David Kirkpatrick

May 15, 2009

Car companies dumping dealerships

Filed under: Business — Tags: , , , , — David Kirkpatrick @ 11:49 am

In a very necessary move from both General Motors and Chrysler — they each have many, many more dealerships than the Japanese manufacturers — the number of dealerships out there is being cut. The exact numbers differ depending on the source, but in the near future there will be fewer GM and Chrysler lots out there.

From the link:

The next auto businesses on the chopping block will be 2,600 General Motors dealerships.GM Chief Executive Fritz Henderson said Monday that the company would by the end of the week start notifying dealerships it wants to eliminate over the course of the next year. The company said last month that it planned to eventually eliminate 42% of its 6,250 dealer locations, which employ more than 300,000 workers among them.

On Thursday, Chrysler LLC’s announced that it is dropping nearly 800 Chrysler, Dodge and Jeep dealers, or about a quarter of its network, as part of its bankruptcy restructuring.

GM (GM, Fortune 500) is not yet in bankruptcy court, although Henderson has said such a filing is “probable.” The company has until the end of the month to win agreement from creditors, unions and dealerships on a turnaround plan or the Treasury Department, which has been bankrolling GM’s ongoing losses, has said it will force the company to file for bankruptcy.

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