About 600 GM, Chrysler Dealers on Closing Lists File Appeals

DETROIT — About 21 percent of the General Motors and Chrysler dealers whose businesses are being shut down by the automakers have filed paperwork appealing the decisions, reported The Associated Press.

Around 600 dealers out of the roughly 2,800 whose franchises were revoked last year have asked for arbitration hearings in an effort to get their franchises back. Dealers have until midnight Monday to file for arbitration.

The appeals mean that many neighborhood showrooms that were shut down or scheduled for closure could return to business. GM Chairman and CEO Ed Whitacre Jr. has said he expects hundreds of dealers to win their franchises back during the process, which must be wrapped up by June 14.

While GM has told about 2,000 Chevrolet, GMC, Buick and Cadillac dealers that they will be phased out by October, about 700 will stay open because the automaker has not taken away all of their brands. Chrysler already has revoked 789 Chrysler, Dodge and Jeep franchises.

The dealer appeals are being filed under a federal law passed in December that appointed the American Arbitration Association to handle the claims. Arbitrators will consider a dealership's profitability, the manufacturer's business plan, the dealership's economic viability, and whether the dealer met objectives outlined by the automaker.

Congress passed the law after dealers complained that businesses run by their families for generations were taken away unfairly.