Saturday, May 16, 2009

Psst... Wanna buy a used car dealership?

The automaker crisis is about to hit the rest of Canada as the impact of the GM/Chrysler debacle spreads beyond the Ontario border with the slashing of the vast dealer networks of both companies.

General Motors of Canada Ltd. is poised to cut almost half its Canadian dealerships and force 310 businesses to close.

This is a bitter pill for the dealerships. Downturns in the auto sector in the past have always hit assembly centres such as Oshawa and Windsor. Dealers would see their sales shrink, but they have never had to face closings and thousands of job losses.

Welcome to the new reality. What's worse is that dealers don't know yet who will get the axe.

Marc Comeau, GM Canada's vice-president of sales and marketing, told Canadian dealers yesterday that their number will be reduced to 395 from 705 and those who are being cut will be informed during the new few weeks.

Meanwhile Chrysler Corp. said it would dump 789 of its dealers by early June.

In the United States, dealers who sell less than 35 cars a year were among those notified in the first round of cuts.

One imagines there is significant angst in dealerships across the country this weekend.



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