Archived Story

County dealers avoid GM cuts

Published 5:22pm Friday, May 15, 2009

It appears the three Lawrence County automotive dealers have dodged the GM bullet. As of Friday afternoon none of the three had received a notice that the Detroit carmaker was saying “sayanora” to them.

Friday was the day when GM notified about 1,100 U.S. dealers that their franchises will be terminated later this year. The cuts are part of a larger GM plan to slash 2,600 of its 6,200 dealerships as the automaker tries to restructure to get in the black again.

This came one day after Chrysler LLC eliminated nearly 800 of its dealerships, including a prominent name in the county — Harmon Motors Sales Inc., in Ironton.

Eddie Marshall of Hamilton Chevrolet in Proctorville said he hadn’t gotten a notice from GM and wasn’t anticipating one.

“We have been doing this for 30 years,” he said. “I can’t imagine.”

Likewise Phillip Ratliff of Higgins Chevrolet of Ironton received no word from GM.

“They were keeping the list quiet, but we did not receive a notice. We must be in the clear,” Ratliff said. “From what I hear they were all up north.”

Higgins opened its doors in 1928 and is in its fourth generation with Karla Higgins as the current owner.

Both Chrysler and GM have said they were cutting dealers because they have too many outlets that are too close to each other, which translates into lower prices from too much competition.

However, Higgins’ competitor across the street is Bob Clyse Pontiac-Buick-GMC Inc., who also was not on GM’s cut list.

“We’ve had an outpouring of support from the county and thank everyone for that,” Clyse said. “Our intentions are to continue to serve the community as we have since 1969.”

The dealership has approximately 32 employees and Clyse said he was happy for them that the business wasn’t affected.

“They have worked hard and that is whom I was most concerned about,” he said.

Clyse, who will be dealing with the fact that GM is phasing out the Pontiac line by the end of 2010, said sales in recent months have been better than expected, but the worry is there.

“The brand names aren’t important as long as GM provides the product people want,” he said. “And I have great faith that they will do so. General Motors up to this point has been good to our family. I’m loyal to GM.”

GM declined to reveal which dealers will be eliminated. Many dealers vowed to fight, first through a 30-day company appeal process, then possibly in court.

GM’s dealers are protected by state franchise laws, and the company concedes it would be easier to cut them if it were operating under federal bankruptcy protection. GM says it’s trying to restructure outside of bankruptcy because of the stigma of Chapter 11.

The Associated Press contributed this story.

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