"When it comes time to purchase a new vehicle, many of my new constituents will abandon GM or Chrysler and go to whichever brand is still locally sold by a person they trust within their community," said Rep. Bart Stupak (D-Mich.), the subcommittee's chairman.
Dealers said the closings had put 100,000 jobs at risk and charged the companies with failing to be transparent about how they reached their decisions. Many dealers said their stores had been performing well despite the economic downturn.
"We have been GM to our community," said Bob Thomas, owner of a Chevrolet-Cadillac dealership in Bend, Ore.
The auto executives said their companies had been slowed by too many dealers, with many representing the same company often competing against one another for sales.
Many dealerships date to the 1940s and 1950s, they said, when motorists lived farther apart and Detroit automakers dominated the U.S. market.
In total, GM is expected to reduce its dealer body by 2,500 through the closure of dealerships, attrition and the shedding of its Saturn, Hummer, Pontiac and Saab lines.
Henderson told the committee that 856 dealers had appealed GM's decision to sever ties. As of now, GM has reversed itself on 45 of them, he said.
GM said the company judged dealerships based on their sales, customer service index, capitalization and profitability. Sales accounted for 50% of the score and customer service was worth 30%.
