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Ford selling dealerships
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June 27, 2001: 8:31 a.m. ET
No. 2 carmaker says it is dropping test program to own dealership clusters
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NEW YORK (CNNfn) - Ford Motor Co.'s experiment in owning car dealers has come to an end, the No. 2 automaker confirmed Wednesday.
A Ford spokesman told CNNfn the company will sell 30 Ford co-owned dealerships across the country in the interest of "good dealership relationships."
Dealers have expressed concerns about the difficulty of competing with the automakers which they are dependant upon.
Ford (F: Research, Estimates) had tried to answer those concerns by buying blocks of dealerships in a number of metropolitan areas, limiting the number of non-company owned dealers directly affected by the ownership group.
Seven dealerships already have been sold as a block in Tulsa, Okla. Nine co-owned dealerships will be sold in Salt Lake City, six in Oklahoma City, and eight in Rochester, N.Y., a company official told CNNfn.
General Motors Corp. (GM: Research, Estimates) , the world's largest automaker, also weighed a dealer ownership plan in 1999 that would have encompassed 10 percent of dealers over the decade, but dropped the plan in the face of opposition.
The automakers are interested in reducing the number of dealers they deal with in order to control administrative costs, and have been concerned about the rise of publicly-traded companies owning multiple dealers, such as AutoNation Inc. (AN: Research, Estimates), the nation's largest dealer.
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But many auto industry analyst believe the automakers have more pressing needs for their capital than buying dealerships, especially in the current softer market for autos. Ford also faces spending an estimated $3 billion to recall 13 million Firestone Wilderness AT tires used on its light trucks.
Many states have franchise laws, supported by the politically-powerful auto dealers, that limit the automakers' ownership of dealerships. 
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Ford Motor Co.
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