DETROIT - General Motors, which hired an outsider to examine its minority dealer program, also has started an internal investigation and has replaced the program's general director.
In a letter Wednesday, April 22, to minority dealers, Ron Zarrella, vice president of GM's North American sales, service and marketing, said the company is looking into alleged improprieties in the program.
The letter also said that, at GM's request, Lee McDaniel has stepped down as the program's general director 'to refocus his efforts in other areas as the investigation is under way.' Eric Peterson has been named general director of the program. Peterson formerly was GM's general director of dealer policy.
McDaniel, 52, has not been in his office for at least two weeks, and could not be reached for comment.
He was appointed general director of minority dealer development in 1992, after having been manager of minority dealer development since 1987. He was assistant minority dealer development manager for a year before that.
GM spokespeople declined to comment on the letter.
Several dealers said they are upset about the internal investigation, and fear GM will dismantle the minority dealer program.
Over the past year, GM's minority dealer program has been the target of several news reports criticizing how it identifies dealer candidates, the quality of the dealerships available to minorities, and the management of the program.
Zarrella's letter begins: 'Over the past several months, I'm sure you have heard, listened to, read about and even inquired about allegations surrounding our minority dealer program and some of its team members. With all that's being talked about I thought it best that you hear it directly from me.'
It goes on to say:
'Rather than paraphrase, here's Lee's statement: 'Certain unsubstantiated allegations have been made by third parties as to the management of the minority dealer programs. These allegations indirectly affect me. I have decided to step aside temporarily until the matter is completely investigated. I fully expect to resume my GM career as soon as this matter is cleared up.''
GM hired Washington attorney Weldon Latham last August to head a team of researchers to study weaknesses in GM's minority dealer program. Latham is a senior partner at Shaw, Pittman, Potts and Trowbridge in Washington, D.C. His report is due in May.