Two Ohio congressmen are seeking postponement of hundreds of General Motors dealership closures because they contend the termination process was “rife with secrecy.” U.S. Reps. Steven LaTourette and John A. Boehner sent letters Friday to Pres. Barack Obama, Treasury Secretary Tim Geithner, and TARP Special Inspector General Neil Barofsky asking for the process to be halted until an investigation of dealer terminations is completed.
But maybe the terminations should be halted for another reason: because vehicle sales are on the upswing.
When GM and Chrysler were developing their restructuring plans in late 2008, vehicle sales were slipping fast. The SAAR plunged 20% in 2008, then another 20% last year. But current new-car sales are climbing again. Industry pundits expect SAARs of about 11.5 million this year and 12.7 million next year.
In the restructuring plan GM submitted to Congress in February 2009, the OEM predicted it would break even with a SAAR in the 11.5-to-12-million-unit range. We are expected to surpass that level by yearend 2012.
Might we hear rumblings of new dealerships in the not-too-distant future?
