There may well be too many car dealers (of all types) but I don't see where any given dealership is a drain or a financial burden to a car maker.
Having too many dealers chasing too few customers might be bad if you're a dealer, but how can it be bad (as in a direct cost) to someone like an automaker (ie - GM) ?
GM is seeking to cut the number of dealerships by something like 30 to
40%. They will pay millions in fees to break dealer contract to do this.But if they did nothing, then they wouldn't have this immediate legal cost, and presumably some dealerships would be forced out of business anyways. So why is GM in such a rush to reduce the number of dealerships?
I don't understand how their dealership network is in any way a cost or requires a money expenditure by GM to operate. I can understand that GM factory workers are a direct cost and if you can let go thousands of workers then yes there is a direct and immediate reduction in expenses (in theory anyways) but I don't see how forcing a dealership out of business equates to a cost reduction for GM.