Legislation to Reinstate GM and Chrysler Dealerships Amid Auto Meltdown

Strategic Insights -

As the auto industry reels from one of its biggest meltdowns in history, a congressman from Ohio has authored legislation to reinstate contracts with thousands of dealerships that were forced to close. Representative Steve LaTourette (R-OH) argues that the termination of these dealers, many of whom were profitable, was "un-American and in some cases, illegal." The legislation aims to help the over 200,000 people employed by these dealerships, whose families are now struggling due to the closures.

Key Takeaways:

  • The legislation, spearheaded by Representative Steve LaTourette (R-OH), seeks to reinstate contracts with 3,000 dealerships that were forced to close due to the auto industry meltdown.
  • The dealerships, many of whom were profitable, employed over 200,000 people whose families are now struggling due to the closures.
  • The congressman argues that the termination of these dealers was "un-American and in some cases, illegal."
  • Representative LaTourette believes that the legislation will have a critical impact in September, when lawmakers are expected to vote on the matter.
  • The congressman has received support from local dealerships, whose customers have been vocal in their opposition to the closures.
  • The controversy surrounding the closures has been fueled by allegations that General Motors and Chrysler may be realigning dealerships, stripping small business owners of their rights.
  • Representative LaTourette estimates that some dealers have invested up to $7 million in upgrades to their showrooms, highlighting the financial losses incurred by these small business owners.

Statistics:

  • 3,000 dealerships were forced to close due to the auto industry meltdown.
  • Over 200,000 people employed by these dealerships are now struggling due to the closures.
  • Some dealers have invested up to $7 million in upgrades to their showrooms.

Sources:

  • "FOX and Friends" interview with Representative Steve LaTourette (R-OH), Federal News Service, August 10, 2009.