White House Opposes Bill Restoring GM,Chrysler Franchise Pacts
15 Julho 2009 - 3:07PM
Dow Jones News
The White House "strongly opposes" a legislative attempt to
force General Motors and Chrysler back to the negotiating table
with dealers who lost their franchises as the auto makers went
through bankruptcy.
In a statement of administration policy, the White House said
the provision, tucked into the House's fiscal 2010 spending bill
for the Treasury Department and other agencies, could derail the
companies' restructuring.
"The decision to invest taxpayer dollars into these companies
required all stakeholders to make difficult sacrifices, and it
would set a dangerous precedent, potentially raising legal
concerns, to intervene into a closed Judicial bankruptcy proceeding
on behalf of one particular group at this point," the Office of
Management and Budget said.
The spending bill is one of two measures designed to help the
axed dealers. The prospects for both are cloudy. Though at least
241 House members have co-sponsored a bill restoring dealers'
rights under state franchise laws, Senate Majority Leader Harry
Reid, D-Nev., said Tuesday that the issue isn't high on the
Senate's agenda.
The White House said it shares lawmakers' concerns about the
dealers, but added that it has taken steps to provide support,
including a Small Business Administration program to provide
guaranteed floor plan financing loans.
"The decision by Chrysler and GM to rationalize their dealer
networks was a critical part of their overall restructuring to
achieve long-term viability in order to save jobs in the long run,
and to improve the prospects for the companies' repayment of the
substantial taxpayer investments," the White House said.
"Without the significant steps these automakers have taken to
revamp their operations, the companies would have failed -
imperiling every GM and Chrysler dealer in the country."
-By Henry J. Pulizzi, Dow Jones Newswires; 202-862-9256;
henry.pulizzi@dowjones.com
(Corey Boles contributed to this report.)