Under Congressional Pressure, GM Hints At Dealer Restoration

Edward Niedermeyer
by Edward Niedermeyer
under congressional pressure gm hints at dealer restoration

The recent revelation that congresspeople have been successful in coercing GM to rescind dealer closures in their districts, has the rest of our elected representatives (not to mention GM itself) sitting up and taking notice. In a conference call with Michigan’s congressional delegation, Fritz Henderson said GM was close to a deal which would restore a number of “mistakenly” closed dealerships. But GM hasn’t met with rejected dealers in weeks, and the Committee To Restore Dealer Rights is unaware of any such agreement. “[Henderson] was very vague, and the plan sounded inadequate to me,” Michigan Republican Hoekstra tells Automotive News [sub]. “He explained, for instance, that they might reopen some franchises if they found errors, but he didn’t say what those errors might be.” Henderson also rejected the dealer demand for compensation of $3,000 per vehicle sold in 2006, 2007 and 2008, further supporting suspicions that GM doesn’t have a deal at all. So what is happening?

I think GM is telling Congress: ‘We’re close to a deal, you don’t have to do anything.’ But GM isn’t doing anything. They’re just playing out the string because rejected dealers can’t hold out that long

Hoekstra may well be right. Without a compensation offer on the table, government-ordered arbitration between GM and the rejected dealers won’t go anywhere. More importantly, Henderson’s use of the term “mistakenly closed” illustrates how much pressure GM has been under from representatives to reopen dealers in their districts. If a number have already succeeded in getting GM to re-open their dealers, it’s only a matter of time before the floodgates open. Remember, GM only accepted arbitration because a bill was working through congress that would have restored all the culled dealer franchises. If arbitration is failing, GM’s only option is to hold off congressional interference for as long as possible, in hopes of as many dealers croaking as possible. And now that everyone knows some representatives have succeeded in rescuing their campaign donating home-district dealers, the rush will be on. All of which further pits the legislative against the executive branch, raising the specter of more, not less, government interference in GM and Chrysler.

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  • Sitting@home Sitting@home on Oct 30, 2009

    Politicians' main concern is jobs; chiefly the 535 jobs in Congress. Despite (presumably) voting for the package that made GM government owned with it's implications for brand, factory and dealership closures, they will back-peddle faster than a clown on a unicycle if they think the fallout will put their own job in jeopardy.

  • Panzerfaust Panzerfaust on Oct 31, 2009

    Amazing, Congress is pressuring GM to un do what GM felt pressured by Congress to do.

  • Jkross22 Good for the seller selling at the right time. I don't see 7 grand here for a 30 year old 318i, but as the late John Candy said, "You don't make any calls, you don't make any sales."
  • Analoggrotto For Tesla owns the entire universe, General Motors is allowed to have part of the heavens on earth, but only true Tesla owners, the first and true followers of Elon Musk will see the purest of Elysium.
  • Probert The only extra port I see happening is a V2G outlet. I don't think the Tesla port supports this. To have both CCS and Tesla would involve masses of cabling and expense that would be absurd in a game of nickels and dimes.
  • FreedMike "So why Rampage and not Dakota?"I'd say it's because "Dakota" just doesn't provide the same measure of penile-sufficiency reassurance that "Rampage" does. In any case, like the Grand Wagoneer, I'm shocked they didn't do a midsized truck years ago.
  • VoGhost Mercedes wins!!!! Now lets compare sales.