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GM, Chrysler roll in new directions without hundreds of dealers
It's the end of the road for nearly 1,900 vehicle dealers in suburbs, towns and cities across America. General Motors and Chrysler are forcing them to close as each automaker struggles to survive by shrinking. The idea is trim costly, inefficient networks of dealers that include multiple locations within 10 to 20 miles in some areas. GM, which is reorganizing with federal help and bankruptcy court protection, is phasing out 1,100 of its 4,700 dealerships as part of cutbacks that include dropping Pontiac, Hummer and Saturn from its model lineup. Chrysler, being purchased by the Italian automaker Fiat, closed more than 780 of its 3,200 sales outlets on short notice this month. The impact on communities will be significant -- eliminating a rough average of 50 jobs at each site, reducing business for local suppliers of goods and services, and hurting commercial real estate markets. Even Little League teams, charities and other groups will feel a pinch as dealer donations stop. "These are big names in local areas and having them shut down has a huge ripple effect in communities," says Congressman Dan Maffei of Syracuse, N.Y. "Not only is it impacting the dealers, it's impacting everyone around them."
Front Page Talking Points is written by
Felix Grabowski and Alan Stamm for NIEonline.com, Copyright 2013
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