General Motors to Shut Down 1,100 Dealerships

Bankrupt automaker General Motors has notified the owners of 1,100 US dealerships that their franchise agreements will not be renewed when they expire in 2010.

GM wants to eliminate 2,600 dealerships, or 40% of their US sales locations, by December 2010. The Big Three automaker has not released a list of the dealerships affected.

The notification letters contain allegations that the affected dealerships failed to meet franchise requirements.

Another 535 dealerships will leave GM when the automaker sells its Hummer, Saab and Saturn brands, and phases out the Pontiac brand.

GM expects to lose 500 more dealerships through natural attrition this year.