feds set to pay gm and chrysler dealers

[lsx only]

http://www.thetruthaboutcars.com/fed...ysler-dealers/

LOOKING BETTER GUYS

[XDCX]

While I'm always looking for good news, I'm not sure I'd get too fired-up about a report from the website TheTruthAboutCars.com.

That said, I do think there will be a settlement effort on the part of GM and Chrysler because they cannot risk that this legislation might gain momentum and pass.

Finally, I hope that any settlement is framed as an effort to ensure the dealer's legal rights are protected. This isn't a Federal Bailout of the Chrysler and GM OLDCO stores - it's simply an effort to see that their legal rights are honored.

[F&I Pro]

From what I'm seeing in other arenas, due to the proliferation of bailouts, a lot of people are seeing this as just that, not as compensation for years of toil and many dollars invested over the years.....Perception here bites, but, regardless, I hope all the OLDCO dealers are taken care of better than what has occurred thus far.

[XDCX]

Originally Posted by F&I Pro

From what I'm seeing in other arenas, due to the proliferation of bailouts, a lot of people are seeing this as just that, not as compensation for years of toil and many dollars invested over the years.....Perception here bites, but, regardless, I hope all the OLDCO dealers are taken care of better than what has occurred thus far.

Great post - I totally agree.

I think there's a growing resentment among Americans about the number and cost of all the bailouts. That's why I hope this isn't reported as another bailout by the Federal Government.

I'm convinced that most Americans have no idea how badly the OLDCO dealers have been screwed over. Even those who took the initiative to watch C-SPAN would have the impression that Chrysler's bought back 100% of the cars and 80% of the parts and tools. (If Jim Press said it under oath, it must be true.... )

On the plus side, I do think the GM dealers will benefit from the pain the Chrysler dealers have suffered.

[oldjeep]

There are several aspects to the settlement or legislative compromise. One is of course money but there is also a movement to soften the imposition put on the consumer by allowing satellite service at OldCo stores with some restrictions. This has been one of Sen Rockefeller's pushes as WV really got hurt service wise. Of course if Chrysler cant succeed there will be no need for warranty and service contract work after the next several years anyway. But it would also help with the parts and tool situation that chrysler has never even addressed yet.

[possum]

That would be a great deal if it can be worked out.

Money, AND Service would ease a lot of pain!

[XDCX]

oldjeep - Thanks for the update.

While I hope the legislation passes the Senate, I'm a realist and I'm pleased to hear that there are settlement discussions. If this issue goes down as an "all or nothing" proposition I'm afraid the OLDCO dealers will end up with nothing.

Pushing for a repurchase of parts and special tools with an option to become a satellite service center seems like a reasonable settlement.

Thanks again for keeping us updated and please let our members here know if there's something they should be doing to help the settlement efforts.

[frenchy]

Has anyone heard anything else new?

[XDCX]

Originally Posted by frenchy

Has anyone heard anything else new?

Our member oldjeep has played an active roll in advancing this cause with Washington D.C., so he's probably best informed to provide an update.

[oldjeep]

The latest is we need help from ALL dealers to advance our cause. This isnt just about OldCo, but God forbid NewCo might need some help in the future if not sooner. It also is not just about the Car Biz. How long till State Farm or Erie has you call Philadelphia, then New York or to the Far East where 'Hank' will take on your problem.

We need support in the Senate from every one who loves this great business. If you dont know your Senators phone number try this on for size.
1-877-SOB-U-SOB (877-762-8762) and ask for your senators office to support the restoration of franchise rights to the affected dealers, S 1304.

At present we need some more traction on this issue. As you know the media has covered us very little. We have to make this the issue it should be. Any of you able to get to Rush, Glenn Beck etc.? We have to do it because the medias attention span is very limited.

We are making headway in the Senate but still need to push on as the Congress makes its way to either legislation or some compromise. Unlike TV episodes this is going to take some time, effort and focus. Just like selling cars has always been. We all work in this unique industry that only we understand. We need to spread that knowledge to everyone we can.

Thanks for letting me beat your ear(s).... More pertinent stuff later...

[XDCX]

oldjeep - Thanks for the update.

In response to your thread I just sent an e-mail message to both of my Senators asking that they support S 1304.

Although I think it's unlikely that any of the Chrysler OLDCO dealers will get their franchises back, I do think that additional support of this legislation will put pressure on Chrysler and GM to settle with their dealers.

I'm done "hoping" Chrysler will do the right thing - we already know what they're going to do.

Thanks again for the update and your efforts to speak-up for both the OLDCO and NEWCO dealers.

[oldjeep]

Here is what the answer to the Constitutionality of the argument is about. I think I understand it but could not debate it. I will leave that up to the Lawyers.

It all boils down to a compromise so Someone doesnt have to look bad for a decision made on something thought up and not thought out.

POINTS ON THE CONSTITUTIONALITY OF
THE AUTO DEALERS ECONOMIC RIGHTS RESTORATION ACT
H.R. 2743/S. 1304


This legislation is constitutional

A. There is no ex post facto problem. H.R. 2743/S. 1304 applies to civil matters. Under established case law, the ex post facto clause is not applicable because it has no bearing on civil matters.

B. There is no Separation of Powers problem. H.R. 2743/S. 1304 does not violate the Separation of Powers clause because it creates a new right under the unique circumstances of the dealer termination crisis and because the legislation is not directly contrary to a final court order (See Plaut v. Sendthrift Farm, Inc., 514 U.S. 211 (1995)).

(1) Chrysler and GM differ in their treatment of dealership agreements: the Chrysler court authorized the assumption and assignment and the rejection of dealership agreements; GM forced its dealers to agree to contractual terminations and modifications of its dealership agreements with the threat of employing the bankruptcy rejection process but stopped short of rejection.

The Chrysler court's orders authorizing the sale of assets and assignment of certain dealership agreements to New Chrysler and the rejection of the remaining dealership agreements are on appeal and therefore the orders are not final. The GM court has not yet made any rulings regarding the dealership agreements and may or may not do so in connection with the sale hearing that commences on June 30, 2009.

(2) Even if, before Congress enacts H.R. 2743/S. 1304, the Chrysler and GM courts' orders become final, a court could construe this legislation as creating new rights for those dealers whose dealership agreements were rejected. The Court in Plaut suggests that a granting of a new right does not create a separation of powers problem.

(3) Congress has the power to enact legislation that contravenes a final court order without violating the separation of powers if the legislation is focused on a small group. This is a factual question in each instance. Here, the group of dealers is sufficiently small so as to fit within the exception.

C. There is no due process problem.

H.R. 2743/S. 1304 increase the number of dealers for New Chrysler and New GM, which does not take property or contract rights from either entity. Rather, it enhances the value of each new company by affording each a more extensive and experienced dealer network. The federal government, as an equity holder in and lender to the newly created entities, is empowered to act to preserve its investments.


Comments from the forum apprciated to help me debate and present.

[XDCX]

Originally Posted by oldjeep

Comments from the forum apprciated to help me debate and present.

I'm like you, I think I understand the overall position, but I wouldn't want to try to explain it to someone else.

In my opinion, so much of what has already happened with Chrysler's bankruptcy violates existing laws, why should it matter? The day the UAW got a better settlement than the first lien bond holders it was clear that the Task Force and Bankruptcy Court were no longer bound by law.