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Auto dealers to soon know of closures

Associated Press / July 14, 2010

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DETROIT — All of the General Motors and Chrysler dealers threatened with closure as part of the companies’ bankruptcies will soon know their fate.

Federally appointed arbitrators are down to just 35 cases out of nearly 1,600 dealers who appealed the closures, according to India Johnson, senior vice president of the American Arbitration Association, the dispute resolution service that handled the cases.

Hearings are set to wrap up tomorrow, with final decisions due by the end of next week.

Congress required the hearings after the automakers disclosed plans to shutter 2,800 dealers last year. The companies said their US sales didn’t justify so many dealers — nearly 10,000 between them. By comparison, Toyota has only about 1,200.

Since the hearings began in February, a majority of the cases have been resolved with settlements outside of arbitration, either because the automakers agreed to reinstate the dealers or the dealers dropped out of the process. Some dealers closed, while others started selling other brands.