JDUB: I agree that bankruptcy is to clear out weak businesses. In the case of GM and Chrysler dealers who were cut, most were operating very successfully. GM and Chrysler just wanted them gone and their bankruptcy allowed them to throw them away with no compensation whatsoever! The only reason the dealers are now bankrupt is that they were just thrown out. As far as reducing rebates, The rebates are as high or higher than before the dealers were cut. Rebates are offered by manufacturers because certain products are not selling at a rate to hold the days supply at a reasonable amount (normally 60 days supply). Reason days supply gets too high is factories build too many cars for the market and/or it is a model that is overpriced or is not something people want in the quantity they built. Higher the rebate, the more of a problem vehicle. Popular models have little or no rebate on them. Now that they have thrown out dealers who sell 15 to 20 percent of their volume, rebates will be here for awhile. They will go down as they bring out products people want and hold production to the sales rate or less. Since they are closing many plants and bringing production down substantially, rebates will probably drop after awhile. Reason will be less production, not fewer dealers.
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