7 Votes

Boost it!

Why Were Certain Chrysler and GM Dealers Given the Pink Slip?

autotronic submitted on 6/18/2009 Official Bell & Ross Timestamp: 2:44:03 AM

6 user comments | Category: Misc News | Source: | SOURCE: automotivetraveler.com

The automotive retail landscape has been dramatically reshaped as both Chrysler and GM together have terminated almost 2,000 dealers as part of their on-going restructuring efforts.

They were able to use the bankruptcy process to circumvent strong state franchise laws to shed dealers. At times there appeared to be no rhyme or reason to the selection process, leaving both dealers and consumers perplexed. Last week, as new details and documents surfaced explaining why certain GM dealership agreements would not be renewed in 2010, Automotive Traveler's Jim Brennan updated his previously published story with additional updates on the GM closures.

In the next few days, Automotive Traveler will start a series featuring the story behind some of these closings and their impact on individual communities. While we will attempt to simply report on each closing, we think that readers will find it difficult not to take sides, especially if they live in a community where these closings hit home. And if you read more, you'll see how a certain morning talk show host has taken to the airwaves to plead the case for saving her parent's dealership from termination.

Read Article

Why Were Certain Chrysler and GM Dealers Given the Pink Slip?

About the Author

autotronic

— autotronic (View Profile)


User Comments

ChevyFan100

GM picked dealers that were rated poor and had old facilities.
GM also closed dealers that had poor sales. The dealer in the picture above must of had either a poor facility or bad customer service.

— ChevyFan100 (View Profile)

Posted on 6/18/2009 11:57:31 AM | reply to this comment | Votes: 1   

Timzilla

the dealer above was closed because it said "PONTIAC GMC" on it...

— Timzilla (View Profile)

Posted on 6/18/2009 2:09:13 PM | reply to this comment | Votes: 1   

Godgore

There were too many GM/Chrysler dealerships and not enough customers to sell them to. Really sucks for those who need warranty work now.

— Godgore (View Profile)

Posted on 6/18/2009 8:28:20 PM | reply to this comment | Votes: 1   

bfghemicuda

These cuts were in the works for over a year or two. Warranty work can be performed at other dealers. A good portion of Chrysler dealers that were cut were geared to sell more used cars than new.

— bfghemicuda (View Profile)

Posted on 6/18/2009 9:38:11 PM | reply to this comment | Votes: 2   

ExGC

GM picked dealers for a variety of reasons. A friend of mine whose dealership got the notice - not one of the terminated brands - was in the middle of the pack for sales. He was told he was terminated because he also owns dealerships for competing brands and they were terminating those who weren't "loyal" and "dedicated to GM" unless they were extremely high performers.

— ExGC (View Profile)

Posted on 6/19/2009 7:40:44 AM | reply to this comment | Votes: 1   

LauderdaleDriver

Excess dealers is one of the reasons that bankruptcy was inevitable. It costs money to maintain them, and with lower market share, they need fewer. Also, the remaining dealers were canibalising sales from each other, cutting prices. Many of these dealers were in areas that were prime in 1955, and dead in the water today.

The state franchise laws, enacted by politically powerful dealers, were probably one of the biggest reasons that GM had to go into bankruptcy. It was costing them $500-$1000 per car to maintain an obsolete dealer network. You can be certain that Ford will be continuing to remove weak dealers, and might eventually follow the others into bankruptcy, to do the same.

— LauderdaleDriver (View Profile)

Posted on 6/19/2009 9:47:22 AM | reply to this comment | Votes: 1   

Add your Comments

Images hosted in your AgentSpace can now be posted in the comments section using the following syntax (case matters): [img]IMAGE URL[/img]
Example: [img]http://agent001.myautospies.com/images/sample.jpg[/img]