denied so much crucial information in a process rife with secrecy. As the findings of this investigation may shed much needed light on the proceedings affecting hundreds of dealerships nationwide, we believe it is necessary to thoroughly analyze its results before continuing with the closures of hundreds of dealerships, and the potential loss of thousands of jobs.

And Republicans aren’t alone in urging a halt to wind-down proceedings pending the SIGTARP’s latest investigation… Democrat Dennis Kucinich has already staked out the position now occupied by the House Republican leader. And did the artist sometimes known as “Government Motors” blink in the face of bipartisan pressure?

Not so much. GM’s Greg Martin tells the Detroit News

GM has no plans to extend the wind-down agreements’ deadlines with dealers. GM and its dealers have made significant progress over the last several months with a clear focus on selling great cars and trucks and providing a superior retail experience. An extension would only divert our collective attention at a critical time and would ignore the independent decisions of arbitrators and individual settlement agreements between GM and its dealers.
Clearly telling Ray LaHood where to stick it has had a salutary effect on GM’s relationship with its 60 percent owner. And hey, what has the government done for The General lately? Seriously though, with an IPO looming, an unfavorable finding in the SIGTARP’s investigation could be a huge blow for GM. And though maintaining focus is a skill GM should be encouraged to pursue, it’s hard to see why the wind-down couldn’t be put on hold until the investigation clears. Especially considering the initial SIGTARP report made it clear that GM was inconsistently enforcing closure rules, and that despite not costing the Detroit automakers “one damn cent” in the words of one GM official, the auto task force decided that not culling dealers would be “inconsistent with the President’s mandate for shared sacrifice.” Given this background, and considering the direction of the political breezes, GM might want to consider hedging its bets and waiting for the SIGTARP investigation to wind up before moving forward with its wind-downs
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6 Comments on “Ohio Reps Request Halt To GM Dealer Closures, GM Declines...”


  • avatar
    HerrKaLeun

    Looking at the GM market share over the past decades, it seems costumers have been winding down most dealers. Are they requesting us now to stop that winding down and to finally buy a GM car?

  • avatar
    AaronH

    Just shows that the car dealerships are a den of thieves just like government.
    The political terrorists depend on dealerships for buying votes.

    • 0 avatar
      HerrKaLeun

      it seems the state laws protect an outdated business model from the time before phone and internet. It is like if the government woudl protect blockbuster from bankruptcy and tax Netflix.
       
      In my world there would be OEM outlet centers in every city where i can test drive every GM [insert your brand] and where it gets warranty service. I can do other service there too IF I WANT.
      When i decide on a car I order it online and pick it up when it is ready.
      The service centers are clean and lean, but don’t need fancy expensive Taj Mahal buildings.
      If i want i can still go to a regular dealer with all the “service”but pay a higher price for the car to cover the cost.
       
      Maybe at some time we will have capitalism and all this will be possible… until then we will be stuck in an old fashioned business model that only seems to exist int eh car world. IT seems to have disappeared in almost every other industry.

  • avatar

    GM is run by self centered,egotistical idiots who have no clue, screw their own fellow employees/retirees, and could give a rat’s fanny about dealers either. then again…you knew that.

  • avatar
    FleetofWheel

    Like a moratorium on home foreclosures, halting dealership closings is wishful thinking; that if we can just decree a halt to the symptoms, then somehow the root causes will abate as well.

    • 0 avatar
      porschespeed

      Though I’m not 100% in agreement on the comparison, I am 100% in agreement with the meta-point.
       
      Folks, do get with reality.  GM has been losing market-share since the freakin’ 70s. They do not need the overhead of having dealer counts that resemble the 50s.


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