GM leaves Barry Chevrolet uncertain, but open

Bill Stevenson/Columbia Basin Herald<br> Barry Chevrolet remains open for business while owner Denver Morford waits for a definite answer from General Motors as to whether he will keep his Chevrolet franchise agreement.

by Bill Stevenson<br
| May 22, 2009 9:00 PM

EPHRATA — Denver Morford smiles, listens and helps an Ephrata couple as they buy a 1995 Buick Regal from him.

He sold the car for a local barber, who recently bought a Chevrolet Impala from him, as a gesture of help. The man didn’t want to trade it in.

During the sale, the owner of Barry Chevrolet doesn’t show signs of the stress placed on him by General Motors (GM) when they sent him a letter stating “We do not see that GM can have a productive business relationship with Barry Chevrolet Inc. over the long term.”

The letter does not contain any clear indication of whether he will be able to continue selling GM manufactured cars as a Chevrolet dealer after October 2010.

“Generally speaking, we would not expect our contractual relationship to continue past October, 2010. Please understand that our planning in this regard is not finalized, and we are prepared to give you until the end of the month to submit any information you would like to us,” the letter states.

It doesn’t bear any GM official’s name or a phone number to contact for more information. The letter is signed “General Motors Corporation.” Morford’s only recourse to find answers and submit information to appeal any GM decision is an e-mail address. The letter, dated May 14, gives him until the end of May to send information.

“I’ve put in a dozen e-mails and no replies,” Morford said. “GM is a rather large bureaucracy and it is very hard to get an answer.”

The letter is part of a restructuring effort by GM, where they have declared they will reduce the number of dealerships from about 6,200 to 3,600 as part of a cost cutting plan. Due to accepting $15.4 billion in federal stimulus funds, GM is facing a federally imposed June 1 deadline to reduce costs or file for bankruptcy, according to the Associated Press.

Morford describes GM’s letter as vague and says it makes some incorrect allegations about how Barry Chevrolet has operated.

GM states they based their letter on a “review of current and foreseeable market conditions and your dealership’s historical performance.”

The company claims Barry Chevrolet sold 48 new GM cars and trucks in 2008, while Morford says he has records to show they sold about 100 new GM vehicles. The Ephrata dealership sold roughly 100 new GM vehicles every year for the last four years, he added.

To counter the potential decision to end the franchise, Morford is seeking public help. He is asking for letters of support for Barry Chevrolet. The Grant County PUD and the Ephrata City Council both agreed to provide letters. Morford said the PUD commissioners, Ephrata mayor and city council members have agreed to write letters personally, in addition to the agency letters.

“People are taking their time to vocalize the importance of our dealership,” Morford said.

With the ambiguity of the letter, Morford suspects the release of the letter to GM dealers across the country may be an effort to pressure some to end their relationship with GM voluntarily.

Barry Chevrolet survived two past efforts by GM to reduce the number of dealers. The first was Image 2000, when dealers were required to paint their building white, with a blue stripe and have a minimum amount of corporate advertising in the dealership. The second was in 2003 when dealers were required to be located near a Walmart. He said they met all the requirements, but GM appeared to fail to follow through on removing dealers didn’t meet requirements.

“It’s a pretty dangerous game of chicken,” he said. “It’s high stakes.”

With the letter being unclear on whether the Chevrolet franchise will continue, Morford wonders if this is another attempt to get some dealers to quit.

“This time frame may come and go, and nothing happens,” he said.

While the question over his GM franchise remains unanswered, Morford said they will continue business as they have for 30 years.

“The worst, worst, worst case scenario (is) we will have some great vehicles,” he said, referring to being a Dodge, Chrysler and Jeep dealer.

A week ago Morford received word his company would continue being a Chrysler, Dodge and Jeep dealership. The company was seeking to end agreements with 789 dealerships nationwide in bankruptcy court as part of a restructuring plan.

Morford said the difference in corporate decisions is difficult to understand as he describes Chrysler’s requirements to be more stringent than GM.

The dealership has gone through changes before. Morford said Barry Chevrolet was a Chevrolet and Datsun dealership in 1980. They added Chrysler, Plymouth and Dodge in 1988 and sold their Nissan (Datsun) dealership to Ponderosa Nissan in 1993, who has since closed. They added Jeep in 1998.

“We are a Chevy dealer until they show up and take down the sign,” he said.

The potential decision to end the Chevrolet franchise would be bad for GM because the company needs revenue, according to Morford. Dealers are required to pay a great deal of money each month to remain a dealership, from buying parts, paying for training to paying $500 a month to have a Chevrolet sign.

He adds the sales for smaller dealers in rural communities, like Ephrata, have helped to insulate him from national trends of declining sales.

“Our size of dealers represent a stability the larger dealers in Spokane can’t,” Morford said.

The uncertainty of GM’s decision troubles Morford, who said he feels the stress of keeping a viable local business open. He employs 13 full time employees and said he thinks about their families as well as the impact it could have on his own.

“Now we sit and wait,” Morford said.

He is asking for customers, community members, friends and family to write e-mails to GM in support of Barry Chevrolet. To write GM, there are two e-mail addresses that can be used, dcfs.team@gm.com or GMDealerNetworkquestions@gm.com, and Morford asks people to write “Barry Chevrolet DLR#36021 BAC:114477” in the subject line.

For more information, you can call Barry Chevrolet at 509-754- 2411.