House Passes Bill To Make GM, Chrysler Reinstate Dealers
By Michelle Krebs July 17, 2009The U.S. House of Representatives approved a plan to restore franchise agreements with dealerships canceled by General Motors and Chrysler during their bankruptcy proceedings.
The automakers as well as President Obama and his task force opposed the provision in a spending bill that is part of the 1020 fiscal year budget beginning Oct. 1 and was passed 219 to 208 Thursday.
Supporters representing both parties argued the companies terminated dealerships with little notice of explanation. The automakers and members of President Obama's auto task force contended shedding dealers would save the auto companies money. Chrysler closed down 789 dealers on June 9. GM plans to close 2,400 by October 2010.
The ultimate fate of the effort is unclear as it does not appear to be a high priority with the Senate.
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Click here to comment on this entry.King Henry II of Germany's third invasion of Italy was undoubtedly a major budget item that year.
Too little, and way too late.
Bad idea. If these companies have any hope of restructuring into something profitable, they have to have the ability to renegotiate or eliminate these unprofitable business relationships. The same goes for their relationship with the UAW, by the way. I know it'll hurt a lot of small businesses, but it's the only way.
Don't make me laugh. Now the automakers will go to court to try and block this as well.
The fingerpointing will go on for years.
This looks to me like a dispute that could end up at the Supreme Court. It's one thing to fire the CEO (Wagner) after you made an investment far greater than the current shareholders.
It's quite another to defy a ruling by the bankruptcy court. This is where separation of powers becomes a good thing. If this does go to a higher court, I only hope that the judges will act reasonably.
But then, you really can't count on that either, can you?
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