GM Statement Regarding Dealer Network Communications

[Steve]

GM Statement Regarding Dealer Network Communications

In conjunction with conversations General Motors started with its U.S. dealers today, GM issued the following statement

As noted in our recent S-4 filing and updated Viability Plan, General Motors plans to reduce its dealer network from 5,969 stores today to approximately 3,600 by the end of 2010.

This process starts today, as GM begins contacting dealers regarding its long term planning. Approximately 1,100 underperforming and very small sales volume U.S. dealers will be advised that GM does not see them as part of its dealer network on a long-term basis. In most cases, existing franchise agreements run through October of 2010.

In addition, we will be updating about 470 Saturn, HUMMER and Saab dealers on the status of those brands and we will be discussing how the remaining dealers will support our retail plans going forward. While additional cuts will be made, we believe the vast majority, over 90 percent, of the remaining dealers will be offered a chance to remain with GM. However, specific dealer issues, further attrition and additional possible dealer network actions are expected to bring the number of future GM dealers to around 3,600 by the end of 2010, as described in the Plan. The actual number could vary given levels of attrition, etc. outside of GM’s control.

“We have said from the beginning that our dealers are not a problem but an asset for General Motors,” said Mark LaNeve, GM Vice President of Sales Service and Marketing. “However it is imperative that a healthy, viable GM have a healthy, viable dealer body that can not only survive but prosper during cyclical downturns. It is obvious that almost all parts of GM, including the dealer body, must get smaller and more efficient.”

“In response, we are letting them know about our long term plans. GM’s viability plan calls for fewer, stronger brands as well as fewer, stronger dealers. We have taken a very difficult step by identifying those dealerships we’d like to keep in the GM dealer network and those with whom we will have to wind down our business relationships,” LaNeve said.

As independently owned businesses, dealer owners will make their own decisions if and when they want to make this information public. GM is not releasing the names of any dealers.

“We are not terminating any dealerships today,” LaNeve clarified, “We will be talking to all of our dealers over the next few weeks, letting them know now in the spirit of open communication, so they are advised well in advance, about our long-term plans and their role in them. Long term, GM should have fewer, healthier dealers, maintaining GM’s current high customer satisfaction ratings, with more sales per outlet.”

[1_low_rider]

i've got a feeling the local dealer in my town will be affected by this. they are a rather small dealership and don't have high sales. cant say it matters to me one way or another though, the first thing i do when i get a new vehicle is make mods that void the warranty for good! still sad to see jobs being taken away from people in which they have no control over or any say so in the matter.

[TRPLXL2]

I have a co-worker that also works t a Chevy dealer as a mechanic, and he said the unemployment is going to be flooded even more after this. Think of all the ASE certified mechanics that are going to be looking for jobs, the market will flooded with people with these skills and no where to go. And 90% of the people other than mechanics that work at a dealer only have a small degree in business or something, so there are going to be even more unskilled people out of work and no where to go. I feel sorry for those people, they weren't even given a fair warning before all of this happened.

[truheel1]

Well BO will just give them GOV health and GM will "CHANGE" to GOV MOTORS. OLDS and PONTIAC will come back as a Gov vehicles produced in a Ohio or Mich GM plant to create GOV jobs. Will be worst than before...
CHEVY/CADILLAC/GMC/BUICK will seperate and create their own company called CCGB or something like that with part ownership with Honda or Toyota. This will take approx 2-3yrs to happen..... Saturn, Hummer will be sold to the Saudias, they love HUMVEES and SAAB to merge w Volvo.

http://www.reuters.com/article/innov...rpc=22&sp=true