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General Motors to Eliminate 1,100 Dealers

General Motors Corporation (GM) today began sending notices to approximately 1,100 of its auto dealers that their franchise agreements will be terminated by the end of 2010, part of its plan to cut its dealership ranks from 5,969 to 3,600. The Detroit News reports that an additional 500 dealerships will be cut by eliminating the Saab, Hummer, and Saturn brands, and that another 400 to 500 may be consolidated with other franchises; GM also expects an additional 400 to 600 dealerships to terminate their agreements voluntarily due to economic conditions. Because GM is not currently under bankruptcy protection, it is not required to release the names of the dealerships being cut, and the company says it will not do so, giving dealers the option to decide whether to go public with the information; Chrysler released its list of eliminated dealers yesterday as part of bankruptcy court filings. GM says it is giving the dealers more than a year of advance notice to give them a chance to sell remaining inventory, to allow employees to find other jobs, and to give owners the opportunity to find other auto companies with which to contract. The News says most of the eliminated dealers' contracts with GM are due to expire in October of next year.

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