The Australian Competition & Consumer Commission (ACCC) has cleared GM Holden of any wrongdoing against auto retailers following its hasty exit from the market last year, Reuters reports.
The ACCC previously launched a probe into GM’s withdrawal from Australia after the Holden dealer network said it was offered “grossly inadequate” compensation packages in exchange for it terminating franchise agreements early. Australian Prime Minister Scott Morrison also backed publicly backed the campaign against the American automaker, saying he “won’t have big overseas corporates [from GM] destroying Australian family businesses.”
In a statement released Friday, the ACCC said it had opted not to take legal action against GM Holden, as the automaker was able to mutually agree on compensation packages with most of its dealers. Some dealers have also opted to take private legal action against GM, which further contributed to the ACCC’s decision not to take legal action against it.
“While our investigation into Holden’s conduct left us with concerns about Holden’s treatment of some of its dealers, the ACCC has decided not to pursue these concerns, in large part because any ACCC action may prejudice the private actions taken by dealers. This was a difficult decision based on a range of considerations,” ACCC Chair Rod Sims said.
Dealers also accused GM Holden of continuing to approve new dealership acquisitions and encourage some retailers to make significant investments in their storefronts, despite the fact that top brass had known GM was set to withdraw the Holden brand from Australia for many months.
Sims said that the behavior by GM Holden in the months leading up to its withdrawal has “done much to damage the General Motors brand in Australia, and perhaps beyond.”
“The way Holden withdrew from Australia and managed the process and its relationships with long-standing loyal dealerships should serve as a lesson to all franchisors of what not to do in managing their relationships with franchisees and treating them fairly and with respect,” Sims said.
While Holden is no longer operational in Australia, GM has launched a new venture in the region called General Motors Special Vehicles, which imports pricier American products like the Chevy Silverado 1500 and Chevy Corvette into the country for local consumption.