GM Cutting 1100 Dealerships Nationwide

[Lorax]

GM has just notified 1100 dealers nationwide that they are closing down by October 2010.

This on the heels of Chrysler closing 785 dealerships nationwide as well, yesterday.

My threadmates thoughts on this?

[lilpup]

no surprise and still better than losing the companies altogether

I hope we get a list today of the dealerships notified.

[firstandten]

Very sad, for those affected

Who would have thought that the government would make the private sector make the kind of cuts that the private sector claims the government would never make.

[lilpup]

The government isn't making them do it. It's something that's been needed for along time but GM originally intended to do it at a less painful pace.

[firstandten]

The government isn't making them do it. It's something that's been needed for along time but GM originally intended to do it at a less painful pace.

Given the fact that GM does need the bailout, the government is making them do it. You are correct that left to there own devices GM would have eventually made the same cuts in their own time frame.

[Lorax]

All true statements, though don't forget the time frame for downsizing, cost cutting, etc, was accellerated by the financial sector's freezing of credit.

People still need access to credit, and if any cars are to be sold, including foreign ones, we need free flowing credit at acceptable rates.

[Retroit]

Chery and Tata will have their pick of dealership locations when they decide to sell their $2000 cars to all the "patriotic" Americans.

[Kevgoblu]

Don't believe that GM or Chrysler was really that concerned about not closing dealerships. Many restrictive franchise laws have previously prevented the domestics from reducing their dealer base. It cost GM billions to buy out the dealerships when they discontinued their Oldsmobile brand. Bankruptcy is one of the few tools that will allow them to break these contracts.

[professorscott]

Lilpup will be disappointed because, unlike Chrysler, GM does not plan to say publicly which dealerships are being eliminated at this time. Also, slightly good news for the GM dealers, GM is saying for now only that those franchises won't be renewed, which means the GM dealers which are losing the franchise will lose it in October 2010 which is 17 months from now, unlike the Chrysler dealers who will lose the franchise on June 9, 25 days from now.

[mwilbert]

I think they probably aren't cutting enough dealers, considering that we hope this is a one-time opportunity [[unless they go bankrupt again.)

From before the complete collapse of sales:

"According to the trade journal Automotive News, the average U.S. new-vehicle franchise reported 322 new-vehicle registrations in 2007. Toyota Motor Sales accounted for 1,628 units per franchise. Ford Motor Company's domestic brands reported 236 registrations, followed by GM's domestic brands at 202 and Chrysler at 169."

Assuming they don't lose any sales from cutting dealers, Chrysler would need to cut a third of its dealers just to catch up with Ford, which has way too many dealers as well.

[luckycar]

We are still open,since 1952.

[lilpup]

GM does not plan to say publicly which dealerships are being eliminated at this time

Huffington Post is trying to compile a list, but any smart dealers will keep it under their shirts when there's so much time before it happening.

[mwilbert]

Lilpup is right that any dealer with a brain isn't going to admit that they are on the list. KingRex is right to say it isn't going to be 17 months--GM will be going bankrupt on schedule June 1st.

[Cincinnati_Kid]

WDIV Channel 4 news reported that Holiday Chevrolet in Farmington Hills, got the call this morning, that they are to close.

[Danny]

The fall the American automotive companies is nigh.

[lilpup]

The fall the American automotive companies is nigh.

Hardly. Stop and realize that as large as these closing may seem they're still only 25% of Chrysler's network and around 18% of GM's.

[Bigb23]

I like, [[cough), how the GM execs are doing all the interviews by cell now, instead of a face to face interview. And they say this will be a phased downsizing, to allow everybody to exit their current employment and find new jobs. WTF ? Exit you're real estate, at a huge loss, and employees find what jobs where ? At least buggy whip makers and farm laborers had a place to go early in the last century, at increased wages.

[lilpup]

Fritz Henderson was on Glenn Beck's show yesterday:

Part 1


Part 2

[Retroit]

I like, [[cough), how the GM execs are doing all the interviews by cell now, instead of a face to face interview. And they say this will be a phased downsizing, to allow everybody to exit their current employment and find new jobs. WTF ? Exit you're real estate, at a huge loss, and employees find what jobs where ? At least buggy whip makers and farm laborers had a place to go early in the last century, at increased wages.

China, here we come! Shanghai or Bust!

[Bigb23]

It's already been established that the Big 3 will be in name only. Look at the Singer saga, move the jobs overseas, and re - brand it with a name you trusted. Then ship it back to us. The same crap with our current execs in the big three, take whatever money is left, and run. Some people will retire in Florida with a fortune, and damn the rest of the people. I have seen this happening over the last TWENTY EIGHT years. Now we have to have Cc explain the way out of this.

[darwinism]

Some of the folks here are simply fools, who CHOOSE to be in DENIAL.

The Big 3 hasn't been doing its people right for years, for goodness sake. Chrysler hasn't been passing the so-called 'litmus test' for a long time. It was managed by German executives, and profits have been going there ever since Daimler was in charge. Yet, the 'rednecks' in our Metro Detroit communities still consider Chrysler a hometown auto company.

GM has been 'private labeling' or 're-badging' Asia-made vehicles for ages. The Chevy Aveo, made in Korea, debuted back in 2004 [[Source), and yet hard-core 'Americans' consumed it like hotcakes thinking that they are supporting their union brothers and sisters here in SE Michigan.

For what its worth, I intend to do my part for American manufacturing as well. That is why I am going to the Ford and GM dealers to give them a chance to earn my hard-earned dollars. But at the same time, I am not going to preach about shit like "Out of a Job yet? Keep buying Foreign" or "What You Drive, Drives America" BECAUSE the FACT is that domestic automaker MANAGEMENT have looted us all for decades in order to arrive at this juncture.

Those of you crying foul about profits going to Japan, Korea, China or wherever else - how about you do this ..... find out for a fact the executive compensation of Toyota's CEO, Honda's CEO, Nissan's CEO, Hyundai's CEO, and so on. Then match those numbers up against your beloved 'American' CEO at GM, Ford and Chrysler. Ladies and gentlemen, right there is our problem.

Do you know that GM makes lots of money all over the world? The Buick model line is THE BEST-SELLING brand in China. Many of GMs divisions do very well in Europe, Australia and the rest of Asia. But yet, GM is bleeding red ink. Hmmm ..... is it the American public's fault that GM can't manage their cash flow? Do you blame your neighbors if your utilities get cut due to delinquency?

Point the blame at Big 3 leaderships through the many years and through the many decades of fucked up decisions; NOT the American consumers, NOT the American public.

[lilpup]

GM has to adhere to the various laws in the countries they do business. They cannot just bring all the profits they make overseas back to the U.S.

The North American market right now has all six of it's top sellers bleeding, not just the Detroit companies [[point of fact: Toyota lost more in their first quarter this year than GM did).

[reddog289]

I would love to see a list of the dealers set to close. I guessed right on one of the Chrysler dealerships. This whole closing of the dealerships deal reminds me of the time when the Mom&Pop drug stores started closing up.Hate to see businesses close but thats what happens when the times are tough.

[Retroit]

darwinism, I agree with much of what you said, and in particular, your condemnation of management. But I'm not willing to leave the unions, the American government, and the American consumer off the hook.

First, the unions seem to have failed to realize that their enemy is not management, it is the cheap foreign autoworker. The should have used their political ties [[read: Democrat politicians) to ensure that foreign autoworkers have equal pay & working conditions with American workers or else foreign cars imported to the US will be tariffed to make up the difference. The government is at fault for not realizing this, even without the unions' request. Also, unions should have been more willing to adopt more of the policies employed by foreign automakers instead of holding firm to the old way of doing things. I realize they have done a much better job of this recently.

As for the American consumer, although it could be said that they were often misled into believing foreign made cars were American made, we [[myself included) more often than not couldn't care less where a car [[or any other product) is made as long as it was the least expensive. We should have realized that if we don't buy anything made here, nothing will be made here any more. Here, too, the government is complicit, because there should be a tariff on foreign made goods in order to protect our industries.

So the blame needs to be spread on our whole culture. It's not enough to pit management against the union against the consumer. We, as a country, are up against foreign countries who have a different standard of living that we must either be willing to accept or else put safeguards in place to protect our standard of living.

[darwinism]

Excellent points, Retroit.

Certainly, spreading the blame would be the most appropriate and sensible notion, with priority going to the management, the government, and the union, accordingly. However, around here in this neck of the woods, folks are way too comfortable blaming the consumers and blaming the foreign automakers EXCLUSIVELY. Clearly, the folks who have that mindset, are either uneducated, brain-washed, in denial, or all combined. Hence the reason why Detroit and Michigan are PRACTICALLY UNABLE to get out of a perpetual rut.

It is really not that difficult, follow the money trail. Look into the compensation packages of the Big 3 executives, and compare apples to apples with the foreign automaker executives. It is obvious the scale is lop-sided.

Yes, the government should have done more, but at the same time ..... its hands are tied because the people refused to have the government do more. Just look at the fallout of GM and Chrysler recently. Bear in mind that GM and Chrysler went to Capitol Hill to plead for help. They begged Congress. And now, people are saying that the government should stay away - Excuse me, but am I missing something here? If GM and Chrysler doesn't want the government to butt in, then DON'T BEG FOR HELP! Ford didn't accept money from the taxpayers, and they are just fine minding their own business the way that they wish. Retroit, blaming the government frankly isn't going to help much, because then politics, right-wing, left-wing and a whole new can of worms gets in the way.

The unions are there to protect its members, to negotiate the best foundation for their members, that's it. That is the role of the union. So, blaming them is just as well be a call for them to disband. What is the whole point of having the union if it doesn't get the most for its member base? Some are saying that the concept of the union is obsolete. Well then, if that is the case, the entire equation ..... the entire ecosystem of manufacturing will be different altogether.

You know what is really funny? It seems that the very people who are from the Big 3, the people who have worked there all their lives ..... knows too well NOT to own the products. One of my wife's grandfathers worked at Jeep in Toledo all his life. Upon retirement, guess what vehicle he bought? A full-equipped Mercedes. Another example; a friend of mine who was an engineer at GM throughout his working life - Guess what cars he purchased for himself and his wife upon retirement? 2 Lexus and 1 BMW.