Movement to Preserve Dealer Rights

Movement to Preserve Dealer Rights

The national new car dealer effort to preserve dealer rights pursuant to the bankruptcy reorganization of Chrysler and General Motors last spring moved to the negotiation table this week with the spectre of Congressional legislation to assist former Chrysler and General Motors dealers both real and looming.

Negotiations between NADA and allied dealer organizations and the reorganized automakers was encouraged and facilitated by Congressional sponsors of the pending legislation, which included House Majority leader Steny Hoyer (D-Md.) and House Democratic Caucus leader Chris Van Hollen (D-Md.).

Dealer participant reaction from the first meeting, characterized by NADA Chairman John McEleny as a constructive dialogue, reflected the reality that several meetings are in the offing to see if dealers and the automakers can come to terms on a non-legislative solution, that will address issues terminated dealers have with the reorganized Chrysler/Fiat and General Motors.

WANADA dealers Tamara Darvish of DARCARS and Jack Fitzgerald of Fitzgerald Auto Malls, who were at the table for the Committee to Restore Dealer Rights (CRDR), shared Mr. McElenys view, which also reflected a unity of purpose and position with respect to the approach the dealers are urging on Chrysler and GM. Besides NADA and CRDR, state and metropolitan dealer associations across the U.S. are represented by the Automotive Trade Associations (ATAE), as are minority dealers by the National Association of Minority Auto Dealers (NAMAD).

A second round of negotiations is occurring today in a U.S. Capitol office provided by legislation co-sponsors, which should signal whether a non-legislative approach is possible or not. Meanwhile, HR 2743 and S 1304 remain balls in play before the Congress with 277 co-sponsors in the House and 43 co-sponsors in the Senate. Rep. Van Hollen said he was hopeful the parties could work out an agreement, but if negotiations dont bear fruit, we are going to proceed on a legislative track. Most fundamentally, the legislation would reinstate franchises that were terminated (Chrysler) or which are being terminated (GM). The non-legislative approach now before the automakers would establish a process through which franchise recovery and/or compensation for the dealers losses in the terminations could be determined.