The grim prospects for dealerships, resulted from the bankruptcy process in which two of the biggest US manufacturers are involved, have been a reason for debate for a long time now. It is likely the saga will continue, at least until GM manages to exit Chapter 11 protection.
The involvement of the Commerce Subcommittee on Oversight and Investigations in the dealership closure is only the latest development and one which greatly pleases the advocate of the dealerships, the National Automobile Dealers Association (NADA).
John McEleney, NADA's chairman was the subject of a hearing with the aforementioned committee, following which he outlined both his gratitude of the state's involvement and the effects the dealership closures had or will have on those involved. Below are a few excerpts from his statement.
"NADA welcomes the engagement of this subcommittee which has a long history of aggressive congressional oversight. Oversight is exactly what is needed due to the lack of transparency and the harsh treatment of dealers during the government-sponsored restructuring of both Chrysler and General Motors."
"GM is closing 1,350 dealerships. Chrysler, through the bankruptcy courts, just shuttered 789 franchises. Between them, these closings put more than 100,000 jobs at risk, in communities throughout the country. With unemployment at its highest rate in more than 25 years, eliminating jobs and closing community businesses is not the way to help a struggling economy."
"We remain concerned, however, because these government-negotiated bankruptcies continue to threaten dealer rights under state motor vehicle franchise laws. These laws inject balance in the inherently unbalanced economic relationship between a dealer and the manufacturer. To fix this problem, Congress should insist that the franchise laws of the 50 states apply with full force and effect by passing H.R. 2743, the Automobile Dealer Economic Rights Restoration Act of 2009."
The involvement of the Commerce Subcommittee on Oversight and Investigations in the dealership closure is only the latest development and one which greatly pleases the advocate of the dealerships, the National Automobile Dealers Association (NADA).
John McEleney, NADA's chairman was the subject of a hearing with the aforementioned committee, following which he outlined both his gratitude of the state's involvement and the effects the dealership closures had or will have on those involved. Below are a few excerpts from his statement.
"NADA welcomes the engagement of this subcommittee which has a long history of aggressive congressional oversight. Oversight is exactly what is needed due to the lack of transparency and the harsh treatment of dealers during the government-sponsored restructuring of both Chrysler and General Motors."
"GM is closing 1,350 dealerships. Chrysler, through the bankruptcy courts, just shuttered 789 franchises. Between them, these closings put more than 100,000 jobs at risk, in communities throughout the country. With unemployment at its highest rate in more than 25 years, eliminating jobs and closing community businesses is not the way to help a struggling economy."
"We remain concerned, however, because these government-negotiated bankruptcies continue to threaten dealer rights under state motor vehicle franchise laws. These laws inject balance in the inherently unbalanced economic relationship between a dealer and the manufacturer. To fix this problem, Congress should insist that the franchise laws of the 50 states apply with full force and effect by passing H.R. 2743, the Automobile Dealer Economic Rights Restoration Act of 2009."