Closing day comes, and Chrysler dealers aren't happy

By James R. Healey, Sharon Silke Carty and Chris Woodyard, USA TODAY Colleen McDonald calls Chrysler "the devil" as she laments losing two Chrysler auto dealership franchises in suburban Detroit, two weeks after being notified by General Motors (GM) that her Chevrolet store is being terminated. Livonia Chrysler Jeep and Century Dodge in Taylor are closing Tuesday, victims of Chrysler's Chapter 11 bankruptcy reorganization that allowed the automaker to get rid of 789 dealership contracts in one fell swoop, cutting its network to 2,400. Some closed already. Another 300 or so are waiting, with little hope, for the results of a bankruptcy court hearing Tuesday on their petitions for relief. But practically speaking, all are out of business today. They'll get no more sales incentive or warranty help from the automaker, no factory financing and no more cars and trucks. "I have a Chrysler-Dodge-Jeep dealership with no cars. I can't go forward with this business plan," says Howard Sellz, who has been in the car business 44 years and runs Big Valley Dodge — now just three acres of empty lots in the Los Angeles suburb of Van Nuys. His office is filled with decades of photos showing him with famous customers and friends such as Jay Leno, Chuck Connors, Sandy Koufax and Frank Sinatra. He started liquidating March 4, got a series of franchise extensions, but that halted when Chrysler filed for Chapter 11 protection April 30. Car buyers who've come out on the wrong end of a negotiation with a dealer might be quietly saying that some had it coming. But the impact goes well beyond the person who holds the franchise agreement with the automaker.

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Comments
on Jun 09, 2009

I believe this will hurt Chrysler in the long run for a short term gain. Sure it would be nice for them to get out of some of the sweetheart sales contracts it has with some dealerships. It will all but force people that may have bought a Chrysler product to consider another brand because they might have to travel to find a dealership to purchase and have work done if needed later. People don't want to travel 50 miles for service. It will be interesting to see how it plays out. GM is doing the same thing. I imagine the other brand dealerships are smiling now.

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