General Motors Corporation and Subsidiaries - Page 13




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          sale of GM vehicles by independent GM dealers so that GM could               
          sell more vehicles to the independent GM dealers.                            
               Vehicles sold under a retail rate support program were                  
          financed at an interest rate below the prevailing market interest            
          rate.  Independent GM dealers who participated in the program                
          were required to advertise the below-market interest rate to                 
          their retail customers.  As discussed earlier, independent GM                
          dealers were not able to earn dealer finance income from GMAC on             
          the rate-supported RISC's.  In order to encourage independent GM             
          dealers to participate in retail rate support programs, GM paid              
          independent GM dealers who had been using GMAC's services a                  
          stated fraction of the average dealer finance income the                     
          independent GM dealer had earned on nonrate-supported RISC's                 
          during a previous base period.  Such payments were described as              
          representing a percentage of the independent GM dealers' normal              
          dealer financing income.  Independent GM dealers who had not been            
          using GMAC's services were paid a stated fraction of the average             
          dealer finance income that other independent GM dealers in the               
          same geographic area earned on nonrate-supported RISC's during a             
          previous base period.                                                        
               Retail rate support programs were structured as follows:                
                    (1)  GM sold its vehicles to independent GM dealers.               
                    (2)  GM's car divisions prepared proposals to use a                
               portion of their sales allowance budget on a retail rate                





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