GM 'not confident' of selling Saab
By Tom Krisher |
January 8, 2010, Friday
|
Print Edition
Print Edition
HUNDREDS of the 1,350 General Motors Co dealers who lost their franchises last year could see them restored in an arbitration process mandated by Congress later this month, the company's interim CEO said on Wednesday.
CEO and Chairman Ed Whitacre Jr also said new Chief Financial Officer Chris Liddell is a candidate for the CEO post. And Whitacre said he's not confident about selling the Swedish Saab brand. GM is phasing out the brand and expects to start closing plants this week.
GM has been in talks to sell Saab during the past month with Dutch exotic car maker Spyker Cars. It has also heard from other suitors after an attempt to sell the brand to a consortium led by Swedish sports car manufacturer Koenigsegg Automotive AB and backed by Beijing Automotive Industry Holdings Co fell apart in November.
But Whitacre said he is not confident a deal can be reached.
"It's real easy. Just show up with the money and you can have it," he said. "Nobody's come with the money, so we're in the wind down deal here."
Whitacre also predicted that GM would be profitable this year, although he said that was dependent on the economy and other factors.
GM had planned to close 1,350 dealerships this year to dump poor performers and better align its dealer base with much lower consumer demand. In many cases, GM had dealerships too close to one another and competing too much on price, the company said.
Congress passed legislation late last year that forces GM and Chrysler Group LLC, which shed 789 dealers last year, to give dealers a chance to appeal against closure decisions. Whitacre said the company had a "pretty arbitrary cutoff point" for shedding dealers, and that it probably made mistakes in getting rid of some of them.
Restoring some dealerships could be good for the company because they would sell more cars for GM. But it also could be bad if a "lousy dealer" with a poor storefront got a franchise back, he said.
Under pressure from dealer groups and lawmakers, GM and Chrysler put out proposals that would have allowed dealers to challenge their closure through arbitration before January 25. But a bill passed by Congress allows dealers to bring a much wider range of proof that they are profitable, raising the possibility that they could remain open.
CEO and Chairman Ed Whitacre Jr also said new Chief Financial Officer Chris Liddell is a candidate for the CEO post. And Whitacre said he's not confident about selling the Swedish Saab brand. GM is phasing out the brand and expects to start closing plants this week.
GM has been in talks to sell Saab during the past month with Dutch exotic car maker Spyker Cars. It has also heard from other suitors after an attempt to sell the brand to a consortium led by Swedish sports car manufacturer Koenigsegg Automotive AB and backed by Beijing Automotive Industry Holdings Co fell apart in November.
But Whitacre said he is not confident a deal can be reached.
"It's real easy. Just show up with the money and you can have it," he said. "Nobody's come with the money, so we're in the wind down deal here."
Whitacre also predicted that GM would be profitable this year, although he said that was dependent on the economy and other factors.
GM had planned to close 1,350 dealerships this year to dump poor performers and better align its dealer base with much lower consumer demand. In many cases, GM had dealerships too close to one another and competing too much on price, the company said.
Congress passed legislation late last year that forces GM and Chrysler Group LLC, which shed 789 dealers last year, to give dealers a chance to appeal against closure decisions. Whitacre said the company had a "pretty arbitrary cutoff point" for shedding dealers, and that it probably made mistakes in getting rid of some of them.
Restoring some dealerships could be good for the company because they would sell more cars for GM. But it also could be bad if a "lousy dealer" with a poor storefront got a franchise back, he said.
Under pressure from dealer groups and lawmakers, GM and Chrysler put out proposals that would have allowed dealers to challenge their closure through arbitration before January 25. But a bill passed by Congress allows dealers to bring a much wider range of proof that they are profitable, raising the possibility that they could remain open.
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