NADA Response to Comments by the Head of the White House Auto Task Force

WASHINGTON, July 21, 2009; Today's characterization by the head of the White House Auto Task Force with regard to the position of the National Automobile Dealers Association (NADA) on the question of dealer cuts is inaccurate. In comments at a hearing before the House Judiciary Commercial and Administrative Law Subcommittee, Ron Bloom maintained that NADA's only point of contention was the speed of dealer cuts. Not true. NADA is on record as consistently disagreeing with the idea of drastic cuts in the number of auto dealers. Auto dealers are independent business owners, entrepreneurs who invest millions of dollars in land, facilities, vehicle inventory, parts, training and employees. It is the dealer who should decide, based on market conditions, when to exit the business. Since dealers cost automakers next to nothing in overhead expenses, cutting dealers at this time does nothing to make either GM or Chrysler more viable.

NADA's position on the issue of dealer cuts has been outlined on numerous occasions, including in multiple meetings with the Auto Task Force. These positions were also stated publicly in an Open Letter to President Obama that was published in major newspapers around the country .

Here's a partial list of other occasions when NADA voiced its strong opposition to dealer cuts:

  --  June 12 -- Press release: NADA Welcomes Congressional Oversight of
      Dealership Closures
  --  June 10 -- Press release:  NADA Applauds Congressional Efforts to
      Restore Dealer Rights
  --  May 23 -- NADA asks all dealers to contact their U.S. Representatives
      to urge them to cosponsor H.R. 2743 and S. 1304, the "Automobile
      Dealer Restoration Rights Act."

  --  May 13 -- Dealers and dealer association executives from around the
      country converge on Capitol Hill to impress upon lawmakers that the
      drastic, rapid dealer cuts demanded by the President's auto industry
      task force will have a detrimental effect on automakers, the economy
      and the country ... NADA press release: "Auto Dealers Are Urging
      Congress to Intervene With the Obama Administration to Oppose Drastic
      Dealer Cuts"