Last Call: Tuesday Is End of the Road for Some Chrysler Dealers
By Michelle Krebs June 9, 2009
At midnight Tuesday, Chrysler will have 789 fewer Chrysler, Jeep and Dodge dealers.
Actually, some already have closed for good after finding out Chrysler was canceling its franchises only weeks ago. Some plan to reopen Wednesday morning as used-car stores or centers providing some kind of automotive service.
But as of midnight, the 789 rejected dealers will be shut out of Chrysler's computer system. They will have a limited number of days to submit their warranty and incentive claims for payment. Chrysler will redistribute the unsold inventory of defunct dealers to surviving dealers.
As the wind down of dealerships occurs Tuesday, Chrysler, its surviving dealers and its suitor Fiat are awaiting word regarding what's next in the courts after Monday's ruling by the Supreme Court Justice Ruth Bader Ginsburg to put on hold temporarily the Chrysler-Fiat partnership.
Fiat technically can walk away from the Chrysler deal after June 15. However, Fiat CEO Sergio Marchionne insists the company won't walk away.
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This is truly a shame, since many of the dealers have had Chrysler product for generations. I just wonder if there were any political initiatives behind which dealers closed, and which dealers didn't.
Fiat is in the catbird seat. They get to take over the company without putting any cash into the deal, with the 'promise' that small car technology will begin to flow out of the remaining dealerships sometime in 2011 or 2012.
My question is this: How many of the remaining dealers will still be in business by then?
It's a shame I agree but it's long overdue. Chrysler started going downhill a long time ago, even before Daimler took over it in 1998. The last round of chrysler, jeep, and dodge cars was all about cost. Taking cost out of barebones was still not enough. Rather than concentrating on quality and material selection, Chrysler chose to expand their Jeep brand to 7 vehicles and bring Chrysler Aspen, which was totally unnecessary.
Chrysler sold cars only due to huge discounts. But CHEAP can only go so far. Consumers are now more educated and there is a huge competition. What big 3 could sell 3 decades ago no longer works.
I certainly feel back for Chrysler dealers but what is the alternative?
I personally don't think that Fiat will have a huge impact on Chrysler product line up. Are they really going to put capital in to develop next generation of Jeeps and Trucks? I don't think so. I think they'll just use Chrysler dealer network to distribute Fiats
Bill - there was no political consdierations. That is just a right wing conspiracy. Chrysler should have cut 75% of their dealers not just 25% (to bring them down to Toyota levels of sales per dealer). So if anything political considerations saved many dealers.
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