GM Shutting Down 1,100 Dealers

[CSpec]

Source: http://www.bloomberg.com/apps/news?pid=206...&refer=home

GM Is Said to Plan Shutdowns for 1,100 U.S. Dealers

General Motors Corp. is sending termination notices today to 1,100 U.S. dealers with about $2.5 billion in unsold vehicles as the automaker starts shrinking its retail network, a person familiar with the matter said.

The dealers hold about 120,000 autos of various brands, said the person, who asked not to be identified because GM hasn’t announced details yet. Mark LaNeve, GM’s North American sales chief, is set to brief reporters at noon New York time.

The closings are GM’s first step toward paring U.S. dealers to 3,600 from 6,200 by the end of next year as it faces a probable bankruptcy by a June 1 deadline. With fewer outlets, the survivors each may be able to sell more cars at higher prices, boosting profit, the person said.

“A concern of all dealers would be if the market value of vehicles were to decline because terminated dealers would be desperate to sell,” said Jim Eagan, a partner at consulting firm Plante & Moran in Southfield, Michigan.

Eagan said he hoped that GM would force the remaining franchisees to purchase inventory from stores being closed. Bankrupt Chrysler LLC took similar steps when it announced the shutdown of 789 dealerships yesterday.

Peter Ternes, a GM spokesman, declined to comment about the company’s plans. CNBC reported that GM’s letter to terminated dealers says the automaker’s cuts aren’t final yet, without saying where it got its information.

‘Emotional Day’

“It’s quite an emotional day,” said Wyman Williams, 61, who was waiting to learn whether his Williams Motors in Commerce, Texas, is on the closings list. “We’ve been here 40 years and what happens today is really important.”

He said he filed for Chapter 11 protection on April 1 for his Chevrolet-Pontiac-Buick store. “It was a necessity, but it worked out as a defensive move,” Williams said. “There’s a judge between GM and me.”

GM fell 1 cent to $1.14 at 11:08 a.m. in New York Stock Exchange composite trading. The shares have tumbled 95 percent in the past year.

GM is hoping for an orderly wind-down of the affected dealers over the next year or so, the person said, meaning they would close when their inventory is gone.

Dropping Brands

Today’s shutdowns are in addition to the approximately 500 dealers being shed as GM disposes of its Hummer, Saturn and Saab brands and drops Pontiac. GM has said it expects some dealers to leave voluntarily.

In contrast to Chrysler, which waited until it filed bankruptcy to cancel dealerships, GM is taking steps to reduce its retail network now, saying it still hopes to avoid having to restructure in court. Still, Chief Executive Officer Fritz Henderson said yesterday that bankruptcy is “probable.”

GM is trying to shave operating costs and shrink debt and union-retiree obligations by $44 billion. The company is surviving on $15.4 billion in U.S. government loans.

GM’s 8.375 percent bonds due in July 2033 fell 0.3 cent yesterday to 4.5 cents on the dollar, a record low, according to Trace, the bond-pricing service of the Financial Industry Regulatory Authority. The yield was 175 percent. The bonds traded at 74.4 cents on the dollar a year ago.

[gm4life]

Not good, I doubt we will get a $h! list. I just want to know if my small town dealer got the shaft. If they did, I will be pretty pissed.

[daves87rs]

Sad..I'm expecting quite a few here...

[A Horse With No Name]

Not good, I doubt we will get a $h! list. I just want to know if my small town dealer got the shaft. If they did, I will be pretty pissed.

Your right, this is going to suck for a lot of small town and family dealers.

Chris

[gm4life]

Your right, this is going to suck for a lot of small town and family dealers.

Chris

Yeah I just don't want to call them and ask...

[cletus8269]

well i've gotten word that the dealership i bought my truck from is probably going under. i want to call the service department and rub it in. maybe even shake their hands as they are going out the door. screw people over for so long and thats what you get.

there were several in the department that got busted for meth earlier in the year.

http://www.independentmail.com/news/2009/j...ets-16-arrests/

plus the manager is a total jerk.

[haypops]

Not good, I doubt we will get a $h! list. I just want to know if my small town dealer got the shaft. If they did, I will be pretty pissed.

Here is the $h! list for Chrylser:

http://msnbcmedia.msn.com/i/msnbc/sections...ealers_list.pdf

[gm4life]

Here is the $h! list for Chrylser:

http://msnbcmedia.msn.com/i/msnbc/sections...ealers_list.pdf

I want GM to do one, alas but they won't. That is really sad, and the interesting part about a dozen dealers within 100 miles of me our closing.

[thedriver]

As of about noon today the dealership I work at is safe. We did not receive the letter, but we have heard one within about 20 miles of us has. We are a small dealership, but serve a largish rural area.

Edited May 15, 2009 by thedriver

[gm4life]

As of about noon today the dealership I work at is safe. We did not receive the letter, but we have heard one within about 20 miles of us has. We are a small dealership, but serve a largish rural area.

Can I ask what dealer is going under that you heard of?

[thedriver]

Can I ask what dealer is going under that you heard of?

I best not say, my info is thirdhand. Our driver talked to someone at this dealership who signed for an official letter. May be bogus...

Edited May 15, 2009 by thedriver

[G. David Felt]

As of about noon today the dealership I work at is safe. We did not receive the letter, but we have heard one within about 20 miles of us has. We are a small dealership, but serve a largish rural area.

What are the specific vehicles that your dealership sells? Just wondering if there is any overlay with the one that is being closed 20 miles away.

If anyone finds the $h! list please post it as I am interested in knowing myself.

As of 11am seattle time, I called up the street and the Lee Johnson Chevorolet dealership is safe, but there is a smaller one only 10 miles up the road in Bothell that I suspect will close as it is only a third the size of Lee Johnson. I also called the Kirkland BPG dealership and they said they are safe and staying open. So at least both Kirkland Dealerships are safe.

It was nice to see that after all the closings last winter that the lone Kirkland Chrysler, Dodge & Jeep dealership here is staying open.

[gm4life]

I best not say, my info is thirdhand. Our driver talked to someone at this dealership who signed for an official letter. May be bogus...

I understand... I just want a $h!LIST. I just fear alot of small towns will be hurting after all this from GM and Chrysler.

[thedriver]

What are the specific vehicles that your dealership sells? Just wondering if there is any overlay with the one that is being closed 20 miles away.

If anyone finds the $h! list please post it as I am interested in knowing myself.

As of 11am seattle time, I called up the street and the Lee Johnson Chevorolet dealership is safe, but there is a smaller one only 10 miles up the road in Bothell that I suspect will close as it is only a third the size of Lee Johnson. I also called the Kirkland BPG dealership and they said they are safe and staying open. So at least both Kirkland Dealerships are safe.

It was nice to see that after all the closings last winter that the lone Kirkland Chrysler, Dodge & Jeep dealership here is staying open.

We are a (soon to be) Buick-GMC dealer. The one I heard about is the same, but in a large Metro area. Both dealers have a long history. I will post more if and when I have confirmations...

[gm4life]

We are a (soon to be) Buick-GMC dealer. The one I heard about is the same, but in a large Metro area. Both dealers have a long history. I will post more if and when I have confirmations...

Well I am glad you guys will be okay, can I ask, how many new cars do you have on your lot?

Edited May 15, 2009 by gm4life

[G. David Felt]

We are a (soon to be) Buick-GMC dealer. The one I heard about is the same, but in a large Metro area. Both dealers have a long history. I will post more if and when I have confirmations...

Thank you, Good Luck to your dealership. The next 12 months are going to be rough for everyone.

[hyperv6]

I hope mine makes it as it does one hell of a good job all the way around.

On the other hand I can give you 6 others if they shut their doors at the end of today I would toast their loss.

IF anything this is a good chance for GM to shead many of the dealers that have done more harm than good. I have had too many GM dealers that false advertise and lie. I usally buy from the ones that treat me right and will not blow smoke up my butt. THey are out there but I hate having to go to the other only to walk out till I find a good dealer.

[gm4life]

I hope mine makes it as it does one hell of a good job all the way around.

On the other hand I can give you 6 others if they shut their doors at the end of today I would toast their loss.

IF anything this is a good chance for GM to shead many of the dealers that have done more harm than good. I have had too many GM dealers that false advertise and lie. I usally buy from the ones that treat me right and will not blow smoke up my butt. They are out there but I hate having to go to the other only to walk out till I find a good dealer.

I totally agree, the Chrylser and Jeep dealer who also has Ford and Kia in town lost the both of them. I do not feel sorry for them that dealer always a jerk. As for my dealer that I drive 20 miles south of town that was Chev, Olds, Pontiac, and Buick until '04 now then went to Chev, Pontiac, Buick and just now after (Pontiac) is down to Chev and Buick. I am called to get an oil change for my Chevy and they DID NOT recieve the letter, so I am thankful. This was not a volume dealer but one that had been in a town of 2,500 for over 80 years and has 25 new GM cars on the lot, but they have great repeat customers and most pay cash for their cars. They have a fair labor rate, and I trust the service department and they only have 2 salesmen!

Edited May 15, 2009 by gm4life

[gmcbob]

I was a little surprised to see the Chevy dealer that used to be Bill Heard Chevrolet become "Classic" Chevrolet when Bill Heard went out of business earlier this year. From what I understand, Bill Heard was one of the worst dealers in the country.

[gm4life]

I was a little surprised to see the Chevy dealer that used to be Bill Heard Chevrolet become "Classic" Chevrolet when Bill Heard went out of business earlier this year. From what I understand, Bill Heard was one of the worst dealers in the country.

That he was.

[fightingbee]

Not good, I doubt we will get a $h! list. I just want to know if my small town dealer got the shaft. If they did, I will be pretty pissed.

I have a feeling this may just alienate more customers in the long run, and the worst part is that it is likely going to gut the dealer network the most in the midwest, where their hometown dealers may not sell tons of cars apiece but still manage to keep overall market share pretty high compared to other regions.

As gm4life is familiar with as well, pretty much any town of decent size in Iowa had a small Chevy dealership. The town I grew up in had ~900 people yet had a Chevy "garage" into the 80's. Now the towns of <20,000 are probably losing their little hometown stores as well.

The only problem with this is if your going to have to drive an hour into town to go to buy from the Chevy dealer, might as well check out Ford/Dodge/Honda/Toyo/etc. along the way, right?

Edited May 15, 2009 by fightingbee

[PONTIAC06]

I really would like to know which ones GM is closing too. Chrysler killed 5 in Wyoming, including the Jeep dealership I go to here in Laramie. The other four are Jackson, Riverton, Rock Springs, and Torrington. I wonder how many GM will close, because around here there are a ton of little family operations in the small towns. And, almost everything here is two hours or more to a decent sized place where some dealerships might survive.

[gm4life]

The only problem with this is if your going to have to drive an hour into town to go to buy from the Chevy dealer, might as well check out Ford/Dodge/Honda/Toyo/etc. along the way, right?

You darn right.

Mine is safe, but still this is NOT a good thing. When people have to go to the "city" it only raises the chance they will consider a non-domestic vehicle not a good idea.

[Satty]

I'm sure that if people can get to the city to see a talkin' picture, they can get there to look at one of them horseless carriages.

[gm4life]

I'm sure that if people can get to the city to see a talkin' picture, they can get there to look at one of them horseless carriages.

:rotflmao:

[mustang84]

The problem isn't the purchasing, it's the servicing. A bunch of Midwesteners are going to suddenly find that they have to drive 50-60 miles to get their new GM or Chrysler car serviced under warranty. I can see Ford picking up A LOT of market share from this debacle...Ford will be the only dealership remaining in my hometown, and it is a 30-40 mile radius to any other new car dealership. Even though the Midwest may not have the population of the West or East Coast, they move plenty of high-profit domestic trucks and SUVs. I see this move hurting a lot of potential business for GM and Chrysler in the future.

[Satty]

So you're thinking people are going to be anticipating having to get warranty work done, meaning people will still perceive GM and Chrysler as having unreliable products, meaning GM is still screwed.

Edited May 16, 2009 by Satty

[daves87rs]

So you're thinking people are going to be anticipating having to get warranty work done, meaning people will still perceive GM and Chrysler as having unreliable products, meaning GM is still screwed.

Exactly.

And it's not like GM couldn't open a few "service" centers, which Ford is already starting to do here.

Ford has quietly been closing dealerships around here for the last few years...

[daves87rs]

I'm sure that if people can get to the city to see a talkin' picture, they can get there to look at one of them horseless carriages.

[Chicagoland]

To all the hnad wringers, when was last time you all bought a brand new GM car? Lots will say 'I never buy new', then complain about lost sales and closings.

Also, if there is a Pontiac and Chevy dealer across one street, and each claiming there 'Delta based car' is 'better', how does that help GM if the sale loses money?

And, since GM is $28 B in debt, how are thye going to whip up these dream cars like the 60's for a 'big comeback'?

[Chicagoland]

To all the hand wringers, when was last time you all bought a brand new GM car? Lots will say 'I never buy new', then complain about lost sales and closings.

Also, if there is a Pontiac and Chevy dealer across one street, and each claiming there 'Delta based car' is 'better', how does that help GM if the sale loses money?

And, since GM is $28 B in debt, how are they going to whip up these dream RWD/V8 cars for a 'big comeback'?

[2005 EquinoxLS]

The dealer in my town, at least according to the local TV station didnt get the letter. Makes me very happy since we have done buisness with them forever. Gustmans has various dealerships thoughout Northeast Wisconsin.

[MRDETROITMETAL]

...Yeah this SUCKS....& F******G Toyopet just got 25 BILLION from the Japan National Bank for USA Operations ???

You KNOW what they are gonna do with that !!!....

"Hey Missa Pontiac Deera, we gonna pay to keep you doors open,....Just sell our S*** Ass cars....Many American SUCKERS will buy...We sending CHECK to you Right NOW !!!....Sianara, Bitch"

....this is BAD.

Very Bad, see Toyo's New add on TV ???

...bunch of RETARDS running to the Local Toyo dealership, & they DO NOT even show ONE car in the Ad !!!!

....They are doing a "McDonalds" on the USA....!!!

...ARE WE REALLY this STUPID ???

Edited May 16, 2009 by MRDETROITMETAL

[Daryl Z71]

To all the hand wringers, when was last time you all bought a brand new GM car? Lots will say 'I never buy new', then complain about lost sales and closings.

Also, if there is a Pontiac and Chevy dealer across one street, and each claiming there 'Delta based car' is 'better', how does that help GM if the sale loses money?

And, since GM is $28 B in debt, how are they going to whip up these dream RWD/V8 cars for a 'big comeback'?

09 Silverado - January 7th, 2009 :AH-HA_wink:

[GMTruckGuy74]

A lot of the Ford dealerships here in southern NJ have been combining with Lincoln-Mercury. That means a lot of the Lincoln-Mercury and/or Ford dealerships are closing and merging with one lot. For example, Holman Ford (Rt 73, Mount Laurel) moved 2 miles away to the Holman Lincoln-Mercury dealership lot (Rt 38 in Maple Shade), and Burlington Lincoln-Mercury (Rt 130, Burlington City) moved 10-15 miles away to Miller Ford (Rt 38, Mount Holly). Don't think Ford is alone in this either - Village Chrysler/Jeep (small-town dealership in Pemberton <Fort Dix>) closed and the franchise moved to Lucas Dodge 8 miles away (Rt 38, Mount Holly); the Triboro Jeep franchise (Rt 130 in Delran) moved 5 miles north to Dodge City (Rt 130 in Willingboro), and a stand-alone Chrylser dealership in Willingboro moved to Dodge City 2 miles north. The Triboro Pontiac franchise was moved 10-15 miles away to F.C. Kerbeck (Rt 73 in Palmyra), several Chevy franchises closed and/or merged with other Chevy dealers (Patterson Cehvrolet, Rt 33 in Hamilton Twp, there since 1933, closed & merged with Superior Chevrolet on Rt 1 North in Lawrenceville); the following have closed within the past 6-12 months: Weed Chevrolet/Bristol, PA; 73 Chevrolet/Berlin, NJ; Brandow Chevrolet/Florence, NJ. So you have to travel 15-20 miles in some cases for dealership service (referencing southern NJ, not anywhere else), it's not really that big of a deal for these owners. If fewer dealerships mean better sales & service for the customer with the remaining dealerships, who's gonna complain???

[fightingbee]

Very Bad, see Toyo's New add on TV ???

...bunch of RETARDS running to the Local Toyo dealership, & they DO NOT even show ONE car in the Ad !!!!

That ad made me think for a second. If Toyo buyers are so loyal and their cars so dependable, shoudn't at least a few of those people be driving to the dealership? :wink:

[Daryl Z71]

I hope TEAM Chevrolet gets the boot. They are complete assholes! On the other hand I hope Regester Chevrolet stays. Thats where I bought my truck and they are the best dealer I have ever been to.

[Innotech]

I know for sure that our Chevy dealer isnt going anywhere. It is the #1 selling dealer in the country (in a town of 114k people no less)

There are a couple nearby Chrysler dealers getting the axe though, mainly in small towns about 30 minutes away.

[Satty]

I know for sure that our Chevy dealer isnt going anywhere. It is the #1 selling dealer in the country (in a town of 114k people no less)

Just about every dealership in every city in America bills itself as the #1 selling (insert brand here) dealership in America. It all depends on how they figure the numbers. There are two local dealers that both advertise they're the #1 Chevy dealership in America, but if you look at the fine print, one is the #1 seller of compact pickups and the other is the #1 seller of GM Certified pre-owned midsize cars, or some BS like that.

[Innotech]

Just about every dealership in every city in America bills itself as the #1 selling (insert brand here) dealership in America. It all depends on how they figure the numbers. There are two local dealers that both advertise they're the #1 Chevy dealership in America, but if you look at the fine print, one is the #1 seller of compact pickups and the other is the #1 seller of GM Certified pre-owned midsize cars, or some BS like that.

it might apply to pickup trucks because this is Louisiana, and this is more specifically Lafayette Louisiana. It serves about 500k people and is known as the hub city of the South. It has the largest Academy store in the country and also osme of the largest Ford/Chrysler/Ddge dealers so I wouldnt be surprised if it really was. People down here still buy like there is no recession. I think our unemployment stands at just 3.9%. All I know is, that place and the Ford place move a LOT of product.

[A Horse With No Name]

I hope TEAM Chevrolet gets the boot. They are complete assholes! On the other hand I hope Regester Chevrolet stays. Thats where I bought my truck and they are the best dealer I have ever been to.

A good dealer is worth their weight in gold. When I was a kid growing up we always bought from a small town Ford store that always took good care of us.

We bought a few cars from a small town Chryco store too..

Now both of those stores are gone.

Loosing a few stores in Central Ohio...

Chris

[Daryl Z71]

They are just a real nice place to go to. They don't pressure you at all, and they explain things to you from every angle. They also didn't try to rip me off like TEAM did either. Hell I even left without the truck the first time after telling them I was going to get it, and they still didn't pressure me. They just called me later on with a better deal.

[A Horse With No Name]

Both my Concorde and my Safari van were bought used from Buckeye Honda. I don't like anything Honda builds right now, but I've been tempted to buy a new Honda as my next car just because they took such good care of us with those two vehicle purchases.

Glad you've got a good GM dealership to go to Daryl, around here most GM dealers are about as worthless as a pair of tits on a Tacoma.

Chris

[Daryl Z71]

Yea thats how the TEAM Dealership is, but Regester really took care of me, and they still do even after I bought it.

[coders11]

This does suck for alot of small town operations that may be shut down but can only be a good thing where I'm at. I can think of 9 GM dealers within 30 miles right off the top of my head. All of them are rather large with TONS of cars on the lots. I can only cross my fingers and hope they kill off the right ones because a couple of them are absolutely AWFUL. I would be curious to see not only the &#036;h&#33;list but the reasoning behind the closure of each lot.

[gm4life]

To all the hand wringers, when was last time you all bought a brand new GM car? Lots will say 'I never buy new', then complain about lost sales and closings.

Also, if there is a Pontiac and Chevy dealer across one street, and each claiming there 'Delta based car' is 'better', how does that help GM if the sale loses money?

And, since GM is $28 B in debt, how are they going to whip up these dream RWD/V8 cars for a 'big comeback'?

My last new GM car was Jan '08. My Bonneville was a CPO GM Exec Car and Impala was new in Apr '01.

[gm4life]

To all the hand wringers, when was last time you all bought a brand new GM car? Lots will say 'I never buy new', then complain about lost sales and closings.

Also, if there is a Pontiac and Chevy dealer across one street, and each claiming there 'Delta based car' is 'better', how does that help GM if the sale loses money?

And, since GM is $28 B in debt, how are they going to whip up these dream RWD/V8 cars for a 'big comeback'?

My last new GM car was Jan '08. My Bonneville was a CPO GM Exec Car and Impala was new in Apr '01.

[Satty]

GM hasn't bothered with a direct competitor to my last 3 new cars.

2006 Fusion S--Midsize sedan 4cyl/manual GM had nothing along those lines when I bought, I wouldn't have bought a G6 even if it had offered a stick

2008 Toyota Prius--GM never even bothered trying

2009 Mini Cooper--The G3 wasn't out in time

If GM had something that was even somewhat close to being as good as the competition, we would've gone GM, but they never bothered showing up.

[Daryl Z71]

GM hasn't bothered with a direct competitor to my last 3 new cars.

2006 Fusion S--Midsize sedan 4cyl/manual GM had nothing along those lines when I bought, I wouldn't have bought a G6 even if it had offered a stick

2008 Toyota Prius--GM never even bothered trying

2009 Mini Cooper--The G3 wasn't out in time

If GM had something that was even somewhat close to being as good as the competition, we would've gone GM, but they never bothered showing up.

Story of GM's life lol. IMO the only thing GM has been good at were Trucks, Suv's, and Muscle Cars.

[regfootball]

"visions of satty flogging a g3 around the 'bring on a test drive trying to compare the g3 to the mini"