Nine months after GM announced it would kill off money-losing brand Oldsmobile, the automaker and its dealers are still struggling to reach common ground on closing the remaining 2,600 Olds dealerships when output ends in 2004, according to the Detroit News.

Some dealers already are closing up shop. But

others are gearing up for a possible legal battle with the world's largest automaker, according to the News. Still others are scrambling to pick up other franchises to fill the void left in their showrooms, with many choosing to turn to GM's biggest competitors, including Japanese and South Korean

automakers.

GM set aside $583 million to compensate Olds dealers. Under a formula based on annual sales, an exclusive Olds dealer selling 500 vehicles a year could get $1.45 million for closing their doors.

Bill Lovejoy, GM group vice-president of sales, service and marketing, said he is "committed to doing the right thing for Oldsmobile dealers."

Indeed, for many dealers, particularly those with family businesses that date back to the early 1900s, the death of Oldsmobile has been an

emotional blow.

Still, many say their biggest issue with GM now is about the compensation. Some say GM's offer does not accurately take into account investments in new dealerships, personnel, training, tools and parts. They also say the wording of the closure agreements may leave

them vulnerable to third-party lawsuits from their own employees.

"Our feeling is General Motors is not negotiating in good faith," said Jim Muir, owner of Jim Muir Oldsmobile-GMC in Sterling Heights, Mich., and president of the Metropolitan Detroit Oldsmobile Dealers Association. "We just want a fair deal."

0 Comments