Chrysler can't catch a break these days and it needs one if it's going to stay alive past the summer. Automotive News is reporting that some Chrysler dealers are now getting together to hire a law firm to protect their franchises. Most of them are afraid that the "new" Chrysler that emerges from bankruptcy will pick the dealers it wants and leave the rest hanging.
In a related story, Alex Taylor III from Fortune magazine highlighted additional problems facing Chrysler. One is product development or lack thereof. One engineer told Taylor that you can't just stop and a program and start again where you left off as crucial knowledge gets lost along the way. He figures this will cause current programs to take one-and-a-half times longer than they would have otherwise.
Another basic problem? Paint. It can't just sit in the pipes when the plant is shutdown. "Paint should be removed and stored after 21 days at a cost of $2 million," a Chrysler engineer told Taylor. "After 69 days, paint would need to be replaced at a cost of $15 million."
As we feared, nothing about this bankruptcy is going to be quick and efficient.
Fortune: Chrysler's Sorry State Revealed
Automotive News: Chrysler Dealers Who Fear Loss of Franchise Prepare to Fight
stovt001 says:
04:28 PM, 05/12/09
You mean poor performing and low satisfaction dealers could be cut? Well boohoo. The downside to franchise laws is that they make it difficult to cut an underperforming franchise.
Alex Taylor III wants nothing other than the complete and total destruction of the domestic auto industry. I'll take anything he has as the cynical, desperate for bad news fear mongering that it is.
flicmod says:
05:46 AM, 05/13/09
I see no difference between what the dealers are fighting for and what the unions have been fighting for. Both are demanding to keep their jobs under their conditions and their conditions only. Both are killing the company that they wish to preserve.
Chapter 11 filings should protect Chrysler (for the most part) from aggravated dealers. When it boils down, those that are under-performing need to be cut off.
iskch says:
08:50 AM, 05/13/09
Looks more like a lost game to me. Fiat will walk in and they will sale what ever they can to get some cash flow. Not even the GOV. money will help. I see JEEP and VIPER on the "for sale" block.
estreka says:
04:37 PM, 05/13/09
Luckily for almost everyone, bankruptcy protection should lock the dealers and their lawyers out of the proceedings.
If nothing else, their voices will be distant echos.