>>>>>If I owned a dealership, and I had to sign a contract that stipulated that IF the company wanted to terminate my agreement with them, and take my inventory of THEIR cars which I PAID for (at wholesale), then GIVE them to ANOTHER dealership FREE, then I need a bullet in my BRAIN for signing it !!
>>>>>
>>>>
>>>>There's no indication that this is what's happening. What is happening is that it's going to much harder for these dealers to sell their remaining inventory.
>>>>
>>>>Tamar
>>>
>>>http://www.bendbulletin.com/apps/pbcs.dll/article?AID=/20090520/BIZ0102/905200339/1041&nav_category=
>>>
>>>From the article...
>>>
>>>"Chrysler spokeswoman Kathy Graham said that because of the extraordinary circumstances, the manufacturer has arranged for the roughly 2,400 dealers it intends to keep to buy the unsold cars from dealers set to lose their franchise June 9. She said Chrysler would normally offer to buy them back but can’t because it doesn’t have the money."
>>>
>>>So, they are being forced out of business, and Chrysler intends for the remaining dealerships to buy up the inventory from the defunk ones (at a major loss to the defunk owners). I doubt that the defunk owners will make any of their investment back on the lost inventory. I hope they were incorporated.
>>
>>But the key is that they're _buying_ the unsold cars. In the message I responded to, you said giving them for free. Actually, I think arranging for other dealers to buy them is a good thing. Presumably, a defunct (Mike's right) dealer isn't forced to sell to another dealer, but it's likely to be the best way out.
>>
>>Tamar
>
>According to
>
>http://wallstreetpit.com/4434-george-c-joseph-letter-from-a-dodge-dealer
>
>"On Thursday, May 14, 2009 I was notified that my Dodge franchise, that we purchased, will be taken away from my family on June 9, 2009 without compensation and given to another dealer at no cost to them. My new vehicle inventory consists of 125 vehicles with a financed balance of 3 million dollars. This inventory becomes impossible to sell with no factory incentives beyond June 9, 2009. Without the Dodge franchise we can no longer sell a new Dodge as “new,” nor will we be able to do any warranty service work. Additionally, my Dodge parts inventory, (approximately $300,000.) is virtually worthless without the ability to perform warranty service. There is no offer from Chrysler to buy back the vehicles or parts inventory."
>
>This was the key part of the letter that led me to say "FREE".
>
>Hopefully, he will be allowed to sell his inventory for a loss and try to stay in business selling his Isuzu vehicles. According to his letter, it appears he is headed to bankruptcy.

That really does stink. Chrysler should be able to do better by their underperforming dealers than this. For instance, why not a slightly longer phase-out period to give them a chance to sell some of those unsold vehicles? Why not let them continue performing Chrysler service, with an even longer phase-out period? I don't know the inner details, obviously, so maybe there are reasons. There is no question the American automakers have more dealers than they need, but why does it have to be this harsh?

Along similar lines, here is a recent column by Dan Barry, who IMO is the best American newspaper working today (and probably has the best gig with "This Land"). Great stuff, as always. He has an incredible eye for the telling detail.

http://www.nytimes.com/2009/05/04/us/04land.html