House bill co-sponsored by Rehberg impacts car dealers

A bill that would prevent General Motors and Chrysler from cutting dealerships from their respective franchises was introduced in the U.S. House of Representatives last week.

The Automobile Dealer Economic Rights Restoration Act of 2009, sponsored by Rep. Daniel Maffei (D-NY) and co-sponsored by 147 others, including Rep. Denny Rehberg (R-Mont.), has been sent in for committee review.

The bill, HR2743, would force GM and Chrysler to restore dealership franchises, at the owner’s request, as they existed before GM and Chrysler began bankruptcy proceedings, June 1 and April 30, respectively. The bill would also preserve dealers’ rights to recourse under state law.

The newly-formed Presidential Task Force on the Auto Industry is encouraging Chrysler to close one-fourth of its 3,150 dealerships nationwide, while GM closures could amount to 40 percent of its 6,300 dealerships.

Libby’s Cabinet Mountain Chevrolet Pontiac was notified last month that it may become one of the GM dealerships cut from the franchise, though it is too early to tell.

“The Montana dealers I’ve spoken with have serious concerns over the way the Auto Task Force has handled these closures, especially when many are reporting profitable bottom-lines,” Rehberg said. “Car dealerships are often one of the largest employers in rural communities, and these job cuts are counter-productive to economic recovery efforts.”