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GM dealers leery of bankruptcy

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By KEITH MORELLI

kmorelli@tampatrib.com

Published: April 23, 2009

TAMPA - Bay area General Motors dealers are edgy about the strong possibility that the automaker could end up in bankruptcy court. That could leave affiliates hanging in the wind, with hundreds of thousands of dollars owed to each left in arrears or, worse, left unpaid.

At any given time, that's how much the manufacturer owes each dealership for warranty work or for rebates dealers have honored.

Some local owners and general managers are watching the news, wishing the GM story would get off the front pages of the newspapers and off television news programs. That could help sales and bring the auto giant back from the brink, said Roger Rivard, owner of two GMC dealerships, James Rivard Buick Pontiac GMC Trucks in Brandon and James Rivard Pontiac GMC in Tampa.

He is optimistic, saying that the automaker needs its dealerships to make sales, and that gives the local new car outlets some ground to negotiate.

"If GM doesn't pay us those fees," Rivard said, "they go out of business. We have leverage. We could shut down sales of that company overnight, as dealers. They need us as much as we need them."

He doubts the automaker will renege on those fees. It might slow down payments, but that's about it, he said.

"I really wish they would get into bankruptcy court and get out so we can get on with our lives," Rivard said. "I am optimistic. I just want to get this over with."

If the giant automaker ends up in bankruptcy court, some dealerships may find themselves without a franchise. Company officials already have said they would like to cut the number of dealers.

That's not a likely scenario in Florida, Rivard said, where franchise laws protects dealerships from shuttering. "Each state has its own set of laws to protect dealers," he said.

Recently, GM CEO Fritz Henderson said that a bankruptcy filing is probable. The automaker has been running its business with a $13.4 billion bailout from the federal government.

Dick Norris, owner of two Dick Norris Buick Pontiac GMC dealerships in Pinellas County, said the less said about the situation, the better.

"I think these comments would be premature," he said. "I've been in the car business for 35 years, and there are so many things we don't know yet.

"This country doesn't need any more nontruths or speculation," he said. "We just need to be patient here for a little while.

"In a few weeks, call me," he said. "The best thing we can do now is to stay away from speculation."

Things "will get better," he said. "I'm optimistic about America."

Reporter Keith Morelli can be reached at (813) 259-7760.

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