A member of our Best and Brightest spotted this letter to the editor on the American Thinker website. While plenty of industry watchers could have seen ChryCo’s meltdown coming—DID see it coming—it’s still a failure with a human face. And here it is.
My name is George C. Joseph. I am the sole owner of Sunshine Dodge-Isuzu, a family owned and operated business in Melbourne, Florida. My family bought and paid for this automobile franchise 35 years ago in 1974. I am the second generation to manage this business.
We currently employ 50+ people and before the economic slowdown we employed over 70 local people. We are active in the community and the local chamber of commerce. We deal with several dozen local vendors on a day to day basis and many more during a month. All depend on our business for part of their livelihood. We are financially strong with great respect in the market place and community. We have strong local presence and stability.
I work every day the store is open, nine to ten hours a day. I know most of our customers and all our employees. Sunshine Dodge is my life.
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.
Our facility was recently totally renovated at Chrysler’s insistence, incurring a multi-million dollar debt in the form of a mortgage at Sun Trust Bank.
HOW IN THE UNITED STATES OF AMERICA CAN THIS HAPPEN?
THIS IS A PRIVATE BUSINESS NOT A GOVERNMENT ENTITY
This is beyond imagination! My business is being stolen from me through NO FAULT OF OUR OWN. We did NOTHING wrong.
This atrocity will most likely force my family into bankruptcy. This will also cause our 50+ employees to be unemployed. How will they provide for their families? This is a total economic disaster.
HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?
I beseech your help, and look forward to your reply. Thank you.
Sincerely,
George C. Joseph
President
Sunshine Dodge-Isuzu
[Thanks to grifonik for the link]
Same thing happened when the FCC changed the rules for radio stations around 2000. Many polititons (Edwards-NC)and friends of (Clear Station) made out well all while the family owned businesses folded because their channel was stolen.
Sorry George. You can waste your money on lawyers or buying pages in the paper to generate sympathy but you won’t win when the government steps in to steal from you.
“HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?”
Didn’t he just answer his own question? If you take away the government intervention, this person owns a dealership selling cars from a bankrupt automaker. Even though his business is profitable for him, it apparently isn’t for Chrysler so this is exactly what SHOULD happen in a “free” market.
Since he didn’t diversify his business (Isuzu… really? Why not sell Suzuki too, or maybe Daewoo, it would be just as good) he’s stuck.
If he doesn’t want to be dependent on another company for continued livelihood, then he shouldn’t be running a business subject to a franchise agreement. He could have also latched onto another manufacturer outside the “turd” list so he wouldn’t be completely dependent on Chrysler.
Unfortunately, this is all just a product of this current social climate we have in this country. Everybody “deserves” everything just because they breathe oxygen.
It’s socialism without compensation.
It’s not socialism. Honestly, this meme from the FUD faction is getting tiresome. If it were socialism, the dealership would be subsidized for selling government motors products at a loss.
It’s not socialism, but it’s certainly sad.
There’s no doubt about it; heart wrenching stuff.
There is financial destruction going on everywhere you look.
One of our clients is an extremely successful IBM Selectric sales/service company. I’m just trying to look them up on my Commodore 64 now to see if I can get some advice from them…..
(Sorry – very harsh – people, please, please take care out there. Bankruptcy is not the end).
Jeff Puthuff:
It’s not socialism. Honestly, this meme from the FUD faction is getting tiresome. If it were socialism, the dealership would be subsidized for selling government motors products at a loss.
…
That is exactly what is happening to the rest of the Chryco dealers that didnt have their franchise agreements terminated. Exactly what you stated is not happening.
@ eamiller – In his letter, Mr Joseph lets us know that his dealership is being taken “without compensation and given to another dealer at no cost to them.”
If you think things like that happen in a functioning free market, then you just don’t understand what a free market is. The role of government in our free market economy is enforcing private property law. It looks like the opposite has happened here.
You can name it anything you want.Blame the government, Chrysler, maybe even blame Mr Joseph.
Call it socialism ,capitalism left winger’s or right.
Fact is 50 more people are looking for a job.The owners family goes bankrupt.The city has another closed store.
Thank you Mr Farago for the post.A failure with a human face…..indeed.
It’s not socialism. Honestly, this meme from the FUD faction is getting tiresome.
+1, although “tiresome” doesn’t quite do justice to my personal level of irritation.
HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?
Bankruptcy is kinda like that. Take it up with those pinko commie Founding Fathers. After all, it was their idea.
26theone: Again, no dealership would be closed or forced out. All would be “allowed” to stay open and because there are not enough customers to go around, would be subsidized.
Taking a dealership and giving it to another is not socialism nor capitalism. Frankly, it’s a Mugabe-style dictatorship.
Agree that this dealer’s troubles have nothing to do with socialism. It’s just a business arrangement that went south with plenty of people to blame.
The ugly truth is that it was a mistake to put that much trust in Chrysler, and now he’s paying the price.
The role of government in our free market economy is enforcing private property law. It looks like the opposite has happened here.
A franchise is a contractual obligation between franchisor and franchisee.
Bankruptcy allows contracts of all sorts to be wiped out. That’s the entire point of bankruptcy; the court gives permission to one party to cut the agreement without cause.
This process is in the Constitution, and was an innovative concept when the founders introduced it. It’s not un-American, this is as American as it gets.
I don’t think socialism is the issue here. This person feels that someone (govt/New Chrysler/FIAT) is coming in and stealing what he considers is his property.
If Chrysler were allowed to die (C7), he and all his kind would be SOL and would most likely follow them down the drain. In this case however, he bought the rights and met the obligations (remodeling, stock, warrenty support) yet the rights he bought are being revolked (and possibly given to a competitor near by) without compensation.
If the government were not involved, the courts would probably be on his side (especially in Florida).
The government is stepping in, changing the rules and redistributing the wealth. He is finding himself on the wrong end of the receiving line.
Yes we can.
If the government were not involved, the courts would probably be on his side (especially in Florida).
This is not true. Once again — bankruptcy allows contracts to be cut unilaterally by the bankrupting party.
Had the government not bailed out Chrysler, Chrysler would have filed Chapter 7. The dealer would be in the same position then as he would be now.
It’s not socialism, it’s bad business judgment. He decided to sell a line of products that consumers didn’t want. He hitched his horse to the wrong wagon. His decision; Karl Marx didn’t tell this guy to sell the wrong brand of car.
Franchise.
I don’t get this guy’s beef with the government. Look, dude: you built a business that was highly dependent on a single corporation (a corporation that has had very visible mission-critical issues for decades). You could have stopped ordering cars at any point or sought out another brand to sell. You instead chose to desperately cling to the side of a sinking ship and are now pissed at the government because you’re drowning. If anything, you should be thanking the government for keeping Chrysler alive for the last 4 months – months in which you could have taken corrective action to prevent your own demise. You didn’t.
Although it is sad, this is how bankruptcy works in the free market world. With or without the government involvement, this would have happened when Chrysler went on its trip to the bankruptcy count. Had the government not stepped in, Chrysler LLC would have gone C7 and EVERY Chrysler dealer would be in the exact same boat.
This is the inherit danger of franchise agreements. When the franchisor is doing well, the franchisees do well. When the franchise goes down the tubes, so do the franchisees.
“HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?”
Free markets decided your cars suck. The maker of your franchise product went bankrupt because they owed too much to everyone including you thanks to selling crap. Your investment is now worthless. Investments are subject to risks including bankruptcy. That’s sounds like a free market working to me!
Hey, free markets are a bitch. If you want comfort and certainty, perhaps socialism would be a better choice for you.
PS – PCH101 always rocks. Love, Non-Tarp Saviors of the Universe(TM)!
Pch101: “Bankruptcy allows contracts of all sorts to be wiped out.”
In what kind of bizarro bankruptcy would the bankrupt party be allowed to confiscate the property of another business?
If I file bankruptcy, the court is not going to award me a corner office at CitiBank’s headquarters.
This is not a severing of a contract. Read the letter; this is a confiscation of a privately owned business without one minute of arbitration.
I’ve read your prior posts, and you seem to be pretty knowledgeable about bankruptcy. However, justifying this as an action of regular bankruptcy is just off the deep end.
Sob… sob… seriously, I can only say so what.
This is a guy who has benefited from state laws protecting his business and from the previous bailout of Chrysler. This is a guy who is part of the group that dictated crap product to Chrysler, didn’t insist on quality products at the low end or higher reliability on the products they did sell.
They didn’t give his franchise to someone else, another dealer got the region. Welcome to life under a franchise agreement.
Basically every dollar of income for the past 20 years has been a gift – nobody is entitled to make money. I feel bad for the dealers, but I certainly don’t pity whiners like this guy.
I hate to see fifty people lose their jobs and a family go into bankruptcy but I am sure when the various state governments intervened to prop up franchises with protection laws (disabling the corporation’s ability to rework its dealer network over time) this dealer and others cheered.
Protectionism is at the heart of socialism.
All of these events continue to reflect the Day of Reckonong that the auto industry has put off for decades.
I hate it (I am/will be victim to it myself) but it is what has to be done.
I do feel for him and his employees…but I don’t know if there’s any real solution at this point. This is something that has been building up for years.
What’s the “FUD faction?”
Re pch101:
Had the government not bailed out Chrysler, Chrysler would have filed Chapter 7. The dealer would be in the same position then as he would be now.
I wonder if Joseph would rather see all ChryCo dealers get shut down simultaneously. He seems to resent that he is one of those forced out so others can survive. I know he doesn’t say this overtly in his letter, but it seems that he feels it is wrong that his work (edit: the intangible development of his sales region) is freely passed to another, but he seems to think it’d be okay if everyone suffered equally.
It would be interesting to hear from a bankruptcy expert on how past companies with privately owned franchises managed similar circumstances where a BK forced only some of the privately held franchises to lose their vital franchise agreement. I think Gateway had privately held franchises, but they nuked all their stores simultaneously.
Had the government not bailed out Chrysler, Chrysler would have filed Chapter 7. The dealer would be in the same position then as he would be now.
I don’t think you can make that statement. There would have been a different set of negotiations. The 125 vehicles may have been offered to the dealer to clear for 25% off book value for example.
Just saying….
In what kind of bizarro bankruptcy would the bankrupt party be allowed to confiscate the property of another business?
That isn’t happening. They aren’t taking his land or seizing any inventory that he has paid for in full.
They aren’t going to sell him inventory in the future. They aren’t going to provide him with credit. They aren’t going to authorize him to do warranty work.
If your local supermarket loses whatever agreement that it has with Anheuser Busch to sell Budweiser, that isn’t socialism, that’s just a contract termination. In this case, it’s the bankruptcy court that gives permission to the bankrupting party to terminate the agreement at no fault of the other party. That’s how it goes.
If the Dodge guy wants to sell used cars or operate an independent service department, or if he can go sign up with a different automaker or if he wants to open a flower shop, he can do all of that.
He has no right to force the parent company to buy back his inventory. That wouldn’t be particularly capitalistic, anyway.
If people are going to scream about socialism, they should do two things. Firstly, they should find out what actually happens when a franchise agreement gets terminated, because it isn’t what you think it is. Secondly, they should learn what socialism is, because this doesn’t meet the definition.
I don’t mean to be the proverbial fart in church here, but all we have here is a letter that hasn’t been verified as true. Even if it is written by the author as is we are still only receiving one side of a story. If true, its extremely tragic but has little to do with the American government and much more to do with big business screwing the little guy – which is what happens in a free market society.
I agree with Pch101, most people have their head so filled with misinformation that they have no idea what socialism really is. They apply to the principle that it must be bad ’cause I been told its bad.
What a cry baby.
You cast your lot with a sinking ship. You, more than anyone, saw the signs. You should have bailed out or diversified when you had the chance.
It is a franchise contract. The mothership went bankrupt and terminated it. It was a risk you took when you entered into the agreement.
And no one is “taking” your dealership and giving it to another dealer. The bottom line is simple. The market it just not big enough any more to support your dealership.
If the government were not involved, the courts would probably be on his side (especially in Florida).
This is not true. Once again — bankruptcy allows contracts to be cut unilaterally by the bankrupting party.
Unfortunately it is true. At issue are not the bankruptcy laws (federal) rather, look to the FL state franchise laws. In Florida and elsewhere, they are very dealer friendly as seen in the billions it cost GM to shutdown Oldsmobile.
This is nothing, wait a couple of weeks when we hear from the GM stores.
While the whole carpocalypse is a very sad affair, there is nothing “socialist” or “unconstitutional” about what is going on. Let face it, Chrysler is in C11 bankruptcy and everyone including share holders, bond holders, workers and dealers are sharing the pain. If the government hadn’t spent so much money on the auto bailout (which I am against) there would have been even more pain to go around.
Yes it sucks but bankruptcy is part of capitalism and so is creditors wielding influence (in this case the government). Yelling “the socialists are coming!” is neither accurate nor helpful.
I just wish the government had applied similar standards with AIG where they seemed to be happy to pay out 100 cents in the dollar to all those institutions that had bought dodgy derivatives. I guess it helps that nearly everyone in the treasury has worked at Goldman at some point in their lives.
This guy is not a secured creditor; he is just an unsecured creditor.
Chysler is NOT taking his land, inventory or equipment. Chrysler is just breaking his franchise contract, under established Bankruptcy law. This guy is actually complaining that Chrysler IS NOT taking his inventory and equipment, and instead leaving him with it.
He would have lost everything LAST YEAR if it were not for the government intervention.
That’s right, if we had more of a free market economy he would have lost everything six months ago, yet he is complaining.
Bankruptcy is provided for in the Constitution, it is a basic tenant of a market economy.
Sorry, but if the company that you do business with goes under you’re screwed. Ask a Yugo/Daewoo/Isuzu car dealer. They all died with no government intervention.
This guy should have had the foresight to see that Chrysler was failing and sold his dealership. He didn’t, and now he loses.
It is sad, but only an idiot would claim that socialism is to blame for him losing his franchise.
Socialism is now a meaningless term. People that mindlessly cry “socialism” instead of offering specific, nuanced critiques will end up with the government that they deserve.
The USSR is gone. You know what people associate socialism with now? With Germany, Japan and the Nordic countries. Americans want to be more like those countries. They are tired of unproductive, con-artist, hyper-cyclical “gotcha” capitalism.
“Oh no, we’re going to wait in line for toilet paper like the Russians” was scary, “Oh no, we’re going to build BMWs, get free college education and drive on glass smooth roads like the Germans” is not.
The biggest failures in Europe are the most capitalist countries, Britain, and, dramatically, Iceland.
Most importantly, bailing out the automakers and, much, much worse, the banks and their credit default obligations to foreign countries, is kleptocracy, it IS NOT socialism. The author of “The Shock Doctrine” calls it disaster capitalism.
If you only have the capability to remember one term at least remember the right one.
I find it somewhat brain addled when it is claimed that the consequences of capitalism are somehow socialism?
When you, for a number of years, present a product to the market which the market doesn’t want, then the result is that you end up in the red – that’s not Socialist red, but financial red.
Do that long enough to lose your line of credit, and you’re in serious trouble.
In fact, one could claim that the manner in which GM and Chrysler has been run is socialism, where the operation of the entity was given precedence over its viability — something that often results in socialism.
The US debate would get a lot more productive if people did some thinking. This Dodge dealer is in a terrible situation – but it’s not the government that’s closing down the dealership, it’s Chrysler which is finally facing up to the consequences of its abject mismanagement.
Capitalism in America has become a game of “screw everyone, get yours.” And this is the result.
Since we have confusion on bankruptcy and socialism, perhaps some educational links would be helpful.
Socialism
Bankruptcy in the United States
Brought to you by the Non-Tarp Saviors of the the Universe(TM)
While it is sad 50 people are losing their jobs, Mr. Joseph should be blaming himself for the predictament he’s in. He had a Chrysler and a Isuzu dealership, two brands that have been slowly dying for more than a few years. Did he see the writing on the wall and look into getting stronger brand? It doesn’t look like it. Whose fault is that? Why didn’t he get another brand? At some point, he decided to bring Isuzu into the fold. Could he have instead gotten another brand when occurred or even since then?
From TFA:
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.
I don’t feel bad for this guy at all. Car dealers have for years lobbied the local and state governments to “protect the customer” by making dealerships the ONLY place to legally buy a new car. Now he’s not a dealership and can no longer sell his cars as “new”. Too bad. Open it up to the free market and let anyone sell cars.
If the guy’s franchise was worthless, then why is Chrysler giving it to a local Chrysler dealership?
It is clear his franchise, which has some economic value, is being taken from him by the United States government, and given to another person, without just compensation.
As Barry and his socialist crew ignore business law in this country in their bid for control, look for the economy to stay in the tank. None of the evil rich is going to take any major risks when Barry changes the rules whenever it suits him to benefit his political allies, and the federal government in it’s bid for complete control of the economy.
Cannot wait for the 2010 elections.
At issue are not the bankruptcy laws (federal) rather, look to the FL state franchise laws.
Bankruptcy allows contracts to be terminated unilaterally. A state franchise law can’t require enforcement of a contract that has been terminated by a federal bankruptcy court.
Good points here.
I feel sorry for the owner. To a point. Much like the auto worker (or better yet, white collar Detroit 3 employee or auto supplier employee with no sub pay, buyout, etc.) who has lost their job through no fault of their own, this guy and his employees are suffering. Perhaps he should have picked up other brands as Dodge business dried up.
On the other hand, there isn’t much he can do now. The bankruptcy laws, (actually correctly applied here, no biased cramdowns) make the dealer closings perfecly legal and necessary.
That is the free market, creative destruction at its best/worst.
BTW, I would define socialism as government ownership of the means of production. One could argue that GM and Chrysler have/are being nationalized, i.e. owned by the government, at least temporarily, and that is a form of socialism.
However, socialism has nothing to do with the plight of this dealer. Without the government interference, he is probably facing a Ch. 7 liquidation and a fire sale anyway.
THIS IS A PRIVATE BUSINESS NOT A GOVERNMENT ENTITY
No, sir, not “a private business” at all. Chrysler continued operations in 1979 thanks to a Carter government “loan”.
Your dealer has been operating from 1979 to 2009 thanks to the 1979 governmental “loan” to Chrysler.
This is beyond imagination! My business is being stolen from me through NO FAULT OF OUR OWN. We did NOTHING wrong
Excuse me, but your family did at least two things wrong:
1. To malinvest in a Dodge dealer. I invite you to read “Iacocca: An Autobiography” to learn about the malinvestment your family did in 1974. In this book, Mr. Iacocca is very open about the unbelievable mess Chrysler was in the 1970s. Your family had wiser investment options in 1974. A Toyota dealer, for instance.
2. To continue making business with a company which deserved bankruptcy in 1979, only to be saved by the U.S. Government. Your family had 3 decades to desinvest, but unfortunately you failed to do so.
I agree that it is sad, but it is not socialism. It is sad that this man made a poor business decision and now he and many of his employees will pay for that decision. He should have at least seen the writing on the wall when Chrysler recently told him to renovate his facility. He could have said no and saved himself the expense. I also question how profitable his business was. If it was, I wonder what criteria Chrysler is using to eliminate dealerships.
A local family owned dealership closed late last year after decades in business. Sad, but they weren’t whining to the local paper about how they were being treated unfairly. They just seemed to move on to another line of work. It’s tough all over, but this is not an example of the goverment being unfair to this dealer.
I find it somewhat brain addled when it is claimed that the consequences of capitalism are somehow socialism
I’ve decided that going forward, anyone who upsets me will be brandished as a socialist.
Bad service from the local restaurant? Socialist food collective!!!
Cut me off in traffic? Pinko commie wannabe Trabant driver!!!
Dog sticks his wet nose in my face (again – God, I hate that)? Marxist devil dog subverting the free market!!!
(I’ll admit, this really has potential. Leninist angles on angry significant others who get upset about my efforts around the house are next on the list.)
This is indeed sad, people losing jobs, a family losing a long-held business. It is not socialism and it certainly isn’t communism, and only a blinders-on anti-government reactionary would indicate that it is…
Plenty of others have pointed out that this fellow has tied his fortunes to a single, poorly-run entity. Why is it such a violation of free-market principles that, when you establish your business as basically 100% dependent on another business, when that other business crumbles you suffer as well? If the company I work for were to go bankrupt, I wouldn’t consider it a violation of the free-market for me to lose my job. The same thing is happening here. It’s sad and difficult, but it isn’t Barack Obama’s fault nor a vast socialist conspiracy.
The dealership owner indicates he did NOTHING WRONG in big all-caps letters. He claims his business is being “stolen” through NO FAULT OF HIS OWN. However, he decided to run a Dodge/Isuzu dealership, which at it’s face seems to be a pretty poor business decision, and failed to diversify his business sufficiently to weather the economic downturn. It is to be hoped that he set up a good repair shop and used vehicles sales operation to hedge against Chrysler’s well known boom-and-bust product offerings and Isuzu’s non-presence on the US auto scene. His failure is his fault, it’s just unfortunate that this set of circumstances came about. Nobody’s taking his business or his property or his money, he’s just not going to be a Dodge dealer anymore.
In a free market, people fail. The idea that one runs a business with all profit and no risk is asinine. It’s a surprise to folks that grew up with the idea that their family owns a business, profits always come in and hard work inevitably yields “the good life,” but it’s a fact. I hope this fellow learns from his business failure and emerges wiser and more protective of his interests. I don’t feel too bad for him, though.
This process is in the Constitution, and was an innovative concept when the founders introduced it. It’s not un-American, this is as American as it gets.
Yes, and when the government chose to play an active role with the bankruptcy of the franchisor (all in the name of saving jobs of people building cars that aren’t selling), it became un-American.
To those that supported Fed involvement, I suppose you also believe the Feds should have also gotten involved with Circuit City’s bk?
What hypocrisy.
My questions:
Why is Old Chrysler cancelling franchises. This company is not building cars, will be selling off any assets it has that are worth anything, and will be going out of business. So B&B, why the need to cancel some franchises and not others, since the company doing the cancelling cannot possibly wring any benefit from the cancellation? My guess is because New Chrysler (effectively controlled by the government) wants only some of the dealers and not all of them.
The man’s letter alleges that the Dodge franchise is being awarded at no cost to another local dealer. If Old Chrysler is adding a franchisee, see Question 1. If New Chrysler (effectively controlled by the Government) is adding a franchisee for free after causing one to be taken from the former holder, what is this other than rewarding one and punishing another. So the dealer’s question is “why does the government like the other dealer better than me and why is he being treated better?” Only the people pulling the strings (the government) knows the answer.
In business, there are winners and losers every day. And bankruptcy is certainly a painful and costly experience with a lot of collateral damage. While I don’t think this situation rises to the level of Socialism, I do think that the heavy hand of the federal government is all over this transaction. I understand bankruptcy. What I have more problem with is the “public-private partnership” which is a kind of hybrid arrangement that is sometimes more politics than business.
I also recognize that lots of business people buy into the game to privatize the gains and socialize the losses (I forget who said that capitalism is too important to be left in the hands of capitalists). But there is a cost, and often these government/business incest sessions like to play by either business or political rules, which ever is more advantageous at the time. This is the part I have trouble with. Business in a free market is allowed to make these decisions that cut off one relationship and start another. Sometimes, it can even be done through the legal framework that is bankruptcy. But when government becomes actively involved, another set of rules are supposed to come into play. Sadly, this isn’t always the case.
Plenty of others have pointed out that this fellow has tied his fortunes to a single, poorly-run entity.
Actually, TWO poorly run entities. He has/had an Isuzu dealership as well.
I still cannot find a case of a parent corporation with franchisee-held stores (stores that depended exclusively on the parent) that filed BK only to cut only a portion of those agreements.
When Bennigan’s / Steak n’ Ale filed C7 they shut down 100% of the corporate held stores and let the remaining privately held stores fend for themselves to try and continue as restaurants branded under a different name.
There just aren’t many cases of a parent company going C11 and selectively terminating a few of their franchisees. It seems the franchise agreements usually remain in place during the C11. A-B selling beer to a grocery store affects a few SKUs out of 10,000. A Dodge dealer, or Subway, or Sprint/Nextel store seems a bit different since many of these businesses exclusively sell one corporation’s products and have many rules in place to govern how they do business. At least a ChryCo dealer can still sell other brands at the site.
I’m surprised at some people’s lines of (non?)thinking here.
“If no action had been taken by the government on Chrysler, he’d still be in the same position.”
Think about what you just said. You just admitted, correctly, that despite all this governmental interference (which, indeed, started near the end of the last administration, and only was magnified and enabled further by the current one), people still lose jobs, and communities still lose businesses.
GM will have its loans forgiven.
So, praytell, what was the point in wasting billions of taxpayer dollars? An organized C11 MANY years ago would have been far, far better – especially since the economy was better back then anyway.
The free market works; its just that when you fail, it lashes at you hard. But that’s what makes it so efficient; it cleans up the failed… yet you can try again if you fix your mistakes and try again. No one even gives it a chance anymore, and thinks the Federal government is able to manage a cash-leaking private entity (isn’t “cash-leaking” the very definition of the Federal government?).
This isn’t free-market, folks. Seriously… get real. This is a failed attempt at saving Chrysler. The detractors always said it was a waste of money. They always said that the “loans” were NOT loans, but indeed was money that would never be regained.
The apologists insisted the taxpayers would be “paid back with interest.” Wrong. I’d love to see the looks on their naive faces now.
At any rate, I’m sorry that this dealer ended up with this fate. A tragic story indeed. And the Chrysler and UAW executives who enabled such a corporate slide into nothingness will all get out with a golden parachute.
taxman100 :
“If the guy’s franchise was worthless, then why is Chrysler giving it to a local Chrysler dealership?
It is clear his franchise, which has some economic value, is being taken from him by the United States government, and given to another person, without just compensation”
This would happen during a Republican administration also. Chrysler ended its contract with the dealer in accordance with US Bankruptcy law written long before the current administration. If “new” Chrysler signs a contract to sell Dodge Franchise rights to a neighboring dealer, that is perfectly legal.
Bankruptcy is inherently unfair. The reason that we have it is because it encourages people to take creative risk, and the value of the contributions from those risks exceed the cost of the failures. It is critically important to the “creative destruction” that free markets need to work.
So you can have 2010 election with a Republican sweep and still expect exactly the same results.
miked :
May 20th, 2009 at 10:28 am
From TFA:
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.
I don’t feel bad for this guy at all. Car dealers have for years lobbied the local and state governments to “protect the customer” by making dealerships the ONLY place to legally buy a new car. Now he’s not a dealership and can no longer sell his cars as “new”. Too bad. Open it up to the free market and let anyone sell cars.
Once again the “Law Of Unintended Consequences” wins.
Like others have said, if Chrysler filed CH7 (like it should have), this guy would be holding even less. He can at least try to make a deal with another dealer. Would he feel better if every Chrysler dealership closed down?
Ok let me ask a few questions.
Let me assume the people who decide which franchises lives and dies are fairly intelligent MBA types.
Let me also assume that you will be cutting a lot of franchises that are otherwise profitable (it’s an imperfect world).
There is going to be pain one way or another but there has to be 50% less dealers.
I find it hard to believe that the best way to go about it is as destructive as ‘this way’.
How do you expect a person or business entity to get rid of 125 cars that he has no other way of getting rid of?
How do you expect to get rid of $300,000 of parts?
If you want my franchise pay me what I paid for it.
The numbers are all arbitrary of course. Some dealers may have 30 cars. Some may have $1 mil. worth of spares.
My point is this. Smart people came up with this plan right? Surely they have a plan for what each dealer is to do with the dead cars and dead parts stock?
To me this is no plan at all. eg. if I’m a McDonalds franchise and I have $1mil. of burger patties and lettuce what the hell am I supposed to do with all this crap if you want the store back?
Eventually this stock is gonna be forced back on the market even further depressing an already distressed market. Who’s gonna want a 2007 Sebring?
Am I naive in expecting an orderly wind down? This panic and mayhem of the highest order.
There is such a thing as due process. If the guy thinks he is being treated unfairly, he can take Chrysler (or the government) to court.
Why whine when the laws aren’t in your favor? It’s not like as if dealers have been without political power during the past few decades.
Fact of the matter is, the U.S. franchise laws are more socialist/protectionist than anything you’ll find in Europe or most other places. Nowhere is it more prohibitively expensive to re-structure a dealership system than in the US. I think this dealer led himself into thinking he was somehow invincible. That’s what socialism does to you, but it’s not want he means.
I agree with you PCH101. I also conceed you are far more knowledgeable than I in this area. I was just pointing out what I believe he FEELS.
I also agree that in a normal BK, he would lose out but this is not a normal BK and he might have some claim to compensation if he was owed by the parent (pennies on the dollar). Such as 125 cars becoming “used” over night? What could be done in BK to protect him as well? Extended authorization to sell the vehicles as new?
Just becasue it’s legal, doesn’t make it right. He should probably just roll over, declare BK himself and screw everybody too.
…then his suppliers, the local deli, the corner gas station, the mall, the strip club on the corner of 4th…
While Isuzu has been a weak also ran in cars, their low cab forward trucks have been solid sellers for quite some time now.
Still this organization had decades to diversify beyond Chrysler.
HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?
I’m sure it’s been said a million times already, but this is exactly what happens in a free market economy. Companies fail, everyone who worked for these companies fails with them. This is free market at work.
HOW IN THE UNITED STATES OF AMERICA CAN THIS HAPPEN?
THIS IS A PRIVATE BUSINESS NOT A GOVERNMENT ENTITY
Yeah! That’s why it’s failing! That’s why you’re f*cked! That’s why Chrysler doesn’t care about your business! It’s a free market – you’re on your own!
Any Tim Curry fans here? (heh). To quote his immortal portrayal of Wadsworth the butler in Clue, “Communism was a red herring”. Likewise, we have a situation where the term socialism is being thrown out by certain interest groups without regard as to whether or not it actually fits, and frankly, for the way the Chrysler bankruptcy was run, its an innacurate descriptor at best and an outright lie at worst.
The early messages over the GM bankruptcy involving temporary equity held by the Treasury may be more accurately labeled “socialism”, but thats a story for another day. If the question is Chrysler, lets dispense with the silly idealogical names that have no bearing on the situation and call it what it is: bankruptcy proceedings of a privately-owned corporate entity closely managed by the Treasury Deparment with the stated goal of preservation of jobs and corporate continuity in some form via an equitable receivership. Debate the success of the stated goal for what it is, but at least be honest with yourself about the intent outside of taking the “hitler ate sugar” caveman perspective of “someone called that dog socialist, and socialism is bad, ergo the dog is going to cause the downfall of western civilization”.
Even if the GM bankruptcy ends up being one where Government Equity is involved, the issue isn’t so much one of whether or not its socialist or not, but more one of “do we want GM to survive or not?” We’ve seen the math, and people who frequent this website know the stakes. If your options are 1-let the company die a quick, messy death and cause widespread economic damage both within and outside the industry, or 2-manage a bankruptcy, take a bit of short term equity with the goal of getting out of the auto biz ASAP, i’ll take option 2. Don’t take this as a rant or advocacy for marxism or a rat against the free market. Its more a question of looking at a problem, coming to a set of solutions that all lead to poor to mediocre outcomes, and then picking the one that sucks the least.
I even think the free market argument is disingenous at best, because when you think about it, no corporation really wants a truly free market. Like communism, competition is a red herring. Corporations don’t want excessive government interference in markets, true, but they don’t truly want competition either. Best case scenario for any corporation, auto industry included, is a setup similar to what Intel and Microsoft have: a market where your share is overwhelming and a monopoly for all intents and purposes, and your “competition” is token, weak, but solvent enough to give you good grounds to argue that you aren’t a monopoly when the Justice Department’s antitrust division comes sniffing around your boardroom.
Pch101:
Let’s rise up and form the United Socialist of TTAC! We’ll return TTAC to the people:) LOL!
The Non-Tarp Saviors of the Universe(TM) can sponsor us.
How do you expect a person or business entity to get rid of 125 cars that he has no other way of getting rid of?
How do you expect to get rid of $300,000 of parts?
…
My point is this. Smart people came up with this plan right? Surely they have a plan for what each dealer is to do with the dead cars and dead parts stock?
NO!
No, of course not! Do you not understand the way free market works? No, they don’t have to plan and do anything for the guys they screwed over. That’s what free market means. You’re free to do what you want and make money any way you want – and nobody will be there to catch you when you fall.
The cognitive dissonance displayed constantly by so many people is astounding (and I’m not referring to the poster I just quoted here). “We don’t want big government to bail anybody out! We don’t want government to control our lives/cars/health insurance/whatever! This isn’t communist China!” And then in the same breath: “Abloo bloo bloo why is nobody bailing out my failed business! How can this happen in our great land of freedom and apple pie?”
How do you expect a person or business entity to get rid of 125 cars that he has no other way of getting rid of?
How do you expect to get rid of $300,000 of parts?
Obviously, halving prices. Everything can be sold at the market price.
This man bought overvalued cars and parts and his family bought an overvalued franchise. It´s time to get real and to realize losses.
Their malinvestment was rescued at the taxpayers expense once by the U.S. government in 1979 and they choose to stay in the Chrysler boat three decades more.
What do you expect?
His product only survived over the last six months by becoming a welfare whore.
Now he wants to become one.
When his business does good, it’s because he worked hard, was smart, and earned it.
When his business does poorly, it is not his fault, but the fault of the [fill in the blanks]
And so do businesses die, and deserve to die. Complacency and laziness will ensure the next entrepeneur comes along. Adapt or die.
i can’t see that being particularly orderly with hundreds of dealers sitting on 10c to the dollar cars and parts
Thems the breaks. My family’s Dodge store was on the list. It hurts and it sucks…luckily, unlike this poor soul, we are heavily diversified in asian brands so we will make a go of it as a stand-alone used store at that location.
Don’t the morons at the UAW get it? The UAW will get the shaft after the next election. The UAW spent hundreds of millions getting Obama elected and this is the payoff. Unless they pay off in 2010 and then again in 2012 election cycles they too will be thrown under the bus.
The Non-Tarp Saviors of the Universe(TM) can sponsor us.
They offered to host an event, but unfortunately, the wine and cheese vendor refused to sell the merlot for the 20 cents on the dollar or whatever it was that the Non-TARPs (TM) had paid for the Chrysler bonds. It must be harder to arbitrage the food and beverage market, I guess.
I also agree that in a normal BK, he would lose out but this is not a normal BK and he might have some claim to compensation if he was owed by the parent (pennies on the dollar).
Nope. A franchisee is toward the bottom of the stack of creditors. He would get about as much out of this as I am, which is zero.
Let’s understand something — he owns the inventory. The company isn’t obliged to take back inventory after bankruptcy, whether or not the government is involved.
For those who argue that this bankruptcy is extremely unique, I’d like to hear a good argument for that position. This is a classic situation in which creditors get paid pennies or nothing at all because the assets aren’t worth much.
(Personally, I suspect that the government got a faster calendar than the norm, but that the legal outcomes were effectively the same as they would have been, and the financial outcomes were actually better for the bondholders than they would have been otherwise because the government overpaid for the assets, even at <30 cents on the dollar.)
The value of a car company comes from its ability to make products that people want, not from what it paid for the machinery to make them. That’s why the liquidation value is low, and why the creditors never stood a chance.
The dealer is an even smaller fish. If he’s like your average dealer, he has screwed enough people over the years to know the difference between a winner and a loser.
no_slushbox: With Germany, Japan and the Nordic countries. Americans want to be more like those countries.
In which case, they are as clueless as those who claim that terminating a dealer contract because the parent company is bankrupt somehow represents “socialism.” Japan, in particular, has been an economic basket case for well over a decade.
no_slushbox: “Oh no, we’re going to build BMWs, get free college education and drive on glass smooth roads like the Germans” is not.
BMW has been moving production away from high-cost areas such as Germany (hence, the plant in North Carolina), and German college degrees prove the old adage that if you want to make something worthless and expensive at the same time, have the government start giving it away. There is no German university or college that matches the best American private or state-sponsored institutions in prestige or academic credibility.
I certainly wouldn’t mind driving on roads like the Autobahn, though, but that is a product of fanatical attention to detail, strict engineering standards and demands from voters for high-speed roads, not more government control over the economy.
In other words, the same national cultural traits that created the 1966 Mercedes that is the subject of the latest “Curbside Classic” feature also drive the construction of superb roads.
On the other side of the coin, slap-dash cars such as the ones the domestics have built for far too long didn’t just spring up from nowhere…they are, unfortunately, a reflection of the bad side of America (i.e., not enough attention to detail, an emphasis on flash over substance, too much emphasis on up-front cost reduction at the expense of long-term quality). Too many of our roads also reflect this sort of thinking.
Their malinvestment was rescued at the taxpayers expense once by the U.S. government in 1979 and they choose to stay in the Chrysler boat three decades more.
Why do people keep repeating this? The government spent no money on Chrysler in 1979. Chrysler received government backed loans (with interest) that were paid back ahead of schedule.
But otherwise, Chrysler has been in and out of trouble for most of my lifetime (I’m 52 yrs old). You would think that a prudent businessman should know better.
Pch101:
“It’s not socialism, it’s bad business judgment. He decided to sell a line of products that consumers didn’t want.”
While I won’t debate what went wrong with Chrysler’s product line (this has been covered before), consider this:
“We are financially strong with great respect in the market place and community. We have strong local presence and stability.”
I will take that to mean he was making a profit. Also consider this: You say that consumers don’t want the product, and that is true in relation to the parent company making a profit, but for a local dealer like this he may have sold more than enough to make money.
“But I thought NO ONE wants a Chrysler product.” Did you know; Dodge is outselling the combined totals of Buick, Cadillac, Hummer, Pontiac, Saab and Saturn. Dodge is the third best-selling domestic brand after Ford and Chevrolet. Dodge is the sixth best-selling brand overall in the U.S. market for the year and in April, Dodge outsold Nissan to become the fifth best-selling brand for the month.
Jeep is outselling GMC, one of GM’s “core” brands.
Everyone agrees that Chrysler is the weakest of the three brands yet Chrysler is outselling the combined totals of Lincoln and Mercury. Chrysler also is outselling the Buick, Cadillac, Pontiac, Saab and Saturn brands.
I think it’s too dismissive to say well he shouldn’t have been carrying that brand. If the brand was selling as well as he indicates then why not? Sell Mitsus or Subarus instead? No doubt he should have tried to diversify more.
I have met Mr. Joseph and much of his staff, including his GM. I was absolutely shocked that Chrysler decided to drop him. His shop is full of some of the nicest people you’ll encounter in this business, and Sunshine is Brevard’s only 5-star dealer according to the website. The good news is that his property is located on a prime spot: US 1 across from the Intracoastal Waterway. I hope he survives expanding his used business and/or with another OEM.
This guy signed an agreement with Chrysler, if they are dishonoring that agreement, he can litigate. Otherwise, sll dealers including him are being supported by our tax dollars. That is not fair to ME. America was based on the free market concept. He and ALL other Chrysler dealers should be holding going-out-of-business sales.
windswords: I will take that to mean he was making a profit. Also consider this: You say that consumers don’t want the product, and that is true in relation to the parent company making a profit, but for a local dealer like this he may have sold more than enough to make money.
It’s my understanding that most domestic dealers do not make money on new-car sales. Their profit centers are the service department and used cars.
geeber:
Germany, Japan and the Nordic countries are far from perfect; much less perfect than many Americans think.
But they have good traits and happy people; they aren’t boogeyman countries like the USSR. “Socialist” has lost its rhetorical power.
That doesn’t mean that the government reactions to the financial “crisis”, like the auto and bank bailouts, which some label as socialist but I would label is kleptocratic, have been good. They haven’t been. At all.
But it means that those who want to shape government policy are going to have to expand their vocabularies and deepen their knowledge.
The government spent no money on Chrysler in 1979. Chrysler received government backed loans
No private investor was willing in 1979 to invest his money in Chrysler.
Without the U.S. government lending taxpayer´s money to a failed business, Chrysler would have joined Peerles, Marmon and Hupmobile in 1979. It would have been much better.
A is A:
‘Chrysler continued operations in 1979 thanks to a Carter government “loan”.’
“Their malinvestment was rescued at the taxpayers expense once by the U.S. government in 1979…”
Never happened. The loans in 1979 were made by private banks. They were guaranteed by the government but not a penny of taxpayer money was paid out becuase the loans were paid back. As a matter of fact, the government made money off the deal thru fees.
Contrast that with now where the loans were direct from the taxpayers and will likey be forgiven and the government will get an actual stock position in the company and some control (as evidenced by the PTFOA’s decision to cut Chrysler’s ad budget). Really totally different than in 1979.
“It’s not socialism.”
Sure it is. The essence of socialism is government control/ownership of the major means of production. Washington is effectively running Chrysler now, so the label fits in this respect.
If the government didn’t want to be called socialist, it should have stayed out of the bankruptcy process and left Chrysler to go C11 or, more likely, C7 on its own. Sunshine Dodge’s owner might have wound up no better, but he would have had no reason to suspect the White House was pulling the strings.
BTW, Sunshine can’t return the new car inventory to Chrysler–but aren’t the cars collateral for the floor plan debt? How does that work?
And what about Obama’s promise to back warranties? How does that relate to cars at terminated dealers?
What an unholy mess.
A quick search of opensecrets.org shows that Mr. Joseph was remiss in his political donations to the ruling class.
I wonder, though I’m far too lazy to do the leg work, how a list of the closing CJD dealers would compare on opensecrets to a list of remaining open dealers.
(Aside: Every time I see CJD I think of Creutzfeldt–Jakob disease, which I’m not sure being afflicted with would be worse than being a CJD dealer.)
“HOW CAN THIS HAPPEN IN A FREE MARKET ECONOMY IN THE UNITED STATES OF AMERICA?”
Funny, it sounds like what he’s asking for is a bailout, to rescue him from the free market economy….
I think it’s too dismissive to say well he shouldn’t have been carrying that brand.
A franchisee occupies a unique space between being an entrepreneur and an employee. They own the business, but are subject to a lot of rules imposed by the franchisor. A franchisee can’t just do whatever the hell he wants or assume that his prospects of success are independent of the franchisor.
Let’s suppose that I operate a burger franchise — we’ll call it Burger Queen (BQ). I paid money for it and I staff up the place, and get to keep profits. But BQ will require that I buy my buns, napkins and meat from them or their preferred suppliers. I will have to train my people the BQ way, sell the types of burgers that BQ advertises, and make sure that my BQ store looks just like they want it too.
As a franchisee, you need to be highly interested in how the parent company is doing. If BQ buys its meat from the Chinese-American Antifreeze Company, that’s cause for concern. If BQ only runs advertisements in Swedish at 3AM on the Bowling Channel, you should be nervous. If customers surveys show that dumpster diving was preferred to BQ food by a ratio of 2 to 1, then you need to start losing lots of sleep.
You may run the most successful Chrysler dealership in the Southeast, making money hand over fist. But if you ignore what is happening with your senior partner, then you are extremely naive.
Franchisees of any business need to be wary of how their franchisor is doing. It’s not as if Chrysler’s failings were a secret; all of the dealers should have been gnashing their teeth. There weren’t just warning signs, there were massive warning billboards that they would have to have been blind to miss.
The only thing I am going to add is that perhaps, just perhaps, this family chose to stay with Chrysler out of that outmoded idea of ‘loyalty’.
As in ‘you dance with the one who brung ya.’
Plus, all of the other franchises may well have been taken up in the area where they are. This theory is somewhat verified by the fact that they clearly TRIED to diversify and ended up with Isuzu. Which GM threw under the bus. (Or has everyone here forgotten just how very popular Isuzu Troopers were some 20 years ago?)
They had to have done “something right” given that they succeeded for 35 years, were able to get a loan to bend over to Chrysler’s demands to spend money on their store “improvements”, and clearly must have some satisifed customers.
You generally don’t have a family owned biz which trashes its customers last 35 years.
Our US economy is tanking, and this story (assuming it is genuine – and why not assume this) is sad. My best pal just got tossed out of his job, and has no prospects. Another friend at church lost his job (in a tier 3 auto parts plant – the last one in the area is now closed).
But yes, let’s not forget true facts. Chrysler was not given a hand-out in 1979, it was truly a loan and it was not only paid back in full with interest, it was paid back early.
The situation now is far different. We taxpayers are on the hook for something like an additional $11 trillion over the next 10 years, and this will double our federal deficit.
I guess what I’m trying to say is – sadly – you ain’t seen anything yet. Once it is realized that the whole Frickin’ United States is essentially bankrupt, how do you think that is going to play out?
Iceland on a grand scale….. no economy, no money, no imports, total collapse. (Not forgetting that the US imports virtually all of it’s clothing).
Those of you with the means to do so might be wise to put up extra cans of food, don’t forget a can-opener. And some cloth, and maybe an antique treadle sewing machine…. unless you’re a nudist.
I feel for this guy and that community.
Out of curiosity what options does this dealer and dealers like him have left to deal with the new cars and factory parts they have in stock? If Chrysler wont buy them back can the dealer sell them at discount? Is there a limit on the price they can set to at least recover some of their loses? What would something like this do to the franchises that survive?
“But otherwise, Chrysler has been in and out of trouble for most of my lifetime (I’m 52 yrs old).”
Well, let’s see if this is true. Let’s assume that if the industry as a whole is losing money than you can’t single out Chrysler because it’s the general economic conditions that are affecting all makers (at least domestic). Otherwise you will have to say that GM and Ford (oh no!) have “been in and out of trouble” for most of our lifetimes.
Since 1960 I count 5 times that Chrysler has gone thru periods of losses: Early ’60’s, early 70’s, late ’70’s, early 90’s, and today. Each of these times also consisted of losses by the other two domestic makers due to recessions/oil shocks. Only two stand out: 1979, because Chrysler was close to bankruptcy and today because Chrysler and GM are in effect, bankrupt. Yet both of these situations were if not caused, certainly worsened by circumstances beyond an automakers control. In 1979 it was 2nd oil shock and currently the economic meltdown.
So if the criteria for whether an auto company should survive or not is to have not “been in and out of trouble” over the years then we would only have Asian, Korean, and European brands to buy today. Except when you start to look at some of the European brands you realize they have been “been in and out of trouble” too. Oh boy.
So there was ever a future in selling Dodge Avengers and Calibers in Melbourne, Florida? I have sympathy for the dealer and his employees, but Chrysler has been technically bankrupt for how long now? It didn’t take a genius to see this coming. In the auto trades, domestic dealerships have been trading for their real estate value for some time. If the government hadn’t come in and subsidized Chrysler to the tune of $5 billion and counting, every single Chrysler dealership would be in his shoes, actually worse, because he can theoretically sell his vehicles and parts to continuing Dodge dealers who can sell them with government-backed warranties.
There’s no question that the Obama administration was given a plate of lemons and has been trying to make lemonade. So far, the lemonade tastes like piss-water, but I wouldn’t have been able to do any better.
@ eamiller – In his letter, Mr Joseph lets us know that his dealership is being taken “without compensation and given to another dealer at no cost to them.”
If you think things like that happen in a functioning free market, then you just don’t understand what a free market is. The role of government in our free market economy is enforcing private property law. It looks like the opposite has happened here.
Exactly. This man PAID for a franchise agreement, and if he has done nothing wrong, should only be removed from the franchise agreement according to the terms listed in it. I don’t know what those are, but I would assume there is no clause allowing Chrysler to take it from him without compensation. And whether or not Chrysler is a “turd” brand is irrelevant. After all, they are giving the franchise to someone else. Poor man.
So there was ever a future in selling Dodge Avengers and Calibers in Melbourne, Florida?
I vacation there each winter, and I see Dodges on the road there. If the dealer goes broke on his own, then that is free market.
John
You lefties got one thing right, it ain’t socialism.
It’s fascism.
I can’t wait until the hippies realize the bill of goods they’ve been sold. There’s some good times coming.
@ Pch101 – I do appreciate your contribution to the comments section with your insight into the bankruptcy process. However, I can’t help but be a little skeptical of someone who feels the need state his case so loquaciously and respond to every criticism so fervently.
One can’t help but start to wonder what your angle is. I mean, what is your motivation to spend all day writing response after response to ensure the masses that everything the government does is on the up-and-up? Just sayin’…
I would assume there is no clause allowing Chrysler to take it from him without compensation.
It’s called Chapter 11 of the Bankruptcy Code. The termination is legal, no question about it.
http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=US&vol=465&invol=513
I can’t help but be a little skeptical of someone who feels the need state his case so loquaciously and respond to every criticism so fervently.
It’s very simple – misinformation annoys the hell out of me.
windswords
It is true that all three of the Detroit automakers usually have problems together. But Chrysler always seem a bit worse. In the early 60’s they permanently fell from #2 to #3 and in the entire 70’s they were alsorans who didn’t have the money to make a car to directly compete with fuel saving imports. And now again with today’s problems. Chrysler’s theme for the last 30 – 40 years is that it is too small to survive in a changing high tech auto industry (wasn’t that the reason for the Daimler “merger”).
FUD = fear, uncertainty, and doubt
When you come across shorthand like this just Google it and Wikipedia or Urban Dictionary will come up with the answer.
FUD is used by people like Rush and Osama to give simple answers to scared people who want simple answers. The type of people who blame socialism, capitalism, unions, religion, atheism, lawyers, etc for anything they don’t understand. People who are unwilling to see more than one side or take the time to understand more of the whole picture.
I personally blame health insurance companies for all our problems:-)
Pch101, thank you for the high velosity reality check. It was sorely needed.
To the rest who think socialism (and I’d like to go on record stating I’m not advocating) is Satanland, I’d like to point out that a fully functioning free market society would be likened to Charles Dickens era of Great Britain. Where if you as a citizen, couldn’t afford to pay your bills for right or wrong, you and your family had no legal recourse against the will of your creditors. Therefore you, and your family, had all possessions, land and property titles taken and you, and your family, were readily and handily thrown in debtor’s prison until the debts were paid or you died. This is how a true free market society works, love it or not. Thankfully we have a little bit o’ socialism thrown in because we got tired of seeing huge breadlines and people harassing a “brother to spare a dime” and the banks screwing one more poor bastard out of his farm for pennies on the dollar.
Our system isn’t pretty and like any government sometimes hurts the ones we try to protect, but it works and has worked for over 200 years. We have the oldest functioning government in the world for a simple reason; we as a people can adapt and overcome and come out greater than we were. If thats socialism, then I’ll take me some.
“You lefties got one thing right, it ain’t socialism.
It’s fascism.”
Oh thank god somebody finally identified this as Fascism. I was afraid that, having already identified our current political situation as Socialism, Communism and Kleptocracy we B&B would miss out on the astute observation that this is, in fact, a fascist dictatorship.
My theory? Herr Obama is secretly setting up socialist/communist plans that will allow him to hold on to his dictatorship long enough to realize his true dream – AN OPPRESSIVE HYPERCOMMUNIST FASCIST GERONTOCRACY!
Then he will really get down to the business of ruining America and taking away our freedoms to enforce the whims of the aged, which is obviously his aim. Well done, Barry!
Casual Observer, I can only guess that Pch101 is one of the few non-idiots on the Internet with time on his hands. I’m glad he’s here.
I have very limited rachmones for Mr. Joseph. He could have seen this coming. If the feds had not floated Chrysler in December, it would be in liquidation now. The bailout deferred the day of reckoning by a few months for him.
Since Chrysler has no salable products its other dealers will be in the same position in a few more months. The smart ones minimized their exposure to Chrysler and diversified long ago.
To speak to this Florida dealer’s little problem: I would think that having been a successful dealer for as long as he has, he’d be able to keep a servicing business open, specializing in Chrysler products but working on other stuff too, as he probably does now. He still has a parts inventory and a new car inventory. The cars, well, price ’em however and get ’em out the door. The parts, a lot of them will be needed to back up the service business. There will still be pain, because he will have to let some of his employees go, and probably some good ones will be among them. But that’s different than being completely out of business.
I was initially questioning the termination of both the Chrysler and Dodge dealerships in Tacoma, and both Chrysler and Jeep in Yakima and Longview, Washington. But in thinking about this some more, it starts to seem as though these dealers who got the finger this week are just ahead of the rest of the Chrysler Corp. dealers who will soon enough join them in not having any more new cars to sell.
Sad story but there has been a lot of redundancy in the auto market for years and he just got the short end of the stick when the jig was up. There are a lot of people finding that out right now since our whole economy for the last few years has been in fantasy land.
He shouln’t be whining and crying about it he should be finding a way to make the situation better and position himself to survive with the time he has left.
Stop sulking in the corner and get up off your ass and make something of the lemons.
jakecarolan:
One Question?
Will the OPPRESSIVE HYPERCOMMUNIST FASCIST GERONTOCRACY be sponsored by the Non-Tarp Saviors of the Universe(TM)?
If so, will there be punch and pie? Nothing helps a OPPRESSIVE HYPERCOMMUNIST FASCIST GERONTOCRACY go down with the masses quite like punch and pie.
Also, please pick up your welcome packet to USTTAC (United Socialist of The Truth About Cars). Pch101 and I will hold your place at the rally.
Therefore you, and your family, had all possessions, land and property titles taken and you, and your family, were readily and handily thrown in debtor’s prison until the debts were paid or you died. This is how a true free market society works, love it or not.
Actually a _true_ free market wouldn’t put people in debtor’s prison. It would sell them into slavery. (You have to go back a ways to find example’s of such a capitalists’ paradise, but they existed. Probably still do in places.)
Isn’t it an oxymoron to have HyperCommunist Fascism? Or is that the new slogan for the Libertarian party?
orc4hire, you are absolutely correct excepting that I was referring to Dicksonian economics, but should have been prefacing early American economics (or perhaps Roman) with endentured servitude or slavery being the price of failure.
How do I get a USTTAC bumper sticker or at the very least an arm band with its insignia?
I think the erosion of this thread into sarcasm shows that the state cheerleaders are very sensitive to criticism.
The difference between a BK and government intervention in a BK is that in a legal BK all the dealers would have been terminated.
In this case winners and losers are being picked in a process akin to paying protection to an inner city gang based on criteria made up on the spot rather then rule of law.
dolorean23 :
How do I get a USTTAC bumper sticker or at the very least an arm band with its insignia?
The bumper sticker is in the welcome package. Normally, we would charge extra for the arm band, but that would be too capitalist.
Fortunately, the Non-Tarp Saviors of the Universe(TM) were able to get them for twenty cents on the dollar so we can include those too. Once we get government sponsorship, we’ll send out uniforms too. Until then, the best we can offer you are some left over “Yes We Can” t-shirts:)
Enjoy!
Robert better close up this thread… It’s getting far too silly:)
Casual Observer, the thread was degraded in the first response, when somebody brought up the whole socialism nonsense. When people start lobbing conservative talking-point firebombs like the notion that the president is a secret socialist bent on stealing our freedoms or ruining industry, it’s already gone to pot.
Don’t call me a cheerleader. I’ve examined the situation and come to my own conclusions, which happen to be different from yours. Just because I don’t think democrats are fascist or socialist or communist doesn’t mean I’m ringing the bell for everything they do. It’s not all black and white and radicalizing the discussion invites sarcastic response.
However, 100 comments in with political digression and no mention of Hitler. I rather regret mentioning it even here. This is a delight!
dolorean23: Therefore you, and your family, had all possessions, land and property titles taken and you, and your family, were readily and handily thrown in debtor’s prison until the debts were paid or you died. This is how a true free market society works, love it or not.
No where is it written that debtors’ prison is part and parcel of a free-market economy, or that 19th century Great Britain represented a pure free market economy (it didn’t – there were still vestiges of the country’s feudal past exerting a heavy influence on the economy).
The United States at that time didn’t have debtors’ prisons – it had already sanctioned the bankruptcy process to handle people who couldn’t pay their debts. The economy in the United States was definitely more free-wheeling than it was in Great Britain at that time.
And people will still lose a substantial portion of their property if they cannot pay their debts. That is why we have bankruptcy courts. A little “socialism” isn’t going to prevent this, unless socialism now means letting people buy things they can’t afford and then keep them when the bills come due, even if they don’t pay for them.
“I think the erosion of this thread into sarcasm shows that the state cheerleaders are very sensitive to criticism.”
Alternatively, we just have a great sense of humor.
jakecarolan :
However, 100 comments in with political digression and no mention of Hitler. I rather regret mentioning it even here. This is a delight!
Godwin’s Law Jinx!
moedaman:
“It is true that all three of the Detroit automakers usually have problems together. But Chrysler always seem a bit worse.”
True due to the fact that a. they are smallest of the domestics and b. they do not have the foreign sales (although they have some) to offset domestic losses.
“In the early 60’s they permanently fell from #2 to #3 and in the entire 70’s they were alsorans who didn’t have the money to make a car to directly compete with fuel saving imports.”
Chrysler had a number of compact to small captive imports that did well in the early 70’s. And they were the first to have small economical fwd cars in the US market by the late 70’s. But they like their 2 domestic bretheren, were dependent on sales of the bigger iron to be profitable. In otherwords, they really wern’t all that different from GM and Ford.
And now again with today’s problems. Chrysler’s theme for the last 30 – 40 years is that it is too small to survive in a changing high tech auto industry (wasn’t that the reason for the Daimler “merger”).”
This was never Chrysler’s theme. It was the meme of so-call “auto-jornalists” and “experts” who said that there would only be 5 or 6 large automakers in the future. Apparently Daimler believed this. They thought they would be bought by someone else unless they became bigger. So they were looking for someone to buy. Chrysler’s ten + billion dollars in cash didn’t hurt either. Iacocca thought this too for a short while in 80’s but decided against it. By the late ’90’s Chrysler was doing well with lots of money in the bank for the next economic downturn. But ex-GM’er Robert Eaton was listening to the “experts” too and well, the rest is history.
jakecarolan:
“When people start lobbing conservative talking-point firebombs like the notion that the president is a secret socialist bent on stealing our freedoms or ruining industry, it’s already gone to pot.”
Yea, let’s get Bush back into office so we can start lobbing liberal talking-point firebombs like the notion that the president is a secret facist bent on stealing our freedoms. ‘Cause that would be so much better.
This inventory becomes impossible to sell with no factory incentives
Says it all.
I have a better story. Same story as above, nice local dealer, decent guy, lots of employees who’ve been with him for decades, etc. etc. etc.
He was an Olds dealer until GM killed the brand. Then he became a Chrysler dealer. Immagine having to go through having your franchise axed, twice. Of course last time he probably got paid something.
dolorean23:
“orc4hire, you are absolutely correct excepting that I was referring to Dicksonian economics, but should have been prefacing early American economics (or perhaps Roman) with endentured servitude or slavery being the price of failure.”
Great. We’re going to have a debate on modern economics while referencing a guy who lived 150 some years ago writing FICTIONAL stories. And he wasn’t even an economist.
This inventory becomes impossible to sell with no factory incentives.
Not impossible, just unprofitable, and most probably as part of transaction that loses money on each unit.
Liquidating dead inventory is ugly, painful, costly, pride-shattering and absolutely necessary.
Any lender worth their salt would willingly go along with a plan to recover what can be gotten out of floor planned cars and otherwise secured inventory as soon as possible.
# Casual Observer :
May 20th, 2009 at 12:43 pm
@ Pch101 – I do appreciate your contribution to the comments section with your insight into the bankruptcy process. However, I can’t help but be a little skeptical of someone who feels the need state his case so loquaciously and respond to every criticism so fervently.
One can’t help but start to wonder what your angle is. I mean, what is your motivation to spend all day writing response after response to ensure the masses that everything the government does is on the up-and-up? Just sayin’…
Casual, courtiers do what courtiers do. Besides, only right wingers have an agenda. If you note, while PCH is well informed and eloquent, he often avoids the some of the substantive issues raised, engaging in misdirection by laying out his case that there’s nothing to see here and that the emperor is dressed in the finest of raiments. It’s a form of prestidigitation.
Nothing to see here, move it along.
If that doesn’t work, expect mentions of Godwin and racism. Mustn’t let any liberty minded point go unchallenged by the standard bearers of statism.
While someone on this thread has already checked out Mr. Joseph on opensecrets.org, I don’t think we’d find many surprises there if were knew the real names of some of the regular commenters here.
The important thing to know about the left is that ironically ideology is not the most important thing to the left. Like everything on the left, it’s only a means to an end. The end is power.
So while art is subservient to politics, politics is subservient to gaining and holding power. Hence Miss California USA is to be condemned for publicly stating a position avowedly held by Barack Obama, Bill Clinton can sexually harass women, gay Republicans get outed and hounded from office, and the local public radio station drops eclectic music in favor of America bashing from the BBC.
I suspect that PCH’s interest is not merely personal, but rather that he has some kind of professional interest in politics, but as always, I could be wrong.
# Mr. Sparky :
May 20th, 2009 at 2:43 pm
“I think the erosion of this thread into sarcasm shows that the state cheerleaders are very sensitive to criticism.”
Alternatively, we just have a great sense of humor.
That you so casually and gleefully accept the mantle of “state cheerleaders” shows just how statist you are.
Socialism? Fascism?
It’s all so confusing. Fascism, which grew out of socialism, presented itself as a third way between socialism and capitalism. The fascists permitted businesses to operate without being directly nationalized, but the economies were planned and companies did as the government directed.
Perhaps we need a new label for what the Obama administration is creating, a fourth way. There are elements of socialism in that the government is taking equity stakes, sometimes controlling stakes, in private enterprises. On the other hand, firing CEOs and BODs and dictating bankruptcy winners and losers is more familiar to fascist systems.
Perhaps Obamism is sui generis. Time will tell. May God have mercy upon us all.
God, I’m so glad I don’t have any sycophants on this site.
Casual, wouldn’t it be creepy if people started saying how cool your comments are? I mean, you’re right on, but who needs to slobber?
I suspect that PCH’s interest is not merely personal, but rather that he has some kind of professional interest in politics, but as always, I could be wrong.
Yep, you’d be wrong about that.
I have been trying (in vain, obviously) to get you to remove the politics from your assessments of this business. It would be much easier to understand and predict what is going to happen next if you did.
windswords & Moedaman:
Chrysler was first to market with the “modern” front drive transverse engine cars in the Omni and Horizon. These cars came out in late 1977 as 1978 models. GM would not have the X cars out for 2 more years and Ford the Escort for 3.
Chrysler was hampered in that they sourced the 1.7 liter engine blocks from Volkswagen. The contract called for a max of 300k per year. When gas prices skyrocketed in 1979-80, Chrysler could have sold double the 300k cars they could build, but VW would not increase supply, figuring that they would rather sell complete Rabbits instead.
The Omnirison was no worse than anything else in the category at the time, and a good deal better than some. My mom bought an 80, and I recall that they were hard to get then (and the only really saleable car Chrysler had at that time).
In this case winners and losers are being picked in a process akin to paying protection to an inner city gang based on criteria made up on the spot rather then rule of law.
A question that’s not being answered, at least no directly. Who is deciding which dealers stay? What’s the criteria?
I can’t see this being partisan or corrupt, though I could see it being unfeeling, especially if you’re a dealer who happens to share effective territory with another, larger, more profitable dealer. I’d be interested to know, and if I were the complainant above, I’d certainly ask, why the mystery Chrysler dealer is getting the franchise?
If the answer is “they make more money” then, well, c’est la vie. They make more money. Franchisees cost money to service, especially when they’re being “serviced” by the franchiser having to maintain an artificial model lineup.
Toyota, for example, doesn’t really have this problem, while GM has it in spades. They have to maintain entirely redundant product offerings to satisfy their franchisers. Chrysler is somewhere in between, but I doubt that, were it not for the artificial Dodge/Chrysler duality, that we’d see Dodges that weren’t Rams or Sprinters.
How would he feel if Chrysler gave both him and his competition free equivalent franchises (Dodge/Jeep/Chrysler) and let them fight it out?
That you so casually and gleefully accept the mantle of “state cheerleaders” shows just how statist you are.
Just because he doesn’t bother to refute this laughable label doesn’t mean he accepts it. Chillax.
In one thread, which started out by discussing the plight of a Dodge dealer, we have touched upon:
1. Charles Dickens;
2. debtors’ prisons;
3. Pch101’s alleged political aspirations (Is he trying out his arguments on us before running for office? Otherwise, this seems like a highly inefficient way to garner votes, considering that most of us have no idea of where he lives or even who he is, which makes it hard to vote for him, unless he plans to run under his screen name.);
4. the nature and meaning of socialism, facism and communism; and
5. Miss California’s view on gay marriage.
All that we need are those topless photos of Miss California and we’ll be set…
Who says the auto industry is dull?
This letter seems mostly an appeal to emotion.
We only have 1 person’s paintjob of the situation; not a realistic set of multiple perspectives. Who knows what the real deal is?
He also may be misguided in implying a New Franchise will be created, when alleging his will be jerked and transferred.
-I thought the current ChryCo move was a Cancel Only.
If he’s instead whitewashing a region-default b/c his card got pulled, I’m then less likely to believe most of his anecdote.
On a parallel note: a distant cousin we only see at holidays invested in an old company ~30ish yrs ago, and held the stock until the Co. went BK, losing everything.
-How is Sunshine Dodge’s case so different?
It is sad people are losing their jobs from that dealer; but don’t go expecting the equivalent of a 50-bagger investing in Crazy Eddie stock; -which is what they did by casting their lot in with a crap business.
If my CEO displayed as little vision and strategy as SD’s management, I would expect our mothership to go down also. And if the top guy cannot demonstrate taking some kind of responsibility, what kind of exec does that make him?
Oh, and Pch101 worships the embalmed head of John the Baptist while spitting on the cross.
-I’ve seen him do it. ;P
jpcavanaugh: The Omnirison was no worse than anything else in the category at the time, and a good deal better than some. My mom bought an 80, and I recall that they were hard to get then (and the only really saleable car Chrysler had at that time).
On paper they were better than the competition in 1978-79 (AMC Gremlin, Chevrolet Chevette, Ford Pinto), but in the real world they showed quite a few bugs. Our neighbors and my best friend’s family had each bought a Plymouth Horizon, and both were as unreliable as my dad’s 1973 AMC Gremlin. And that is saying something.
If it wasn’t for the government, Chrysler would go POOF completely, and EVERY Chrysler/Dodge/Jeep dealer would be closing, not just some of them (like this guy).
geeber:
Ours was actually pretty good. Certainly as good as any Mopars of the era. Of course, they were plagued by cheap body hardware and suffered more than their share of electrical and fuel system glitches. But hey, it was a product of the Late Lynn Townsend era at Chrysler, which was not a good thing. But the basic engine, transmission, suspensions – the car stuff- was quite trouble-free.
That said, there are not many cars made from 1978-81 that I would be interested in owning today.
Is he trying out his arguments on us before running for office?
I do hope that you support my campaign. It will probably be a first to have a candidate run under his screen name, but I’m innovative like that.
Vote early, and vote often: http://www.ci.detroit.mi.us/Departments/HealthWellnessPromotionDepartment/Programs/EnvironmentalServices/AnimalControlCare/tabid/984/Default.aspx
jpcavanaugh:
My father car-pooled with the neighbor. His Horizon (complete with the optional woodgrain side panels) died in our driveway when it was less than a month old and had to be towed away.
My friend’s Horizon also died repeatedly, and the outside door handles kept breaking.
The only 1978-81 cars that I find interesting are the AMCs. They are badly built and were uncompetitive even when new, but they are like many cult movies – they are so bad, they are actually quite interesting. A ride in a Gremlin is an instant reminder of how good we have it today when it comes to vehicles.
Pch101 what is with the Detroit Animal Control link? Am I missing something here.
I’m with you, geeber.
We need to raise the price of electronic ink so folks won’t use so much of it in endless argument.
Less politics, more topless photos!
Am I missing something here.
It’s the old joke about being unable to even get elected as dog catcher. Guess that it was older than I thought…
The Feds are on the hook to uphold the lifetime warranty on those PoS vehicles. This gent can make a fortune selling them parts. Just hire a couple of Southside Chicago Democrats and you’re on the gravy train.
Pch101: I do hope that you support my campaign. It will probably be a first to have a candidate run under his screen name, but I’m innovative like that.
After posting on this site regularly, you are certainly prepared to lead a discourse on the nature of communism, facism, socialism and capitalism and how these all somehow relate to the auto industry.
Or why it’s okay to give GM lots of taxpayer money but wrong for the government to demand changes in the executive team that lead the company straight to bankruptcy.
Or how the downfall of GM and Chrysler was caused by Toyota dealers, the Sierra Club, The New York Times, the Bush Administration, free trade, Consumer Reports, Wal-Mart, people who drive a hybrid…strangely, everyone except GM and Chrysler management.
Provided, of course, that you want to be associated with those arguments…
Ronnie Schreiber : While someone on this thread has already checked out Mr. Joseph on opensecrets.org, I don’t think we’d find many surprises there if were knew the real names of some of the regular commenters here.
Wow, someone seems a little Goebeled. Paranoid much? My background is simple, I’m a total liberal pinko who spent the better part of 20 years serving my country in the US Army playing on M1A1s. I’ve deployed 5 times for my country and feel as such, I can say any God-damned thing I want to. Pch101 isnt vying for office and doesn’t seem to have a political agenda other than to get yer head outta yer ass.
Less politics, more topless photos!
Given the hoopla around Ms. Prejean, I suspect you can have both fairly soon, though I think we need a left-wing hottie involved in a pseudopolitical snit (say, expressing empathy for terrorists) to balance the scales.
Not that the Dixie Chicks weren’t cute.
I live in this dealers area, so I went back to the original article and the letter, both published in the local paper. Below are a few reader comments about Sunshine Dodge:
All I can say is “What took them so long to close Sunshine Dodge?”….. If the other dealerships were as dishonest and run as bad as Sunshine was, they deserve it. I only dealt once with Sunshine Dodge, and my parents did at the same time. BIG MISTAKE!
My experience was, sadly, similar. I took in a car for a rough-running engine. They diagnosed it and put on some part. It didn’t help – so I made another appointment to bring it back. 2 days later, before the appointment, a piston had a hole in it the size of a quarter. What SHOULD HAVE BEEN a $100 O2 Sensor repair became a $2500 engine replacement because of their mechanic’s diagnosis. To make matters worse- the dealership refused to do anything about it.The extended warranty company agreed to pay, PROVIDED I did NOT take it back to that dealership. Obviously, after that, I didn’t take ANYTHING back there again. So for me, the only surprize is that they STAYED in business all these years..
Gee George, I’ve bought four new cars, three being Dodges (other dealers) since you stole the spare out of my trunk when I was trying to get warranty work done and had to call the police on your employees, and you stood there like the “Don”. Good luck in your new profession.
Bought a truck from Sunshine about ten years ago. It was not a pleasant experience. Two days after the deal the salesman calls saying they made a mistake and I owe them $1500! I told him sorry about that, but a deal was made, papers were signed and that was it. I don’t owe you a dime. He then preceded to threaten me, saying he was going to have the truck repossessed. He got very ugly about it. A quick letter froma lawyer and I never heard back from them.
‘Now you know how your customers feel after purchasing a vehicle from you. What goes around, comes around.’
When you close the doors I’d like to be there to see if it’s the same face that looked at me when you had employees removing items from cars being worked on.
America should have voted for RON PAUL!
We’re doomed.
This process is in the Constitution, and was an innovative concept when the founders introduced it. It’s not un-American, this is as American as it gets.
Because the other options were either debtors prison or sorting out issues with a rifle. Neither of which worked particularly well.
This dealership should consider filing for Chapter 7 protection, it sounds like he’d be a good candidate with all of his indebtedness. Perhaps he can out-bankruptcy Chrysler LLC’s bankruptcy.
Try going to the dealers website (google it) before making comments on the Isuzu dealership. They sell Isuzu commercial trucks.
The problem with this dealer is that they only sell Dodge. Chrysler said a long time ago they were going to close the dealers that didn’t sell all 3 brands.
Ronnie Schreiber :
“That you so casually and gleefully accept the mantle of “state cheerleaders” shows just how statist you are.”
It does or perhaps I think I would look cute with pom-poms? The mind boggles.
The charge of “state cheerleader” is so absurd and over-the-top that it doesn’t require a retort. It requires ridicule.
My favorite form of ridicule is satire. The absurdity of my posts are a satirical mockery of this silliness of socialism argument in this topic.
Where as Kahn thought revenge was a dish best served cold, I believe ridicule is best served with a side of glee (and a nice sweet tea when its hot outside).
The government taking a stake in GM… Now that’s socialist. But that not today’s topic. Thus, keep your socialist ponies in the stable until then.
This message brought to you by:
The United Socialists of The Truth About Cars
The Committee to Elect Pch101 for Dog Catcher
The Non-Tarp Saviors of the Universe(TM)
Plus, all of the other franchises may well have been taken up in the area where they are. This theory is somewhat verified by the fact that they clearly TRIED to diversify and ended up with Isuzu. Which GM threw under the bus. (Or has everyone here forgotten just how very popular Isuzu Troopers were some 20 years ago?)
Or perhaps he was too late to the party and Isuzu was all that was left.
They had to have done “something right” given that they succeeded for 35 years, were able to get a loan to bend over to Chrysler’s demands to spend money on their store “improvements”, and clearly must have some satisifed customers.
And they had to be doing something wrong if Chrysler is asking them to leave, as in they weren’t selling enough cars. Or, the original Mr. Joseph knew how to treat customers right but the current Mr. Joseph does not. There are many possibilities.
You generally don’t have a family owned biz which trashes its customers last 35 years.
There are quite a few dealerships in my area that have been open for a lot longer than 35 years that have closed recently. Most had reputations for not exactly being “customer friendly”. The fact they were open for 35 years doesn’t mean they were a good dealership.
A question that’s not being answered, at least no directly. Who is deciding which dealers stay? What’s the criteria?
I read, elsewhere, that the approximately 25% of dealers being shuttered were responsible for 14% of sales. IOW, they are underperformers. I suspect this is at least one of the criteria.
I bought a new Dodge Omni in 1980. It was “ok”. The windshield leaked, and despite 10 visits to the dealer it could never be fixed. The headlights would constantly blowout, there was some “issue” with the fuse box (electrical system) and I had to carry spare headlights, which where not cheap, once I drove back to Long Island from the Catskills at night with only my parking lights, that was fun. That night I lost 2 sets of lights! I was carrying the spares, but they lastest only a few minutes. Usually got longer out of em. The shifter (linkage) was messed up from day one, and the dealer couldn’t properly adjust it. As long as I didn’t try moving the lever while turning it was “ok”. The idle was too high and couldn’t be fixed, though after I once in frustration held her in gear too long while slowing down, just to see the tach drop, she never properly idled after that (ok, I take the blame on that one). There were several other things equally wrong. But the kicker was the warped head from overheating. The Dodge dealer didn’t tell me what was wrong, they just gave me back the car with the radiator cap not installed! Amazing slime. However, it was “pretty quick” for a lil econobox. My friend insisted his dad’s huge 1978 4 door Merc (Linclon, not MB) with the biggest V8 available would “smoke me”, and we went 0 – 80 several times in a row, his expression was priceless, as I handed him his a@@ every time. I really am enjoying this thread. The “opinions” of the free marketeers are so devoid of reality… same old same old.
a proud member
The United Socialists of The Truth About Cars
and I want a seat on the committee
The Committee to Elect Pch101 for Dog Catcher
excellent slogan :)
The Non-Tarp Saviors of the Universe(TM)
-ps- I could make the bumper stickers if enough interest..
Chrysler R.I.P.
former owner: 65 Cuda formula S
70 Charger R/T
brother’s car: 69 SuperBee 440 sixpak
friends cars I knew well:
67 Barracuda 383
68 Barracuda 383
68 Dart GTS 340 4 speed
69 Charger R/T (hemiautomatic trans)
70 Duster 340
70 Challenger R/T
71 Challenger R/T
73 Cuda 340
numerous Vipers from first year thru current
Dangerous Dave wins the thread.
My favorite form of ridicule is satire.
To begin with, satire isn’t necessarily ridicule. I mean it’s easy for someone who isn’t mature or wise to confuse the two, so I guess it’s understandable. Sometimes one satirizes one’s own allies to make a point. One would never ridicule one’s allies or friends. In any case whereas ridicule is a gross and blunt cudgel of a tool, satire requires a deft hand and some comedic talent. Satire requires actual thought and criticism, not to mention some talent to parody style and politics. Keep working at it and I’m sure you’ll get better at it eventually.
Friends, I thank you for a wonderful day’s worth of reading. My one complaint is in inaccurate the use of labels. I suggest that we leave behind these words since they stifle the discussion; instead, let us agree to use the names of early church heresies. When there is something that we don’t like about the president/congress/EPA/or whomever, we can use Arian/Donatist/Origensian/Pelagian/Gnostic, and so on. This will show our displeasure, but it will not offend anyone . . . assuming that none of us are Zoroastrian dualists.
Ok. How about we just move past socialism and onto fascism then. Mussolini and FDR would be proud.
We feel your pain, we really do. Life is very unfair.
Some actions could/should have been taken by government – not the current one, or even the last one. This is a culmination of 30 years of problems, gas has been priced so low in this country that the foolish car makers have been making vehicles out of touch with reality. It is sad that it took this downturn in the economy to open their eyes.
If Reagan had added 50 cents tax to gas, going up to 75 etc and so on till we had now got $5 gas (still cheaper than most of the world) we would now have strong car companies that could compete in the world.
Instead we have the sad remains of once proud companies, deluded into selling farm implements thinking they were cars (calling them SUVs)- and everyone wakes up one day to find that the emperor has no clothes. And poor Mr Jospeh, and his 50 employees get shafted!
LotusCortina
New York
Everyone, really. Show me the memo that declared:
“The term Franchise is now synonymous with Socialism and Fascism.”
This guy, unfortunately for him and his employees, cast his lot with a losing company. But, really, did he not see this coming?
This is a kind of socialism, that is not FUD.
Btw, FUD is fear, uncertainty and doubt.
If the govt had stayed out, GM and Chrysler would both be out of business and all the dealers that they have would be in the same boat as this guy. And that probably is what should have happened.
In the long run what is left of the auto industry would become stronger. Trying to keep these weak players going makes the industry as a whole weaker.
psharjinian: Given the hoopla around Ms. Prejean, I suspect you can have both fairly soon, though I think we need a left-wing hottie involved in a pseudopolitical snit (say, expressing empathy for terrorists) to balance the scales.
Go to tmz.com, and enter “Carrie Prejean” in the search feature.