661 GM dealerships saved from closure
NEW YORK (AP) – General Motors Co. will reinstate 661 dealerships it sought to drop from its sales network.
GM executives said Friday that 661 dealerships – more than half of the 1,100 seeking to stay with the automaker – will receive letters giving them the option to remain open. The company said it made the move because it would not have enough time to negotiate with all 1,100 dealerships within a four-month window imposed by the federal government.
“By doing this we save a lot of time, energy and dollars,” said Jim Bunnell, GM general manager of network support, saying the company wished to avoid a “very large arbitration process.”
As part of its restructuring, GM last year told about 2,000 dealerships it would not renew their franchise agreements once they run out in October 2010. But the dealerships have said GM treated them unfairly, and last month Congress passed a law requiring an appeals process for the dealers. About 1,100 dealers have appealed GM’s decision.
GM’s decision to keep the additional showrooms open effectively shrinks the number of appeals it has to contend with. Arbitration hearings for the dealers who did not get offers will begin later this month.