Durbin Asks GM to Consider Community Impact During Restructuring Process
[WASHINGTON, D.C.] – Assistant Senate Majority Leader Dick Durbin (D-IL) today asked the CEO of General Motors, Fritz Henderson, to consider the impact that dealerships have on local communities as the company moves forward with restructuring and reducing its dealership network. Late last week, GM informed 1,100 dealerships that they would be losing their franchise agreements in a plan to cut 2,600 of its 6,200 dealerships under a restructuring agreement with the government.
“GM dealerships have made a significant contribution to their communities,” wrote Durbin. “I recognize the tremendous challenges facing GM as it restructures and rebuilds the organization. I ask, though, that as you make these painful decisions, you make every effort to assist impacted dealers in the transition and be sensitive to community needs during the transition.”
Durbin also noted the economic impact of closing GM dealerships in a state that has already been hit hard by the economic downturn. “The last few years have been challenging for cities and rural communities across Illinois. The unemployment rate in the state is 9.1 percent. The state lost 51,600 jobs in April. Closing GM dealerships in Illinois will only contribute to this bleak climate.”
Earlier today, Senator Durbin sent a similar letter to the CEO of Chrysler, Robert Nardelli, asking him to consider the impact that dealerships have on local communities as the company moves forward with restructuring and reducing its dealership network. Chrysler has notified a bankruptcy court that it plans to eliminate 789 of its dealerships nationwide – 44 in Illinois – as part of an effort to restructure its failing business.
[Text of letter below]
May 18, 2009
Mr. Fritz Henderson
CEO
General Motors Corp.
PO Box 21-8004
Auburn Hills, MI 48321-8004
Dear Mr. Henderson:
As General Motors moves forward with restructuring and a reduction in its dealership network, I urge you to consider the positive role these dealerships play in their communities. From employer to tax payer to civic leader, GM dealerships have made a significant contribution to their communities.
Clearly, closing dealerships will translate into job loss and an economic hit to the region. The last few years have been challenging for cities and rural communities across Illinois. The unemployment rate in the state is 9.1 percent. The state lost 51,600 jobs in April. Closing GM dealerships in Illinois will only contribute to this bleak climate.
I recognize the tremendous challenges facing GM as it restructures and rebuilds the organization and commend you for working through these with the President and his team. I ask, though, that as you make these painful decisions, you make every effort to assist impacted dealers in the transition and be sensitive to community needs during the transition. These dealers in many cases have sponsored Little League teams, provided that first job for high school students, and served as a staple of community organizations and activities.
These are difficult times for your industry and for Illinois communities. I hope that we can work together to protect both partners and emerge stronger.
Sincerely,
Richard J. Durbin