Automakers weigh dealership closings
WASHINGTON — General Motors and Chrysler will reconsider decisions to close thousands of dealerships as part of a compromise meant to stave off federal legislation that would require them to keep the showrooms open.
The decision by the two automakers, announced Thursday, raises the prospect of new life for some of the more than 3,000 dealerships that were slated to close as part of the broad auto industry restructuring. Dealers have loudly protested the decisions, and some said Thursday the policy is merely an attempt by the automakers to placate Congress.
Just how many dealers could potentially be allowed to stay open remains unclear. The companies did not provide any estimates. Dealers involved in talks this fall with the automakers said likely only a handful of lots targeted for closure would survive, despite the new policy.
The plans of GM, based in Detroit, and Chrysler call for face-to-face reviews with dealerships and binding arbitration for those who challenge closure of their showrooms. Chrysler said its review process would start Thursday while GM said talks with dealers would begin in mid-January. Chrysler, based in Auburn Hills, Mich., said dealers will be given a chance to open new showrooms if an arbitration panel rules in their favor.
Dealer groups and a key lawmaker questioned the automakers' latest plans, however, opening the possibility of Congress considering the dealer legislation anyway.
