WASHINGTON -- General Motors helped orchestrate a campaign inviting as many as 4,000 U.S. dealers to oppose U.S. legislation that would save stores targeted for closing, a spokesman said.
The statement by GMs Peter Ternes marked the companys first confirmation of an effort, led by sales chief Mark LaNeve, that has drawn sharp criticism.
In denying that GM used coercion, the statement also rebuts allegations by U.S. Sen. Charles Grassley, R-Iowa, and dealer representatives that improper pressure was exerted on the dealers by hundreds of sales managers making the calls.
The calls informed dealers of a Web site where they could log their concerns about the legislation if they wanted to do so, Ternes said in an interview. There was no strong-arming.
Ternes also quoted from a LaNeve e-mail to subordinates asking them to avoid pressuring dealers. GM didnt monitor or review the sales managers calls, the spokesman said.
Grassley introduced a dealer-protection bill similar to one passed last week by the House Appropriations Committee as part of a spending measure.
The way it was
Both bills would restore terminated franchises to their status before GM and Chrysler LLC filed for bankruptcy this spring. Chrysler eliminated about 789 dealerships, about a quarter of its U.S. total, during its six-week bankruptcy.
GM, which emerged from court protection Friday, has told about 1,400 dealerships that their franchise wont be renewed when they expire in October 2010.
More than 1,000 other GM stores are expected to be cut through attrition and brand eliminations, bringing GMs projected U.S. total by the end of next year to about 4,000 from 6,000 currently.
Under the bill, the companies would have to work through state courts rather than U.S. Bankruptcy Court if they wanted to proceed with the dealership terminations.
Grassleys letter Thursday to GM CEO Fritz Henderson expressed concern that the automakers opposition to the bill and its phone calls to retailers have caused many dealers to feel threatened.
While not offering evidence of GMs involvement or its tactics, the senator accused the company of strong-arming dealers into defeating the legislation.
Heavy-handed pressure tactics
The Automotive Trade Association Executives, a group of more than 100 state and metropolitan area dealer associations, also passed a resolution last week condemning what the group called heavy-handed pressure tactics and veiled threats from GM management.
GM spokesmen last week declined to confirm the companys role in the campaign -- which was also handled by the National Dealer Council, an elected group of GM dealers that represents retailers interests.
The council asked members to sign a statement on the Web opposing the legislation, and about 1,500 dealers have done so, said Duane Paddock, head of the council.
Their names will be given to certain lawmakers, said GM spokesman Greg Martin.
The council sent a July 6 letter to dealers that gave them until the next day to sign a statement of opposition, a copy of the letter shows.
At least a half-dozen Colorado dealers complained that they got calls from GM managers asking them to sign the form in the compressed time frame, said Tim Jackson, head of the Colorado Automobile Dealers Association.
Ternes said hundreds of sales managers under the four brands designated for survival participated in calls to dealers. The effort was directed by LaNeve, North American vice president for vehicle sales, service and marketing, the spokesman said.
LaNeve last week e-mailed the general sales managers for each of the brands -- Buick, Cadillac, GMC and Chevrolet -- advising them to avoid the use of improper pressure.
Ternes said LaNeves July 7 e-mail said: Please make sure the field only asks the dealer to look at it and sign if he agrees. Please dont pressure the dealers. That is not the intent.
LaNeve also traveled to Washington last week to help lead GMs lobbying effort opposing the legislation, Ternes said.
His job situation at GM was put in limbo when the company named Bob Lutz, 77, as vice chairman in charge of marketing and communications on Friday.
Three dealer representatives said they had received complaints from about 30 dealers who had been contacted by GM managers.
Some dealers told me that GM managers had indicated that the company was keeping a list of those who were not cooperative, said Don Hall, head of the Virginia Automobile Dealers Association.
The number of complaints Hall has received from Virginia dealers has doubled to about two dozen in recent days, he said.