US car giant General Motors has flown in a man who has closed more dealerships globally than anyone else in the company, as Holden showroom owners prepare to negotiate the terms of their compensation packages in the wake of the iconic brand's shock shutdown announcement.
Former high-ranking executive Jim Bunnell – who helped close 2000 showrooms in the US during the Global Financial Crisis, and subsequently wound-up the company’s operations in Europe, India and South Africa – has been appointed to oversee the termination of 203 Holden dealerships across the country and manage the impact on up to 9000 employees.
Mr Bunnell (pictured below), a 39-year veteran of General Motors, has been lured out of retirement for the Holden assignment.
He had finished up with General Motors in July 2018; one of his last roles with the company was as executive director of “dealer rationalisation” (car industry speak for closing showrooms), according to his LinkedIn profile.
A confidential bulletin sent this week to Holden dealers said Mr Bunnell has been appointed to “oversee the successful wind down of Holden vehicle sales”.
Mr Bunnell, named executive director of Holden Transition, will report to Holden boss Kristian Aquilina.
The Holden bulletin said Mr Bunnell has “extensive experience at General Motors overseeing orderly and respectful transitions with other brands across the globe, including Chevrolet Europe, India and South Africa”.
He also “supported the changes to the North American dealer network post-bankruptcy in 2009. We welcome Jim to the Holden family”.
During the Global Financial Crisis a decade ago, when General Motors filed for bankruptcy, Mr Bunnell was instrumental in reducing the company’s North American network of 5900 dealers to 3600.
The cutbacks included shutting the showrooms of discontinued General Motors brands such as Saturn, Saab, Pontiac, Oldsmobile and Hummer.
When asked by US trade journal Automotive News in May 2009 how General Motors would decide which dealers would go and which ones would stay, Mr Bunnell said: “Certainly we’re going to comply with all of the state laws. We’re very confident that the mechanism we used is a very good and very accurate reflection of the dealer's performance.”
Holden dealers claim the compensation being offered by General Motors to terminate their franchise agreements more than two-and-a-half years before they were due to be renewed is “insufficient” and likely to be rejected by most if not all showroom owners.
For its part, by the end of this week Holden says it has only put formal offers to 40 per cent of its national network of dealerships.
Less than 24 hours after the Federal Government announced a Senate Inquiry into the Holden shutdown, the car maker has shed some light on the compensation package which, it says, goes well beyond its minimum obligations.
“Holden is doing the right thing by its dealers during this difficult time,” a company spokesman said. “We believe the offer is fair. In most cases Holden dealers will receive compensation a factor of four times the average Holden new car profit per unit of all dealerships over the 2017-2019 fiscal years.”
Holden says its compensation formula is “applied consistently for all dealers and covers reasonable earning expectations from the new Holden sales department over the remaining portion of the Dealer Agreement”.
Dealers also have the opportunity to continue as authorised Holden service outlets, which it said is “a consistently very profitable part of their businesses”.
Meantime, anyone wanting to grab a bargain as Holden clears remaining stock may already be too late.
Following a leaked bulletin that showed discounts of $7500 to $17,500 would be offered across the range from March 1, many Holden dealers say they only have “weeks not months” worth of stock remaining. Most are expected to be cleaned out by June 30, the end of the financial year.
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