Dealergate

Well, it has the attention of Congress, if they're not just feigning ignorance to protect their sorry dumbasses.

Wall Street Journal

Car Chiefs Grilled on Dealer Closings
Senators Question Whether Dealers Are Being Fairly Treated; Auto Rescue Could Face More Hearings
By JOSH MITCHELL

WASHINGTON -- Top executives of General Motors Corp. and Chrysler LLC defended plans to cut thousands of car dealerships at a congressional hearing where senators questioned whether the dealers were being unfairly treated in the companies' downsizings.

The hearing Wednesday was the latest signal that Congress wants to gain more influence over the Obama administration's car-industry rescue.

Dealers told the Senate Commerce Committee the closings won't produce the cost savings claimed by the car makers. They said the move was being made hastily and without regard to state franchise laws that require manufacturers to compensate dealers slated to be shut.

Car dealers are a potent force on Capitol Hill thanks to their campaign contributions and prominent status in many communities.

"I honestly don't believe that companies should be allowed to take taxpayer funds for a bailout and then leave it to local dealers and their customers to fend for themselves with no real plan, with no real notice, with no real help," said the committee's chairman, John D. Rockefeller IV (D-W.Va.).

GM Chief Executive Frederick "Fritz" Henderson and Chrysler President Jim Press, testifying before Congress for the first time since their companies filed for bankruptcy, said they needed to terminate a total of about 3,400 dealerships to cut costs, improve the image of their brands and ultimately boost sales.

"This is our last chance to get it right, to fix permanently those parts of the business that have diverted us from consistently building winning cars and trucks and the consumer experience to match," Mr. Henderson said as dozens of dealers crowded the room.

Mr. Press called the dealer cuts the "most difficult business decision" of his career. He added that "there's not enough business for the number of dealers Chrysler has today given that we have less than two-thirds of our former sales volume."

Mr. Obama has said he doesn't want the government running GM and Chrysler while the U.S. Treasury holds significant ownership in each. But lawmakers from both parties have expressed frustration over their limited role in the administration's plans.

"I never would have believed as a candidate for the U.S. Senate that the U.S. government could buy GM without a hearing, with no vote, yes or no," Sen. Mike Johanns (R., Neb.) said at Wednesday's hearing. "There are billions and billions of dollars at stake here."

Mr. Johanns said he soon would introduce legislation requiring the administration to obtain congressional approval any time it used funds from the Troubled Asset Relief Program to take equity stakes in a company.

Last month, the Commerce Committee's top Republican, Kay Bailey Hutchison of Texas, threatened to hold up a war-funding bill because of the dealer closings.

Rep. Jeb Hensarling (R.,Tex.) a member of the congressional panel that oversees TARP, said this week the panel would push for hearings on how the funds are being used to help car makers.