DETROIT — Following on the heels of the news that Chrysler will close down nearly 800 of its dealerships, General Motors Corp. has announced that it will reduce its dealership levels by 40 percent. GM said it will cut 1,100 of its 3,600 dealerships. This number does not include the approximately 300 GM dealerships that already closed this year due to bleak sales numbers.
According to a company spokesperson, the 1,100 dealerships have until October 2010 to cease operations. About 600 of the locations sell mostly Pontiac, Saab, Hummer or Saturn brands, according to one media report.
The National Automotive Dealers Association (NADA) issued a statement on the closures, saying, "General Motors’ plans to cut its dealer network are drastic and far-reaching and will impact more than 63,000 dealership employees and thousands of their sales and service customers.
"We view GM’s action with a profound sense of sadness and disappointment. GM’s decision comes through no fault of the dealers, who are, in many cases, family-run businesses that have been loyal partners with GM — through good times and bad — for multiple generations.
"NADA fully expects GM to honor all its obligations to the affected dealers, whether or not they decide to wind down their operations. It’s critical for GM to treat each affected dealer fairly and equitably."
NADA added that it will work aggressively on all fronts with regard to assisting these dealers, and the affected Chrysler dealers, during these historically challenging times.