A person owning a McDonalds franchise, can easily revamp to another kind of fast food and probably make more money, they don't have the kind of money invested in this business as the auto dealer has.
These dealers have their lives invested in these dealership. The auto makers demand/tell the dealers how many cars they MUST TAKE (it is not an option) each year. The dealers HAS to put these cars on a Floor Plan with their local banks and pay the interest each month.
This dealer states he has $300000.00 in part inventory, which they won't buy back. This dealer invested in himself, his employees, and his community all to be swooped away from him and GIVEN FREE to some one, how is that fair?
What difference did it make if the dealer only sells 35 cars a month????? It is 35 more that the auto makers profited by, right?
I remember the Oil companies did this often times in past years. They would start a gas war, until the little man was forced to give up his service station. Then the Oil companies would come in and build their and as it was the only station they UPed the price of gas, no competition.
You assume that Chrysler has no per-dealerships costs.
That is simply not true.
Production rates for cars and spares - infrastructure - networking - shipping - training and on and on - all can track some costs to corporate.
The fact that they may net some to corporate at each dealership does not mean that they could not net more with less dealerships.
If you cut costs by more than you cut gross you increase profit.
And as for revamping to another kind of fast food - he already sells Isuzus and used cars. He has portions of his business that are not dependent on Chrysler.
Hey - by the way - where are all the people who claim on other threads that they will never buy another Chrysler or GM product?
I mean - really - what does it matter to them if this guy goes under - in their perfect world he would fail outright because smart Americans wouldn’t buy that government trash anyway.