I rise to ask Chrysler and GM to continue to honor their commitments to auto dealers in this country. Chrysler and GM should not deprive economic rights to profitable dealerships across this country. Yesterday, I joined with Representative Frank Kratovil of Maryland, and introduced the Automobile Dealer Economic Rights Restoration Act of 2009. The act aims to restore the economic rights of GM and Chrysler dealers as they existed prior to each company's bankruptcies.
We want to preserve GM and Chrysler car dealer's rights to recourse under state law and at the request of an automobile dealer require GM and Chrysler to reinstate franchise agreements, in effect, prior to those company’s bankruptcies. These are bankruptcies negotiated with federal officials at taxpayer dollars are helping to maintain both companies. Therefore these bankruptcies should not be used to change the rules that dealers have been operating under.
I first wrote a bipartisan letter with Representative Chris Lee of New York and more than 65 of our colleagues to the auto task force in may asking them to work with the companies to reconsider the forced closings. Since then thousands of dealers have been informed by GM and Chrysler through a seemingly arbitrary system that their relationships were ending, essentially immediately, leaving some dealers with millions of dollars invested in car stock with no options for consolidation, and little leverage for liquidation.
In my home district in upstate New York, there is a dealership, Louis Goodman Chrysler, which has been the cornerstone of one of our communities for 50 years. Mr. Goodman opened his dealership in 1959 in Syracuse. Two years ago at the age of 82, Mr. Goodman passed away. But, his dying wish was to make sure the dealership reached the half century mark. His widow promised to keep it running, at least through the 50th anniversary, which was last week. Louis Goodman Chrysler, received a letter on May 15 informing them that Chrysler was severing their relationship. The letter gave no indication as to why this particular dealership was targeted, just that it was ending. I visited Mrs. Goodman last week to celebrate the 50th anniversary. This is a dealership that is profitable, partly because of selling pre-owned cars, it employs dozens of people, has been loyal to them for years. It is exactly kind of small family business that we in this house claim to want to help, not close.
We all recognize that the economy is not favorable to the auto industry right now and especially not in certain sections of the country where the population can no longer support an extensive dealer network. We’ve already seen lay-offs from parts manufacturers in my district, plant closings, and Chapter 11 among, um, one of the suppliers. In this context, across CNY, 11 dealerships have closed on their own since 2007, and we expect to see other dealerships consolidate and close this year. But we do not, in the middle of a recession, need to take a hatchet to local family owned businesses that have supported our communities for decades, when market forces are already at work. These dealerships employ hundreds of people across my district. They sponsor our local little league teams, our pancake breakfast, they buy ads in our local newspapers and local TV newscasts. They have been the cornerstone of our community for generations.
Now, I’ve also signed a letter with Congressman Chris Van Hollen and Majority Leader Hoyer, and over a hundred more fellow members, and we sent it to President Obama, talking about our concerns and the total lack of transparency in how this system is shutting down profitable dealerships. We want to know, from both sides of the aisle, whether we can get more transparency and indication of how this indeed saves money. The auto companies, buoyed by taxpayer dollars, should be honest with the dealerships, and with the American people about how these decisions are being made, and they should be negotiated with, the dealerships should be negotiated with, how to consolidate dealerships in a way that will help to find a soft landing for the workers and the communities. Not just my district, but across the country.
Now I yield back the balance of my time.
