An arm of General Motors has asked surviving GM dealers to put in writing their opposition to bipartisan legislation that would restore franchise agreements to dealers the government issued pink slips to earlier this year, sparking accusations of “coercion” from one of the bill’s chief proponents.
The bill has momentum on Capitol Hill, but is not supported by the President. The Obama Administration said Wednesday reversing the closings would set a “dangerous precedent, potential raising legal concerns, to intervene into a closed judicial bankruptcy proceedings on behalf of one particular group at this point.”
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In a July 6 letter obtained by the Washington Times the GM National Dealership Council’s Chairman Duane Paddock said the NDC “strongly opposes this bill” and “would appreciate your signature of support at the bottom where it is designated.” It requested recipients to fax the signed letter by 5pm the next day to the NDC.
“It is extremely important you do this immediately. Our voices need to be heard,” the letter stated.
GOP Sen. Charles Grassley, of Iowa, who authored the legislation in question, believes this letter amounts to intimidation on behalf of the NDC.
He demanded in a letter to GM executives “I would like to know if and how GM will react to individual dealerships if they decide not to sign the letter in opposition to these bills.”
“Can you assure me and the hundreds of dealers who employ thousands of workers that you will not retaliate against them if they do not sign this letter or do not lobby against the bill on behalf of GM executives?” he asked.
GM issued an official response to Mr. Grassley that said “GM’s only involvement was to make our field personnel aware of the letter at the request of the NDC. Our field representatives were asked in the course of their of their normal interface with dealers to inquire if they read the letter and “if they agreed with it” to sign it and return it. GM did not instruct or coerce dealers to sign the letter and I assure you there will be no retaliation.
GM’s Washington Director of Policy Greg Martin said it was GM’s view the bill put their current path forward “at risk” and stressed that the NDC operates independently of GM management. “Not a single GM executive knows who signed” the letter Mr. Martin told the Washington Times.
The House will vote add the legislation, which has 242 cosponsors in their chamber and was introduced by a Democrat, as an amendment to the financial services bill sometime this week.
In the Senate, Mr. Grassley’s legislation has attracted 17 cosponsors. 10 of the cosponsors are Democrats.
