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More new car dealerships are turning into (sparsely populated) used car lots. There's a Pontiac-GMC dealer near me that's rapidly turning into a GMC commercial truck operation with used passenger vehicles sold on the side.
Three years ago, there were about four or five Suzuki dealerships operating in and immediately around my city. Now, there's precisely one. The next nearest dealership is 15 miles away, not on a public transit line, and expensive to get to via cab if a worst-case scenario came up.
If I were in a whimsical mood and didn't care about a car payment, I'd pick up a different brand because of part support concerns. I'm resolved to stay with my vehicle (not unhappily, mind you) until I'm forced to choose something else, which I hope isn't soon.
Chrysler dealers being forced to close
Review and discuss!
I suspect that the reasoning here was that there is a bigger Jeep dealer 20 miles up the road but the Chrysler and Dodge dealers up there had folded a couple of years ago.
Huffington Post Tracks Closing GM Dealers (Straightline)
There's a link there to a interactive map of Chrysler dealer closings.
They should renegotiate problems in the franchises. Dumping seem dumb to me. If they go out of business due to lack of sales or poor management. That is fine. GM and Chrysler seem to be compounded the problems rather than fixing any. Or maybe this is all part of the Obama team thinking they know the auto industry.
Anyhow GM doesn't need to sell more cars. They're losing money on most of the cars they sell. They need to sell LESS cars.... but at a profit.
Good sales people aren't redundant, but that is not the purpose of this post. Dealerships have been closing, bought out, and assimilated for years. Little towns have experienced that.
Why is our selling dealership, a family owned franchise, on the list. Ask us why we, and probably others, passed by the Corporate Box Store in Grapevine to buy from a small friendly store. And maybe we should ask the dealers why they stuck by Chrysler Daimler Cerberus when Edmunds was condemning some of the product provided to the franchisees.
Individual transportation and suburban sprawl was a huge mistake. But since, for now, that is what some of us are experiencing, private vehicles are a necessity. And also assumes the population will continue to increase and need still more vehicles soon.
Did the Bedford, Texas franchise take a hit because the boys want to increase the profit at their big box store to pay for the assumption of land and construction taken on by the original owners and subsequent owners and corporate managers and revolving door employees. Employees, who used to do something else.
Perhaps the answer is fair trade. Make the industry sell vehicles at msrp and then differentiation would only be in product quality and service. And by the way the rubicon was the first vehicle ever ordered and the wait was something else considering the bankruptcy. But the dealership made that an easy thing. And in 1987, I was one of those people who busted his behind for customers, selling chevies under a great guy, Then sold hondas under a ??? owner in a town where people went out of their way to avoid him. No, never bought a honda and get chills when entering toyota dearlerships. Just find for the most part, even with my mouthy nature, most domestic dealerships more pleasant. Maybe it goes back to ChevyFordDodge mine is the best contest.
GM, however, has a somewhat different process that should result in more of the local dealerships persisting, as they are taking geography into account and trying to reduce redundancy, particularly among suburban dealerships. At least, that's what they SAY they are doing.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Just for the record this guy is no little innocent caught in the storm - he has dealerships of six or seven different car companies...
My name is George C. Joseph. I am the sole owner of Sunshine Dodge-Isuzu, a family owned and operated business in Melbourne, Florida. My family bought and paid for this automobile franchise 35 years ago in 1974. I am the second generation to manage this business.
On Thursday, May 14, 2009 I was notified that my Dodge franchise, that we purchased, will be taken away from my family on June 9, 2009 without compensation and given to another dealer at no cost to them. My new vehicle inventory consists of 125 vehicles with a financed balance of 3 million dollars. This inventory becomes impossible to sell with no factory incentives beyond June 9, 2009. Without the Dodge franchise we can no longer sell a new Dodge as "new," nor will we be able to do any warranty service work. Additionally, my Dodge parts inventory, (approximately $300,000.) is virtually worthless without the ability to perform warranty service. There is no offer from Chrysler to buy back the vehicles or parts inventory.
Our facility was recently totally renovated at Chrysler’s insistence, incurring a multi-million dollar debt in the form of a mortgage at Sun Trust Bank.
HOW IN THE UNITED STATES OF AMERICA CAN THIS HAPPEN?
Sincerely,
George C. Joseph
President & Owner
Sunshine Dodge-Isuzu
http://outdoorsbest.zeroforum.com/thread?&id=864316
Seems like this guy picked a couple of losers, Isuzu (I believe) is getting out of North America, and now he loses his Dodge license. It really does suck, Chrysler sticking it to the dealers like this, pretty much forcing them into BK. All they can do is, at best, sell the inventory and parts to another Dodge dealer for what he paid for them.
Just proves anytime the government gets involved things get worse.
Yep, all their manufacturing plants are completely shutdown due to the BK and don't expect to open again until they come out of it. I've had my eye on a Dodge Challenger for a couple of months but am now having second thoughts, can't see spending $30K+++ when they're BK. I may consider a Sebring convertible though, one year old low mileage ones are going for under $16K, with an original MSRP north of $30K+++.
Last updated: May 20 2009 23:11
Funds move to halt Chrysler restructuring
Three of Chrysler’s secured creditors are mounting a fresh attempt to thwart the carmaker’s Chapter 11 reorganisation on the grounds that it violates their legal rights and the US government’s authority under the Troubled asset relief programme.
However, the Indiana State Teachers’ Retirement Fund said on Wednesday that it had a fiduciary responsibility to its members to continue the fight. The fund stands to lose $4.6m under the current settlement proposal and has teamed up with Richard Mourdock, Indiana state treasurer, to try to recover those losses.
The latest objections could galvanise other lenders to renew their challenge. “I fully support their motion and believe a number of lenders (including us) will ultimately join their group,” said George Schultze of Schultze Asset Management, one of the creditors that had abandoned an earlier legal fight.
In a court filing on Wednesday, the Indiana funds accused the government of adopting a strategy of “the ends justify the means”.
They also said the Treasury “has taken constructive possession of Chrysler and is requiring it to adopt a sale plan in bankruptcy that violates the most fundamental principles of creditor rights – that first-tier secured creditors have absolute priority”.
http://www.ft.com/cms/s/0/b3c8beb8-4564-11de-b6c8-00144feabdc0.html
I would say the forced closings of dealerships could be also construed as illegal. If it was legal why did GM pay dealers $billions when they quit making Oldsmobile.
I ain't no Philadelphia lawyer, but I believe most BK laws are written to uphold that.
It is as basic as our Constitution's 5th Amendment. The big banks were happy to take 30 cents on the dollar as the Treasury was giving them a lot more than that through the back door of the bank with TARP. All the little guys and small pension funds are just expected to roll over and say yes Mr. President we want the shaft.
I was watching a special on CNN about this very subject and the guy was saying that if this does go ahead as Obama is planing, it will fundamentally change the rules of business and will have some very serious long term ramifications.
Why would any investor, foreign or domestic, (think China here) in his right frame of mind invest in the US if the federal govt. could basically rewrite the BK laws at any time and screw the secured creditors?
GM was not going through BK at the time F E Olds was retired. It may be that the BK laws allow the dumping of inventory where ever it is.
I would be surprised if the franchise agreement included any verbiage covering the present emergency.
I look forward to all such dealers to form an alliance & instigate a class action suit against Obama/Chrysler.
With dealers suing, Mopar will die off and then all their dealers will close, then will they be happy?
Imagine the fury if the government let them go bankrupt. Damned if you do, damned if you don't.
If the competition doesn’t have the legacy costs of the domestics we either have to remove the legacy costs to allow the domestics to compete or place a tariff on imports to balance the legacy costs. Neither of those two things seem to be happening so let them fail and get on with life. We have used our children’s earning power like a credit card to save the investment bankers already and they simply thumbed their noses at us. They took several million dollars in bonuses for causing the mess in the first place paid with our tax money. Now we are being asked to save the least trusted people in the US, car salesmen and the most bloated workers in the US the UAW with our grandchildren’s future earning power?
Has anyone stopped to ask why Honda can make a car people will buy made in the Us by US workers without union workers and Chrysler can’t with union workers? Do we see what the problem might be there?
If we believe in capitalism we should allow the dealers that can’t make it to close. If we believe in socialism then let the government do as they wish just keep out of their way. That is what the USSR did before it collapsed; they supported state manufacturing and dealerships. But they aren’t listening to us anyway so we can just sit back and wait till the smoke clears.
We have a new bike shop in Alpine. Big sign out front we repair WalMart bikes. So at least the repair business is getting healthier for cars and bikes.
If we believe in capitalism we should allow the dealers that can’t make it to close.
I agree with that. I don't like the way that GM and C are using some unknown formula to strip dealers of their businesses. If they go out of business because they have alienated their customers, I say good riddance. There are many cases of healthy dealerships being stripped of their franchises, leaving them with 100s of vehicles they can no longer sell as new, because they are not legitimate dealers. Will the tax payers get stuck with those when they get picked up by the bank? Every where you turn you see bigger messes made by the government being involved in business.
So I am on the let capitalism work side. Keep government out of business except to make laws that protect US from predators.
I agree with that. I don't like the way that GM and C are using some unknown formula to strip dealers of their businesses. If they go out of business because they have alienated their customers, I say good riddance. There are many cases of healthy dealerships being stripped of their franchises, leaving them with 100s of vehicles they can no longer sell as new, because they are not legitimate dealers. Will the tax payers get stuck with those when they get picked up by the bank? Every where you turn you see bigger messes made by the government being involved in business.
So I am on the let capitalism work side. Keep government out of business except to make laws that protect US from predators.
I said when they announced the dealership closing that this would be ugly. I think some GM and Chrysler execs may have had an axe to grind with some of those dealerships. I agree, some of these closings don't make sense.
Generally, I agree government should stay out of business but this is an extreme situation and GM and chrysler came begging for money. A failure by GM and Chrysler back in December would have taken Ford as well since most of the supliers would have also went belly up.
This is an unprecedented situation. Not sure if it is right or wrong. Don't know how it will affect things in the future. I have a hard time believing any of the talking heads on TV right now. They are all guessing.
Chrysler dealer vows to fight to the finish (Reuters)
My guess is Obama had his ACORN goons hit all the businesses for donations and there is a list. This guy was on the list and he gets nicked. Being a Republican in Chicago cannot be a good existence. I would rather be stuck in grass hut in darkest Africa as Chicago.
The other one I see is a John Massarelli, an IL options trader who gave $1,000 to a PAC. There's a retired Massarelli, but she was a Clinton donor over in PA. Don't see a Rocco anywhere.
FundRace 2008
Opensecrets.org
Rocco graduated from Libertyville High School. I think they are a family of GOP being targeted. Why else hit a dealership that carries all the lines and sold 60 cars last month. The largest Ford Dealer in San Diego did not sell that many cars last month. My guess is Obama thugs making up the lists.
http://www.classmates.com/directory/public/memberprofile/list.htm?regId=3768286
I thought ACORN had something to do with voter registration. What is the car connection?
However, it's not clear whether or not those procedures were followed in Nevada prior to a highly publicized raid by state officials on Oct. 7. According to an affidavit by Colin Hayes, a criminal investigator for the secretary of state's office, a probe began July 2 after the county registrar reported receiving a number of suspicious registration forms from ACORN. Hayes did not state whether or not those suspicious forms had been flagged by ACORN before being turned in. Later, during a July 18 meeting, ACORN's lawyer told local and state officials that the group had identified a number of suspicious registrations and "would be willing to provide such information" for further investigation. On Aug. 7, at the request of the county registrar, ACORN supplied copies of documents related to 33 ACORN workers who had been fired for "suspicious" voter registration activities.
Investigator Hayes followed up, confirmed that many registrations were faked, and found a former ACORN worker who confessed to faking most of her forms. After obtaining a warrant based on the affidavit, state officials seized records and computers. Secretary of State Ross Miller was quoted as saying the faked forms included names from the starting lineup of the Dallas Cowboys.
On banking:
It stretches the facts, however, to say that ACORN "forced" banks to make risky loans, though it has certainly applied pressure on banks to make loans to minority and low-income borrowers. ACORN also has worked directly with banks in a joint effort to increase such lending. In Chicago these efforts date back at least to 1992
I do find some of the dealer's selection suspicious but I think it has to do with dealers who upset Chrysler's management over the years. But i haven't spent most of the day researching this on the internet.
Doug Ross looked at the possibility that the Obama Administration may have targeted GOP donors in deciding which Chrysler dealerships would have to close their doors.
Doug noted that every single dealer he checked out except one were either GOP donors or donated to Obama's rivals in the democratic primary.
UPDATE: Chrysler Dealership owner Jim Anderer was on with Neil Cavuto. Jim's dealership is being shut down. Anderer noted that the closings didn't make any sense and that many of them were profitable. Anderer says the country was shutting down his business. He couldn't understand how they were making their decision on which dealerships they were closing:
Here is the list Doug put together:
• Vernon G. Buchanan: $147,450 to GOP candidates and organizations
• Wallace D. Alley and Family: $4,500 to GOP.
• Robert Archer: $4,600 to GOP and conservative causes.
• Homer S. Higginbotham and Family: $2950 to GOP.
• James Auffenberg and Family: $28,000 to GOP; $6,000 to one Democrat candidate.
• Michael Maroone and Family: $60,000 to GOP; $8,500 to two Democrat candidates.
• Jerome Fader: $6,500 to Democrats; $2,500 to Independent Joe Lieberman.
• Stephen Fay and Family: $13,500 to GOP.
• William Numrich: $20,000 to GOP.
• Robert Carver: $10,000 to Democrats including $1,950 to Hillary Clinton, nothing to Barack Obama.
• Robert and Linda Rohrman: $24,000 to GOP.
• Frank Boucher, Jr. and Family: $18,000 to GOP, $1,000 to one Democrat candidate.
• Scott Bossier: $4,300 to GOP.
• Todd Reardon: $17,000 to GOP; $2,000 to one Democrat candidate.
• Russ Darrow and Family: $78,000 to GOP.
• Bradford Deery and Family: $24,700 to GOP.
• Charles Gabus and Family: $30,000 to GOP.
• Brian Smith: $15,500 to GOP.
• Michael Schlossman: $14,000 to GOP; $14,000 to three Democrats ($12,500 to Sen. Russ Feingold).
• Don Hill: $11,000 to GOP; $12,800 to conservative incumbent Rep. Heath Shuler.
• Don Miller: $2,000 to GOP; $1,000 to Feingold.
• Eddie Cordes: $2,150 to GOP.
• Robert Edwards: $1,100 to GOP.
• James Crowley: $19,100 to GOP.
• Stanley Graff: $2,200 to John Edwards (2008 Presidential Run); $500 to GOP.
• John Stewart: $10,500 to GOP.
• John Fitzgerald and Family: $4,600 to John McCain (2008); $2,000 to Hillary Clinton (2008); nothing to Barack Obama.
• William Churchill and Family: $3,500 to GOP.
• Thomas Ganley: $9.450 to GOP.
• Gary Miller: $20,000 to GOP.
• Kevin and Gene Beltz: $18,500 to GOP.
• Arthur Grayson: $14,000 to GOP.
• Eric Grubbs and Family: $26,000 to GOP.
• Michael Leep and Family: $19,500 to GOP; $4,800 to three Democrats including Sen. Evan Bayh.
• Harry Green, Jr.: $10,000 to GOP.
• Ronald Hoover: $5,250 to GOP.
• Ray Huffines and Family: $18,500 to GOP.
• John O. Stevenson: $1,500 to GOP.• James Marsh: $8,200 to GOP.
• Max Pearson and Family: $112,000 to GOP.
Hope and Change is only for those that fall in line with the administration.
I'm just going to cling to my religion and guns
if you really want to make your case you need to show that those dealers who survived gave less to Republicans and/or more to the Democrats.
I don't have any numbers but I have a hard time believing this. I'd guess that most if not all dealers - being small business owners - would be more inclined to support Republicans.
Everything is possible in politics, of course, but what you propose smells too much like a conspiracy theory for my taste.
Smart businesses who want to wield political influence contribute to both parties.