By Nathan Duke
As a prelude to General Motors Corp.’s filing for Chapter 11 bankruptcy protection from its creditors Monday, a Bayside division of the automaker had shuttered its doors in May.
Bayside’s Cunningham Pontiac Buick GMC, a division of GM, closed last month amid the auto company’s financial woes. The offices of the dealership, at 214−27 Northern Blvd., were empty as trash cans sat atop desks and no vehicles were visible through its storefront windows.
After GM headed to bankruptcy court in Manhattan, President Barack Obama announced the government would invest $30 billion in the auto giant. The move follows Chrysler’s April 30 Chapter 11 filing.
Unlike his GM neighbor, Bayside Chrysler co−owner John Zanetti said his Northern Boulevard−based store is one of the premiere Chrysler dealerships in the country and that it does not face closure.
But a statement on the GM dealer’s Web site indicated that it might reopen in the northeast Queens community.
“For over 65 years, it has been a pleasure helping our customers, selecting and servicing their vehicles of choice and providing our employees a place to do a great job,” the statement said. “At this point in time, we have ceased sales and services at this location, sold off all remaining inventory and we look forward to returning to what we do and enjoy best at a later date in time.”
Steve Koufakis, the owner of the Star Auto Group, which has a Chrysler dealership in Queens Village, said his location was spared but his business is not immune to the recession.
“Obviously, things are pretty tough,” Koufakis said. “It’s not a lack of customers. The problem is the government gave the banks the money to hand out and the banks aren’t lending it out. The credit is the single biggest problem right now.”
In adjusting to the hard economic times, Koufakis got creative and let go fewer than 2 percent of his employees and went to a 4−day work week instead of laying off 25 percent of his 320 workers.
“Not one person complained,” he said.
Meanwhile, sales staff at City Cadillac Hummer Saab on Northern Boulevard in Long Island City continued to handle customers Tuesday afternoon. Manager Sam Fox was not immediately available for comment due to a pending conference call with General Motors. The New York Times reported Tuesday that GM had found a buyer for Hummer, its specialty SUV brand that was hit particularly hard by the recession and high gas prices.
City Councilman Tony Avella (D−Bayside) said he believed the closing of the Bayside dealership was bad news for the community.
“It does hurt the economy,” he said. “It probably employed people locally or within the greater Queens−Brooklyn area. It’s unfortunate that GM is in such a precarious situation. Hopefully, the bankruptcy option will stave off the complete shutdown of GM and some of the dealerships will stay open.”
But Community Board 11 Chairman Jerry Iannece said he did not believe the neighborhood would be affected.
“I don’t think it will have an impact whatsoever on the community,” he said. “I think many of these dealerships, with people coming and going, created issues in the community in terms of parking. I don’t think this will be anything that people will be too upset about.”
On the other hand, Chrysler’s Zanetti was upbeat about the outlook for his dealership.
“We sell and service lots of cars,” he said. “We are excited for all this to be over with and to emerge as a stronger, more efficient car company.”
In its bankruptcy petition filed this week, GM said it had $82.3 billion in assets and $172.8 billion in debts. During a news conference Monday, Obama said the government was forced to invest more money in GM to prevent millions of Americans from being adversely affected. The automaker, which used to be the nation’s largest industrial company, had already been given $20 billion to keep it solvent.
“We are acting as reluctant shareholders because that is the only way to help GM succeed,” Obama said.
GM, which has been a key component of the 30 companies making up the Dow Jones Industrial Average since 1925, will be replaced by Travelers Co. next week, the Wall Street Journal reported.
Reach reporter Nathan Duke by e−mail at nduke@cnglocal.com or by phone at 718−229−0300, Ext. 156.
