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GM Dealer Cuts Should Be Suspended by Obama

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On: Tue, Oct 26, 2010 at 1:10PM | By: Sherry Christiansen

GM Dealer Cuts Should Be Suspended by Obama

Rep. Steven LaTourette, congressman has suggested that the Obama administration suspend the 500 GM dealerships scheduled to be terminated October 31st, while waiting for a federal investigation of dealer cuts to be completed.

The 500 dealerships are those allocated to close last year that are now facing the end of their termination agreements.

The Inspector General’s office (Special Inspector General for U.S. Troubled Asset Relief Program) is in the process of completing an investigation of dealer cuts that GM and Chrysler ordered. The findings could be revealed too late for the 500 dealerships scheduled to be closed at the end of this month.

“It's like someone's in prison and the DNA that would prove his innocence is hidden,” LaTourette said in a phone interview today. “Once a dealer is shut down, it's difficult, if not impossible, for him to get back on his feet.”

LaTourette has been known to advocate for U.S. auto dealers, and last year he even launched a bill that would reverse over 2,000 dealerships that GM and Chrysler planned to terminate during bankruptcy. The bill was successful in the House, but was halted by the Senate. The bill eventually became the forerunner for the dealer arbitration bill that passed in December.

The Ohio congressman will join forces with dealers to contact the administration and request the terminations be put on hold. Because the United States Treasury owns 61% of General Motors, the government has a lot of power over the Detroit automaker to “secure the automakers cooperation,” according to LaTourette.


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