On the Democratic side, House Majority Leader Steny H. Hoyer and Reps. Chris Van Hollen and Daniel Maffei circulated this letter, asking lawmakers to sign it by 5:00 pm today:
Dear President Obama:
We are writing to express our concerns about General Motors’ and Chrysler’s decision to close profitable automobile dealerships across the country, and urge you to ask GM and Chrysler to delay final action on proposed closures pending further review of the decision to consolidate dealerships and the process by which Chrysler and GM selected the dealerships to close.
Closing these dealerships will put over 100,000 jobs at risk at a time when our country is shedding jobs at an alarming rate. We also question the criteria being used to determine which dealerships should be closed and the fundamental fairness involved in this effort. It is our view that the market rather than leaving it up to the manufacturers whose poor leadership contributed to their demise. Furthermore, we believe car dealers will be key players in any effort to revive the American auto industry.
We believe the dealerships are one of the auto industry’s key sources of strength and the manufacturers should continue to honor their agreements and contracts. The dealerships, and their more than 1 million employees, form personal relationships with customers that often contribute to brand loyalty and will be key to General Motors’ and Chrysler’s recovery following this economic downturn. While we understand the desire to reduce the number of unprofitable dealerships, no one has yet sufficiently explained the need to close profitable dealerships.
We recognize that efforts by your Auto Task Force prevented the total liquidation of General Motors and Chrysler, as well as their dealership networks. We commend your efforts to help these businesses survive these challenging economic times.
However, we are concerned that manufacturers are closing profitable dealerships to circumvent current contracts which could require expensive buy-outs under normal conditions. We are also concerned about allegations that dealers that have previously stood up for their rights against the manufacturers are being targeted by these closures. We believe that the forced closures of profitable dealerships needs to be scrutinized by the Task Force to prevent additional future financial loses to General Motors and Chrysler and job loses across the United States
We may consider legislative proposals to ensure that dealers and their employees are treated fairly, and we look forward to your timely response.
Democrat Senators wanted answers during a committee hearing last week:
Sen. Amy Klobuchar (D-Minn.) asked about one specific dealership targeted for closure, which she noted has what seems like an good location near the Mall of America.
“Some of these dealers were actually doing pretty well,” she told the company chiefs.
On the Republican side: Video via Gateway Pundit: Texas Representative Ted Poe Accused Democrats of Shady Dealings–
Republican Senators, besieged by auto dealers who say their closures were unfair, wanted answers from the automakers, and the automotive task force:
Some lawmakers also sought to zero in on the role of the autos task force, complaining at times of a lack of openness.
Yesterday Rep. Darrell Issa (R-Calif.) sent letters to Chrysler chief executive Robert Nardelli and autos task force chief Steven Rattner about “the lack of transparency” surrounding the decision to trim Chrysler dealerships.
“Intervening in the bankruptcy process by exerting pressure on Chrysler to shed 789 dealership agreements is a misuse of the authority of the Task Force, giving credence to growing concerns the Task Force is not working to facilitate the restructuring of Chrysler but rather to nationalize the company by making decisions affecting the company’s day-to-day business,” Issa wrote.
Issa demanded a number of documents and records be presented to the Committee on Oversight and Government Reform for review.
Dealers want to know why their profitable dealerships are being closed when they’re not costing the automotive companies a penny:
I’m not hearing any good explanations.
Hat Tip: Doug Ross @ Journal
Sweetness and Light took a look at what Obama wants for the auto industry, based on what he wrote in his bestseller, The Audacity Of Hope.
The American Spectator: Obama’s Enemies List Grows