Peter Kitzmiller, president of the Maryland Automobile Dealers Association, has issued the following statement in response to the decision by General Motors to close more than 2,600 dealerships nationwide:
“The Maryland Automobile Dealers Association, which represents over 330 new car and truck dealers representing both foreign and domestic manufacturers, strongly disagrees with the decision by GM to cut more than 2,600 dealerships.
"Bondholders and the UAW are clearly cost centers for GM, however dealers are not. Dealers create revenue for GM when they buy vehicles and parts. GM’s costs are not affected by the number of dealerships, whether it is 6,000 or 3,000
"The Obama Auto Task Force needs to focus on organizational and structural changes to GM that will protect the taxpayer’s investment in the company and help it to become viable. But the decision to close dealerships, if it is allowed to go forward, will do nothing to protect the taxpayer’s investment. In fact, it will do just the opposite: It is estimated that GM will lose up to 35 billion in sales revenue with such a drastically reduced dealer network and, worse, more than 137,000 dealership employees will lose their jobs.
"It is MADA’s position that anyone who thinks this part of GM’s plan makes sense does NOT understand the retail automotive business. We call on the Obama Task Force to review GM’s plan and focus of the fact that massive dealer cuts will do nothing to help GM’s bottom line and that the loss of over 130,000 dealership jobs will devastate local communities. Dealers are not a part of GM’s problem; they are GM’s link to the consumer that will play a critical part in the company’s recovery and long term survival."