Four Detroit dealers are still a long way from being able to sell cars for Chrysler

Article by Christian Andrei, on November 16, 2010

Several legal questions are being faced by four Detroit area car dealership owners who had won federal arbitration hearings over the summer, making it unlikely that they would sell cars for Chrysler Group LLC anytime soon. The franchises of these dealers were revoked during Chrysler’s bankruptcy. These legal questions are casting doubt on whether their businesses would survive.

The issue is centered on the nature of their franchise agreements and if the deals are governed by state or federal law. According to state law, any existing Chrysler dealer within nine miles of a new franchise can file an objection and terminate the franchise before it opens.

Meanwhile, the previously terminated dealers would be considered new. But if federal law pre-empts state law, there could be a reinstatement of the franchises. Colleen McDonald, who owns Livonia Chrysler Jeep, said that her business is in a “holding pattern,” as not one dealer who got a reinstatement had opened yet because what’s being required is “impossible.”

Other dealerships in the same situation include Bruce Campbell Dodge, Village Chrysler Jeep and Fox Hills Chrysler Jeep. These four suburban Detroit businesses are included in the 32 terminated dealers that have won in arbitration hearings by Congress.

On the other hand, Chrysler prevailed in 76 cases. In 2009, Chrysler shut down 789 dealers, 14 of these were located in metro Detroit, cutting its 3,250-dealer network as part of the bankruptcy restructuring. [via autonews - sub. required]

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

Whether or not you’re a tech addict, you realize that the digital revolution is now moving at high speed. Before you know it, there’s already a new one on the...
by - January 17, 2017
We really couldn’t deny that quite a number of Audi customers and would-be-buyers are intently waiting for higher performance RS versions of the Audi A4 and A5. Of course, these...
by - January 17, 2017
The Chevrolet Cruze is coming to Australia. But it won’t be known as the Chevrolet Cruze. Instead, it will bear the Holden badge and get the Astra moniker. The 2017...
by - January 17, 2017
As expected, four years after the current generation of the BMW 4 Series was introduced in 2013 with the BMW 4 Series Coupe, the German premium carmaker is implementing a...
by - January 17, 2017
As BMW continues to pursue its plans for the coming years, President-elect Donald Trump gave out a warning to car manufacturers to prevent them from exporting their cars to the...
by - January 17, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries