BSM Files Discriminatory Allocation Lawsuits Against General Motors

The attorneys at Bass Sox Mercer have filed two separate lawsuits against General Motors on behalf of dealers fed up with GM’s failure to allocate a fair number of vehicles to their dealerships.

The lawsuits have been brought in Colorado and Arizona arguing that General Motors has breached its own Dealer Sales and Service Agreement obligation to provide all dealers with a reasonable quantity and mix of new vehicles. Likewise, the lawsuits argue that each State’s franchise provisions governing vehicle allocation have been violated.

General Motors has failed to provide a reasonable number of vehicles to these and other dealers by virtue of GM’s initiation of a tiered allocation system within which dealers with higher sales volume are favored over those with lower sales volume relative to market potential. GM has also breached the Dealer Agreement and state franchise laws by virtue of its distribution of STMI vehicles GM unilaterally sets aside for “discretionary allocation”.

These lawsuits seek an order requiring GM to allocate vehicles fairly and requiring GM to pay damages related to significant lost profits from the sale of new vehicles not allocated to the dealership along with front-end profits from incentives, the sale of F & I products and profits on trade-in vehicles.