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Some Chrysler Dealerships Appealing Bankruptcy Decision

Posted By admin || 24-Jun-2009

According to an article in the Star-Telegram, two former Chrysler LLC dealership owners have filed an appeal of a bankruptcy judge's order terminating their franchises and those of more than 700 other dealerships as part of Chrysler's bankruptcy plan.

The article said:

"Tarbox Motors Inc. of North Kingstown, R.I., and Tarbox Chrysler Jeep LLC of Attleboro, Mass. filed a notice in bankruptcy court on Friday, saying that they were appealing the decision to U.S. District Court."

Earlier this month, U.S. Judge Arthur Gonzalez allowed Chrysler to terminate the franchise agreements of 789 of its dealers as part of its bankruptcy plan. That's 25 percent of its dealership network. But the appealing dealerships claim that the closings won't save the bankrupt automaker any substantial money.

They also claim that the dealership terminations are causing thousands of job losses around the country. Many Chrysler dealerships affected by the automaker's bankruptcy are converting their companies into used car lots or repair shops; but many more are closing their doors completely.

It is highly unlikely that these dealership appeals will be successful especially if allowing the dealerships to remain open is perceived as making Chrysler less viable once it emerges from bankruptcy.

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