GM and Chrysler: Will closing dealerships help?

Shutting car lots is either part of the cure or another step into the abyss

For everyone hoping General Motors and Chrysler would survive, said Brandon Matthews in Sirius XM Radio’s Satwaves blog, “it’s time for a reality check. It’s over.” The automakers' hopes ended Thursday with the decision to close 800 Chrysler dealerships and up to 1,000 GM dealers, which will turn the remaining outlets into local monopolies without the competitive drive to succeed.

The real losers here are workers, said Craig Brown in Seeking Alpha. Each of the GM and Chrysler dealerships that are closing employ dozens of people. “And there will be knock-on effects to those servicing these dealerships with services or products.”

That’s bad news for the whole economy, said Douglas A. McIntyre in Time, as we’re already losing 600,000 jobs a month. “It is the only financially expedient thing to do, but the government is” encouraging cost-cutting that will add to the “burden of unemployed Americans” at the worst possible time.

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