Government Plans for Political Interference in GM, Chrysler

Nicolas Loris /

When the government bailed out General Motors and Chrysler, part of the necessary, painful road to recovery was to cut unnecessary dealerships. Before the cuts GM and Chrysler had over 9,000 independent dealerships in the United States. To save costs, GM and Chrysler cut 1,300 and 800 dealerships, respectively – still leaving them with many more dealerships than the likes of Toyota which only has 1,240.

Both closed dealerships and some lawmakers have complained that the decision to close certain dealerships was politically motivated. But the reality is the choices made were purely economic and the only reason it became a political issue is because the government interfered with bailout cash in the first place. But Congress still isn’t satisfied, saying terminated dealerships should get a second look:

Auto dealers shed during the bankruptcies of General Motors Co. and Chrysler Group LLC would have the chance to appeal their terminations under a $447 billion year-end spending plan released yesterday by Democrats.