1987-1992 CADILLAC FRANCHISE PURSUIT;
SIGNER CO-DEVELOPS FREMONT AUTO MALL & BUYS
DIGIULIO PONTIAC-GMC:  GM DISAPPROVES BOTH.

Note:  This section describes my efforts in the co-development of the Fremont Auto Mall and concurrent efforts to acquire other franchises while Buick sales plummeted.  The story is lengthy, but I feel it is important for readers to be aware of the long and consuming process involved in the complex development of the Fremont Auto Mall, my years of grueling efforts to obtain the Cadillac franchise, and my purchase of DiGiulio Pontiac-GMC that was rejected by GM.  This section should help readers comprehend how devastating it was to me when GM, using any unethical means it deemed necessary, relentlessly pursued my franchises for its own Buick-Pontiac-GMC-Cadillac plan  in the mid-to-late 2000′s in the Fremont Auto Mall, after refusing to support my efforts for that exact structure and location in the early 1990’s.

(Some pages in the linked documents are vertical, and may be rotated ¼ turn clockwise by simultaneously depressing “Ctrl” and “Shift”and “+”. )

Since the mid-1980’s I had expressed to Cadillac my desire to become its dealer in Fremont, where it had never been represented before.  I met with Cadillac San Francisco Zone Manager Bill Kindley a couple of times informally in 1984 and 1985, at which time he indicated that Cadillac planned to appoint a dealer in Fremont in the future, but there was no immediate timetable.  On January 7, 1986, I met again with Mr. Kindley, and then followed up with a letter formally documenting my interest in a Cadillac franchise for Fremont.  On April 18, 1986, I met with Mr. Kindley, at which time he informed me that I was a viable candidate, but he was under pressure to find a minority dealer for the point, thus putting me, a white male, at a great disadvantage.  However, he indicated that, when the time came, I could submit a proposal whereby I could be a financial participant with a minority dealer.  I recalled that in 1979, the Buick Zone Manager who awarded me the Buick franchise told me that before doing so, he was required to prove that he had attempted, but failed, to find a qualified minority. 

Over the months that followed, I maintained contact with Mr. Kindley.  While Cadillac would have preferred an exclusive dealership without any other brands, Mr. Kindley realized that the low volume luxury brand could not stand on its own in the Fremont market.  As a result of my discussions with Mr. Kindley over the years, I had remained confident that I would be considered when the time would come, but the problem of being a white male would have to be addressed.  He also indicated that if he could eventually obtain permission to appoint a non-minority, Cadillac would most likely allow the brand to be added to my existing Buick facility, with minor modifications.  On April 3, 1987, Mr. Kindley informed me that Cadillac was currently doing a survey on the Fremont market to determine if it was time to establish representation there.  He explained that he expected to appoint a dealer shortly after Hayward dealer Doty Cadillac completed construction and relocated to its new facility in nearby Dublin, a project that was in process at the time. 

In June 1987, due to my active involvement in the community, Fremont Chamber of Commerce Executive Director Stan Allen invited me to lunch on June 18 as the first dealer to meet with he and Santa Fe Pacific Realty representative Bill Jones.  The purpose of the meeting was to determine my interest in participating in the development of an auto center near the intersection of Interstate 880 and Durham Road in Fremont.  The emerging auto center concept, in which multiple franchises would locate adjacent to each other, had shown considerable success in other areas, mostly Southern California.  Santa Fe Pacific Realty was a division of Southern Pacific Railroad, which owned the undevel­oped 700+ acre plot of land.  After hearing Mr. Jones’ overview of the company’s plans, I expressed my interest in participating in the project if terms were acceptable and there was widespread partici­pation by the other local dealers.  (Southern Pacific Railroad later spun off its Santa Fe Pacific Realty division, which in mid-1990 was renamed Catellus Development Corporation.  In the time frame before the name was changed, I will refer to the entity as Santa Fe/Catellus.) 

Prior to Mr. Allen’s meeting with me, Fremont multi-franchise dealer Hank Torian had expressed his interest to Santa Fe/Catellus about his interest in the auto center concept, wishing to develop the center himself and resell the property to the other dealers.  Santa Fe/Catellus wished to deal with the other dealers directly.  As a result of Mr. Torian’s and    my expressed interest, Mr. Allen arranged a June 23, 1987, lunch meeting with all dealers in Fremont except the owner of Fremont Ford, who had already bought property in nearby Newark for the construction of a new facility where he would become Newark’s first-ever new vehicle dealer.  At the lunch meeting, all dealers, except the owner of Central Chevrolet, expressed interest in the auto center project.  A subsequent meeting of select dealers, of which I was one, was arranged for June 25, with a follow-up survey of land size needs and sales tax revenues generated.  I completed the survey showing two franchises and a property size that would accommodate both Buick and Cadillac, on the assumption that I would be awarded the Cadillac franchise by the time the plots were finalized.  The surveys were forwarded to a consultant

On August 25, 1987, Santa Fe/Catellus held a meeting with all participating local dealers in which it formally presented its concept for the Fremont Shores Auto Center.  Santa Fe/Catellus’s plan was to develop a mixed-use project that would require rezoning of the approximately 800 acres.  In consideration of the local dealers’ influence with City officials toward the rezoning goal, Santa Fe/Catellus offered the dealers an attractive price on the land in the proposed Auto Center.  This low price, combined with the synergistic effect of the pooled resources of all the dealers, made the project a win for the dealers, Santa Fe/Catellus, and the City of Fremont.  Santa Fe/Catellus acknowledged my input at the August 25 and prior meetings in an August 27 letter.   

When the Fremont Auto Mall (originally tentatively named Fremont Auto Center, then Auto Mart, then Auto Mall.  I will refer to it as the Auto Mall) project was conceived in 1987, I enthusiastically described to Mr. Kindley the plans and the participation by all Fremont dealers except Central Chevrolet.  I urged him to award me the franchise promptly so that I could commit to adequate property in the developing Fremont Auto Mall to accommodate Cadillac.  He indicated interest in the Auto Mall concept, but reiterated that Cadillac was not yet ready to appoint a dealer in Fremont, partially due to the Doty relocation.  Mr. Kindley also reminded me that he was obligated to give priority to a minority candidate for the Fremont point if a qualified one were available.  In a September 11, 1987 letter to Mr. Kindley, I summarized the many benefits of moving quickly on appointing me, and also informed him of a minority candidate my dealership had sponsored and trained (at the request of Buick San Francisco Zone Manager Dale Kingsbury.)  I felt that having a minority involved with me might make Mr. Kindley’s job easier.  

After the August 25 Santa Fe/Catellus meeting, the Fremont dealers met, with attorney Jim McKeehan acting as the dealers’ representative in negotiating the project with Santa Fe/Catellus and the City of Fremont.  After considerable discussion amongst the dealers, on September 24, 1987, Mr. McKeehan consolidated the points the dealers considered important into a letter to Santa Fe/Catellus’s legal counsel.  At the same time, the dealers each paid an equal sum to a $200,000 trust account set up by Mr. McKeehan for to cover certain expenses associated with the dealer partnership that would be formed.  As one of seven initial dealer participants, I paid a total of $28,571.42 in two installments on September 24 and October 2, 1987.  On October 6, 1987, I sent Mr. Kindley a letter informing him of a substantial deposit I, and the other dealers, had just made toward the Auto Mall project. 

On November 18, 1987, I informed Mr. Kindley about having been approached by the Nohr family about my purchasing their Subaru and Saab franchises in order to supplement my declining Buick sales.  In response to my telling him that I wouldn’t go forward with it if I would receive Cadillac soon, Mr. Kindley said that there was no progress on the Cadillac point so I should go ahead with the “bird in the hand.”  I replied that I would pursue it, but would continue to maintain contact with him about Cadillac. 

An article in the Fremont Argus on January 26, 1988, reported on the development of the Fremont Auto Mall.  As one of the lead dealers working with the Fremont Chamber of Commerce supporting the project, I was quoted in the article.  As Fremont Auto Mall meetings and negotiations continued, I provided continuous status updates to both Buick Zone Manager Dale Kingsbury, and new Cadillac Zone Manager Frank Liebgott, who replaced the retiring Bill Kindley in January 1988.  My first meeting with Mr. Liebgott was on February 17, 1988, which I confirmed in a letter on February 19.    

On February 24, 1988, I and other Fremont dealers attended a special Fremont City Council meeting to support Santa Fe/Catellus’s position on a General Plan Amendment.  At the meeting, the City Council approved the rezoning for auto sales use, as described in this February 25 letter.  On March 2, a meeting was held between the Fremont Mayor, City Manager, which resulted in the Fremont mayor and city manager assuring the City’s full support, and establishment of a task force to do whatever was necessary to develop the auto mall.  A March 14, 1988, letter from the Fremont City Manager confirms the City’s commitment.  On March 15, the Fremont Chamber of Commerce sponsored a rally to support the auto mall project.  A March 18 Fremont Argus article describes Santa Fe/Catellus’s continued pursuit of its plan for property adjacent to the auto mall. 

In March 1988, I completed my purchase of the Subaru and Saab franchises from Nohr’s Imports, and added them to my Buick facility in Fremont with the support of Buick Zone Manager Dale Kingsbury.  When I added Subaru and Saab, I changed the name of the dealership from Don Signer Buick to Signer Buick-Subaru-Saab. 

On April 13, 1988, I met again with Mr. Liebgott, and followed it up with this letter about the Fremont Auto Mall.  I focused on the fact that all locally represented luxury cars, except Chevrolet’s Corvette, would be located there.  On June 16, Fremont City Manager Kent McClain issued an update to Fremont dealers about the City’s continued efforts toward the auto mall project.  On June 30, Mr. McKeehan sent another update regarding discussions with the City and Santa Fe.  He noted his discussions with Mr. Torian and me, as we were the most active of the dealers in moving the project forward. 

On September 9, 1988, I sent a letter to Mr. Liebgott after attending the Cadillac 1989 dealer announcement show in Las Vegas, for which Mr. Liebgott had extended me an invitation.  In the letter, I updated him on the auto mall project.  On September 10, 1988, Santa Fe/Catellus furnished us dealers a “tentative schedule of significant events” in the Fremont Auto Mall process.   

On December 2, 1988, I met with Mr. Liebgott at his request.  He told me that Western Regional Manager Jere Kitzmiller had been in to the Zone Office recently, he had told Mr. Kitzmiller that I was his choice as the Fremont dealer, and that both agreed that Cadillac would have to dual as it could not make it on its own as a single point.  Mr. Liebgott asked me about the amount of property I had requested at the Fremont Auto Mall.  I asked him about getting Cadillac then in my current facility, to which he responded with questions about the size of my facility.  He went on to say he wanted to get me approved as a dealer with the Fremont Auto Mall condition first, and then consider allowing it in the current facility. 

On December 5, 1988, Pontiac San Francisco Zone Manager Bob Durand sent a letter to Rich DiGiulio of DiGiulio Pontiac-GMC in Fremont.  The letter acknowledged Mr. DiGiulio’s interest in the developing Fremont Auto Mall, and then advised Mr. DiGiulio that it was not in the best interest of him, Pontiac, or Pontiac customers to relocate to the Fremont Auto Mall, and that Pontiac was satisfied with his current location.  It went on to say that if other Fremont dealers relocated to the Auto Mall, it would probably be in his best interest to do the same.  The letter then explains that Pontiac may establish representation in Milpitas. 

Pontiac’s satisfaction with Mr. DiGiulio’s current location is very curious considering that his facility was built in 1963 in what was in 1988 was an extremely low traffic area.  Additionally, within a one-block radius of his dealership were four dealerships housing six other franchises, all of which were destined for the Fremont Auto Mall.  When the other dealers would relocate, DiGiulio Pontiac-GMC would be left in a virtual ghost town.  Pontiac’s resistance to the Fremont Auto Mall could be explained by the fact that DiGiulio’s current location was located 13.7 miles driving distance to the Milpitas site, while the Fremont Auto Mall site is located 8.8 miles from the Milpitas site.  The Newark site that GM would later insist its dealers relocate to is 10.1 miles from the Milpitas site.  Mapquest distances for the various sites may be viewed here.  California’s 10-mile franchise law allows an existing dealer to protest, and possibly block, another dealer’s encroachment into that radius.  On a straight-line basis, the Fremont Auto Mall is approximately 6.8 miles from the Milpitas site, and the Newark site is approximately 9.0 miles away.  As the law is based on straight-line distances and Newark would also be under 10 miles, the extra distance to the Newark site versus the Auto Mall would make it much more likely that GM could prevail in the event of a protest hearing, and be allowed to add a new Pontiac-GMC point in Milpitas. 

Buick Zone Manager Dale Kingsbury was replaced by new Buick Zone Manager Chris Wolf in 1989.  As Mr. Liebgott had done when he arrived, Mr. Wolf enthusiastically supported the Fremont Auto Mall project from the time he learned of the project.  The fact that all of General Motors’ Zone offices were in a building in Fremont approximately six blocks from the original Signer Buick-Cadillac facility gave the Zone Managers the unique opportunity to become intimately familiar with the local market.  The San Francisco Zone was comprised of Northern California, Oregon, Washington, Alaska, Hawaii, Idaho, Utah, Montana, Wyoming, Colorado, and parts of Nevada, New Mexico, and North and South Dakota. 

In another display of the City of Fremont’s commitment to the Auto Mall, it accelerated the reconstruction of the Interstate 880/Durham Road interchange.  The widening of the overcrossing was important to the success of the proposed Auto Mall, as described in this February 23, 1989 Argus article

I contacted Mr. Liebgott on March 10, 1989, to inform him that I would soon have to finalize the amount of property I would need at the Fremont Auto Mall, and to obtain the status of Cadillac’s Fremont dealer appointment process.  He said that Cadillac home office (to whom Western Regional Manager Jere Kitzmiller reports) still wanted a single point dealer here, but that they don’t understand the local market.  

On March 23, 1989, Fremont dealers’ attorney Jim McKeehan sent a letter to the dealers updating them on various issues that had been resolved among the parties.  On March 28, 1989, the Fremont City Council approved the rezoning of 88 acres of Santa Fe/Catellus’s property for use as an auto mall, as described in this March 29 Fremont Argus article.  This rezoning approval was a significant step forward for the Auto Mall after nearly two years of ongoing discussions between all the parties. 

On April 5, 1989, I delivered a copy of the March 23 McKeehan letter to Mr. Liebgott to inform him that I would have to commit to property size soon.  It was important that I have Cadillac’s commitment to me before I would commit to the extra acreage it would require.  On April 14, 1989, architect George Avanessian distributed a preliminary Auto Mall layout of the Auto Mall to the dealers. On April 20, 1989, the Fremont Argus published an article about the Fremont Auto Mall progress, and neighboring city Milpitas’s efforts toward its own auto mall.  The Milpitas property was priced at $18 per square foot, which compared to the low $6.91 per square foot that Santa Fe/Catellus gave us Fremont dealers in recognition of our time and expense in assisting them with their 700+ acre project rezoning.  

On May 3, 1989, Mr. McKeehan distributed a letter from Fremont Assistant City Manager Roger Anderman regarding the City’s interest in providing financial assistance for the auto dealers.  On June 5, 1989, Mr. McKeehan wrote a letter to the Fremont Mayor and Council Members outlining requested assistance for the Auto Mall project.  On June 13, 1989, the Fremont City Council approved a $5 million subsidy to the auto dealers, as described in a June 15 Fremont Argus article.  I, and the other Fremont dealers, had attended the City Council meeting that ran until after midnight.  On June 16, Mr. McKeehan acknowledged the Fremont Chamber of Commerce’s continuing support of the Auto Mall.  On July 23, an article appeared in the Fremont Argus about the City of Fremont paying for Auto Mall improvements. 

I continued to have frequent contact with Cadillac Zone Manager Frank Liebgott.  Over time, Mr. Liebgott and Western Regional Manager Jere Kitzmiller convinced Cadillac home office in Detroit that Cadillac couldn’t make it on its own here, and was able to issue me a Letter of Intent dated October 4, 1989.  This letter stated that I would become its Fremont dealer upon completion of a new facility at the Fremont Auto Mall.  Cadillac also required that I divest myself of non-GM franchises, namely Subaru and Saab.  My receiving of the Cadillac Letter of Intent was a very exciting event for me after the countless hours over many years I spent toward that goal and the creation of the Fremont Auto Mall.  While the benefits would not be realized until later, it formed the foundation for a return to profitability in the future.  In good faith reliance on Cadillac’s requirement of, and apparent support of, the Fremont Auto Mall, I continued with my efforts on that project. 

On October 10, 1989, on behalf of Fremont auto dealers, Guardian Builders Executive Vice President Jim Salter wrote a proposal to Santa Fe/Catellus outlining terms of land purchase.  Guardian Builders was the Auto Mall infrastructure developer working with the dealers.  On November 27, an Argus article described Auto Mall financing negotiations.  (The article mentions that the dealer group was looking for Cadillac and Saturn dealers.  At that point I had kept the Cadillac Letter of Intent confidential.)

Consistent with a national sales collapse, which was even more pronounced in California, was my dealership’s new retail Buick sales decline from 908 in 1984, to 365 in 1987, to 246 in 1989.  Also, national sales of my newly acquired Subaru and Saab brands were plummeting as well.  In light of the gloomy trend, and the fact that my employees were beginning to doubt that we would get Cadillac, in 1989 several key employees left me for dealerships selling successful brands with a bright future.  As result of all the obstacles, my dealership suffered losses while I simultaneously paid various administrative fees as my share of the multi-party Fremont Auto Mall project that continued to move slowly forward.  In order to stay afloat, in 1988-1990 I borrowed heavily from my mother and against my home.  Needless to say, during this extremely difficult period, I spent many sleepless nights, as well as worked seven days a week, one more day than my normal six days.  The only things that gave me the will to continue were the fact that I was confident I would eventually get Cadillac, and the a large real estate equity I anticipated to be created by property I would own in the Fremont Auto Mall.    

On December 7, 1989, Santa Fe/Catellus documented land purchase terms and listed dealers who would be closing first.  Dealers listed as “cash” purchasers would be paying cash to Santa Fe/Catellus based on financing they had secured, mostly through their manufacturers.  Dealer Dee Barnes was the Ford dealer who had relocated to Newark in 1988, but planned to have a satellite showroom in the Auto Mall.  The dealer list excludes GM dealers DiGiulio Pontiac-GMC, Moran Olds, and Signer Buick-Subaru-Saab, as the finance terms offered were not acceptable, and we had not yet secured financing from GM. 

On December 14, 1989, I provided Mr. Liebgott updated documents on the Auto Mall, which he used for his request to home office to allow me to sell Cadillacs now in my current facility, subject to relocating to the Auto Mall in the future.  He informed me that people above him felt that if I got Cadillac in the current facility that I might not go to the Fremont Auto Mall.  This notion was absurd, as it was I, not GM, who was developing the Auto Mall with the accompanying investment of the time and money. 

A meeting of the Fremont Auto Dealers was held on January 11, 1990, and summarized in a January 12 letter from Jim McKeehan.  The letter outlined the requirement that each dealer to deposit $50,000 in a trust account in order to remain in the Auto Mall project.  I did so, as noted in this letter.  On January 19, 1990, I sent Mr. Liebgott a letter reporting of this latest expenditure on the Auto Mall, and documenting my previously discussed request that I be allowed to beginning selling and servicing Cadillacs immediately in my current facility. 

On February 21, 1990, I completed an application for Motors Holding Division investment as a possible means to finance the Fremont Auto Mall property.  Motors Holding is a division of General Motors that forms a dealership corporation that has stock owned both by General Motors and a dealer/operator.  Over time after operation begins, the dealer would buy out GM stock using dealership profits.  While I didn’t want to have a partner in the business that I had owned by myself for nearly a decade, no other GM entity yet would agree to finance the Auto Mall.  

On March 1, 1990, architect George Avanessian sent a new property layout to the dealers.  On March 1, 1990, a Fremont Argus article updates the status of the Fremont Auto Mall, and that we three GM dealers were working with General Motors for financing the land. 

Negotiations had been taking place on a Tri-Party Agreement between the dealers, Santa Fe/Catellus, and the City of Fremont.  This agreement was a necessary element of the closing of the property purchase.  On March 16, 1990, Attorney Jim McKeehan sent the dealers a copy of the Tri-Party Agreement draft

Based on their familiarity with me and the Fremont Auto Mall project, as well as the extreme challenges GM faced in this import dominated market, both Mr. Wolf and Mr. Liebgott realized the benefits of being located in a large auto mall alongside high volume, market segment-leading imports, in particular the luxury imports, with which Cadillac competes, sold in Fremont.  The Zone Managers went to great lengths to attempt to obtain financial support from GM for the project.  Toward that end, In March 1990, he asked me to write a letter detailing the Fremont Auto Mall project that he would present to various GM parties in an attempt to secure financing for me, as well as the Pontiac-GMC and Oldsmobile dealers.  On March 21, 1990, Mr. Wolf assembled the large meeting of GM executives, Fremont’s City Manager, the Auto Mall infrastructure, and us three participating GM dealers.  Mr. Liebgott was unable to attend, but designated three other Cadillac representatives to attend.  A week later, Mr. Wolf and Buick Assistant General Sales Manager Knox Ramsey met with me to inform me that Mr. Wolf’s efforts at obtaining financing had been unsuccessful, and there was nothing they could do to help.  GM’s refusal to finance was extremely unusual, as the corporation normally eagerly supports and finances new facility construction, including occasionally building on speculation.  Following GM’s steadfast refusal to finance the Auto Mall, the owners of DiGiulio Pontiac-GMC and Moran Oldsmobile withdrew from the Auto Mall project after spending nearly three years and tens of thousands of dollars each. 

At a later date, it would become apparent that the only GM representative at the March 21 meeting who had a vote in GM’s decision to support the Auto Mall was GM Argonaut Real Estate representative Roch McClain, and possibly his accompanying boss.  At the time, GM real estate people had authority over dealer location decisions, overriding the wishes of GM’s local zone managers who knew the market best.  Mr. McClain was negative toward the Auto Mall from the beginning, presumably because he had his own secret Newark agenda that would be revealed at a later date. 

On March 29, 1990, Frank Liebgott visited me.  He said he had talked to two Cadillac decision makers, and that I should make a plan for selling Cadillacs out of my current facility permanently in the event that the Auto Mall didn’t come together.  My notes state, “Frank [Liebgott] suggested I have [landlord Art] Bridges extend showroom or build separate, offer him $500-$1000 more rent [per month] for 10 years.”  His reference to extending the showroom meant enclosing the two existing covered patios, one on each side of the showroom.  Also, as soon as the Auto Mall was approved, I could get Cadillac immediately.    

Following the unsuccessful March 21 financing attempt meeting, and faced with a May deadline for paying a partial payment toward the purchase of the Fremont Auto Mall property, on April 11, 1990, I wrote a letter to GM Vice-President/Buick General Manager Ed Mertz seeking emergency financing.  On April 19, 1990, Assistant General Sales Manager Bob Henderson called me on behalf of Mr. Mertz and painted a very gloomy picture about the chances of GM, or its Motors Holding Division, financing the Fremont Auto Mall.  However, after I gave him more information, he indicated he would look into it further. 

On April 20, I informed Mr. Liebgott about my conversation with Bob Henderson.  He replied that if I was able to get help from Buick, he and his boss would insist that Cadillac help too.  He said he understood and sympathized with my efforts, and knew the hell I had been through.  In taking another swing at Buick financing assistance, on April 27, 1990, I called Mr. Mertz’s office, where I left a message.  Having not heard back, I called again on April 30, and received a return call from Mr. Mertz a few minutes later.   Mr. Mertz offered no hope of any financing assistance from Buick, even though I was merely seeking a mortgage, not a subsidy. 

When combining Mr. Henderson’s gloomy statements with Mr. Mertz’s declination of financing assistance, it was apparent that there was no hope of my receiving assistance from this avenue.  As both Mr. Mertz and Mr. Henderson were based in Buick’s home office in Flint, Michigan, and Roch McClain of GM Argonaut was based in GM’s Western Regional office in Los Angeles, it was apparent that it had been secretly decided above the local zone level that GM would not accommodate Mr. Wolf’s, Mr. Liebgott’s, and my pleas for support of the project that we strongly believed in.  It was to be revealed years later that, according to GM executive Raymond Buttacavoli in July 1993, it had been ordered in GM’s Michigan home office, that GM would not support the Fremont Auto Mall project, as noted in a letter from Fremont Mayor Bill Ball to GM President Jack Smith.  On page 5, in paragraph 4, Mr. Buttacavoli is quoted, “GM people had advised Motors Holding and GMAC not to finance any moves to the Fremont Auto Mall.”  On page 3, paragraph 5, it is stated that in 1989, Mr. McClain met with the City staff and left the impression that he didn’t like the auto mall.  The next paragraph refers to Chris Wolf’s March 21, 1990, unsuccessful finance attempt meeting of GM executives.  So, the Ball letter’s statements certainly indicate that GM’s decision to not finance the Auto Mall had been made well before the 1990 discussions, but held secret from Mr. Wolf, Mr. Liebgott, and me.  It would later become apparent that GM refused Fremont Auto Mall financing because it had secretly decided it wanted GM dealers in Newark rather than the Fremont Auto Mall. 

Despite rejection of financing at every turn, I had no viable choice but to continue with the Auto Mall project in order to satisfy Cadillac’s requirement.  As explained in a May 8, 1990, letter, on May 10, 1990, Santa Fe/Catellus presented Purchase Agreements for the Fremont Auto Mall property.  A few pages of the 58 pages of agreement and exhibits may be viewed here.  On page 6 (pdf page 7) of the select pages, it shows the requirement of two deposits of 2 ½% of the $1,452,508 purchase price.  The two deposits would total $72,625.42.  I had no choice but to go forward with the deposits despite my dwindling cash reserves, and the fact that GM refused to finance the property Cadillac required. 

Pictures recorded the May 10, 1990 monumental event that took three years to achieve.  The first is a picture of me signing the documents with two Santa Fe/Catellus representatives looking on.  The second is a picture of the attendees:  Front row from left: (unknown person,) Fremont Mayor Bill Ball, Santa Fe Pacific representative.  Second row: Santa Fe/Catellus’s Mark Crutcher, Fremont Council Members Gary Mello, Kurt Roessler, Alane Loisel, John Dutra, Dealers Hank Torian, Don Signer, Mark Hamilton, Frank Meads, Jon Meads.  Third row:  Dealers Hank Pierotti and Tom Claridge.  An article appeared the following day in the Fremont Argus reporting of this historic event.  

On May 21, 1990, Frank Liebgott called me, and then visited the dealership immediately.  He told me that he was going to make the recommendation that Cadillac dual now, in other words, allow me to start selling out of my current facility.  In the conversation I expressed the misery I had experience over the past two years (with declining business and the Auto Mall project without GM financing,) hanging on only because Cadillac was the light at the end of the tunnel.  Mr. Liebgott sympathized with what I had been through.  He told me he should have an answer by the end of the week (Friday, May 25.)  I ask that readers review my notes of the May 21 meeting to grasp my feelings at the time. 

On the morning of May 25, 1990, I returned Buick Zone Manager Chris Wolf’s call from 5:00 the day before.  Within an hour after the phone conversation, he and Assistant Zone Manager Mary Kay Long visited me at the dealership.  In near panic, apparently thinking I might do something drastic, he told me that he got “vibrations” that GM might do something to finance the Auto Mall.  I told him that I had held on for the last year and a half, working seven days a week, on the belief that I would get Cadillac.  After they left my office, it occurred to me that Mr. Wolf’s urgent visit probably resulted from comments I had made to Buick District Manager Bruce Gibson the day before, that if I had to shut down, I might have to see a lawyer about no Cadillac, in effect referring, in part, to my continued good faith efforts and expenditures on the Auto Mall.  It should be noted that I was running out of cash, and I had committed to $72,625.42 additional for the Auto Mall project in May and June, and faced further outlays to close on the property in August, still with no financing from GM despite Cadillac’s requirement.  I was in desperate straits. 

On June 6, 1990, I talked to Motors Holding representative Scott Chamberlain, and asked him to proceed with the approval process.  Mr. Chamberlain expressed interest in supporting the Fremont Auto Mall, but he was at the dealer direct contact level, and like Mr. Wolf and Mr. Liebgott, had been deprived of GM’s super secret no-finance edict. Even though both Mr. Wolf and Mr. Liebgott had pushed for my Motors Holding pursuit following their lack of success in obtaining financing, in past conversations, Motors Holding showed little or no interest above Mr. Chamberlain’s level.  In retrospect, it appears that the lack interest was due to the aforementioned Detroit directive to not finance the Auto Mall.  

On June 6, 1990, Mr. Liebgott came by the dealership and told me that he was putting together a package to get us the Cadillac franchise before he went on vacation the next day for two weeks.  As far as I remember, this was the first time he told me that he had gotten approval to do so.  On June 13, 1990, I was awarded the Cadillac franchise (Sales and Service Agreement) for Fremont.  On that day, since Frank Liebgott was on vacation, I met with Assistant Zone Manager Ann Pattyn at the Zone Office to execute the required documents, including a letter detailing the requirement that I must relocate to the Fremont Auto Mall.  As Cadillac had ordered inventory in advance for the time I would receive the franchise, new vehicles began arriving within days after the June 13 finalization.  At the same time, although I would have preferred to retain them the brands, I terminated the Subaru and Saab franchises as mandated by the Cadillac agreement. 

After the long journey that had led to this day, Ms. Pattyn shared my excitement.  On this day, I could not have imagined that many years later, Ms. Pattyn (later Blakney) would be in a role that included an intensive initiative to get my Buick and Cadillac franchises back.  Ms. Blakney’s involvement in that effort began in late 2004, and is discussed in a later section on this website. 

Between January 1988 and June 1990, my sales had declined drastically mirroring Buick, Subaru, and Saab’s Bay Area drop in sales, thus causing large financial losses.  During this period, the total negative cash flow generated was $646,000, as a result of the Subaru and Saab blue sky (goodwill) I paid in 1988, the dealership losses, and Fremont Auto Mall associated payments.  Sadly, the value of the Subaru and Saab blue sky (goodwill) was forfeited when I was required to give up those franchises (I found no buyers) when I later became a Cadillac dealer, and the Fremont Auto Mall investment was ultimately forfeited as a result of my never relocating there due to GM’s Newark plan to be discussed later. 

There is no doubt in my mind that, had there been no Fremont Auto Mall project, I would have received Cadillac permanently in my Fremont Boulevard Buick facility on, or before, October 4, 1989.  In addition to positive indications in this regard made by Mr. Kindley long before the June 1987 genesis of the Fremont Auto Mall concept, as discussed above, on March 29 Mr. Liebgott suggested I extend the showroom to accom­modate Cadillac in my current facility should the Fremont Auto Mall not come to fruition.  His overall statement clearly confirms that Mr. Liebgott considered my large 10-year-old facility satisfactory for Cadillac’s requirements for the next 10 years.  His comment on December 14, 1989, that people above him felt that if I got Cadillac in the current facility that I might not go to the Fremont Auto Mall virtually confirms the reason for the delay. 

Based on the above factors, it is clear that, had there been no Auto Mall concept, I would have received the Cadillac franchise no later than October 4, 1989 when Cadillac issued me the Letter of Intent requiring the Auto Mall, rather than in June 1990.  In the nine months from October 1989 to June 1990, my dealership lost $98,976.  In the first nine months after I received Cadillac, the dealership had a profit of $160,596.  So, it can be reasonably assumed that had I received Cadillac in October 1989 (or earlier,) the following nine months would have produced a profit rather than a loss, for an improvement of $259,572.  Consequently, this figure represents my lost profit oppor­tunity that resulted from Cadillac’s delay in awarding me the franchise due to its mistaken belief that I would not go forward with the Fremont Auto Mall project.  Additionally, Cadillac lost out on nine months of sales at my dealership.    

I continued to contact Motors Holding, as I assume both Mr. Wolf and Mr. Liebgott did also.  Motors Holding continued to show little interest, but finally gave me form letter to sign on July 3, 1990, which effectively released Motors Holding of liability.  It appeared that Motors Holding was going through the motions, but did not intend to offer any assistance. 

On June 15, Jim McKeehan sent the Auto Mall dealers a letter with a list of deposits the dealers had made, and the balances due in the second installment.  Shortly thereafter, he provided the dealers with a summary of the costs associated with each lot – mine was lot 2.  The column titled “subsidy” is the $1.79 per square foot contributed by the City of Fremont, which is a credit to each dealer’s balance. 

On July 20, 1990, Signer Buick-Cadillac paid an additional $38,762.95 toward the Fremont Auto Mall property closing.  On July 27, 1990, my total property deposit to date of $72,625.41 was released from escrow for property purchase.  On August 14, 1990, Catellus notified selected dealers of special financing terms.  On August 27, 1990, Catellus offered a special arrangement for me due to Cadillac’s requirement that I move to the Fremont Auto Mall, and accom­panied by GM’s refusal to finance the project.  Catellus’s letter to Jim McKeehan outlining the special arrangement states, “Don Signor [Signer], however, has a very unique situation.  Apparently, Cadillac will take away his franchise if he does not commit himself to the Auto Mall.  In recognition of Don’s unusual circumstances, we offer him the following:” The letter goes on to spell out terms of an option payment to extend my option to purchase property and get credit for the $72,625.41 I had already paid to Catellus. 

In addition to Catellus’s special arrangement, the Fremont Auto Dealer Partnership created a special agreement for me to remain in the project for an additional payment to the Partnership of $46,786.00, subject to other terms and conditions.  I paid this amount.  On August 29, 1990, the Dealers and I signed this agreement.

 To clarify my expenditures, I had invested into both the Dealer Partnership for various development and infrastructure costs, as well as paid a deposit to Catellus for the property.  After paying all of this, which totaled about $160,000, I still owned nothing.  All of the dealers in the Fremont Auto Mall Partnership, except the Lincoln-Mercury/Jeep-Eagle dealer and I, closed on the purchase of their respective properties before the end of August.  The Lincoln-Mercury/Jeep-Eagle dealer later purchased property, but never relocated to the Auto Mall. 

It is difficult to convey the extreme frustration and feeling of helplessness I experienced in my pursuit of both the Cadillac franchise and GM’s financing assistance for the Fremont Auto Mall.  I tirelessly dedicated countless hours of my life over a five-year period co-developing the Auto Mall, offering GM a proposal that all other manufacturers would have jumped at in a heartbeat, and most likely provide whatever financing is necessary to make the project happen.  

On September 6, 1990, Fremont City Manager Roger Anderman sent me a “condolence” letter regarding my inability to close on the Fremont Auto Mall property, and acknowledging the “difficult, frustrating, and time-consuming” nature of the project to date.  The same day of the letter, an article in the Fremont Argus reported of the dealers’ land purchase, with my name omitted due to lack of financing. 

I continued to stay in contact with Catellus to attempt to work out a financing arrangement that would work for me.  As I began making sizable profits immediately after I began selling and servicing Cadillacs, I was in a better position.  Catellus proposed another arrangement in an October 16, 1990 letter.  Unfortunately, it was not acceptable. 

During the fall of 1990, Mr. Liebgott exerted efforts with Cadillac personnel to obtain financing for the Fremont Auto Mall, only to be highly frustrated by the Detroit-based senior executives’ rejection of this obviously great opportunity.  Based in part on conversations with Mr. Liebgott and my October 17, 1990 letter to him, Mr. Liebgott sent pictures of Fremont dealerships to Project 2000 Director Edd Roggenkamp, in requesting financing for the Auto Mall.  (Project 2000 was a plan GM was developing that, among other things, would designate where GM wished to have each dealership in the country located at the turn of the century.)  My letter to Mr. Liebgott listed the 19 franchises controlled by the dealers who had bought property in the Auto Mall, as well as 6 franchises controlled by dealers not owning property.  Those 6 were the 5 GM divisions plus Mitsubishi, which was controlled by the Oldsmobile dealer.  Mr. Liebgott’s frustration with GM’s resistance was evident in the quote “These are GM’s facilities.  If you want to be there after the mall opens, then fine.”  It should be noted that his focus was on the other GM dealerships, all of which were much older than my ten-year old facility.  I considered both Mr. Wolf and Mr. Liebgott to be honest, dedicated GM representatives who valiantly attemp­ted to achieve what they genuinely believed was best for General Motors.   

On October 30, 1990, an event was held to celebrate the groundbreaking of the Fremont Auto Mall.  Dealers, Catellus executives, and City of Fremont officials were among the attendees.  It was a bittersweet event for me, as I had put so much of my life into its development, but without financing had nothing to show for it. 

In late 1990, Rich DiGiulio of DiGiulio Pontiac-GMC approached me about buying his family’s dealership.  I informed Motors Holding of this possibility as additional profit potential for the dealership corporation, but Motors Holding continued to show little interest.  My purchase of the DiGiulio franchises will be discussed later. 

On January 28, 1991, Mr. Bottiglieri of Motors Holding came to the dealership to review the financial statement for my Motors Holding application.  After the review, he said he would be meeting with his boss, and then call me by the end of the week.  After not hearing from him, I called him on February 1 without success, then again on February 4.  At that time, I had to refresh his memory on the subject, at which time he said he hadn’t discussed it with his boss.  I made future contacts with him on February 5 and 6 without success.  It was quite apparent that Motors Holding, as with all other divisions of General Motors to which I had appealed, had no interest in financing the Fremont Auto Mall project.  A March 12, 1991, letter from the City of Newark to Roch McClain, refers to a February 15, 1991 letter from Mr. McClain concerning GM’s interest in Newark, thus removing in my mind all doubt of the reason for GM’s multi-divisional refusal to finance my Fremont Auto Mall project.  I did not learn of the March 12, 1991, letter until September 2006, when the City of Newark furnished me a copy.  As noted above, Raymond Buttacavoli would admit in 1993 that GM secretly never would support the Fremont Auto Mall.   

In the months and years that followed the August 1990 land purchase by other dealers, I continued to seek financing for the Fremont Auto Mall project.  Discussions with land­owner Catellus Development Corporation (formerly Santa Fe Pacific) led to a March 13, 1991, proposal for my purchase of land to where I could get credit for the $72,625.41 I had forfeited.  (This forfeiture does not include the tens of thousands I had separately paid toward the dealer partnership.)    

On March 27, 1991, an article appeared in the Milpitas Post about GM’s pursuit of property for three dealerships.  Although the article didn’t specify, the article presumably meant three franchises, Chevrolet and Pontiac-GMC as noted in the aforementioned December 5, 1988, Pontiac letter to dealer Rich DiGiulio.  The article notes that due to the condition of the economy, no agreement had been reached between GM and the land seller.  It was the condition of the economy that contributed to what would be a delayed construction schedule by Fremont Auto Mall dealer property owners.  Second generation Billings Chevrolet ultimately relocated from San Jose to Milpitas in 1992 in a GM-initiated and Motors Holding funded facility, only to close permanently in January 2005, largely due to its isolated location and a lack of neighboring dealers.  GM never did establish Pontiac or GMC representation in Milpitas.  

As mentioned above, I began discussions in late 1990 with DiGiulio Pontiac-GMC dealer Rich DiGiulio about purchasing his Fremont dealership.  After multiple meetings and negotiation, and Mr. DiGiulio’s consulting with other family members/owners, we completed an Asset Purchase Agreement (“buy-sell”) and submitted it to the various General Motors divisions on April 26, 1991.  In addition to the time and expense of an attorney writing the Asset Purchase Agreement, I spent considerable time and effort creating the package for GM explaining the rationale for, and benefits of, my proposal.  

The package I submitted with the buy-sell included the following: 

  1. Cover letters to GM Zone Managers. Page 3 and 4 comprise a letter to Buick Zone Manager Chris Wolf summarizing my futile attempts at securing financing.
  2. Pontiac application forms.
  3. Asset Purchase Agreement between buyer and seller. (Included here are first 3 and last 3 pages of the 21-page agreement.)
  4. Facility design, location, and costsTo address GM’s desire for individual brand focus, my 1991 proposed facility had Buick-Cadillac sales operations separated from Pontiac-GMC operations, both physically and with separate sales and management staffs.  Service customer write-up areas were to be separated in a similar manner, and Buick-Cadillac technicians were to be in a separate building from Pontiac-GMC technicians.  A common parts department and business accounting office would have provided economies of scale in functional areas that are not seen by customers. 
  5. History of the Fremont Auto Mall development, and benefits of the project for all parties, including trend data indicating the impending doom of small volume dealerships.  The package included extensive information supporting the benefits of creating a business that would have sufficient volume to sustain itself.  I included National Automobile Dealers Association data showing the increasing difficulty of smaller volume operations to make a reasonable profit, if even survive. 
  6. Letters documenting my extensive past unsuccessful efforts to obtain GM financing for the Fremont Auto Mall.
  7. Bay Area sales trend data for Buick, Pontiac, Cadillac, and GM total.  All show a downward trend strongly indicating the need for consolidation. I provided sales charts clearly showing the declining volume trend of San Francisco Bay Area Buick, Pontiac, and Cadillac sales, as well as total GM market share.  As I did not have truck data in my files, GMC sales history was not included.
  8. My personal and dealership history.
  9. Financial forecasts for the proposed operation.  I created several sales and profit scenarios, which are described in the documents.  All forecasts were shown as monthly sales and profits.  The annualized net profit before bonuses and taxes in the various scenarios ranged from a low of $160,212, to a high of $1,809,012.  In the years that followed, Bay Area Cadillac sales declined from 1990 sales levels, and Buick declined drastically, as did Pontiac to a slightly lesser extent.  On the other hand, GMC sales later rose dramatically as a result of GM evolving into a truck-dominated producer.  With the GMC sales increase (at high profit levels per unit) over the years largely offsetting the car decrease, the profitability shown my forecasts would have still been valid.  So, it is reasonable to assume that average dealership profits of $1,000,000 per year would have been achieved.   

My proposal included temporary operation in the DiGiulio facility until such time the Fremont Auto Mall facility would be built.  The facility and property size were adequate to house the operation.  The profits that would have been realized from the multi-brand structure, as well as the additional volume to take to the Fremont Auto Mall, could have contributed to an acceleration of the relocation to the Mall as required by Cadillac. 

After submitting the buy-sell and my proposal package to Pontiac on April 26, I contacted Pontiac Assistant General Sales Manager Jim Murray, to whom Mr. Durand reported, to further my pursuit of approval.  In a May 14, 1991, telephone conversation with Mr. Murray, among other things I arranged to have lunch with him on May 24.  On May 14, I sent a letter confirming the telephone conversation

On May 16, I talked to Buick Assistant General Sales Manager Knox Ramsey about obtaining his assistance in achieving approval to my proposal.  In the conversation, he told me about a Chevrolet-Olds-Buick dual at 4th and LaBrea in Los Angeles.  As GM’s volume division, Chevrolet, with both cars and trucks, outsold Buick-Pontiac-GMC by a large margin, the LaBrea store was considerably higher volume than my dealership would be after the DiGiulio purchase. 

On May 16, 1991, Mr. Durand sent a letter to Mr. DiGiulio disapproving his sale to me, despite the overwhelming business case for my proposal, citing adequate profit opportunity for Buick-Cadillac without other GM brands.  Mr. DiGiulio faxed me the letter on May 17.  So, despite extensive time and aggressive efforts all the way to the Assistant General Sales Manager level of both Buick and Pontiac to obtain approval of my proposal, I hit a brick wall as I had with my Fremont Auto Mall financing attempts.  My subsequent follow up with both Buick and Pontiac decision makers resulted in no change in their positions. 

In attempting to understand GM’s rejection of my proposal, it appears that its arrogance blinded it to the indisputable supporting rationale I presented.  Contradicting GM’s rejection of the golden opportunity I proposed, in March 1992, an Auto Age magazine article reports on GM’s plan to have all-make dealerships in California to improve its sagging market share there.  This would mean having Chevrolet and Oldsmobile in addition to the four GM brands I proposed.  However, I’m not aware of GM allowing all make dealerships until it had no other choice in San Francisco in the early 2000’s, followed by Oakland in a factory-supported dealership.  

I believed at the time that my plan was a win-win for both GM and me, a belief I continue to hold today.  In recent years, GM has approved countless similar multiple brand dual structures, clearly validating the data and rationale I presented in my 1991 proposal.  In fact, in early 2005, in obvious recognition of the wisdom of my rationale that it rejected, GM secretly pursued the exact same Buick-Pontiac-GMC-Cadillac structure in the Fremont Auto Mall, and initiated unconscionable acts of harassment to induce my exit before I learned of it.  Then, when GM presented its plan to Congress in 2009 in preparation for the TARP bankruptcy bailout, it explained that dealership consolidation was an important element of its recovery.  But my presentation of that exact logic fell on deaf ears in 1991 as the once invincible GM refused to accept the reality of its steadily falling sales in the late 1980’s, especially in California.  My proposal was a perfect adaptation to the reality of GM’s decline, and would be at the best possible retail location in the Fremont Auto Mall.  GM’s inept rejection of my “no brainer” multi-franchise proposal in the Fremont Auto Mall is a microcosm of the corporate arrogance that permeated GM, and would eventually lead it into bankruptcy and taxpayer bailout.  

On May 13, 1991, an article appeared in Automotive News magazine about a J. D. Power study about the national trend toward auto malls, which was being led by California.  The article quoted Bob Fitzharris, the director of the firm’s 1991 Auto Mall Study.  I subsequently contacted Mr. Fitzharris, who turned out to be familiar with the Fremont Auto Mall project.  He endorsed the Fremont project as a good one.  I informed GM representatives of the Auto Mall Study and Mr. Fitzharris’s positive opinion of the project.  

In mid-May 1991, I met with Catellus Director of Development John Greer and his associate Mark Crutcher about the Auto Mall property for the proposed DiGiulio purchase.  Mr. Greer’s May 22, 1991, letter confirms Catellus’s interest in a ground lease to assist in making the project work.  The letter also acknowledges the considerable time and effort I had put into the project.  It should be noted that I continued to attend Auto Mall Partnership meetings even after I was unable to buy land in 1990.  

On June 27, 1991, the Fremont Auto Mall Partnership Administrator informed dealers of an upcoming City Council Meeting on July 2, 1991.  The memo asked dealers to attend the meeting and support the renaming of Durham Road to Auto Mall Parkway.  I attended that meeting to support this invaluable visibility tool.  Sadly, this renaming later worked to my detriment when GM insisted on my relocating to Newark. 

On September 13, 1991, Catellus Project Director Mark Crutcher sent me a letter suggesting the possibility of Catellus offering me a build-to-suit lease.  On September 19, 1991, I met with City of Fremont Community Development Director Ann Draper, Fremont Mayor Bill Ball, Fremont Auto Mall Partnership Administrator Liz Calhoun, and Catellus’s Mark Crutcher and John Greer, to discuss the financing arrangement.  All parties were motivated to find a financing solution for the mutually beneficial project.  I subsequently furnished requested financial information to Catellus. 

On October 14, 1991, Fremont City Manager Roger Anderman wrote to the various General Motors Zone Managers stating the City’s concerns over rumors of GM’s pursuit of a Newark site for its dealers.  The letter describes the extensive efforts by both the City and the dealers, and the many benefits of the Fremont Auto Mall over Newark.  Mr. Anderman requested an opportunity to discuss the issue with GM. 

On October 20, 1991, a large double article appeared on the front page of the Fremont Argus about the developing rivalry between Fremont and Newark for GM’s dealers.  The article describes GM’s pursuit of the Newark site, as well as my resistance to Newark and ongoing pursuit of the Fremont Auto Mall.  Following are selected quotes from the article: 

  • “Yet, before GM buys the property, it may have to come to terms with its own dealers, who may be reluctant to make the move from Fremont to Newark.  The Fremont GM dealerships are:  Jim Moran Oldsmobile, Rich DiGiulio’s Pontiac/­GMC, Rich Brunelli’s Central Chevrolet, and Don Signer’s Buick/­Cadillac.  Moran, DiGiulio, and Brunelli said they have no immediate plans to move anywhere, although Moran and DiGiulio helped plan the Fremont Auto Mall.”
  • “Signer maintains he wants to move to the mall, an is trying to get the financing to buy land there and build a new car lot.  But GM apparently wants him to consider moving to the 20-acre site in Newark, where he would compete directly with Fremont Ford.”
  • “In an Oct. 14 letter to GM, Fremont City Manager Roger Anderman wrote: “We do not understand why General Motors would be considering moving its dealers to Newark (which has no auto mall), especially without the courtesy of first contacting the City of Fremont to determine how we might be able to help meet your needs and those of your dealers.  This matter is of great concern to us.  …The idea of having a true auto mall in Fremont and a General Motors-only ‘mini’ mall in Newark makes no apparent sense to us or to those who are advising us on our auto mall.”
  • “Fremont Community Development Director Ann Draper said city officials are meeting with the auto dealers weekly to keep the auto mall on track.  She said the city asked Signer to make a list of everything the city can do to help him move to the auto mall, and the city is now doing everything on the list.  She would not elaborate.”
  • “’There were a lot of unforeseen things that came along (after the ground­breaking),’ said Donald Signer, who has said he’d like to locate his Buick-Cadillac dealership to the mall.  ‘You have to look at the psychology of it.  When business was great, dealers were thinking ‘lets move as quickly as we can.’  But when business is as slow as it is now the urgency isn’t there.’”
  • “And Signer may not make it at all.  Signer, who sells Buicks and Cadillacs, said he wants to go to the auto mall because he believes ‘if there’s a mall in the area, like there will be here, then I have to either be there or close up shop.’  But Signer’s manufacturer, GM, has other ideas.  Signer approached his manufacturer, General Motors Corp. of Detroit, and asked the company to finance his land acquisition and construction at the mall.”
  • “Signer said GM has been slower than other auto manufacturers in making real estate loans to its dealers, and the company rejected his application.  But Councilman John Dutra, in an interview last week, said GM offered Signer another deal – locate to a 20-acre site across from rival Fremont Ford in Newark and get Detroit’s support.”
  • “Signer implied he found that [Newark] deal befuddling because, only a year ago, GM awarded him a Cadillac franchise in light of his plans to go to the auto mall, where sales would be strong, he said.  The dealer refused to reveal GM’s new business plan, but he added ‘the only thing I can say is ‘minds change.’’  GM officials did not return phone calls.”
  • “Signer still wants a presence at the auto mall, and says he’s trying to secure financing now from a lender other than GM.  But, GM will still have a say.  ‘I can make my own decisions,’ he said.  ‘However, they are in a position of influence.  If they come along with a deal I can’t refuse…but my commitment has been to the Fremont Auto Mall.’” 

A map was included in the article with a list of dealers planning to move to the Auto Mall.  The list included all Fremont dealers (including Signer Buick-Cadillac) except the three on the “No plans to move” list: Central Chevrolet, DiGiulio Pontiac-GMC, and Jim Moran Oldsmobile.  The front-page article was an embarrassment for me, considering the conflict between “partner” GM and me on location choice, and the fact that GM stood alone among all involved parties in its rejection of the obvious logic in favor of the Fremont Auto Mall.  GM’s ludicrous maverick plan to isolate itself from the Auto Mall made it a laughingstock among all parties involved in the Auto Mall project.  I subsequently discussed GM’s Newark plan with the aforementioned J. D. Power auto mall expert Bob Fitzharris, who replied that GM was crazy.  Interestingly, Mr. Fitzharris was a retired GM employee. 

In response to my continued pursuit of Auto Mall financing, on October 23, 1991, Catellus sent me a proposed ground lease to attempt to accommodate my needs.  The proposal included an option to purchase.  While this was a step in the right direction, it would still require that a third-party lender agree to finance the construction of a facility on leased land – an action that would be challenging to achieve. 

On November 1, 1991, the Fremont City Manager met with two representatives of General Motors, one of whom was GM Argonaut’s Roch McClain.  On November 4, Mr. Anderman wrote a letter to the Fremont City Council summarizing the meeting.  According to the letter, the GM representatives indicated that no decision had been made whether to go to Fremont or Newark, and that Fremont was still in the running.  As time went on, it would become obvious that GM had, in truth, already made the decision to locate in Newark, with the only unknown at the time being the methods it would use to force its local dealers to comply. 

A November 19, 1991 Fremont Argus article reports of the sale of DiGiulio Pontiac-GMC and Fremont Mazda.  It should be noted that the report that the buyer was a Sacramento group purchasing DiGiulio was erroneous, unless there was a sale that fell through.  The DiGiulio dealership was purchased in early 1992 by Bob Gee and financial investor Dee Barnes, who owned Fremont Ford in Newark.  The partners also simultaneously purchased Moran Oldsmobile, and added it to Pontiac-GMC in the DiGiulio facility for temporary operation.  As a condition of its approval of the buy-sell, GM required that the new owners agree to relocate to Newark on a specified timetable. 

The November 19 Argus article also describes the difficult state of the auto business at the time.  (The sluggish economy contributed to dealers’ delayed facility construction at the Auto Mall.)  Despite the slow economy, Pierotti Volvo-Nissan-Hyundai-Suzuki opened as the first dealer in the Auto Mall on December 9, 1991.  Owner Hank Pierotti had rushed to construct his new facility and move as soon as possible due to deadlines associated with his leasing out of his old facility property and his need to vacate. 

I remained a member of the dealer partnership, and attended all meetings, even though I did not yet own property.  A January 3, 1992, dealer partnership amendment adding partner West Valley Toyota (which would own the Lexus dealership) shows me as a continuing partner, but with 0% of the land.  In my ongoing efforts to obtain financing, I continued to have discussions with Catellus about its financing my facility in addition to the as the ground lease it offered me in October 1991.  

The Fremont Auto Mall Partnership dealers supported Catellus’ requests to the City of Fremont for approval of its development projects adjoining the Auto Mall.  On January 17, 1992, I wrote a letter to Fremont Mayor Bill Ball urging his support of Catellus’s Pacific Greens project.  I stressed to Mr. Ball that GM didn’t want me in the Fremont Auto Mall, and that my only hope was if the Pacific Greens project was approved.

 In January 1992, Catellus was well aware of GM’s intention to have me move to Newark, and that if I were to make it to the Fremont Auto Mall, my only remaining hope was if Catellus would finance the project.  In response to my need, John Greer of Catellus indicated to me that if its Pacific Greens project were approved, his company might agree to finance the entire project for me.  But he cautioned me that there had been impasse on certain items of negotiation with the City that stood in the way of approval.  A January 22, 1992, Fremont Argus article describes the City Council’s lengthy discussion of unresolved issues in the Catellus project in its January 21 meeting, and its continuance of the discussion to its February 4 meeting.  I responded to Mr. Greer that through my Rotary and community involvement, I knew nearly everybody involved in the project, and offered to arrange a meeting of the parties to attempt to resolve the issues.  I was able to arrange such a meeting for January 31, 1992.  

In hopes of a successful outcome, I provided Mr. Greer my dealership financial and sales data on January 27, 1992.  I included new and used car sales data for DiGiulio Pontiac-GMC, as I would attempt to persuade the new owners of those franchises to move adjacent to me at the Auto Mall, something that would be beneficial to all parties.  The data I provided indicated the amount of sales tax dollars collected for the City of Fremont, income that would be lost if the GM dealers were to go to Newark. 

The scheduled January 31 meeting was held, and attended by Fremont City Councilman John Dutra, City Manager Roger Anderman, City Staff members Donna Sloat and Dave Millican, Mr. Greer, and me.  As my role was facilitator, I mostly observed the discussion.  Since Mayor Ball was still undecided on the Pacific Greens project and consequently was the swing vote, at the meeting it was agreed that on Monday, February 3, there would be a meeting between Mr. Ball, John Dutra, and John Greer, assuming that Mr. Ball would agree to it.  I did not attend the February 3 meeting. 

At the Fremont City Council meeting on February 4, which was continued to February 5, the Council tentatively agreed to approve Catellus’s project subject to a number of concessions from Catellus, including that Catellus offer incentives to domestic auto dealers to move to the site.  In return, the Council offered to reduce the annual $600,000 payment due the City by $72,000 per GM franchise brought into the Auto Mall.  Over the 10 years of payments, the $720,000 per franchise provided Catellus a strong incentive to bring in GM dealers.  A report of the Council meeting appeared in a February 6, 1992 article in the Fremont Argus. In its February 11, 1992, meeting, the Fremont City Council approved the Catellus project, as reported in a February 12, 1992, Fremont Argus article

After my further attempts to secure financing, on February 21, 1992, Catellus sent me a letter containing the terms of a proposed build-to-suit facility with an option to purchase.  I responded to these letters with a counter-proposal.  In my letter, I cite my special involvement with the City in getting the Pacific Greens project approved.  I also stress that I would continue to attempt to get Pontiac-Olds-GMC into the Auto Mall.  Due to the volume his franchises produce being critical to the success of the Auto Mall, I also asked that my agreement be contingent on Hank Torian’s dealerships be on a timetable to be in operation by Spring 1993.  Catellus returned a revised proposal on April 2, followed by another on April 3On April 4, 1992, I returned the signed April 3 agreementThe land purchase price was to be $4.00 or $4.50 per square foot, depending on the particular lot I would choose.  

After reaching the agreement with Catellus, I made a public announcement that I had arranged financing and would go forward with the project.  An April 9, 1992, article in the San Jose Mercury News reported of Hank Torian’s and my commitment to the Fremont Auto Mall.  The term “commit­ment” used by the writer was a misnomer, as we had both been committed for years.  Mr. Torian had bought property in August 1990, and I had done everything I could do in the absence of financing.  Mr. Torian’s commitment was to set a timetable for construction, and mine was an announcement of my obtaining financing from Catellus.  An April 26, 1992, article in the Fremont Argus made a similar announcement about Mr. Torian’s and my statements. 

In April and May 1992, GM began stepping up the pressure on me to accept its Newark project.  A meeting between new Buick Zone Manager Tom Garove, new Cadillac Zone Manager Greg Warner, and me was held on April 23, 1992, and summarized in a letter from Tom Garove to me dated May 29, 1992.  The letter discusses the delays of the Fremont Auto Mall and GM’s Newark proposal.  It then acknowledges my continued desire for the Fremont Auto Mall, and extends the dates for relocation into new facilities by June 1, 1994.  However, there was still no GM offer of financing for the Fremont site.  It is noteworthy that, even though GM’s interest in Newark had been revealed in 1991, neither Buick Zone Manager Chris Wolf, nor Cadillac Zone Manager Zone Manager Frank Liebgott, did anything to induce my relocation to Newark.  As both of them were strong Auto Mall proponents, GM waited until it transferred in replacement Zone Managers who had the assignment of convincing me I was an idiot for favoring the Fremont Auto Mall.     

On July 27, 1992, I sent Mr. Garove a letter describing the current status of the Auto Mall.  I summarized my financing agreement with Catellus, as well as my plan to go forward with the project on a timetable concurrent with the move of other dealers, which had been delayed by various factors.  

In August 1992, an article in the Fremont Argus reported on Ford Dealer Dee Barnes adding a franchise on his property, and that he planned to develop 4.5 acres across from his dealership.  (That is the property where his partner, Bob Gee, would eventually relocate their Fremont Pontiac-Olds-GMC from Fremont as required by GM.)  The article also quoted me as saying that I knew of no dealer changing its plans to move the Fremont Auto Mall, and that it made no sense to divide the dealers into two locations (as isolating GM dealers from the Auto Mall would do.)  Lincoln-Mercury Dealer Mark Hamilton agreed. 

A September 30, 1992, article in the Fremont Argus reported on a reopening of the discussion of incentives to get dealers into the Fremont Auto Mall.  The incentives focused on attracting domestic dealers (primarily GM due to GM’s rejection of the Auto Mall.)  The article tells of the closure of the new Pierotti dealership in June, 6 months after it had opened as the first dealership at the Auto Mall.  Unfortunately, Mr. Pierotti’s rush to move in as noted earlier was accompanied by sales declines due to a severe economic downturn and greatly reduced market acceptance of most of his car lines.  These factors, added to the fact that he was the only building within the hundreds of acres of bare Catellus land, made success at that time a challenge at best.  Two other dealerships had recently begun construction, Claridge’s Mercedes, and Lexus of Fremont.    

In addition to the difficult economy, other factors caused delays in the Fremont Auto Mall, the most prominent of which was the large empty Pierotti facility.  The facility’s mortgage holder foreclosed on the property, and attempted to sell it.  Unfortunately, there was only one dealer whose volume would support it – Hank Torian.  As such, Mr. Torian just sat back and waited until the lender finally succumbed to Mr. Torian’s terms.  Mr. Torian’s vehicle lines included Honda, Toyota, Dodge, and Chrysler-Plymouth.  It was critical that Honda and Toyota be in operation at the Auto Mall to provide the volume necessary to make a “mall.”  Mr. Torian’s waiting out the lender for the bargain price on the Pierotti building held up the entire project, and certainly made a premature move by me indisputably unwise.  

It is important to note that GM’s resistance to the Fremont Auto Mall had its roots back in early 1990 when it refused financing, and probably back to 1989 based on actions by Roch McClain per the Bill Ball letter.  So, GM’s ongoing resistance had nothing to do with the post-1990 delays, which were mostly due to a severe cyclical economic downturn that couldn’t have been foreseen at that time.  Beginning in 1992, GM exploited the delays caused by these beyond-my-control circumstances to push its Newark agenda upon me.  I planned to move forward with the FAM project when Mr. Torian began construction, the importance of which was a condition of my financial arrangement with Catellus in April 1992.     

Buick Zone Manager Tom Garove arranged an October 27, 1992, meeting between he, new Cadillac Zone Manager Greg Warner, GM Argonaut Realty representative Roch McClain, and me.  The meeting is summarized in this letter from the Zone Managers.  In the meeting, Mr. McClain presented a proposal whereby GM would rent me a facility it would build in Newark.  Two days after the meeting, Mr. McClain faxed me the details of GM’s rent proposal.  In the proposal, I would not own the facility, and my rent would generate for GM an annual return on its investment of 21.92% as noted on page 5 of the document.  This was an absolute insult considering the fact that I had spent years developing the Fremont Auto Mall in order to own property.  I, of course, had no interest in GM’s proposal. 


1987-1992 summary

The 1987-1992 period was extremely draining and often stressful.  The period was marked by:

  • The drastic decline of Buick’s market acceptance and sales, accompanied by my extensive time, effort, and expense to obtain franchises to offset the decline.
  • Extensive time and effort in the creation of the Fremont Auto Mall, including:

o     Dealer meetings that averaged more than once a month
o     Personal meetings with Fremont mayor and city council members
o     Attendance of Fremont Planning Commission and City Council meetings
o     An accumulation of two file drawers of Fremont Auto Mall related documents  

  • My exhaustive efforts to obtain Fremont Auto Mall financing while GM inexplicably opposed the project, despite Cadillac’s requirement of my relocation there.
  • My loss of key employees amid business decline.
  • Heavy borrowing to remain afloat while funding franchises and Auto Mall amid the declining level of business.
  • Long hours at work, often seven days a week.

After the countless hours spent toward developing, and $160,000 invested in, the Fremont Auto Mall, GM’s rejection of financing caused me to still not own land there.  Worse yet, I had to fight GM’s efforts to coerce me to build on its illogical Newark site, where I would be at a sizable disadvantage to the Fremont Auto Mall I worked so hard to create.  GM’s strong-arm actions to virtually force me to Newark are discussed in the next section.