General Motors wants to prevent a dealer in Iowa from selling Chevrolet and Cadillac models alongside Fiat Chrysler Automobiles (FCA) vehicles in the dealer’s “dualed” showroom. However the dealer argues that state law permits it to sell both GM vehicles and FCA vehicles under the same roof.
Note: unrelated GM dealer pictured here.
According to a recent report from Automotive News, a federal judge denied GM’s request for preliminary injunction against KAR Auto Group in Decorah, Iowa. Previously, KAR Auto Group’s Chevrolet-Cadillac dealership and Chrysler-Dodge-Jeep-Ram dealership were separated by about 180 feet. However, KAR Auto Group combined the two dealerships earlier this year to help reduce overhead, citing a state law passed in 2010 that took precedence over General Motors’ franchise agreement.
General Motors argued that the dealership group failed to submit a formal request to combine the two franchises, and that the dual arrangement did not meet the minimum size requirements stipulated in its contract, even when it was previously divided between GM and FCA products. GM also said that adding FCA products to the to the GM dealership tarnishes GM’s image, and that the dealer was planning to “commingle” the two automakers’ branding.
“GM’s standards – comparable to those of other manufacturers – are designed to enable efficient dealership operations, and positive customer experience and brand image,” said GM spokesman David Caldwell. “We will continue our efforts to enforce the contract.”
Note: unrelated GM dealer pictured here.
Meanwhile, KAR argues that a 2010 state law gives it a right to consolidate operations. U.S. District Judge C.J. Williams said that General Motors failed to show how the consolidation could cause GM “irreparable harm” to have competing brands in the same showroom. Williams also added that dividing the General Motors and FCA operations would force the FCA store to close, leading to job losses and preventing FCA customers from obtaining repair and service work in the relatively rural town of Decorah.
“KAR is pleased with these results and in particular the broader effect the decisions will have with respect to dualing in Iowa and on the viability of a trademark claim that a manufacturer may bring in response to dualing,” said KAR’s lawyers. “A trial on the merits will follow.”
KAR estimates it will save $575,000 annually by dualing General Motors and FCA franchises.
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Comments
GM has been a big fat cry baby over FCA lately, at least Ford tries to compete instead of whining and throwing lawsuits around. Ford will always be the #1 American brand, but GM and FCA continue to battle for the #2 spot, and GM is falling, especially since the one strong point over FCA was sedans, and now those are gone. Tahoes and Suburbans are the last thing they have over FCA, and that will be on decline once the Wagoneer gets here.
I simply do not get GM in the last few years.
What is next for them ? Are they going to sue their customer for buying their product !
Listen, I AM NOT a FCA fan, but they build a better product today in most cases !
I will never own one, a FCA, yet am moving away from GM after 40 years of GM ownership !
This one dealership in Iowa, is not the only one. And even if it was, others are right next to each other using the same employees just moving them back and forth !
Even my local dealership, owns a Ford and GM dealership in town, and comingles employees in all aspects !
They could care less about GM or Ford for that matter, whoever is most profitable at the time !
After all they learned from the best at this practice, from GM !
Look, anyone can step back and look at the GM of today, and ask themselves —
——————–What the h3ll is going on ————————–
Make a product, and compete for Christ’s sake !
You look like a bunch of mediocre cry babies !
And as for your investors, do they ask at the board meetings how much you spend on lawyers VS customer support ?
Maybe take that money and fix some of the $hit you sell, and everyone would not be suing you, and you would not have to sue everyone !
Again-
———————–WHAT THE H3LL IS GOING ON GM ————————
——————————————- ? ————————————
The only one who looks like a mediocre cry baby is you. All you do is make posts trashing GM. Why are you here?
The dealer is breaching the franchise agreement, should GM not do anything? You sound like a child who believes there are no consequences for anything.
I wish that you could open up a “Carmart” and sell ALL Brands side by side so you wouldn’t have to screw around and check out different makes at different dealers.
Quite honestly the way we buy cars is stupid in 2020!
Corey Green, you said a mouthful there !!!
EVERYTHING else Americans buy in 2020 is online !
I do not like it that our local people can not seem to make it work, yet over the years less and less support from them has been happening !!
And service, man don’t even get me started on that !!! Like I have said before, GM would be so much farther ahead if they got rid of the dealerships as we know them today or the last 50 years and modernized them to 2020 !
Just because you put lipstick on a pig does not mean anything is run differently !
And to you GMDoc. Do you not understand what is going on in the real world ?
Where do you live ? There is no where around me where one family does not own 6 dealerships together of ALL brands, and for years now !!!
And WHO is paying the bills ? You might be surprised depending what part of the country you live in !!
Again, this is a contract that is written around laws, and signed by both parties. If there are grounds for breach, fine get out !!! If not again, it just sound like a winy baby who did not get their way !!
I can not believe this is not cut and dried by law !! And it seems to be the case yet GM does not like it any longer, as they are so da/\/\ cheap !!!!
Leave GM !!! put your money where your mouth is and buy them out !!! Get out !!, like the UAW strike, see where that gets you !!
Ill tell you where it gets GM, just farther and farther behind the competition !!!!
Eye on the prize GM, eye on the prize !!!
” O ” what is the prize any more today ? with GM it is hard to tell !!!
A la Trump style.
GM is bitter about the Peugeot merger
Most people are brand loyal, or styling loyal. You know what I mean? Like there’s nothing like a 300 and nothing like C8 Vette, Chrysler doesn’t sell a suburban, and GM doesn’t have a 500. So I don’t see the problem and with today’s economics, this makes sense. Besides used vehicle dealerships have been doing it forever.
Im here because i read about the so called competition, hoping I’ll get a suprise i can sink my teeth into, kiddo. I used to be a GM fan, until they let me down. Who knows, maybe when Mary Obama retires, GM will return to it’s former glory one last time before soulless electric cars take over for good. Does that answer your stupid question?
Mike,
Are they ? It sounds like in the state of Iowa that is not true !
So a judge already said its done, just like a judge told GM that the suit against FCA over UAW was done !
Yet GM continues to cry, like a mediocre cry baby !
Just keep spending that share holder money, and not on a better vehicle or the customer you need, and just continue to watch your reputation slide and slide !
Just trying to help GM, remember GM products are NOT good enough, and their customer support is HORRIBLE !!!
Do you have down syndrome?? Fca is consistently bottom of reliability, their engines don’t last past 100k,and their performance cars are built on 10+ year old platforms. They sell maseratis that are built on the same platform as a 30k chrysler 300. You must’ve been dropped on concrete when you were a baby, repeatedly
GM is bitter about the Peugeot merger
@Mike:
Absolutely. If it’s a breach of the agreement GM has every right to take action!
FCA would do the same if one of their dealers were doing something similar.
Seems Iowa state law supersedes the franchise agreement. If it didn’t, do you think the dealer in question would have merged two separate buildings that were a mere 180 feet apart into a single, consolidated building? No, the dealer would not, and didn’t until long after the state law allowed the action.
Also, it currently does not appear FCA would do the same thing. FCA is not suing the dealer for putting FCA vehicles under the same roof as GM products.
And finally, GM should quit picking on the dealer. The fact is, the dealer has been selling both GM and FCA vehicles for some time now. Two buildings or one roof shouldn’t matter to GM. All GM should care about is the volume of GM vehicles sold, the quality of the dealer’s sales and service staff, and how well the customers are being treated. If the dealer is doing well with this, leave them alone. Focus attention on the dealers that are not doing well with this. I can think of a couple GM dealers in my area that could use some attention.
Whypac,
Now thats the truth.
The commenters here are always blaming the dealer for GM’s short comings, is this a dealer shortcoming ?
How is this dealer doing ?
For me , again, this has less to do with the dealer and more to do with GM !
If GM cant manage the dealers, get out !
These are just contracts, we all know there is a way out !
Just like the UAW, its a contract, GM signed the contract !
Again-
———————- What the h3ll is going on at GM ———————————–
How can you sign a contract and then blame the contract you just signed ?
GM is just looking like the worst run business in the world at this point !
Promising the moon, delivering nothing, partnering with what appears to be ” shady operators ” at best ( Nikola )
This stuff is fun to watch, yet very sad !
But I bet in the next two years GM will be on top, you just wait !!
Thats a funny, GM has been saying that for 5 years now !
Covid 19 has been a game changer for all of us. If it takes combining both dealerships to save jobs, than so be it.
I don’t see FCA seeing and they are in the same position as GM.
I meant sueing. Damn spell check.
funny..fca did not complain but gm did…lol…put them side by side like I did and easy sale of challenger over camaro every time. Not talking about v6 cars. Rt vs standard camaro is where the battle is at and fca is just better made. Do not get me wrong as I have wanted camaro since I first saw one and it took a lot to change me and wifes opinion. We went from whole hog on camaro to all the way fca with one visit to car show with them side by side. Best car I have ever owned and I have owned multiple sports cars. Sad that gm did not keep pontiac trams am as sometimes is just takes on change to sell a car over another. Fca made the right choice and had the right car at the right time.
Alex Petree,
That’s a new one, and also picking on those with a disability !
Yet not surprising on here from this group, and I have been called worse !
Be careful with your engine not lasting 100,000 miles as many GM engines in todays world last significantly less than 100,000 miles.
Just on this site alone there are 2 class actions on GM engines not lasting past, and I have personally had to change the timing chain on more than one 3.6 GM under 100,000 miles !
Today GM cant see the forest through the trees.
Look at all this energy and money and time spent on nothing that has to do with a lasting product !
The GM of the past, when they actually made a superior product and stood behind it, would literally laugh at FCA !
Now at least in the USA, GM is like a joke to most ! Its a needed product, not a wanted product !
The FWD based SUV is the Impala ( grocery getter ) of the past. Everyone needs one, few WANT one !
So as far as vehicles people want, desire to own, GM has few. Some loyal truck owners yet, Corvette, yet thats about it !
However lets not forget China, GM is doing great over their ! GM seems to have nothing but time and money when releasing and servicing vehicles over their !
I wonder how the franchise laws are written over their ?
Read the article. FCA dealership would have had to close had the merger not happened. So GM is saving FCA jobs. I’d be pissed as well if sales of my product paid the bills on a building that my competition was using to sell cars. If the dealership can’t survive on its own, that says all that needs to be said.
Agreed.
I go into a dealership, or sit in a vehicle and notice right away what I like and what I don’t. Then I end up buying what vehicle I THINK is the best or has the most “likes”.
Example; when shopping for a truck, it came down to the new Silverado or the LD. I chose the LD because I disliked the fact that it had a black interior, no sliding rear window, mirrors that were on the smaller side, and low ground clearance. In the new Silverado I disliked the forward visibility, the steering wheel DIC controls, the brake pedal feel, the safety tech, the larger size of the truck and the interior as a whole felt kind of cheap. So i bought the LD.
My aunt was recently shopping for a vehicle and she test drove nearly every midsize CUV. and when she found one that she liked, she bought it. That’s usually what people do.