Column: There’s a difference between Motor City and the Granite State
My dad spent most of his working years in Milford pumping gas, keeping the books or handling the parts room at the Pontiac dealership. Later he was in the parts room at the Chevrolet dealership. From him, I learned about loyalty to the brand and the products from General Motors. I grew up thinking that dealers and the automobile manufacturers were partners and mutually supportive.
A couple of years ago that perception was shattered after a couple of local automobile dealers spent an hour with me telling about the struggles they had with their manufacturers. We remember what seemed to be the arbitrary and unnecessary closings of dealerships during the recession, but there is much more than that.
There are a wide range of contractual obligations that are part of the “take it or leave” relationship dealers have with their manufacturers. Dealers complain that they are forced to make expensive changes to their buildings, inside and out, following design plans imposed on them. Examples used included the stone facing on fireplaces and the specific chairs for waiting rooms as well as the renovation of entire façades of buildings.
Senate Bill 126 would help level the playing field between dealers and manufacturers.
While no one likes to see government interfere in private business matters, New Hampshire is following many other states to support our auto dealers and their 14,000 employees. You can be sure the big manufacturers, General Motors, Chrysler and Ford, strongly oppose the bill.
Sen. David Pierce of Etna noted that “automobile manufacturers control nearly every aspect of a dealer’s livelihood.” He suggested this “one-sided power relationship has hurt New Hampshire business” and went on to tell about the experience of a local business, Howe Motors, which opened its doors as a Chevrolet dealer in 1958 in Claremont. Over the years, Howe added a Toyota franchise to the business.
Pierce told an attentive Senate and a nearly full gallery: “Back in 2009, when GM went broke, it ordered the dealership to build a new facility to separate the franchises so that the Chevrolet franchise was not under the same roof with Toyota. Needless to say, Howe Motors, did not succumb to GM’s demands due to the capital investment that it would have required. So, even though Howe Motors’ Chevrolet franchise had been in business in Claremont for 50 years, GM simply took away the franchise.”
The senator from the North Country, Jeff Woodburn of Dalton, noted that 10 years ago there were nine dealers in his area, today there are four. That means consumers have to travel longer distances to buy a car or have one serviced at a dealership. He mentioned a Lancaster dealer who has operated for decades out of a building with a barn as part of it. Woodburn noted “one size doesn’t fit all” and that selling cars out a barn in Lancaster works for the North Country while it might not in a city or along the border with Massachusetts. There has been heavy lobbying coming from both sides, including full page ads against the bill in the state’s largest newspapers, but it passed the Senate on 21-2 roll call vote.
Senator Andrew Hosmer of Laconia did not vote because he is an auto dealer. Senators supporting the bill felt, as one Senator said, “Detroit’s whims” should not determine the practices of an important and vital part of our economy. Plus, I think the relationship between auto dealers and the communities they serve is well understood by senators. SB 126 now goes to the House. Members there should get ready for a major lobbying onslaught.
Bob Odell, a Republican, is the New Hampshire senator representing Antrim, Bennington and Francestown, among other towns.