Wednesday, June 3, 2009

GM and Chrysler LLC shades off dealers for the sake of survival

On June 3, 2009, at a Senate Commerce Committee hearing executives of the GM and Chrysler LLC said that the elimination of their dealers is a critical step for their survival. The two major American automakers went bankrupt and declared to eliminate more than 2,300 dealerships. This means an estimated 100,000 people will lose their jobs which forced the government to look into the matter.

In his testimony, Frederick A. Henderson, interim CEO of GM, said that his company had no choice but to sacrifice for the sake of a “stronger and more viable GM.” In his testimony, Jim Press, Chrysler President, said that in order for a successful merger with Fiat SpA, the company required a “quick turnaround of its dealer network.”

However, Senator John Rockfeller, chairman of the panel, was not satisfied with their explanation. He said that the companies, who received government bailout money and not helping their local dealers and customers, were doing wrong.

This move by the two auto companies shows failure of the Obama administration to protect US jobs. However, the government has to admit that only giving away money would not change the financial condition of the companies. I think, along with stimulus packages, the present American government should work on reforming their overall business and corporate sector to survive in the future.

Related articles:


No comments:

Post a Comment