Almost five years after US taxpayers bailed out General Motors and Chrysler, a large majority of their slimmed-down dealership networks are posting soaring profits, Bloomberg reports, and contributing to the US auto industry on track this year to deliver 15.4 million vehicles, the most since 16.15 million were delivered in 2007.

Consider another important figure: Bloomberg says that more than 90 percent of GM dealerships are profitable, compared to about half of them in 2008 and 2009. At the start of 2013, GM had 4,355 US dealerships and Chrysler had about 2,600. Compare that with just a few years ago, when GM had 6,246 dealers in 2008, while Chrysler had 3,200 in 2009.

As part of their bankruptcy restructuring, both GM and Chrysler decided that their retail networks contained far too many dealerships and insisted that they be slimmed down. The resultant dealership terminations followed by a rebounding auto market - in part due to better new GM and Chrysler vehicles - have increased the number of sales per dealership to record levels. Many dealers are taking advantage of increasing profits and investing in facility renovations and updates, such as Chrysler dealership owner David Kelleher. He's spending $2 million to expand his store.

"The [dealership] terminations, albeit evil, gave us the opportunity to correct ourselves," says Kelleher, whose dealership survived the cuts. Though he opposed the forced dealership closings, he says, "It accomplished what they set out to do."


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  • 32 Comments
      johnb
      • 1 Year Ago
      I see the wh has been sending out more good press releases besides just the successful launch of it's incredibly popular heathcare law. :)
      groingo
      • 1 Year Ago
      So, where is the publics cut...oh yah, we ate over 10 billion dollars on GM!
        Jeff Dance
        • 1 Year Ago
        @groingo
        How much was taken from the owners of the franchises that where cut? I know my family took a hit for 60 million when our store was taken from us. What came out of your pocket?
        OptimusPrimeRib
        • 1 Year Ago
        @groingo
        I bet the bailout wasn't the result of 130,000+ dead and $3 trillion dollars spent.
      Skicat
      • 1 Year Ago
      But .. but ... Boe ner and TPers say "the American people don't want big gubmint." It can't do ANYTHING right.
      CadiVetteFerrari
      • 1 Year Ago
      Obama supporters and democrats say this: blah blah blah. Bush supporters and republicans say this: bleh bleh bleh. Blood in the streets.
      Jeff Dance
      • 1 Year Ago
      Chrysler took a profitable business owned by my family for 35 years without compensation.
        • 1 Year Ago
        @Jeff Dance
        [blocked]
          Jeff Dance
          • 1 Year Ago
          Chrysler cut 789 dealers because the government appointed task force said they had too many dealers and from what I have been told the dealers that had been cut were chosen by the govt task force and not Chrysler corp .My Fathers store was one of the 789 cut, the store was taken from us without any compensation or payment and given at zero cost to a dealer group based out of Chicago. We were a top performing franchise that was always within the top 50 dealers in the nation , at one point in time we were the number 1 retailer of Chrysler products in the nation. The county where my family store was located is has a republican majority and every gm and Chrysler store in the county was shutdown by the task force to affect the tax revenue of the county. Since the closure of the store the county had to shut down public schools and public programs because of a lack of funds to operate them.
          Jeff Dance
          • 1 Year Ago
          Bob Dance Dodge Longwood Florida ,Seminole county Florida.
          • 1 Year Ago
          [blocked]
          Skicat
          • 1 Year Ago
          Name of dealership? Name of county, pls.
      knightrider_6
      • 1 Year Ago
      ...but Mitt Romney said that bailing out GM and Chrysler will doom their future.
        churchmotor
        • 1 Year Ago
        @knightrider_6
        Actually, Mitt wanted to take the companies through a LEGAL and PROPER bankruptcy. NOT what Obammy did by kicking all the creditors to the curb, firing white collar workers, then handing BILLIONS in cash to the UAW. Mitt would have solved the problem by kicking the UAW to the curb.
          Rob Pollard
          • 1 Year Ago
          @churchmotor
          ACTUALLY, Mitt said Detroit should go through a bankruptcy WITHOUT any govt involvement. That second part is the key. Mitt thought his banker/private equity friends should be able to handle providing the necessary cash. You know, because in the midst of a worldwide financial crisis, there are plenty of big banks who have spare tens of billions of dollars laying around to use for financing while GM and Chrysler worked their way through the bankruptcy. I mean, you can find a list of those banks who were pushed aside by the govt....well...hmm....somewhere, I suppose. And please point to the court decisions that showed that what Obama did was illegal with the bankruptcy. Call me crazy, but I'm not just going rely on "churchmotor's" legal skills -- I'd rather rely on federal judges and the Supreme Court.
      • 1 Year Ago
      [blocked]
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