GM Will Sue Dual-Showroom Dealers

AUTOMOTIVE NEWS reported that GM Will Sue Dual-Showroom Dealers.General Motors will sue dealers who refuse to move non-GM brands out of their showrooms. "We're going to get involved in some litigation with dealers," said Bill Lovejoy, group vice president for vehicle sales, service and marketing, on Wednesday, July 25. "A dealer friend called me up, and I said, 'I still love you, but I don't like your behavior. I'm going to fight you on this.' "I'm playing schoolyard basketball. If I can kick your butt, I'm going to."

About 25 GM dealers would be affected, the company says. GM is seeking to enforce a franchise-agreement provision requiring that it approve any dual franchises. But dealer advocates say the laws of some states will block GM. Frank Ursomarso, president of Union Park Automotive Group in Wilmington, Del., says many state franchise laws would allow GM to enforce its franchise agreement only if it could prove that the non-GM brands could stand alone. "The franchise agreement cannot take precedence over the state law, regardless of what the franchise agreement says," Ursomarso said.