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General Motors Corp. will tell 1,000 to 1,200 dealers Friday that it will not renew their franchises. The automaker plans to eventually close a total of 2,600 operations.
In California, the moves will have far-reaching implications for dozens of cities, which depend on sales tax revenue from the dealerships to fund substantial portions of their budgets.
The dealerships join a growing list of retailers felled by the dour economy: Sites that once held Mervyn’s, Circuit City and Linens ‘n Things stores remain empty except for a few locations. And as difficult as it has been to sell or lease those properties, at least they can be easily adapted for other uses. Car dealerships, on the other hand, are special-purpose properties that are hard to adapt.