chrysler going under,hope my job is safe
- Thread starter jjsticks
- Start date
i was thinking the larger multi dealers would survive. a while back they were doing away smaller mom and pop dealers.and locating them with multi dealership.what will they gain with a single location when the other multi dealers would have more traffic.I really have my finger crossed 'cause I no spring chicken, JJ boc boc!!
heres a link to the stores that will be closing.I feel sorry for these great people :sad: http://msnbcmedia.msn.com/i/msnbc/sections/business/Chrysler_dealers_list.pdf
der Spieler
Member
I was surprised that the small dealership in my town (Pop. 2800) was saved. It's co-branded with Ford. They do sell some cars every week but I would have thought they would have been sacrificed for the big city dealerships.
Bill Pedersen
Member
Hi Guys,
Thank you for your thoughts and concerns. We also will still be a dealership with the new Chrysler! Unfortunately, I have many friends that didnt make it and may very well lose their life savings. The 789 dealerships that will not be renewed will be terminated mid-June. This was such an unnecessary thing to have happen. The dealerships are a profit center for the manufacturer not an expense. Its a scary thought to see that the auto task force has this much control and not have a clue.
Bill
Thank you for your thoughts and concerns. We also will still be a dealership with the new Chrysler! Unfortunately, I have many friends that didnt make it and may very well lose their life savings. The 789 dealerships that will not be renewed will be terminated mid-June. This was such an unnecessary thing to have happen. The dealerships are a profit center for the manufacturer not an expense. Its a scary thought to see that the auto task force has this much control and not have a clue.
Bill
der Spieler
Member
rooster57 said:
To the contrary. If the dealership doesn't sell the cars they pay Chrysler interest.
Bill Pedersen
Member
Yes it is Tim. Cutting the dealer count will result in very, very minimal savings to Chrysler. It will be better for the remaining dealers because there will be less competition from dealerships selling and servicing the same brands. The auto task force looked at the import manufacturers car sales vs. the number of dealerships and decided that Chrysler and GM should decrease their dealership count.
To answer your question, no the dealership doesnt make money from Chrysler if you dont sell vehicles. For every new vehicle that is on your lot, you will have to pay $175 to $400 a month for the interest and insurance. You start paying interest before the vehicle even gets to your dealership.
The rent is another big expense. Many of the dealerships buildings in the large metro areas will cost $20,000-$60,000 a month for rent.
A dealerships service and parts departments are measured by an Absorption percentage. This percentage basically amounts to the percent of the total dealerships fixed expenses the service and parts department could pay. The national average for Chrysler dealers is in the low to mid 60% range. A good Service and Parts business helps pay the bills, but you still have to sell vehicles to make a profit.
Bill
To answer your question, no the dealership doesnt make money from Chrysler if you dont sell vehicles. For every new vehicle that is on your lot, you will have to pay $175 to $400 a month for the interest and insurance. You start paying interest before the vehicle even gets to your dealership.
The rent is another big expense. Many of the dealerships buildings in the large metro areas will cost $20,000-$60,000 a month for rent.
A dealerships service and parts departments are measured by an Absorption percentage. This percentage basically amounts to the percent of the total dealerships fixed expenses the service and parts department could pay. The national average for Chrysler dealers is in the low to mid 60% range. A good Service and Parts business helps pay the bills, but you still have to sell vehicles to make a profit.
Bill
Hot Rod Todd
Member
So on 30 June, the now former dealers send back their unsold Chryslers and makes a bigger stockpile, and Chrysler loses the $200-400 per month interest charge?
Sounds to me like your Government needs some help!
Sounds to me like your Government needs some help!
Bill Pedersen
Member
Thanks George. Yes, I do know David, but it has been a while since I have seen him. He is quite the fabricator and machinist. You need to talk him into building a T-bucket. Please tell him I said Hi.
Bill
Bill
Pickup Man
New Member
We lost 2 dealerships here just reported yesterday :sad:
Bill Pedersen
Member
Because of the Bankruptcy Court, Chrysler cant buy back any of the rejected dealers new vehicles, parts inventory or the Chrysler special tools.
Chrysler told us today that they would be able to assist the rejected dealers in redistributing these things to the new servicing dealers. The current model vehicles shouldnt be too big of a deal, but the parts inventories will be a real nightmare. The special tools will be of little value since the new dealers should already have them.
The current plan for this to take effect is June 9th. This is a terrible situation I bet that many of the rejected dealers will end up having to file bankruptcy.
Bill
Chrysler told us today that they would be able to assist the rejected dealers in redistributing these things to the new servicing dealers. The current model vehicles shouldnt be too big of a deal, but the parts inventories will be a real nightmare. The special tools will be of little value since the new dealers should already have them.
The current plan for this to take effect is June 9th. This is a terrible situation I bet that many of the rejected dealers will end up having to file bankruptcy.
Bill
der Spieler
Member
I'm trying to figure out how they figured out who to close. The Dodge dealer north of here in a town of 30,000 is shutting down but the dealership here in my town of 2800 is staying open. Both dealerships are co-branded, the one to the north with Toyota and ours with Ford. Maybe Toyota was doing the bulk of the business up there and Chrysler figured the loss wouldn't do any more damage to their bottom line. One would think that Chrysler would continue the service departments in the closed, co-branded dealerships. The trained personnel and special tools are there. Why waste it. It can only hurt their future sales when existing Chrysler/Dodge owners have to travel several miles for warranty issues.
