March 5 (Bloomberg) -- General Motors Co. said it plans to reinstate 661 dealers as the automaker attempts to shore up declining market share. GM offered franchise agreement letters to the dealers, North America President Mark Reuss said today in a statement.
“We are eager to restore relationships with our dealers, and get back to doing what we do best -- selling cars and taking care of customers,” Reuss said. “The arbitration process creates uncertainty in the market. We believe issuing these Letters of Intent is good for our customers, our dealers and GM.”
The Detroit-based automaker is trying to increase U.S. sales and market share while trimming four of its eight brands. Chief Executive Officer Ed Whitacre named Reuss, 46, to the post in December in a shuffle of top managers.
GM accounted for 19.9 percent of U.S. sales of cars and light trucks last year, a drop from 22.3 percent in 2008, according to Autodata Corp. in Woodcliff Lake, New Jersey. Ford Motor Co. beat GM in monthly sales in February for the first time since 1998.
Reuss said last month that repairing dealer relations is his most important priority. On March 2, he announced changes to his North American leadership team that reduced management layers.
The company began to re-evaluate the closing of 1,100 retailers after Congress passed a law in December to give GM dealers who lost or were scheduled to lose franchises the right to hearings. The binding arbitrations may reverse the automaker’s termination decisions.
Chrysler, which targeted 789 dealers for closing, is also bound by the law. Chrysler’s arbitration isn’t expected to begin until late this month or early April, said Kathy Graham, a spokeswoman.
