can i explain? >> we have offered dealers that will not continue with us. it is to provide an amount of time, provide compensation to them, and allow them to purchase parts, and overtime we would not renew their contract and it would not be with us. >> beginning this fall, they can't buy the 2010 models. >> that is correct. >> you diagnose them with being -- with having terminal cancer. mr. thomas, do you feel terminated? >> very much so. i feel terminated. >> why do you feel terminated? >> because i do not have an opportunity to be a full-fledged general motors dealer anymore. i can't return parts or order

cars. i am are really in the game. >> how about the gentleman next to you? do you feel terminated? >> absolutely. >> why? >> same reasons that mr. thomas said. . . e where i do business has viewed us as going out of business. the precedent to our dealership, tv stations have been to our dealership. my employees are extremely worried, extremely nervous. it's just like beige. >> could have been a different way -- i think you mentioned way -- i think you mentioned that you've offers from people to buy your dealership over the years. >> there have been people approaching. i'm sure mr. thomas has had people. anybody who has a good viable business. >> could there have been a different strategy or what if you weren't meeting the goals

that general motors set for you, you could've been given time to sell your dealership? did they give you an opportunity to change up what it was? >> no, sir. >> and when they have evaluated you in the past of the adversary if you don't do these seven things, next reauthorization were not going to be there for you? >> no, sir, they didn't. and outside of bankruptcy they couldn't say that. that's why they wouldn't. >> my time is expired. thank you. >> thank you to mr. dingell, for questions, please. >> we have a very difficult business here. we have to decide how we are going to protect the rights of the dealers and at the same time see to it that we restructure our american automobile industry so that we save the rest of the dealers, as many other workers as we can, the jobs and the communities that are affected. first of all, to mr. peres and mr. hendrick. do you have written roles for the closure of dealers and for the termination of the dealers?

>> yes. >> yes or. >> would you please submit each of them to the committee with such accompanying remarks as you would like to make. now, there is no appeal right for a dealer in the case of chrysler, is that correct? >> that's correct. >> are their appeal rights for general motors? >> yes, there are sir. >> would you submit to the committee the precise character of those appeal rights. now, would you tell us, please, mr. hendrix and mr. press, just give us a number, how many of the dealer terminations have been changed by the company under the companies under your appellate procedures or under your categories and standard? >> at this point we have changed

45 decisions. we are not complete without reviews but that's the status as of this morning. >> mr. press. >> we have had no change. >> all right. i have heard of the dealer who was terminated. i won't tell you which company it was. were a big storm had caused the collapse of a bridge, and that dealer was essentially shut off from access to his customers. and he was terminated but the company involved has seen fit to reinstate the dealer because they understand the facts. do you have provisions in your termination agreement, mr. henderson and mr. press, that would permit you to address that kind of problem? >> yes, sir. that was a general motors dealer, and when we we look at the facts after the submission we conclude that we were in

error in our decision and we reversed that decision. >> mr. mceleney, if the legislation that we are working on nasa's, and it screws up the bankruptcy process and causes the collapse of either or both of the companies down the road, we're going to have a rather nasty situation on our hands. part of it is going to be we are going to see all the dealers out of business, all the plants close, all the communities hurt, all the workers and all the suppliers hurt. what do we do about that situation? >> sir, i think with that situation, you know, this is not a normal bankruptcy. as you know this is a government

negotiated bankruptcy. the debtor in possession financing beige. >> i understand those things but what are we going to do if that result is occasioned by the situation? >> i don't think that will happen. i think the fact that the government is involved is going to present data mapping. >> is that a statement or a hope? >> part may? >> is that a statement or a hope that it's not going to haven't. >> i guess that's a hope. >> i doing in the hope of. >> thank you. >> mr. press, mr. mceleney searched this. none of chryslers submissions to announcement could have been interpreted to put chrysler dealers on notice of the scope of the termination as follows your is that statement true? true? yes or no? >> i'm sorry? >> mr. mceleney state as follows, none of chryslers submissions to the government prior to may 14 announcement could have been interpreted to put chrysler dealers on notice of the scope of the terminations

that followed. guesser no, is that true? >> we have had a genesys program, dealer consolidation program in place for more than 10 years, and i think the majority of those dealers had good, long time to prepare for that. >> would you submit for the record your comments that proves that this is not the case. now, mr. mceleney, did general motors give adequate warning prior to its may 15 announcement that it would be winding down approximately 1200 dealers, yes or no? >> yes. >> interpress, please describe briefly what chrysler is doing to reclaim and redistribute the inventory of the 789 dealerships it announced would be closed. >> mr. deal, just one second that i now think i understand your question about notification to the dealers versus no in that there was a reason they may not -- the notification to dealers, there was not any additional

time given, the primary reason for that was until april 30, at 6:00 at night, before we had to file for bankruptcy we did not plan to. this was not a plan to go for. we had no knowledge of this, and after that may 1 is when we began to develop this program. so there was no notification. >> all right. now, mr. press, if you please. what is chrysler doing to reclaim and redistribute the inventory of a 789 dealerships it is announced will be closed? spec we have committed that we would redistribute every single vehicle and every part. >> how about specialized equipment? >> and a specialized equip and. i'm happy to say 100% of the vehicles have already been committed to. they have started moving. we are at 80% on the park and about the same on specialized equipment. we will continue to work until that commitment is fulfilled and all of those burdens are really. >> i want you to listen to this question carefully. how much is it going to cost

each dealer that is being terminated on each car from the termination? are there any fees associated with that? do they get the full value of the car? is a distressed price? how will that be addressed? >> the price is at the invoice price that they paid less, $350 for inspection, cleaning and transportation to the dealer that will be selling the vehic vehicle. >> can general motors give you the same answer? >> indicates a general motors, to the extent the dealer signed to wind down agreement we would expect that moment of court over the next 70 months to sell down their inventory and they would be afforded the same driven as any other general motors deal with respect to retail and support for selling to customers. >> how much cash money are they going to be out in the case of general motors? >> they shouldn't be out any. >> when you take back inventory?

parts, vehicles and specialized equipment. >> the case of general motors if the dealer chooses to wind down, we anticipate through that period they will not only sell their cars, they would sell their part by virtue of the fact that they would be able to ride work in service to customers and finally the tools would be amortized. a dealer who terminates, if they just choose to voluntarily terminate by virtue of our agreement with gmac, a dealer can return the cars to gmac and we would redistribute the cars with no cost to the dealers. >> thank you. my time has expired. . . why do they have to pay you $1,500 when you shut them down?

>> first of all, the company filed bankruptcy. it is a defunct organization. in a bankruptcy, all precedent would be that the inventory would be the responsibility of the dealer if the company that are franchised with is no longer in business. there was not a provision in possession financing, it could not be provided to buy the cars back, so our challenge was, without using taxpayer money, find a way to relieve the dealers of inventory and do it in a manner where it did not cost the taxpayers, which we did through the redistribution program. the redistribution program. that was implemented and we did redistribute 100% of the vehicles that we are happy to say that is complete. >> that had to happen very late last night because as 7:00 last night we had phone calls from dealers say we have

cars and they will not take them back. >> we have made that comment and have written notices, it is in the newspaper bree will continue to provide dealers information. we have reduced to the cars to other dealers physically they may not have left the law because we could not begin until yesterday when the new company formed but we are at it. anybody that has it please give them my name i would be happy to talk to them. >> we will. you mentioned taxpayers but every one of the dealers are tax payers as well. >> thank you, mr. chairman. there is another hearing going on so i have been shuttling back and forth i also need to alert mr. blankenbeckler there is a play into texas calling my name so i may leave after these questions. i would like to ask mr. press

and mr. henderson send, but is there an established set of criteria under the evaluation which dealerships were to be closed and which were to be left open? you have actual criteria in writing how you evaluated dealerships foreclosure or to remain open? >> yes. we do and resubmitted those last night. >> yes we do. >> does the dealers know of these criteria? >> and our case, they were not notified of the criteria prior to the notification. >> mr. henderson and? >> in our case we have identified the criteria the -- criteria but the dealers and not necessarily know what the criteria are the two most important our sales

effective and customer satisfaction. >> you submitted them last night? twenty-two? >> the staff of this committee. we can resubmit them. >> we don't have them. >> we can get them to use to make the point* is you're under oath and i don't want people to think we're holding something back. we don't have been a criteria agreements. >> we have just established one of the puzzles, if it is somewhat unfair to mr. blankenbeckler and mr. thomas and the other dealers to be told their dealerships will be revoked and get to they did not have any prior knowledge of the analysis and criteria that were being used and apparently to this day don't have the knowledge. mr. blankenbeckler is that a fair way to run a railroad? >> no. >> mr. thomas?

>> i think it has been an open process. >> that is one of the problems i hope@@@@@@@@@ @ r7dn 3 of the documents this is a power point presentation. after looking at, this would be the criteria you said you using? can we have copies made to give to everyone here? >> since you have received your to letters, has anybody from either company, chrysler or gm, come to you and said we want to explain why we have done what we have done, and we want to give you a chance to show us the

error of our ways, and if you wish to continue business relationship, here is what you need to do? >> no, they have not. do? >> no. they have not. >> mr. henderson and mr. press, do think it would be reasonable business practice to give dealers said in some cases have decades of relationships with the companies that you had some opportunity to know why they were evaluated the way they were and give them an opportunity to show why they may have been evaluated unfairly? >> yes, sir. i would like to add that because of the fact our notification was coincidental with the bankruptcy action, a lawsuit was brought and the fact we could not have a lawyer in an active lawsuit in every discussion we were not in a position to do that until yesterday. year more than happy to have those discussions going forward now that the lawsuit

has been finalized. >> mr. henderson? >> as of yesterday we received 856 request to reconsider our decision, we reversed 45 weeks elected to complete the review by today but given the number of requests we will plan to work through the weekend into monday to finish this and are willing to consider all quest for consideration. >> mr. blankenbeckler you told me privately the amount of investment you have in your dealership, if you wish to would knowledge that, i would appreciate it if you would, but in any event, if you don't, i do you feel before that investment which has been built up over 84 years is just wiped out you should have some opportunity to get some renumeration or have a discussion about

renumeration with gm and chrysler? >> i can imagine why that would not be the case in this country. i don't see as i said in my statement, i don't see how that could happen. >> could you give a general parameter of the amount of investment your family has made over the past years? you don't have two. >> i don't care to state that. >> i will say for the record. >> i am not any different, it is a large sum of money. >> it is magnitude that of more than my net worth but i yield back. we'll thank our witnesses and they're chairmen and i do hope that talking directly to mr. henderson and mr. press you will come up with some protocol ford dealers that mr. blankenbeckler that wish to continue a relationship for

given a fair opportunity to plead their case for i hope you do that. >> mr. braley? >> do you know, a jennifer fox, mr. press? >> i may. >> you know, a jennifer fox to works in the washington d.c. office? >> yes. i don't know her last name. >> i assume she uses an e-mail address that and seven chrysler.com that is an employee of chrysler? are you aware chrysler is attempting to convince chrysler dealers who have not been terminated to ring gauge in a lobbying effort to point* out the positive aspects of the consolidation through bankruptcy that has been going on? >> i am aware the fact because

of the publicity there are 391 dealers that have benefited and they give to the league and 100 year dealers 21 the opportunity to make their position known. >> are you aware chrysler has been sending out talking points under a key messages memo that says chrysler llc made the appropriate business decision with the dealer network that could be thriving and profitable and the automobile industry cannot support the number of dealers that currently exist. dealers have known chrysler wanted to consolidate and locate all three brands under one roof and started the process more than 100 years ago we understand the process to evaluate the dealers was thorough based on data driven metric and is a dealer moving forward with a new company i plan to purchase some of the eligible inventory, were you aware that is going on?

iraq that is in our testimony, part of the speech with consistent communication. number of dealers ast they but like to be have their voice known as well. >> let me ask you about the 1.that dealers have known, this has come up during the testimony today that chrysler wanted to consolidate dealership's more than 10 years, if that is the case then why didn't that happen in the numbers we have seen until this bankruptcy rose? >> has been happening, at great question. i can understand what you ask that the consolidation has been the ongoing process. a year and a half ago we had meetings dealers were identified they knew which it would go forward and which locations and we give them a tool box of real-estate, tax planning to facilitate those discussions and transactions and some of them did.

>> you have to agree the volume of close to dealerships over that 10 year period it pales in comparison to the announcement that grew out of the bankruptcy. isn't that true cracks remain because the bankruptcy was caused by the fact that we were made to support specific dealers days vehicles for specific dealers now that that did not get carried 40 new company is formed. >> i understand that and i only have five minutes. you talk about the data driven metric is that the requirement that was requested? of those contained the data driven metrics you just identified? >> yes. we have submitted we will submit the criteria and provide additional data as requested. >> in your testimony before the senate commerce committee you said chrysler loses over $1 billion annually because of

underperforming dealers and mr. henderson you claimed in similar testimony that dealers and add $1,000 of cost to every vehicle park road to you both have financial analysis that was conducted before the decision was made to terminate the deal their franchises that supports those allegations you made in your testimony? >> yes. we have the analysis of the sales situation and that does exist. we knew the number. >> it was added and submitted as part of your testimony? >> sorry? >> for today's hearing. >> not by dealer. >> can you provided to the committee? >> there is confidentiality data we receive. >> i know there is a need to redact information to protect confidentiality is still give the impression i am seeking would you agree to provide that? >> as long in protecting the

dealers right. >> the same question for you, does gm have been dated to support the statement that you made that the dealers are costing york company $1,000 per vehicle? >> as i mentioned in my testimony, we have an overall cost per vehicle that is articulated in the same package resubmitted last night approximately $2 billion, a 2 million units. >> do you have the underlying data that was used to make that calculation and is in the materials we have received? >> yes. >> you can identify that for the committee? >> on page nine, and to last page. >> on that page, we made the

calculation, and you have supporting documentation for the conclusions that show the portion for dealer margin, incentives paid common standards for excellence come on and on blackstone's numbers are not just published somewhere as a standard cost factor associated with each vehicle are they? >> what i outlined in my testimony these are cost over time have come into structured to provide direct support. it is not identified per individual dealer because it goes to all dealers but best in class competitors do not have the same sort of support. >> my time has expired but it seems there are plenty of unanswered questions the committee needs to explore on this subject. >> i ask unanimous consent to put this document from general motors that looks like they may have e mail last night, but 10 pages, the one

we have been discussing. >> without objection. i would make the point* it may be helpful for the dealers to be able to see a copy to review. >> since it is in the record we will put on the table if they planned to look at it. >> that will be helpful. >> next mr. burgess. >> i have a map of the united states that pertains adjust to chrysler for the moment. it looks like what a republican and what would like the electoral map. [laughter] but it is chrysler dealers. my state of texas all the three happen brothers release baird in the economic downturn, our state has been hit pretty hard with the closings. there is a member in the northeast, as chairman of the house financial services committee able to make a phone call to get one of this dealerships or distributors to

stay open. what is the number i need to call? is it 1800 car czar? celly who to call so i can help the dealers in my area that have been so badly hurt. >> i don't understand your question with all great respect to the office, i have to say i am not aware of any dealer that was ever removed from the list that was submitted to the judge. i have no knowledge of that. i would very much like to see if i could get that. >> it was in all of the paper's yesterday, at barney frank made a call to someone and got his dealer to stay open. it is unconscionable what is going on also is good joint economic committee i was just told a gm dealer. i am sorry. so that is mr. henderson. >> it is not a dealer at all.

select just tell me the telephone number that i call. that is what i am after. >> we have to look at the sales warehouses big long two general motors and is part of the restructuring plan for facilities to be close. >> will interrupt you but the fact is a member of congress made a call and it was not closed that was slated foreclosure. it is fundamentally unfair producing the people at this table they represent family is in everyone's the district. this process has to be open and transparent and fair we have a president elected on the promise of transparency and fairness and that is not being delivered. who wrote the language of the wind down agreement? >> in our case general motors staff sales organization as well as counsel. >> and for chrysler? >> there is no similar

agreement we have no wind down agreement it is a different situation. >> what have you communicated to the white house regarding the restructuring of both organizations? >> a restructuring plan has been part of our bankruptcy and part of our application for funds and qatar plans were available through u.s. treasury. they have been made aware of the process and discussion but we have not had any employed or direction of what we're doing. >> with this committee be able to have access to the e-mails tween your company and the white house regarding the restructuring in the case of general motors? >> absolutely. >> could i convince the chairman to do so it would be easier if that could be made available to us. >> in our case, i have no weight tm