The move would eliminate some 2,600 dealers.
GM also said it was eliminating its Pontiac brand and laying off thousands more jobs in its revised business plan.
“It’s a really big shock,” said Rudy Dossett III, general manager of Dossett Big 4, which sells Pontiac, Buick, Cadillac and GMC in Tupelo. “Big 4 has been in business for 60-plus years and has had Pontiac from the beginning.”
Dealers haven’t been told their fate yet, but they expect it will come this week. GM said it would contact dealers in the next few months.
“Everybody’s sitting back, waiting to see what happens,” Dossett said.
GM’s announcement reflected its efforts to slim down its work force and thin its ranks of dealers, with the hopes of returning the company to viability.
“It’s unnerving to everybody because we don’t know who’s going to receive that letter,” said Jeff Smith, who co-owns Frankie Blackmon in Corinth with his wife, Brenda. “But on the business side from General Motors, I see what they are trying to accomplish.”
The goal, he said, is to weather the economic storm now so they’ll survive later.
Jimmy Clark, co-owner of Larry Clark Chevrolet Pontiac Buick in Aberdeen, said he is in a “holding position” until GM figures out what it plans to do.
“It’s a big blow, especially to small town America,” Clark said. “We’ll wait and see what tomorrow brings ... It’s not just in North Mississippi. It’s the whole nation.”
He said it’s his understanding that GM is looking at dealerships that duplicate market coverage.
Smith said he expects GM will look hard at small rural dealerships to see if their sales numbers justify “maintaining that relationship with the manufacturer.”
The Pontiac brand will be eliminated by the end of next year. GM also is looking to sell off or eliminate Saturn, Saab and Hummer, leaving the company with only four brands – Chevrolet, Buick, GMC and Cadillac.
“There’s definitely nothing pleasant about losing a brand like Pontiac that has so much history,” Smith said. “From a public standpoint, it’s a negative. But on the business side, it makes sense.”
Automakers haven’t been shy in recent years to dump brands.
GM shed its Oldsmobile brand in 2004. Chrysler-Plymouth was a division of Chrysler Corp., but the Plymouth brand was retired in 2001. Chrysler then became a stand-alone division of DaimlerChrysler AG.
Pontiac had been gaining consumer interest in recent years with offerings such as the G8 and Solstice convertible, but it was too little, too late, dealers said.
Now, Dossett has nearly two dozen Pontiacs ready to be sold to what he expects might be a skeptical public.
“We’re going to continue to serve the customers and service the vehicles,” he said. “No matter what, we’ll still be here, even if the brand isn’t.”
Clark said Pontiac sales have been “a small part of our business,” but it doesn’t make the news easier.
“We’re disappointed that that’s just part of their plan,” said Clark. “But as a GM dealer, you have to abide by what they say.”
However, he added, “We’re more interested in the restructuring of GM.”
Clark said the restructuring comes during a “very serious situation” for the auto industry. New car sales have been steadily falling during the past two years. And as part of the recession, thousands of workers are out of jobs and re-evaluating expenditures, including car purchases.
“Until a person has his family taken care of and job security,” Clark said, “buying a car is not top priority.”
Contact Dennis Seid at (662) 678-1578 or firstname.lastname@example.org. Carlie Kollath can be reached at (662) 678-1598 or email@example.com.