• May 29, 2009
On top of the 1,124 General Motors dealers that will be closed next year, the ailing automaker is reportedly going to announce another round of dealer closings on Monday when its bankruptcy declaration is expected. According to two Automotive News sources, 450 dealers will not see their dealer franchises renewed. For his part, Mark LaNeve, GM's VP of North American sales, said the number would be "less than half that."

No matter the number, it's more of the same bad-yet-necessary news being spread around. LaNeve notes that the dealers who won't be renewed "have very specific issues" including "specific performance issues." Among them are supposed to be some stores that are skewed exclusively or heavily Pontiac. These dealers will be shutting up shop when their franchise agreements expire in October 2010.

[Source: Automotive News -sub req'd | Image: Mark Ralston/Getty]


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  • 24 Comments
      • 5 Years Ago
      I don't see how cutting dealers will cut costs for GM? GM gets paid by the dealer as soon as the vehicle is built and rolls of the line. When you see a truckload of vehicles going down the road, they have already been paid for.

      Fewer dealers will make the remaining dealers more profitable and the consumer will pay more with less competition. Since the Government will own GM, will they still publish cost on the internet?
      • 5 Years Ago
      I wonder if a majority of the GM dealers getting the axe donated to the republican party, just like the majority of the Chrysler dealers that were told to close shop?

      Government control of private business, the first step in creating a socialist, communist state.

      Hope you guys like wearing red.
        • 5 Years Ago
        You pathetic redneck... I'm sorry, but that's all I can say.

        This ridiculous statement has been debunked over and over already by real journalists, it's not even funny that you (or other people for that matter) keep rehashing the same soundbites, over and over and over again.

        Like f*cking PARROTS... That's right, be proud of it.

        Someone said it, you don't seem to be very bright guy. And if 80% (or even more) donate to republicans, how the hell are you going to close half the dealerships without involving reps in it? Imbecile
        • 5 Years Ago
        True, the majority of the Chrysler dealers who are being targeted for closing donated to the Republican party...

        In fact over 80 % of ALL car dealers who donate to political parties donate to the Republican Party, this includes the ones that are staying open.

        Fox News didn't mention that second part did they?

        • 5 Years Ago
        You are clearly not a bright guy.
        My friend lost his Dodge dealership and he is a Democrat.
        If we wear red it will because the Republicans shipped all the jobs and manufacturing over to China.
        Last time I checked Obama was trying to save and create jobs in this country.
      • 5 Years Ago
      GM has roughly 7,300 "stores" in industry babble. I worked for GM, so I know personally that GM wanted to slim down to 4,000 dealerships by 2014.

      Now that Pontiac is dead, and all of Saturn, Hummer and Saab will likely be written down completely in bankruptcy protection, GM likely wants to have 3,000 dealers coast to coast.

      The 1,124 & 450 dealer cuts cited here are just the TIP OF THE ICEBERG.

      If GM is to *survive* and not go tip us completely within the next few years, it will have to purge another 2,500 dealerships.

      That is massive bloodletting but necessary. If GM pussies out and doesn't cut those 2,500 dealerships, it will NOT be moving forward with much needed aggressive restructuring of the retail channel.
      • 5 Years Ago
      Last time I checked Obama was trying to save and create jobs in this country.

      16,000 American jobs lost each day.

      Sounds like he really knows what he is doing.

      If we wear red it will because the Republicans shipped all the jobs and manufacturing over to China.

      Yeah, I'm sure all the loans Obama gets from China to pay for his "stimulus"
      doesn't factor in.

      In fact over 80 % of ALL car dealers who donate to political parties donate to the Republican Party, this includes the ones that are staying open.

      For now.
        • 5 Years Ago
        Venom,

        That "warmonger" had the support of our current Secretary of State and Vice President and well as the democrats presidental nominee before Obama. The economy actually tanked in the last two years, the two years with a republican president and a democrat controlled congress.

        Oil is traded on an open market and when a the global economy loses money countries buy less porducts like oil which makes the price go down. When things pick up globally the price of oil will rise again.

        I'm sure glad democrats don't have the tools like the republicans do with Hannity and Rush. Oh wait, they Olberman, Michael Moore and other Hollywood actors like Jeanine Garafalo who pretty much says if you dissagree with Obama you're a racist.

        Both sides are the same.

        And yes, I know what communisim is. I studied in China for over a year. I've lived it and seen it and it doesn't take care of it's people like Michael Moore leads people to believe.
        • 5 Years Ago
        Funny thing.
        The economy tanked on the 8 year watch of the Republican party or did you forget those little things like facts. That's right, people like you don't believe in things like facts.
        A trillion here and a trillion there for a fake war.
        $4-$5 gas, what did Bush say about that, nothing, kept talking about Iraq.
        If the Republicans were still in we would be invading Iran now spending another trillion here and there.
        I can't even count on one hand how many times Bush talked about health care or taking care of the people in this country because it was never. All that warmonger wanted to do was keep spending money on wars in the Middle East. I don't think he has even mentioned Bin Laden's name in 2 years.
        I will bet you don't even know what socialism or communism is. You just hear it from Rush or Hannity or O'Reilly and repeat it like a parrot.
        • 5 Years Ago
        Obama want's to save jobs?

        Really?

        Obama's actions have made it clear that he has an agenda - namely to transform the American ideal away from the truck, SUV and large passenger cars that we purchase now, to the small fuel efficient commuter appliances prevalent in Europe.

        Small problem: It's been proven time and time again that Americans only buy these narrow little piss-pots when they can't afford something, anything bigger.

        American roads were designed for 50's American iron - long, wide and capable of carrying a family of 7. Drive an econo car on the highway and you'll feel how out of place they are. Feel that tractor trailer pass? - The sway that made you and your passengers cringe??

        Big question: Are Americans going to buy the "Obama'ized" Chevrolet's? - the 35mpg small cars he and the other democrat boobs are mandating?

        I'll answer that for you - Again, study after study proves that Americans only buy small cars when they can't afford something bigger.

        Count me with the majority.

        Jobs? The American auto industry be damned, obama's willing to roll the dice on a proven loser.

        You voted for the idiot.
      • 5 Years Ago
      A GM dealership in Frankenmuth Michigan got the axe in a different way.
      A few weeks ago they had all their cars pulled by GMAC and they were supposed to get new financing and have new cars. It never materialized and today they closed their doors.
        • 5 Years Ago
        congrats to the Autoblog comment system for messing it up, again!
      • 5 Years Ago
      One needs only to visit the dealership in the picture (it's in Santa Monica) Z06's languish in the showroom full of dust. The parts area is a mess with zero customer service. Sales and advertising materials over a year old dot the showroom.
      What a mess...
      • 5 Years Ago
      second!!
        • 5 Years Ago
        second and a half!!
      • 5 Years Ago
      I agree with Peter, the first/second comments are old, old, old....get a life.
      • 5 Years Ago
      GM will never work until the management by committee mentality ends. The company and "others" need to be management by one man with a strong vision and high standard of what needs to be done. Great companies are run by great men. Go down the list of successful business. The unions, the MBA wonder-kids and all the yes-men are what ruined the business. Captains run a ship, not the crew or deckhands.
      • 5 Years Ago
      all you first and second idiots need to really shut the hell up. that crap is stupid and pointless
      • 5 Years Ago
      They should axe dealers with poor customer service. Get rid of the scum.
      • 5 Years Ago
      could some explain, how having too many dealers affects GM? I would think that the more outlets the better off GM is. Does GM sell the car to the dealer, or is it still in GM's name until a customer signs the dotted line?
        • 5 Years Ago
        You obviously don't understand mass retail or distributed sales channels. There are not just too many dealers, but too many small dealers. The mom & pop shops, and dealers of any size with bad customer service, are the problem. They are...
        -- the slowest to respond to leads
        -- most likely not to respond to specific questions in leads or in e-mail (availability, pricing)
        -- have the lowest conversion-to-sale rates (Auto Nation has double the conversion rate)
        -- most likely not to have a dedicated Internet manager to manage lead and customer e-mails
        -- most likely to provide unsatisfactory service

        Whether you like the big guys or not, the Auto Nations of the world invest in better trained staff. They respond quicker and more completely to leads; they provide both better selling experiences and post-sales servicing than the small dealers. Plain and simple.

        Here is why GM needs to purse thousands of small and under performing dealers:

        (1) Small and crappy dealers are killing GM cos they don't respond as well to leads, and hence struggle to sell vehicles. Lost sales = lost selling margin for GM. GM loses.

        (2) When said small crap dealer provides bad service, the owner blames GM for the bad experience, and buys a competitive vehicle the next time around. Defection = lower LTV for GM. GM loses.

        It's simple economics a grade 6 student can understand.
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