GM: Hundreds of dealerships could be restored :


Some of the  General  Motor  dealers were happy. Hundreds of the 1,350 General Motors Company dealers  who lost their  franchises  in  last year could see them restored in a congressionally mandated arbitration process that begins later this month, the company’s interim CEO  said  Wednesday.  CEO  and Chairman Ed Whitacre Jr. also said that new Chief Financial Officer Chris Liddell is a candidate for the CEO post. And Whitacre said he’s not confident about selling the Swedish Saab brand.

Talking with reporters at GM’s Detroit headquarters, Whitacre also predicted that GM would be profitable  this  year,  although he said that was dependent on the economy and other factors. Congress passed legislation late last year that forces GM and Chrysler Group LLC, which shed 789 dealers last year, to give  dealers a chance to appeal closure decisions. Both companies went through bankruptcy protection earlier this year and are receiving government aid.

Restoring some dealerships could be good for the company because they would sell more cars for General Motors. When the franchises were revoked last summer, General Motor officials said dealers were judged on whether they met sales goals, customer service scores, the condition of their buildings and other criteria. They were allowed to stay open through October of this year to sell their inventories. Under pressure from dealer groups and lawmakers, GM and Chrysler put out  proposals that  would  have allowed dealers to  challenge closures in arbitration.

Whitacre added reporters that he would consider Chris Liddell, the CFO hired from the same post at Microsoft Corp., in the search for a new CEO. Liddell, 51, announced before GM hired him that he would leave Microsoft to pursue a higher-ranking position. At Microsoft, Liddell developed a reputation for holding down costs while building  up cash. He instituted a plan to cut $3 billion from the technology company last year that  included  its first mass layoff, wage freezes and cuts in travel and other expenses. GM is majority owned by the federal government and Liddell was granted an exemption from government imposed pay caps to take his post. He will be paid $750,000 this year, but will get up to another $5.45 million in stock starting in 2012 if GM successfully sells its shares to the public.

GM received $52 billion in U.S. government aid and has begun repaying $6.7 billion of that as a loan. The rest would be repaid through the stock sale. Whitacre also said he is not optimistic for a deal to sell its Swedish Saab brand, but he expects the sale of Hummer to a Chineseheavy equipment maker to close on Jan. 31. GM is phasing out Saab and expects to start closing plants this week.

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