- Connect
- Login
- Print Subscription
|
Welcome,
| |
| |
- Most Commented
- Most Commented
- Most Emailed
- Most Emailed
- Popular
- Popular
« News Home
2 Valley dealers must close 
STAFF/WIRE REPORT
TWO AREA DEALERS ARE among the 789 dealerships nationwide that Chrysler intends to close next month.
Frederick Chrysler Jeep Dodge in Boardman and Preston Chrysler Plymouth Jeep in Warren are on an elimination list that was filed Thursday with bankruptcy court.
Chrysler plans for the dealerships to stop selling vehicles June 9. Its plan must be approved by the court, however, and a hearing is set for June. 3.
Officials at the Frederick and Preston dealerships could not be reached for comment.
Frederick has had a roller-coaster ride the past few years. It announced in 2005 that it was selling its location on the west side of Market Street to make way for a new Saturn dealership owned by Jim Pace. Frederick planned to build a new $5 million Dodge dealership in front of Southwoods office complex.
The move was blocked by court action because of deed restrictions on the property, however. In 2006, Frederick bought the Chrysler and Jeep lines from Greenwood Market Motors and opened at Greenwood’s location just down the street at 7871 Market St.
Preston also has a BMW franchise at the Warren location. In addition, it operates Toyota and Hyundai dealerships in Boardman and Toyota and General Motors dealerships in New Castle, Pa.
Chrysler wants to eliminate roughly a quarter of its 3,200 U.S. dealerships, saying in a bankruptcy court filing that the network is antiquated and has too many stores competing with each other.
Many of the dealers’ sales are too low, the automaker said, with just over 50 percent of dealers accounting for about 90 percent of the company’s U.S. sales.
Dealers were told Thursday morning through United Parcel Service letters if they would remain or be eliminated. The cuts are likely to devastate cities and towns across the country as thousands of jobs are lost and taxes are not paid.
Even for dealers that were not included on the list, Thursday’s news was not easy to handle.
“It’s heart-wrenching,” said Chuck Eddy, whose Austinown Chrysler dealership was not cut. “I’ve grown up in this business. My dad’s been with Chrysler since ’57. I’ve grown up with a lot of these families. That’s all I’ve ever known — Chrysler.”
Chrysler Vice Chairman Jim Press called the cuts difficult but necessary. He said the list of dealers is final and there will be no appeal process.
“This is a difficult day for us and not a day anybody can be prepared for,” Press told reporters during a conference call.
A hearing is scheduled for June 3 in U.S. Bankruptcy Court in New York for the judge to determine whether to approve Chrysler’s motion. Judges often rely on companies in bankruptcy to help determine what is in their best business interest, such as the closure of dealerships or cancellation of contracts.
Chrysler executives said the company is trying to preserve its best-performing dealers and eliminate ones with the weakest sales. More than half of the dealerships being eliminated sell less than 100 vehicles per year, they said, and account for 14 percent of U.S. sales.
The company is also trying to reduce the number of single-brand dealerships to bring all three Chrysler brands — Jeep, Chrysler and Dodge — under a single roof, they said. It also wanted to limit competing dealerships.
“We recognize in the short term we will see some loss of sales,” Press said. “But based on the long term ... the dealer [network] is key and it’s going to be very strong, powerful, with a much better financial viability.”
The 3.5 million customers who purchased vehicles from the affected dealers will be notified about the closures and their warranties will still be honored, said Vice President Steven Landry.
Chrysler dealerships aren’t the only ones scheduled to get bad news this week. General Motors Corp. says it is notifying 1,100 dealers that it will not renew their franchise agreements when they expire at the end of September 2010.
- Requires free registration.
Comments
What a shame. More people out of work.
Bobby - Willie Mays is with ya....
Geez, can't this be over already?
You people voted for that man that thinks he's the King and look at what he let happen.
Come on it's not the President causing this, the dealers them selves caused this with there cut throat techniques. Selling cars to people who can't afford it and screwing the mechanics and bodymen any way they can. The dealers only looked out for themselves.
I worked some of the dealers in Youngstown and most of the owners are true snakes, and let's not forget the F&I guys.
I feel bad for all of the employees and their families that work for the dealers, I wish them the best. I know they will get screwed over and cheated by the dealers over all of this.
Ford isn’t having the problems and Donnell Ford is one was one of the best dealers I worked for.
Actually, it's all just supply and demand. Simple economics. Populations shift and businesses shift with them or close. They are no different than how Pep Boys, Lowes and others trim areas of little return in order to shore up their core.
Doesn't anyone read Adam Smith anymore... ?
Hundred - dead on, man. This should have happened years ago. But the franchise laws for certain states are soo restrictive that the companies had little power. Its sad to see this occur, no doubt. Nobody wants people to lose their jobs. But its time to reshape America's economy before its too late.
This now leaves room for a couple of dealeships to sell Chinese built cars.
At one time auto makers would not allow dealerships to be within 25 miles of each other. That has certainly gone out the window with places like Spitzer and Greenwood being just a few miles apart.
How many lawsuits will Chrysler and GM see because they are eliminating franchises?
We just have to hope that the domestic automakers can indeed survive.
(This comment was removed by the site staff.)
My wife and I live in Alaska. I called all over the country looking for a dealer who knew something about the Dodge Challenger. Bob Frederick at Frederick Chrysler-Dodge-Jeep was the most knowledgable and sincere individual I spoke to. I aranged to order a 2010 model vehicle. from his firm. Now i find out he's on the Chrysler list of dealerhips to be closed. This is a terrible shame and a gross error! This mistake need to be corrected. My wife and I not only would have been spending money with Frederick Dodge, but we would have stayed a night in a local motel, as well as ate a few meals in local restaurants. My wife also likes to shop so there's no telling what stores will suffer here. As you can see this Chrysler axing affects others. I would hope the Mayor and city leaders would stand up for these businesses being cut. It's the right thing for them to do! Thanks for your time. Michael Hankins - Anchorage, AK