Chrysler Dealer Attrition: Cunning Plan or Cratering Sales?
“Chrysler LLC reduced its number of U.S. dealerships by 196 in the past year and increased the percentage of outlets selling all of its brands, as the automaker tries to create a stronger sales network.” That’s one way to look at it. The alternative theory– that the “reduced” dealers simply went belly-up– doesn’t get a look in from Bloomberg. Reading between the lines… “The pace of consolidation may be quickening as falling real estate values and declining auto sales convince more of the Auburn Hills, Michigan-based company’s dealers to sell,” ChryCo executive vice president of sales for North America Landry told Bloomies. It would be interesting to know to whom these dealers sold. Meanwhile, the ailing American automaker claims 3,488 outlets at the end of May, a decline of 5.3 percent from a year earlier. So what of Project Genesis, Chrysler’s attempt to consolidate its dealers into tri-branded stores? The hard numbers are notable by their absence. But we do get anecdotal evidence of the plan’s progress. “John Gunning, owner of Manassas Dodge in Manassas, Virginia, said many Chrysler dealers in his area can’t afford the risk of borrowing money to buy another franchise and build a new dealership as auto sales decline.” Hey! Maybe Chrysler could buy-out the dealers? Uh, maybe not.