Chrysler Dealers Form Group, Hire Attorneys

By Brendan Moore

05.12.2009

chrysler-logo-smallChrysler dealers who believe that they may be on the bubble in terms of Chrysler’s plan to reduce their dealership count have formed a group named the Committee of Affected Dealers and hired Squire, Sanders & Porter, a Cincinnati, Ohio law firm. The firm will represent the dealer group in the U.S bankruptcy court in New York State.

A spokesman for the legal firm stated that they have requested a face-to-face meeting with President Obama, but have not yet had a response from the White House.

The Committee of Affected Dealers intends to do everything they can to convince either Chrysler or the federal bankruptcy court in New York to not eliminate their dealerships. The view point of the Committee of Affected Dealers, state dealer organizations and the NADA (National Automobile Dealers Association) is that no dealerships should close and that Chrysler is making a mistake if they think closing dealerships will make their manufacturing business more profitable.

Chrysler, under pressure to announce the list of dealers that they intend to eliminate, refuses to comment except to say that, at this time, there is still no list of dealers that they intend to keep. However, Chrysler has already stated publicly that will release a preliminary list of dealers they intend to keep on Thursday, which is 48 hours from now. So, unless you believe that Chrysler is going to knock out that list in the next two days, it is readily apparent that there is a list, and Chrysler is just playing it close to the vest in the run-up to Thursday.

The Committee of Affected Dealers and their legal representation are asking each dealer to put up $4000 USD to finance the fight against Chrysler. Sentiment among the dealers regarding their chances of prevailing against Chrysler and/or the bankruptcy seems to be mostly positive at this point, but it is difficult to say just what the dealers are thinking at this early juncture.

The dealers who believe they will be on Chrysler’s list to stick around are not saying publicly what everyone knows; that is, that they stand to benefit considerably when the Chrysler dealer population is reduced. Once they know their position is safe, the surviving dealers cannot help but privately pull for Chrysler’s dealer consolidation plan.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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3 Comments

  1. If I’m a successful Chrysler dealer, things are definitely looking up. More profit, better employees, more marketing dollars from Chrysler, and so on.

  2. Do these guys really expect to prevail against the federal bankruptcy action? Like that’s going to happen.

    These dealers have a very advanced case of self-entitlement.

  3. What does the rule of law mean anymore? These dealers are protected under state law, which should not be IGNORED by the federal government.

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