Forced Closuure of Dealerships
Ok. What am I missing? Can someone explain to me how forced closure of dealerships saves an auto maker money? This defies logic from my point of view. I agree that getting rid of a 'bad' dealer would be beneficial, but in my state, it is creating hardships, and seems so unnecessary. It appears that the closures are visited upon the smaller (low sales volume) dealers. We have a few small family owned dealerships that have been selling the same brand since the 1930s. These are located in small towns and areas without enough population or income to support a large volume of new car sales. Over half of the business in these shops is repair, service, and used auto sales. One owner has stated that his organization costs GM nothing and wonders why he should loose his dealership. I agree with him. What am I missing?
There is another nasty bug in these closures: These dealers are stuck with their present stock of new cars. After loosing their franchise, they can not sell their present stock of new cars (I suppose there is a warranty issue), AND GM won't take the cars back. What are they to do?