Swenson Motor Company learns GM wants to terminate GMC contract
WILLMAR -- Swenson Motor Company of Willmar and Benson has been notified by General Motors that Swenson will no longer be a dealer for GMC trucks in Willmar and for GM cars in Benson.
But the termination would not occur until October 2010 when Swenson's contract with General Motors is up for renewal, and Swenson Motor Company owner Rollie Swenson said Tuesday "there's nothing really in ink or cut and dried at this point.''
Swenson said he received a letter from GM on Friday stating the corporation, after looking at current foreseeable conditions, "did not see that they can have a productive business relationship with Swenson Motor Company over the long term.''
Swenson said the letter was not a total surprise.
"All the corporate have been trying to cut dealerships back for some time,'' he said. "But on the other hand, at this point it still is not a shutdown because if they don't file for bankruptcy, they really aren't in a position to terminate our contract. If they file for bankruptcy, it all goes to the federal court.''
"Why shut down a dealer?'' Swenson asked. "The dealers pay all the costs. It doesn't cost them to have any dealers.''
Unless and until GM files for bankruptcy, Swenson said he'll continue to be a GMC dealer under the present contract. If General Motors does file for bankruptcy, then GM can terminate the contract.
"Number one at this point, unless they file for bankruptcy, because of Minnesota laws, they can't do what they're suggesting here. We're hoping they don't file for bankruptcy because, in fact, we just passed a law in the Minnesota Legislature that makes it tougher for any of the corporates to get rid of a franchisee or in our case a sales contract without some justified cause,'' said Swenson.
Swenson said the letter from General Motors stated GM's planning is not finalized. The letter said GM is prepared to give Swenson until the end of the month "to submit information you would you like us to have.''
Swenson Motor Company has been in business since 1946 and sold Packard and Oldsmobile until 1950. In 1950, the company moved to a new building at the corner of Litchfield Avenue West and Seventh Street, where Swenson sold Oldsmobile and picked up the GMC line in 1953.
The company moved to the present location on U.S. Highway 12 East in 1982 and picked up the Chrysler, Plymouth and Dodge lines, in addition to offering GMC and Oldsmobile.
In the meantime, Oldsmobile and Plymouth were shut down, leaving the present line of Chrysler, Dodge and GMC trucks, he said.