GM may restore some dealerships

DETROIT — Hundreds of the 1,350 General Motors dealers who lost their franchises last year could see them restored in a congressionally mandated arbitration process that begins later this month, the company's interim CEO said Wednesday.

CEO and chairman Ed Whitacre Jr. also said that new chief financial officer Chris Liddell is a candidate for the CEO post.

In a wide-ranging talk with reporters at GM's Detroit headquarters, Whitacre also predicted that GM would be profitable this year, although he said that was dependent on the economy and other factors.

The 1,350 dealerships, which were allowed to stay open until October 2010, were targeted as part of an effort to dump poor performers and better align its dealer base with much lower consumer demand for autos. In many cases, GM had dealerships too close to one another and competing on price, the company said.

Congress passed legislation late last year that forces GM and Chrysler Group, which shed 789 dealers last year, to give dealers a chance to appeal closure decisions. Both companies went through bankruptcy protection earlier this year and are receiving government aid.

Whitacre said GM had a "pretty arbitrary cutoff point" for shedding dealers, and that it probably made mistakes in getting rid of some of them.

When pressed, he said "hundreds of dealers" maybe closer to 100 than a thousand, but it's a "substantial number."

Whitacre also told reporters that he would consider Chris Liddell, the CFO hired from the same post at Microsoft, in the search for a new CEO.

Liddell, 51, announced before GM hired him that he would leave Microsoft to pursue a higher-ranking position.

Liddell was hired late last month as CFO, the first permanent top manager hired from outside the traditionally insular GM since the company left bankruptcy protection in July. He replaced Ray Young, who transferred to GM's China operations.

At Microsoft, Liddell developed a reputation for holding down costs and building up cash. He instituted a plan to cut $3 billion from the technology company last year that included its first mass layoff, wage freezes and cuts in travel and other expenses.