Which Dealership Terminations should Neil Barofsky investigate and why?

[XDCX]

There's no question that the termination of thousands of GM and Chrysler dealers at the direction of the Task Force was poorly handled. While I believe GM was more honorable than Chrysler, both OEMs have blood on their hands.

The good news is Neil Barofsky is investigating possible illegal activities that took place during the process that determined which dealerships would be terminated.

The purpose of this thread is simple, which Dealership Terminations should Mr. Barofsky investigate and what should he be looking for?

[XDCX]

I'll list the Dealership Terminations Mr. Barofsky should investigate in this post and update the list as more members respond to this thread.

Dealership Terminations to investigate and why:

• Zangara Dodge - Factory politics may have played a role in saving this dealer
• Tenafly Chrysler Jeep - Dealership had sued Chrysler over termination of Plymouth and refused to take Sales Bank units
• John Bailey Pontiac Buick Gmc - Financially strong single point store with good CSI gifted to Jim Ellis, large multi-point dealer
• Jim Tarbox Jeep - Peter Grady's deposition revealed dealer was terminated despite his "strong scorecard"
• Mark Calisi - Eagle Auto Mall - Dealer was terminated despite high MSR and strong capitalization
• Charlie Morris, Terry Chrysler-Jeep - Arbitrator concluded Chrysler closed the wrong dealership to terminate - Chrysler's "chosen" dealership ended up filing for bankruptcy
• Painter Family Dealerships in Utah - Chrysler gifted franchise to incoming NADA Chairman, Stephan Wade
• Audette Cadillac - Second largest Cadillac dealer in the country gifted to Suburban auto group
• Chief Pontiac/GMC - Did Political Contributions play a role in selecting this dealership for termination?
• Birmingham Chrysler/Jeep - High volume Pacesetter store terminated. Did Chrysler favor mega-dealers over a family store?
• Pannion Chevrolet

[JUNIOR]

I Think ours, Tenafly Chrysler Jeep is one to look at. The owners sued Chrysler over the termination of Plymouth and we didn't play nice when they were trying to get us to take bank units. I am sure they never forgot that lawsuit.

[Jeff Duvall]

John Bailey Pontiac Buick Gmc, Buford, Ga. Good dealer, good CSI, financially strong in probably the best location in Georgia and possibly the southeast. Single point family owned dealer terminated and franchise gifted to Jim Ellis, large multi point dealer in Atlanta.

Jim Tarbox in Rhode Island and Mark Calisi in New York, for the obvious reasons that came out in Peter Grady's testimony in bankruptcy court.


Charlie Morris, Terry Chrysler-Jeep,Burnt Hills, N.Y. facing dealer filed bankruptcy after Chrysler did, even the arbitrators ruling stated Chrysler closed the wrong dealership

Both the Painter family dealerships in Utah. Incoming NADA Chairman Stephen Wade was gifted the store in St. George while serving as Chairman of NADA's Industry Stabilization Task Force and met with Chrysler and GM before during and after the bankruptcy.

Larry Crain Chrysler Dodge Jeep, Little Rock Arkansas. Strong dealer opened less than 1 year and the other Chrysler dealer in Little Rock that I dont know the name of but had been in buisness for generations. Both were terminated and gifted to RLJ McClarty Landers.

Any dealership that was gifted to RLJ McClarty Landers or the Larry Miller group from Salt Lake City Utah.

Audette Cadillac Troy, Michigan. In buisness forever, second largest Cadillac dealer in the country gifted to Suburban auto group. And the Chrysler Jeep dealer in Troy sold over 2000 cars a year and purchased over $1,000,000 in parts per month from Chrysler gifted to Suburban as well.

[XDCX]

Junior and Jeff - Thanks for the posts - I added your information to the list in the second post of this thread.

[XDCX]

Here's an e-mail I received in response to a post I made concerning this thread in the comments section that followed the story by Automotive News:

"Chief Pontiac-GMC was a dealer terminated in Bonduel, WI. They contributed to the Republican party. It is NOT FAIR that a dealer is closed due to their political afiliation!!! I read that ultimately Barrack Obamma decided to close dealers that contributed to the republicans and called it "shared sacrifice"! This is a bunch of !@#$!!! I'm a customer of Chief, and they need to be given their dealership back! I even testified at their arbitration hearing in Madison, WI in May. This wrong needs to be corrected. This is still the USA!!!"

While I'm not certain if political contributions played a role in the rejected dealer selection process, I think it's great that a customer feels so strongly about his local dealer that he testified at the arbitration case.

I'll add the dealership to the list in the second post of this thread.

[XDCX]

Here's another e-mail I received:

Audette Cadillac-West Bloomfield, MI
John Bailey GMC-Buford, GA
Birmingham Chrysler Jeep-Troy, MI
Pannion Chevrolet-Southfield

Several more and the stories of each are too much to write about and so much to tell. Many legs to each story.

Jeff Duvall's post has already added Audette Cadillac and John Bailey GMC to the list and I'll add Birmingham Chrysler/Jeep and Pannion Chevrolet.

While I know the stories can be painful to tell, some dealers may find it helpful to share their frustrations and find they're not alone.

[Jeff Duvall]

X-man, Birmingham Chrysler Jeep was the dealer I mentioned in my previous post located in Troy Michigan and Stephen Wade only received one of the Painters franchises
Also any Chrysler Dodge Jeep dealer located near Iron Mountain Autoplex in Windsor Colorado. This dealer filed bankruptcy in June or July of 2009 after the state of Colorado pulled their dealer license for not paying off over $400,000 in customer trade-in payoffs. Oh and by the way this mega complex was heavily financed by Chrysler Financial aka Cerberus/Nardelli the same people leading Chrysler when the dealer cuts were made

[steve_biegler]

In a perfect world every effected dealer would be back in business. I understand that is not possible, state franchise laws that at one time protected the effected dealer now protect the gifted dealers of many states. In response to the argument that some of the dealers should have been shut down, isn't the free market good at that? If there is a dealer that isn't taking care of customers or selling their MSR or doing something ILLEGAL there are ways the factory can get rid of them through the requirements of their franchise. Many of the dealers that were cut were small businesses in small towns across the country just trying to make a living and employ some of the people left in the small towns. Many may have been the largest employer left in town! Most did not have the resources of savvy to make a big splash about being closed and felt overwhelmed by the factory/government, these are the ones that also need help. In my state in 1960 there were just over 600 new franchised dealers in our state. Just before the cuts there were 108, quick math will tell you that we have lost just about one new franchised dealer per month since 1960! WOW the free market was working dealers were consolidating or were closing on their own terms and the manufacturers were buying back tools and parts.
EVERY dealer has a story and to try to decide who should be investigated and who shouldn't is in my opinion impossible. I feel the effected dealers should be compensated for their franchise, and have parts and tools bought back per the franchise laws in their respective state.
I hope something comes of this probe but I have my doubts. I hope this brings the story back in the public eye. I have heard from many people you have to just move on and whats done is done, most are dealers that still have a franchise, go figure. I think NADA and many of the major automotive publications have the same feeling. Even automotive news moved this article off the front page of the web edition, you have to really dig for it, I found that very interesting.

A long rant to say ALL effected dealers should be helped.

[crowe]

City Motors (Jeep) Greensboro NC was in negotiations of a buy/sell agreement w/ Asbury Automotive Group. City was terminated & gifted to Crown Chrysler Dodge (Asbury). City had the Jeep franchise (AMC) before Chrysler did & got nothing but the shaft.

[steve_biegler]

We were also in the middle of a buy/sell. Gifted to the local Chrysler/Dodge.

[srt]

I would agree with Steve's comments that all cases deserve looking into. The high profile cases are well known but that leaves hundred's of others who suffered the same the same fate. We have been taught to let the free market decide the fate of a business. On a side note , can anyone explain what Obama was talking about with equality of sacrifice? I still don't see where the indivdual dealers fit into this.

[XDCX]

Thanks to those who have added to this thread.

I have received a few additional e-mails and I'll add them when I get a chance to get caught up this evening.

[XDCX]

I received an e-mail from an individual who suggested that some of the worst injustices will likely receive little attention because the dealer settled with either GM or Chrysler and entered in to a Non-Disclosure Agreement.

I think this applies to some of the Chrysler dealers who entered the arbitration process - they're still bitter about the injustice of their termination but they can no longer talk about it.

[XDCX]

I've received a few e-mails that have identified a possible pattern - did Chrysler favor dealers where Chrysler Financial had exposure?

To the extent Cerberus knew they were going to split-off Chrysler Financial and retain the company, did they instruct Auburn Hills to favor stores that had large real estate or working capital loans?

As I have suggested countless times, I feel the fact Zangara Dodge was allowed to move forward to NEWCO illustrates how tainted the dealer selection process was. Zangara Dodge was already closed down and being investigated by the New Mexico Attorney General when Chrysler made their "data driven" decision to move the dealer forward to NEWCO.

I have always felt that decision was based on Zangara's relationship with executives in Auburn Hills - especially his relationship with Landry.

That said, is it possible the decision to save Zangara Dodge was not based on Ken's personal relationships but the fact Chrysler Financial would have taken an even bigger loss if Zangara Dodge had been terminated?

In the end, Ken Zangara filed personal bankruptcy and his store was sold off to the Larry Miller group. Did the Larry Miller group pay any Blue Sky to get the dealership? If so, who received the money - Chrysler Financial (AKA - Cerberus)?