Co. says it’s prepared to implement a plan to pacify dealers who face the loss of their franchises as part of a massive cutback of the auto maker’s distribution network.
GM’s proposal includes face-to-face reviews and binding arbitration, which together, could result in some dealers being reinstated.
But implementation requires “that legislation related to GM’s dealer restructuring does not move forward,” the auto maker says a statement.
Some members of Congress, backed by several dealers, are trying to prevent GM andGroup LLC from eliminating more than 2,000 dealerships nationwide. Many dealers call the eliminations excessive and arbitrary. GM says the cutbacks are necessary for its long-term viability.
Highlights of the GM plan include:
- A commitment to advise all Chevrolet, Buick, GMC and Cadillac dealerships that received a complete wind-down agreement of the criteria used by GM in deciding which stores to drop.
- A face-to-face review process for all complete wind-down dealers who have not already terminated their dealer sales and service agreements with GM.
- +If the complete wind-down dealer is not satisfied with the outcome of the face-to-face review process, he or she can proceed to binding arbitration. The arbitration will expressly be limited to whether GM selected the dealer to receive the wind-down agreement on the basis of its business criteria.
GM says its proposal offers a better process and alternative to address dealer concerns compared with the proposed legislation “that would raise a variety of legal and constitutional concerns.”
The auto maker says the plan stems from months of discussion and “constructive engagement among dealer groups and members of Congress.”
“GM especially appreciates the leadership of Senator (Richard) Durbin (D-IL) and House Majority Leader (Steny) Hoyer (D-MD) and the contribution of other Congressional members,” says GM sales chief Susan Docherty.
“Their tireless efforts to facilitate the discussion among all parties to achieve a non-legislative resolution to address dealer concerns were critical to the development of GM’s comprehensive plan,” she says.
She also thanks the National Association of Minority Automobile Dealers “for their commitment to work through some very difficult and complicated issues involving GM’s dealer network.”
“We’re fighting to make sure we don’t become extinct,” NAMAD Chairman Desmond Roberts told Ward’s in an earlier interview, referring to the fate of many minority dealers.