Chrysler Group has been sued by rejected dealerships that demand compensation for lost income and damages against their legal rights. Nine plaintiffs have sued Chrysler with four dealerships being the most recent ones to claim reinstatement and several more will probably join the suit in the following weeks.
The first dealership to file a lawsuit was Century Dodge Chrysler Jeep in Wentzville, Missouri. Some other dealers joined their efforts in an attempt to revert the decision to close, but other have resigned to the fact that they are extinguished.
The automaker filed for bankruptcy protection in 2009 and wanted to eliminate almost a quarter of its retail body. Using bankruptcy protection, Chrysler tried to overcome the restrictive state franchise laws, but some dealers sought arbitration. New laws have allowed states such as Oregon, Maine, Illinois or North Carolina to block Chrysler if they wish to grant a new franchise or relocate a dealership where other dealers were rejected.
Sales volumes, customer satisfaction and whether the dealer could handle all or just some of the three brands produced by Chrysler, were all taken into account when deciding which dealerships should close. The process of consolidating dealerships and locating all three brands under one roof started more than ten years ago. It was part of the decision of the company to stop manufacturing and marketing overlapping products. The current economic conditions would not allow the retail network to survive.
