Some Rejected Chrysler Dealers Left Holding the Bag

After being rejected by Chrysler in June, Rogers Dodge in Alvin, Texas closed its doors. Like many other rejected Chrysler Group dealers, however, owner Nicholas Parks says that he is still attempting to disentangle himself from the automaker.

Parks says he still has $450,000 worth of inventory that he cannot sell. Three Chrysler autos sit on his otherwise abandoned car lot and another 11 vehicles have been ordered and paid for, but never delivered to his dealership.

Parks’ dilemma is far from unique. Many rejected Chrysler dealers have discovered that resolving their inventory problems can be a complicated and frustrating process.

Some rejected dealers have claimed that Chrysler is not honoring the commitments made by the company’s Deputy CEO, Jim Press, in his June 12 letter to Congress. In that letter, Press promised to help rejected dealers redistribute their inventories.

On August 27, Chrysler notified the rejected dealers that their accounts would be settled on September 1. The solution offered by Chrysler was to credit the dealers for vehicles they had not received and pay for all incentives and warranty work the dealers had performed before losing their franchises. However, many rejected dealers expressed skepticism based on Chrysler’s previous failures to meet its deadlines and honor its agreements in such areas.

Last week Chrysler spokesperson, Kathy Graham, stated that the automaker had redistributed all but 73 of the 44,000 vehicles that were left on rejected dealers lots when their franchises were terminated early this summer.

What she did not address was the matter of settling the dealer’s accounts and some rejected dealers claim that they have yet to be refunded the money they paid for vehicles that they never received.

Graham claims that the automaker is “aware of the issue” and says, “We are working diligently for a solution.”

She also says that reimbursement of rejected dealers is a separate issue from redistribution of vehicles left on their lots.

Doug Wilson, former owner of Wilson Dodge, in Jackson, Mississippi disagrees. “They promised under sworn testimony that they would affect the transfer of all these vehicles,” he says. He claims he still has eight Dodge vehicles on his floorplan and that some were paid for, but never received. Others, he says, were sent to other dealerships. He says, “They picked the vehicles up, but they haven’t paid them off.”

Another rejected dealer, Brian Jones, says that his former dealership, Jones Chrysler-Dodge-Jeep, in Wickenburg, Arizona has received invoices for two trucks that were ordered but never delivered. After Chrysler rejected his dealership, Jones says that he sold the two trucks to another dealership in Tucson, but they remain on his floorplan and Chrysler is holding him accountable for $50,000.

Jones claims, “Chrysler doesn’t know where they’re at,” and says, “The dealer in Tucson hasn’t paid me for them because they haven’t received them.”

Nicholas Parks doesn’t think Chrysler has an accurate accounting of how many of its vehicles remain on rejected dealer’s lots. He says that, until about a month ago, transport drivers were arriving at his lot daily in search of vehicles that had already been moved to other dealerships.

Referring to the Kathy Graham’s statement, Parks said, “If they know there are 73 vehicles nationwide, why would they have to ask me which ones were on my lot?”

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