GM Holden rejects arbitration

General Motors has rejected a last-minute call for arbitration with Holden dealers and a push to extend the deadline for them to accept its compensation offer beyond June 30.

GM has been in dispute with 185 Holden dealers operating 203 retail outlets since it axed the brand in February and terminated their franchise agreements nearly three years early.

It had given them until May 31 to accept a compensation offer, which was later extended under pressure from the Australian Competition and Consumer Commission (ACCC) to June 30.

“GM Holden does not agree that an arbitration process would be appropriate or helpful. We have responded to the Government accordingly,” an email from GM Holden to the dealers issued Monday afternoon read.

“The deadline for the acceptance remains the close of business tomorrow, Tuesday 30 June.”

Mediation between GM and the dealers failed in June and GM last week also rejected an offer from the dealers that dropped their compensation demands much closer to what was being offered.

GM had offered dealers $1500 per vehicle sold in a set period, partial compensation for capital works and a five-year contract to be part of the ongoing service and spare parts network for Australia’s carpool of 1.6 million Holdens.

The Australian Holden Dealer Council (AHDC) dropped its compensation per car figure from $6100 to $2500, equivalent to what GM has already agreed to pay New Zealand Holden dealers.

The push for arbitration came from the federal government and was first reported in the media over the weekend.

But Holden dealers were told in an email message obtained by carsales that GM had would not agree to either proposal.

“As we have always stated, we are keen to maintain an ongoing relationship with you and your business as we focus on supporting the 1.6 million Holden drivers out there. We remain hopeful you agree to do the same,” the email concluded.

June 30 is the undoubted crunch moment in this protracted dispute. If a significant number of dealers sign up with GM then the campaign for better compensation could end.

It would also potentially leave those dealers who don’t sign up facing expensive and protracted court action to gain compensation.

The AHDC has fought a bitter campaign against GM, actively campaigning against its right to establish its new GM Specialty Vehicles business and enlisting the support of federal politicians on both sides of the aisle.

A federal parliamentary Senate inquiry into the Holden closure and its impacts begins next month. One of its members, Senator Deborah O’Neill, wrote to corporate watchdog ASIC last week calling on GMSV to be investigated.

In separate news related to the Holden axing, AADA has blasted GM in its submission to the Senate inquiry.

“The AADA has serious concerns with the conduct of GM in the lead up to this announcement and in the months since. This inquiry should hold GM to account and address concerns around unconscionable conduct and failure to act in good faith,” CEO James Voortman stated in the foreword.

That point was further emphasised later in the submission, which also contained a timeline of what the AADA said were “a series of disappointing decisions by the Detroit-based multinational” (pictured).

“The AADA believes that the failure to offer fair compensation for walking away from its contracts; the way GM has conducted itself since presenting its offer of compensation; and the actions in the lead up to its withdrawal announcement all pose serious questions as to whether GM has acted in good faith.”