May 22, 2009

MARYLAND SENATORS ASK TREASURY SECRETARY GEITHNER TO EXPLAIN LOCAL GM AND CHRYSLER DEALERSHIP CLOSINGS

Washington, DC - U.S. Senators Benjamin L. Cardin and Barbara A. Mikulski (Both MD), sent a joint letter to Treasury Secretary Timothy Geithner today urging him to obtain more detailed information from Chrysler and General Motors on their recent decision to abruptly close hundreds of local dealerships nationwide.

 

"Our constituents are rightly concerned about this latest economic threat to their communities, which is why I want to understand the reason General Motors and Chrysler took such quick action to cut off dealerships that cost them little or no money to maintain," said Senator Cardin "The end-goal is clear: restore the viability of the U.S. auto industry. But how will this dramatic action help them to survive?"

 

"I have met with dealers and concerned constituents all over Maryland. They want to know why General Motors and Chrysler so quickly closed dealerships operating at little or no cost to the car companies. They're not the only ones," Senator Mikulski said.  "As Maryland's senior senator, I am committed to making sure Marylanders know the circumstances surrounding this decision."

 

The full text of the letter is below. A PDF copy is attached.

 

 

United States Department of the Treasury

1500 Pennsylvania Avenue, NW

Washington, DC  20220

 

Dear Secretary Geithner:

 

It will come as no surprise that the recently announced dramatic downsizings of the General Motors and Chryslers dealer networks are disturbing to us and many of our colleagues.  These dealerships are mainstays in communities in most every state.  In Maryland they provide jobs to tens of thousands and their sales make up approximately one fifth of the state's retail sales tax base.

 

            We have met with dealers from Maryland and they make several arguments about the importance of a robust dealer network, among others:

   Dealerships operate today at little or no cost to the car companies;

   Dealers know how to best sell cars in their individual communities and have built deep reservoirs of local good-will for the car companies;

   Cutting dealerships will lead directly to job losses and loss of revenue for automobile manufacturers at the worst possible time; and

               Convenient and reliable access to dealers for service is an ongoing strength for car manufacturers.

 

            We want to support General Motors and Chrysler and help the Auto Task Force in its immensely challenging job.  At the same time, we have a responsibility to our constituents to explain the sacrifices they are being asked to make.  We have yet to see clear arguments to justify the rapid shut down of so many car dealerships.  These closings will cause greatly increased disruptions, bankruptcies and unemployment in many communities and we need to understand how they will help General Motors and Chrysler to become profitable, viable companies in the future.  We urge you and the Task Force to do all you can to keep Congress advised regarding dealership closing plans and the role these closings play in the future viability of General Motors and Chrysler. 

 

We look forward to continuing to work with you and to receiving more information about how we can stabilize our American car manufacturers.