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California dealer group says Chrysler LA dealership is illegal

by Bill Cawthon on

Automotive News is reporting that the California New Car Dealers Association (CNCDA) has filed a petition with the California New Motor Vehicle Board (CNVB) calling for an investigation into Motor Village LA, a prototype new car dealership Chrysler Group opened in Los Angeles last November as a testbed for new retailing strategies and as a showcase for new Chrysler and Fiat vehicles. The dealer group wants the state to discipline Chrysler for operating an illegal, manufacturer-owned dealership. Disciplinary measures could include revocation of Chrysler’s license to sell cars at Motor Village LA.

California law prohibits a manufacturer from operating a dealership within ten miles of an independent dealer selling the same brand. California law does grant a one-year exemption provided the manufacturer sells the dealership to an independent owner operator by the end of the first year. Motor Village LA does have a dealer operator but the CNCDA charges arrangement is a sham as the dealer operator does not have any significant money invested in the dealership, as required by California law.

A Chrysler spokesman says the company disagrees with the CNCDA and looks forward to discussions with the CNVB.

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 just-auto.com, 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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