Chrysler Closing Dealerships Nationwide

Chrysler Closing Dealerships

In an already overstrained economy, Chrysler LLC has announced the closing of dealerships across the nation. When and where is the only question. The once mighty auto giant is trimming down to stay in competition not only with other auto makers, but with the economy as well. The projected report is that 14% of total dealerships will be affected.

After posting record profit losses all year, Chrysler appears to be targeting the least profitable dealers. Dealer performance, logistics, and dated facilities are all part of the criteria for closures. The growing number of foreign competitors in the U.S. market has definitely played a deciding factor as well. Chrysler states that the closings are needed for the auto company and the auto industry as a whole to survive.

Chrysler is not the only company this week to announce dealer closings. G.M is also set to close a number of their dealers also. Preliminary reports are that nearly 2,000 of G.M.s 6,200 dealers will be affected. Insiders are optimistic that this figure will not be that high. G.M. is also not out of the dark despite federal bailout money, and chapter 11 bankruptcy is still a big reality. Even the Japanese giant Toyota has felt the economic crunch, posting their first ever loss while being in business in the United States.

Not only does this affect employees at the local dealer level, the impact will have a secondary effect on those directly in business with them. Lending institutions, parts suppliers, and qualified auto technicians will all be affected adding to the nations already over crowded unemployment rate.

Ford Motor Company, the most fit of the three domestic auto makers, and hasn’t had to rely on a government bailout, is also talking of down sizing a few dealers. As of yet, none have been affected, but the auto maker has suspended new dealerships from opening up. It appears that the scaling back effort by Ford a few years ago has sustained the company in the lean times.

Layoffs, closings, bailouts. The industry is still reeling in these tough economic times. Luckily for our nation, history has shown us that after an economic down turn, there is always a long period of prosperity. The big three are trimming corners to reach the big upswing which is surely on the way. The industry will survive, and lessons learned will not be forgotten.