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

Article by Christian A., 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

Carmakers usually leave us thirsty for information on whether they would introduce a new, refreshed or face-lifted vehicle and on when they intend to launch it. There are reasons for...
by - February 20, 2017
Cadillac’s CT6 full-size prestige-luxury sedan is still somewhat new. It has been offered to the global auto market for two model years – 2016 and 2017. But for those who...
by - February 19, 2017
In many industries, it is the rivalries that make things exciting. In basketball for example, there is the well-known rivalry between the Los Angeles Lakers against the Boston Celtics. For...
by - February 19, 2017
Now on sale in several major markets around the world including Europe, the BMW 5 Series (G30) heralds the arrival of the new seventh generation and represents a whole new...
by - February 19, 2017
Just recently, it was speculated that a new Porsche Cayman GT4 RS is coming. There is no official confirmation yet from the German sports car maker, but the arrival of...
by - February 18, 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