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Holden dealers ask Aussie PM to help fight GM for compensation

on February 26 2020 | in Highlights, Industry news, Latest news | by | with Comments Off

Senior Holden dealers in Australia have asked its Prime Minister Scott Morrison for his government’s help in securing compensation from General Motors for the loss to the dealer network of the 72-year-old badge, reports the Sydney Morning Herald.

“We asked the Prime Minister to help us hold General Motors to account,” a Holden dealer executive, representing 203 Australian showrooms and 9000 employees nationally, told the paper’s motoring publication, Drive.

“The Prime Minister was disgusted with GM’s behaviour. He asked us what he can do to help and is considering a number of options.”

Asked what leverage the Prime Minister and the Federal Government had over General Motors, a Holden dealer representative told motoring journalist Josh Dowling that the US car giant had admitted it has “breached its own dealer agreement”.

A statement from Holden said: “We believe the compensation to be fair. We are disappointed a small number of dealers are choosing to raise their issues in the public domain, rather than raising them with us.”

General Motors is rolling out its compensation offers in the coming week. Holden says only 13 per cent of Holden dealers have so far been made a formal offer.

“Any claim of unanimous rejection is untrue. Further, many dealers we have met with so far have expressed thanks for the professional approach Holden has taken in the discussions,” Holden said in a media statement.

“Different dealers will take different approaches to their commercial negotiations around compensation. We also acknowledge that responses can be emotional as we work through an amicable solutions to a difficult situation for all.”

However, the Holden dealer group claims the rejection of the initial compensation offer will be “unanimous” because other dealers yet to have their meetings now know how the US car giant is forming its calculations.

“Our estimations are that the compensation offer covers just 16 per cent of the dealer’s liability,” said a Holden dealer representative. “The calculation is the same for everyone. No one is going to accept that.”

Holden’s Australian dealers have engaged automotive legal specialists HWL Ebsworth and advisory firm KPMG to help dealers calculate what they are owed in compensation by General Motors.

Dowling reported that some Holden dealers have been offered as little as A$100,000 to shut their showrooms, while others have been allocated up to A$2 million to transition their businesses.

Despite record low sales over the past two years, the Sydney Morning Herald says it has learned that Holden and General Motors continued to urge some dealers to invest in multi-million-dollar showroom upgrades and facilities.


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