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Automakers' health should be a factor in arbitration, senator says


$928,000 per cancelled dealer? No wonder GM went broke, not because that was the actual cost, but because no one in management or accounting had a clue as to where their money was going, or how they were going to earn more. Anyone who could actually defend that figure is an out and out liar.

I would love to see hard evidence of how closing dealers has any positive cash benefits directly to the manufacturer. The only justification for less stores is that fewer sellers, assuming they can sell the same amount of over-all product (and that is a HUGE assumption), will be more profitable themselves. Given more profitability per store, they should be in a better posistion to pay for better facilities, which could make them more attractive to lure potential customers from competitors. Eventually, this could translate into higher overall sales. None of this is a given. The idea that less is better has some merit. The reality of what GM and Chrysler did to thousands of people (dealers and employees of dealers) is horrible. No representation in small rural towns means fewer sales....period. The most unfortunate thing is that many closed dealers will get the opportunity to see justice, but it will be too late, since many will have been without a franchise or have already been closed for more than year.


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