General Motors closing 1,200 dealers

Robb Brown's roots with General Motors Co. (GM) run deep.

His grandfather, Willis E. Brown Sr., founded Toledo's Brown Pontiac in 1926, which is currently the oldest seller of the GM brand in the U.S. The decision by the beleaguered automaker to kill Pontiac surprised Brown, whose first Pontiac was a 1971 LeMans with a GTO hood.

"I thought we were doing well," Brown said in an interview with DailyFinance. Brown argued that Pontiac sales were doing better than Buick, which GM is keeping.

Nonetheless, Brown does not think that GM did right by Pontiac. Resources that would have gone to Pontiac went to Saturn. Pontiac models suffered.

Here we are trying to sell the same old car to the customers," he said. "People are not stupid.They figured it out."

The picture for many GM dealers is bleak.

As Bloomberg News noted, GM "intends to cut dealerships by 42 percent to 3,605 from 6,248 at the end of last year to help reduce liabilities by $44 billion and keep $15.4 billion in U.S. loans." The plan will lead to the elimination of 137,330 jobs at a time when the economy can afford it least.

The ramifications are huge. Newspapers and local television stations count on car dealers to buy advertisements. That's not to mention the impact on smaller businesses and on employment. Many of these firms, such as Brown Pontiac, have deep roots in the community.

Like most car dealerships, Brown does sells more than one model. He hopes to be able to find jobs for his Pontiac workers at his Honda, Mazda and Hyundai dealerships.

Brown, though, is not sure what he will do. His grandfather, who guided the business through the Great Depression and World War II, would be shocked by what happened to Pontiac.

"He is rolling over in his grave," he said.
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