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Lawmaker, McEleney to GMAC: Floorplanning at Crossroads

November 05, 2009

WASHINGTON — U.S. Congresswoman Candice Miller (R-Mich.) and National Automobile Dealers Association (NADA) chairman John McEleney have undertaken separate campaigns to extend a program designed to provide floorplanning credit to Chrysler dealerships.

Up to 140 dealerships will be adversely affected when the initial six-month term ends on Nov. 15. The program began after GMAC became Chrysler’s captive lender in the wake of the OEM’s May bankruptcy filing. The facilitation of interim floorplan financing was part of an agreement between the two companies, the Obama administration and Chrysler Financial, which will cease operations in 2011.  

Miller has been working to gather more signatures for her letter, which will be mailed to GMAC and Chrysler Financial as early as today.

“With additional time, credit markets will likely improve, and other issues like the recent changes to the Small Business Administration loan guarantee program can help many of these dealers,” the letter states.

NADA’s McEleney wrote to Chrysler Group CEO Sergio Marchionne, warning that the automaker is at risk of losing “a substantial portion of its retail network” — namely, those dealerships that were turned down for floorplanning by GMAC or don’t expect to be approved by the Nov. 15 deadline.

McEleney urged Marchionne to broker an intercreditor agreement between the two lenders and extend the program by 12 months. The full text of his letter can be found at NADA.org.

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