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Auto Dealers respond to Chrysler filing

by Bill Cawthon on

The National Automobile Dealers Association (NADA) issued the following statement which can be attributed to NADA Chairman John McEleney:

Bankruptcy is not the preferred option, but we have every expectation that Chrysler and its dealers will emerge stronger and more competitive than ever. We’re pleased to hear of the announced merger with Fiat which should help speed up Chrysler’s restructure.

It’s important to point out that Chrysler will continue to honor all warranties and that Chrysler dealers will work with all parties concerned and, most importantly, will make sure that their customers are taken care of.

Bankruptcy, however, must not be used to drastically reduce dealer numbers. Dealers generate more than 90 percent of manufacturer revenue and are not a cost to the automaker. A rapid reduction in dealer numbers would not only do absolutely nothing to improve Chrysler’s viability in the short term, but it would actually work against Chrysler’s stated objective to increase revenue and cut costs.

Chrysler’s bankruptcy is especially disappointing. Like so many others, we were hopeful that all of the stakeholders would be able to reach agreement, and Chrysler’s restructuring could move forward out of court. The key now is to get in and get out of bankruptcy as quickly as possible. Since NADA represents all dealers – both domestic and international – our concern is to minimize disruption to the entire auto industry. In other words, the shorter the bankruptcy, the better for the entire industry – both domestic and international.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.

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