Chrysler to sell its factory-owned dealership in Los Angeles

Article by Christian Andrei, on September 23, 2011

Chrysler Group has entered a deal to sell Motor Village, a factory-owned dealership located in Los Angeles. If this deal is completed, it may hold off the disciplinary action that the California Department of Motor Vehicles is set to impose. Last week, administrative charges were filed, claiming that Chrysler improperly operated a factory-owned store at Motor Village.

The California New Motor Vehicle Board, which functions like a court to resolve auto franchise issues, has set a meeting on Sept. 27. New Century Automotive Group, a group located in North Hollywood, Calif. and the owner of three Volkswagen dealerships and single BMW, Mini and Infiniti stores, is a prospective buyer.

Dennis Lin is the owner of New Century. According to Ralph Kisiel, Chrysler spokesman, the company will “work expeditiously” so that the deal could be closed in October, says Autonews. The store had its grand opening last November right before the Los Angeles Auto Show.

The event was attended by Chrysler CEO Sergio Marchionne. Chrysler had said that it sought to showcase its models in the store. Chrysler also wanted to use this store to test its new retail strategies.

The dealership became open for business in early 2011. However, several dealers filed objections because this store supposedly was in violation of state franchise laws, which disallow a factory-owned store that’s located within 10 miles of privately owned dealerships.

A complaint was filed by the California New Car Dealers Association with the DMV last March. A hearing took place in May. And on Sept. 14, charges were filed by the department with the board. With regards to the complaints, Kisiel said that the company continues to work with the DMV in order to find a resolution for all the parties.

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