New GM Taking Heat for Loyalty Oath

Robert Farago
by Robert Farago
new gm taking heat for loyalty oath

When TTAC received a copy of GM’s letter to dealers “asking” them to lobby against the dealer cull rollback bill, we blogged it as a “ loyalty oath.” More than a few commentators said pish-posh [paraphrasing]; H.R. 2743 was nothing more than an SOP lobbying campaign. The fact that the letter told dealers to cc GM’s National Dealer Council Chairman Duane Paddock left little doubt in our (OK my) mind that New GM’s dealers were being told in no uncertain terms to toe the New company line (i.e. shiv their former colleagues). Automotive News [AN, sub] reports that “General Motors executives have been pressuring individual dealers to sign a statement saying they oppose legislation that would restore terminated dealerships’ rights, according to a U.S. senator, a dealers group and dealer representatives.” Point counterpoint after the jump.

“Some dealers fear that GM could take action against them if they do not sign a letter of opposition” to the bill, Grassley said in a letter to GM CEO Fritz Henderson. “It’s alarming to have GM corporate leaders force dealers — some who are losing everything they worked hard to build — to take an active stand against it.”

GM’s Washington spokesman Greg Martin’s e-mail reply: “Many dealers who signed participating agreements are ready to move forward, and so are we as a new company. Certain proposed legislation puts our progress and viability at risk. We have a right to have our voice heard, too, and we look forward to responding to Senator Grassley’s letter.”

So nothing about blackmail, then. Well, except from New GM dealers . . .

Three dealer representatives said that they had received complaints from a total of about 20 individual dealers who had been contacted by GM managers.

“They felt tremendous pressure to sign the form,” Don Hall, head of the Virginia Automobile Dealers Association, said in an interview today. He said he received complaints from 10 to 14 Virginia dealers.

im Jackson, head of the Colorado Automobile Dealers Association, said he had received similar complaints from about a half-dozen retailers in his state.

“Some had received three or four calls each from GM asking them to sign the letter and then to call back when they actually sent the signed statement,” Jackson said in an interview.

Jim Moors, franchising director at the National Automobile Dealers Association, said he got several calls from dealers who complained “that they felt coerced” by calls from GM offices.

Question: why is New GM treating its dealers like this? Someone ought to send them a copy of How to Win Friends and Influence People, stat. Not that I’ve read it . . .

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2 of 6 comments
  • Buickman Buickman on Jul 12, 2009

    further proof as to my theory - Camaro. GM makes a hot car, only gives the dealers the smallest of margin even though the market will bear a higher price. result? dealers charge over list by thousands and customers pay it. end game? dealers get bad image and the perception becomes it would be an improvement to cut out the middle man and buy direct. Robert, can I have my tin foil hat back now please?

  • Fincar1 Fincar1 on Jul 12, 2009

    "This sort of thing was normal procedure in the USSR. Why are we copying that system?" For the same reason we elected Barack 0bama, and for the same reason we elected Democrat senators and representatives who pass legislation aimed at centralizing power in the federal government.

  • The Oracle I say let the clunkers stay on the roads.
  • Jpolicke Twenty-three grand for a basket case? And it has '66 wheel covers and gas cap so who knows what else isn't original?
  • Scott Can't be a real 1965 Stang as all of those are nothing but a pile of rust that MIGHT be car shaped by now.
  • 56m65711446 So, the engineers/designers that brought us the Pinto are still working at Ford!
  • Spookiness I dig it. The colors are already available on the CX-50. The terracotta is like a nice saddle brown. The non-turbo Carbon Edition has a bluish gray and a burgundy leather interior. A nice break from the typical relentless black and 50 shade of gray palette. Early CX-30's had some dark navy blue (armest, console, and parts of the door) but I guess that was just too weird and radical so they switched to all-black.I'd be fine with cloth in colors, leather is over-rated, but I'll never have an all-black interior in a car ever again.