"Red" v. "Senator Joe"

Before the Senate;s Antitrust and Monopoly Subcommitee last week went General Motors President Harlow H. Curtice to answer charges that G.M. had 1) become too big, 2) abused its dealers, e.g., it refused to give more than one-year franchises. Right off the bat Harlow Curtice announced that G.M. was offering to turn the one-year franchises of all its 17,000 dealers into five-year contracts. The announcement caught Subcommittee Chairman Joseph C. O'Mahoney by surprise, but he quickly broke into a pleased smile and congratulated Curtice for taking "the suggestion I made when you were last here... I hope that Ford will promptly take congnizance of what you have done, and Chrystler likewise."

There were more smiles as the hearings dragged through their fifth week, and the smoke-filled, green-walled hearing room took on an air of a gentlemen's club. To rambling Joe O'Mahoney, Curtice became "Red." To carefully tailored Harlow Curtice, O'Mahoney became "Senator Joe."

To answer charges that it bullied dealers, G.M. put William F. Hufstader, vice president for distribution, on the stand. Case by case, Hufstader brought out the records. Among them:

¶ Pontiac Dealer M.H. Yager of Albany, N.Y., who testified that he had been bullied by G.M. and would show only "a small profit during 1955," actually made $81.898 in salary, bonus and net profit during the year's first ten months, even though he spent only half his time in the auto business. On an original investment of $10,000 (half of it borrowed), Yager made more than $1 in 15 years.

¶ Buick-Chevrolet-Pontiac Dealer Lee Anderson of Lake Orion, Mich., who complained that the company permitted employees to but cars at a discount for resale, had his facts wrong. Employees could buy only one car a year, had to promise not to sell it until introduction of the next model. G.M. canceled his franchise only after Anderson publicly and repeatedly "bitterly criticized" G.M. policies. But Anderson was not ruined; between 1946 and 1954, Anderson made $700,000 in salaries and profits.

¶ Ed Travis Jr., a St. Charles, Mo. Buick, Pontiac and G.M.C. truck dealer, lost his franchise because "he simply did not meet the challenge presented by the current automobile market."

¶ Conway, Ark. Oldsmobile Dealer J. B. Silaz Jr., who complained that he could not get enough cars, actually wanted to operate "as a new-car broker rather than as a dealer," i.e., sell to bootleggers.

By week's end the hearings has almost petered out. The platoon of G.M. brass gathered up their papers and went home, leaving assistants to clean up odds and ends of testimony over the next few weeks. What had O'Mahoney accomplished? The hearings showed that G.M. executives did their homework before they took the stand, that they freely cooperated with the committee, and that they ran a highly efficient business. While some of G.M.'s 17,000 dealers were clearly sore, the records proved that even they had done very well. Quipped one newsman: "It's just an argument between big millionares and little millionares." In what O'Mahoney had originally billed as a full-dress probe into big business, G.M. had come off well.

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