Daily Auto News Facing Closure, Chrysler Dealers Considering All Offers
Daily Auto News
789 Chrysler dealerships will close their doors for good in 20 days. All of them have cars left to sell. As the June 9 deadline to go out of business approaches, they’re starting to consider all offers.
USA Today reports, “The dealers have just a few weeks to sell the Chryslers, Dodges and Jeeps or risk losing thousands of dollars on them, giving people who want a car on the cheap a serious chance for a deal.” The 789 dealerships slated for closure that day currently hold about 44,000 cars. Chrysler has “told us that the inventory is our problem,” Pennsylvania dealer Keith Hollern told USA Today.
Complicating matters, dealers don’t own the vehicles on their lots. They borrow money to buy the cars from Chrysler, making payments as the cars sit unsold and finally paying off the loan with the proceeds from the sale. “But Chrysler sales were down 46% the first four months of the year, so many dealers have been paying interest for months. Even if the vehicles are sold at cost, dealers still lose thousands in interest payments,” USA Today notes.
Kicking Tires reports, “Some of the closing dealers say they haven’t received any help from Chrysler to offload unsold cars, trucks and SUVs.”
Chrysler has made arrangements for closing dealers to sell some of the cars to dealers who will remain open. Automotive News reports, “Chrysler will not buy back the inventory and parts of the rejected dealerships. Instead the automaker will recommend dealerships that might be willing to buy the inventory.” Those dealerships, however, already have their own inventories to sell – and in a depressed market, they may not be able to take on cars from the doomed dealers.
According to USA Today, Chrysler “Has signed a deal with GMAC Financial Services, Chrysler’s new finance company, to float loans to dealers that Chrysler plans to keep can take on the 789 dealers’ unsold inventory.”
As the deadline approaches, many dealers will be looking to get rid of the inventory they have left, accepting whatever money they can get in return. Dale Horn, Owner of a Chrysler dealership in Malvern, Ark., told USA Today, “It’s not a matter of ‘if.’ We will sell them all.”
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