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General Motors says 661 dealers welcomed back from bankruptcy restructuring

General Motors says 661 dealers welcomed back from bankruptcy restructuring 1General Motors will offer reinstatement to 661 of its U.S. dealerships targeted for closure as part of the automaker’s bankruptcy restructuring last year.

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GM planned to terminate franchise agreements with about 1,300 U.S. dealers by the end of 2010 in a bid to operate its retail networks more efficiently and return the company to profitability. About 1,160 dealers have sought arbitration.

Mark Reuss, GM North American President, said the manufacturer has opted to reinstate more than half of the dealers appealing closure in an effort to complete the arbitration process before the congressionally mandated deadline of July 15.

General Motors says 661 dealers welcomed back from bankruptcy restructuring 2

The company plans to continue settlement talks with some 500 dealers who will not be offered reinstatement and remain in arbitration, Reuss said.

To be reinstated, the dealers will have to meet certain business criteria, including minimum working capital requirements, sales and profitability within 60 days of receiving reinstatement letters next week

GM had 6,150 dealerships at the end of 2008, including Saturn, Saab, Hummer and Pontiac — the four brands GM is selling or ending. The Treasury owns 60 percent of GM after the 2009 bankruptcy restructuring.

Congress in December required an arbitration process for terminated dealerships at GM and Chrysler, which received more than $65 billion combined in taxpayer-supported bailouts and other financing over the past year.

Chrysler closed nearly 800 showrooms last June when it emerged from bankruptcy under new management led by Fiat.

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