UPDATE: GM notifies 3 local dealers they're being dropped

Three General Motors dealerships, two in Aiken and one in Thomson, are among 1,100 dealers nationwide that received a letter Friday from the Detroit automaker indicating their franchise agreements won’t be renewed.

GM told Henna Chevrolet Cadillac in Aiken, Johnson Motor Co. of South Carolina in Graniteville and Stokes Hodges Chevrolet Cadillac Buick Pontiac GMC in Thomson that it will not renew their contracts after they expire in October 2010.

The cuts are part of a larger GM plan to drop 2,600, or nearly 42 percent of its 6,200 dealerships, in an effort to restructure outside of bankruptcy court and become profitable again.

Mabel Beasley has been a customer of Henna Chevrolet for years, and on Friday she was shocked to learn the dealership might lose its franchise agreement.

“That would be terrible,” she said upon hearing the news while waiting with her husband at a customer service area at the Richland Avenue site. “Well, goodness sake. It seems strange to me we’re trying to help out the economy and we’re cutting all these jobs.”

Officials at both Aiken County sites said they want customers to know they’re going to continue to operate as they always have with the hope of staying open past October 2010.

“Don’t give up on us,” said Henna’s general sales manager Jimmy Scott. “We’re going to fight this.”

Duncan Johnson Jr., owner of Johnson Motor Co. of South Carolina, said he also has hope, noting that the letter he received Friday stated “Please understand our planning in this regard is not finalized.”

“They (customers) can expect business as usual,” he said. “As the letter indicated, this is not a final decision. So we’re actually working now trying to secure our foothold in Aiken. I certainly hope it will have a GM dealer in town. The population I think warrants it … I expect to do what’s best for our customers and whatever that might be. And hopefully we’ll continue to be a GM dealer long past 2010.”

Stokes Hodges will not be closing, however, said Barry Nestor, the chief operating officer of Stokes Hodges Automotive. If GM follows through with its plans, the dealership will either acquire another franchise or become a used car dealership, he said.

“At this point, we’re not talking to anybody. We own the facility, we’re staffed and we have good people in place. Our concern primarily is for 21 families who are in that store,” Mr. Nestor said. “It’s a sad day for the GM side of things for us, but the most important thing here is for us to take care of our employees and customers.”

Mr. Nestor said the letter was standardized and did not give specifics reasons why the dealership was being cut from the GM network.

“I have not spoken personally with anyone at GM. We have put a call in to our representative, and we have not heard back,” Mr. Nestor said. “We’re a strong company. We have a strong ownership behind us, and we’ll be fine.”

Though other local GM dealerships did not receive a letter on Friday, they are still uncertain about their future.

“This is just the first cut. There’s more to be done after this one. Right now, we’re safe,” said Richard Pendarvis, the owner of Pendarvis Chevrolet in Edgefield, S.C.

Johnson Motor Co. has a location in downtown Augusta that was not included in GM’s decision Friday.

Mr. Scott said the letter he received by FedEx said dealers on the list could send information to GM before the end of the month. He said he’s not sure what information is being requested, but he plans to contact the company to correct what he says would be a “huge mistake.”

Mr. Scott said that if Henna and Johnson have their contracts dropped, that would leave no GM dealer in Aiken County, forcing customers to drive to Augusta for purchases and vehicle servicing.

“They’re not going to want to drive to Augusta,” he said.

Aiken resident Dick Howell, who is a Henna customer, agreed that would be a problem. He said the possibility of GM dropping Henna doesn’t make sense to him.

“They sell a lot of cars,” he said, but added he can’t help but worry about the nation’s economy. “It doesn’t look like it’s going right.”

Henna employs about 35 people and has been operating under the ownership of Louis Henna since 1997, Mr. Scott said. The site has been a car dealership under different names, though, for more than 40 years, he said.

Johnson Motor Co. of South Carolina employs 23 people, has been open since 2002 and carries Buick, Pontiac and GMC products.

Mr. Scott said Friday’s notification was one that “floored” him. He said he doesn’t understand the decision either, noting how “Everybody’s sales are down. It’s not a GM problem. It’s an economy problem.”

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