GM dealerships face new rules to survive

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CHICAGO, June 2 (Xinhua) -- U.S. automaker General Motors will move to dump dealers in bankruptcy court unless retailers accept unspecified modifications to their franchise agreements, the automaker said Tuesday.

Dealers that GM wants to keep are receiving letters in the mail Tuesday that outline the modifications, Chief Financial Officer Ray Young told analysts in Detroit.

The conditions dealers must sign include agreements that give GM power to terminate franchise agreements if retailers fail to meet high standards of customer service and sales, he said.

"We expect their performance levels to be very, very high and we're going to measure those levels," Young said. "And if they don't perform to those levels, that will be cause to seek termination in the future," he said.

Other dealers that GM wants to eliminate are being offered payments to help dispose of inventory and gradually close the dealership, Young said.

In its Chapter 11 bankruptcy filing Monday, the company said it would immediately try to cut 2,100 dealerships, far more than the 1,100 it had originally announced.