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QUEENSLAND LNP Senator, James McGrath, who is also the deputy government whip in the Senate, has made another strong attack on General Motors and Holden over the compensation packages being offered dealers and has accused GM chief Mary Barra as being “Gordon Gekko on steroids” and accused her of “the worst corporate behavior”.

In a speech to the Senate he said that Mary Barra, the worldwide chair and CEO of General Motors, “who has a pay package in the tens of millions of dollars”, was sending Australian families to the wall and accused her of “American legal chicanery”.

“Ms Barra is now using coronavirus as an alibi for the worst corporate behaviour. Talk about Dodge City. Talk about Gordon Gekko on steroids.”

Gekko immortalised the phrase: “Greed is good”.

The senator said that if GM no longer put any value on the brand it should hand the Holden brand over to the dealers. Senator McGrath offered to pay Ms Barra one dollar for it.

He said: “It now appears General Motors are privately attempting to put the screws to these Holden franchisees, forcing time lines and attempting to make dealers sign up to further oppressive agreements as part of settlements and to stretch out payments.

“Shame on you, General Motors. Shame on you, Ms Barra, and your American legal chicanery.”

James McGrath

Senator McGrath, who is the deputy chair of the committee set up to investigate Holden’s departure from Australia, went on: “To put it bluntly, General Motors are trying to sneak out under the cover of COVID-19, disappear in the night and leave Australian businesses stranded after an 89-year one-night stand.

“This is an unforgivable stance for General Motors to be taking, particularly at a time when the Australian economy and businesses are managing the economic shock of the current pandemic.

“Our motor industry in Australia means our retailers, mainly family businesses, who invested heavily in facilities and people over the past 100 years at the behest of the manufacturers.

“I’m very concerned at the apparent stonewalling by General Motors with regard to what should be good-faith commercial negotiations with its dealers in relation to their exit from the Australian market.

“In hindsight, it seems General Motors has planned to subvert the franchise code, and it’s been years in the making. General Motors have promised the earth and have given a bucket of sand.

“The decision by General Motors to discontinue Holden operations in Australia is their prerogative, but they must do so responsibly and in a manner that is fair to the very people that have enabled the company to operate in the Australian marketplace.

“General Motors need to understand that what they’re offering dealers in compensation for killing the brand is just not good enough. General Motors may think the rich history of the Holden brand in Australia is worthless, but I think it’s priceless.

“If General Motors think the brand is worth nothing, then hand the brand back to Australia. Give it back to the Holden dealers.

“In fact, I’m happy to purchase the Holden brand from General Motors for a dollar. I’ll send you, Ms Barra, a dollar in the post and you can give us the Holden brand back and we’ll give it to the Holden dealers.

“This is about the livelihood of people right across the country, particularly in regional areas. It’s not just about the dealers and franchisees who are impacted by the decision. It’s about the mechanics, the allied trades and the owners of thousands of vehicles.

“I’ve said it before and I’ll say it again, and I’ll keep saying it louder and louder: General Motors, be better. Australian Holden dealers want a fair deal. They don’t want a special deal, they just want a fair deal,” he said.

Meanwhile, the peak body representing new car dealers has announced that it “strongly supports Senator McGrath’s statement in the Senate for calling out “General Motors’ poor treatment of local Australian car dealers”.

“The COVID-19 crisis has overshadowed the actions of a multinational, Fortune 500 company virtually ending its more than a 100-year association with Australia and treating local dealers very poorly in the process,” AADA CEO James Voortman said.

“After announcing it was terminating 185 Dealers across Australia, the compensation offered to those dealers has been described as totally inadequate and not one dealer has accepted the offer,” he said.

“The behaviour of Holden, along with Honda more recently cutting their operations in Australia, again highlights the risks that many local car dealers face and the imbalance that exists between them and the large foreign multinational car companies.

“It’s not just the car companies pulling out of Australia who are a threat to local dealers but the unfair terms that many of them face in their commercial arrangements are an ongoing problem, not just for the local dealers but also for Australian consumers and small businesses who rely on them.

“That is why AADA has been working with the government on draft automotive franchising laws due to be finalised in the coming weeks. It is crucial that these laws are strengthened so that dealers are given protections similar to those afforded to dealers in countries like the US and the EU,” Mr Voortman said.

“Since the emergence of the COVID-19 crisis, GM have reportedly turned the screws and failed to budge on their initial compensation offer, telling dealers their ability to be a future authorised service Dealer is dependent on them accepting the offer,” Mr Voortman said.

“After so many Holden dealers have given so many years to this brand, it is incredibly disappointing that during a very tough time for the industry, GM are not exiting Australia in a fair and dignified manner despite their assurances that they would do so,” he said.

“We have seen Holden terminate all of its dealers and Honda have cut a substantial portion too. If these multinationals need to withdraw or restructure their networks, so be it, but there must be a set of regulations that ensure they do so fairly,” he said.

“Dealers are currently doing it extremely tough with some of the worst sales figures in living memory. The ability to recover from this economic downturn will be greatly assisted by laws which protect dealers against the abuses of multinational vehicle Manufacturers,” he said.

We need local dealers to provide local jobs and work for local small businesses, and we need to encourage and support local Dealers to invest and grow their business, especially as we look to recover from the terrible impacts of drought, bushfires and Covid-19, the AADA said.

By John Mellor

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