GM Expects To Lose 500 US Dealerships

Jan. 12 (Bloomberg) -- General Motors Corp. said it may lose as many as 500 dealers in its home market this year, an increase from 350 last year, as the largest U.S. automaker works toward a goal of cutting 1,700 by 2012.

The reduction will widen in part because of the strain of a fourth straight year of U.S. auto-sales declines and a company initiative to trim brands and emphasize only Chevrolet, Cadillac, GMC and Buick, GM North American President Mark LaNeve said in an interview today. GM may also have to spend more to convince some of its 6,400 dealers to consolidate, he said.

Culling dealerships and brands is part of GM's plan that also includes trimming labor and debt costs to convince the U.S. Treasury Department that the Detroit-based automaker can survive and repay $13.4 billion in promised federal loans. GM has said it will fail without government loans.

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Comments

[drymartini1]

Only 500 !! What the hell. Wake me up when they close at least 2000 dealer networks. i hate car salesman more than anyone...yes even ceo's LOL :)

GM has too many dealerships anways...too many dealerships = too much capacity. and no profits for anyone.

[gascelebrations]

Exactly. Overbuild and you get the result pretty quickly. Even the Detroit Free Press, rabid cheerleaders that they are, had an article a while back calling for consolidation and closure of dealerships.

[FightingTheRight]

Do you hate mechanics, service writers, the parts counter people, prep people and office personel.

Because they all lose their jobs too.

[drymartini1]

but having way too many dealerships makes all of them not make much profits. less dealerships = more profits. get it.

[JoeBlough]

Auto industry just a jobs program?

[Anciano]

Miles to go....
Bloomberg: Ford May Seek Emergency Aid as Economy Imperils Sales
http://www.bloomberg.com/apps/news?pid=20601103&sid=adXLe7n0Z808&refer=us
"Ford Motor Co., the second-largest U.S. automaker, may have to abandon
a plan to forgo federal loans as the weakening economy threatens to drive
domestic sales 10 percent lower than the company’s forecast. Ford
predicts that U.S. light-vehicle sales will reach 12.2 million units this year,
almost 2 million more than the annualized sales rate over the last 3
months. Chrysler forecasts that sales may reach 11 million, while General
Motors projected a range yesterday of 10 million to 11 million. "The market
will not reach 12.2 million units this year, no way, no how," said John
Wolkonowicz, an IHS Global Insight analyst. The Lexington, Massachusetts
based consulting firm trimmed its 2009 sales estimate last week to ..."

[Anciano]

The Bush Depression is going to be dark and deep, we have promises to keep....
Wall Street Journal: Chrysler Dealers Refusing to Order New Inventory
http://online.wsj.com/article/SB123172160917772419.html?mod=todays_us_nonsub_marketplace
After a deep slide in sales in the fourth quarter, Chrysler LLC now faces a new obstacle in its battle to survive: Many dealers are loaded with inventory and aren't ordering new vehicles. Take Bill Rosado, owner of a Chrysler-Dodge-Jeep dealership in Milford, Pa. He says he is resisting the
company's requests to add more stock to his already-crowded lot. "We're not ordering any cars in spite of the pressure they give us. We are going to sit tight with what we have," Mr. Rosado said. "We don't see any peak soon where all of a sudden Chryslers are going to be desired."

[Trittydi]

As I said above about Chrysler ....

My brother was a top mechanic for a Dodge/Chrysler dealer in Northern Illinois. They closed their doors for good about a month and a half ago. GM called in the debt of the outstanding inventory of the lot - something manufactures never do - they needed the cash. Instead - it closed down the dealership. That's not how the dealerships and maker have historically done business. Without the cash on hand to pay for the inventory - they had to close. That'll be happening in communities all across the country. >POOF!< -- more jobs gone.
*

[larry278]

Well, GM was & is aiming to shed dealers. Are they, GM, ahead of, behind of or on their target of getting rid of Chevy dealers for '09? A lot of mavens say that GM still has to get rid of more dealers. A GM bankruptcy can kill both GM & its dealer network.
As old Engine Charlie Wilson was found of saying, "What's good for GM is good for America.". GM would be better off dead.

[whoknew---]

Well, very bad news, hope the one in Pacifica California is still hanging on, nice folks....

Best Wishes----