Chrysler Cuts Dealerships

By Paul Eisenstein June 12th, 2008

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Even before the current slump in car sales, it was conventional wisdom that the Big Three U.S. automakers were "over-dealered." In some cases, they operated two, even three times as many as their import rivals when you adjusted for overall sales. Once, that was considered a real advantage, giving Detroit more coverage, but no longer.

General Motors began trimming back its showroom count more than a decade ago, often to sharp resistance from the smaller retailers who were typically the first to go. Now Chrysler is stepping up its own dealer consolidation program, eliminating 196 outlets, or roughly 5 percent of its total during the last 12 months.

The pressure is increasing, both on Chrysler and its retailers. With the overall American car market slipping and Chrysler's own share plunging even faster, it's becoming harder and harder for marginal outlets to stay in business. And the automaker is pressing even some of its healthier dealer to consider selling out.

Part of the campaign is to consolidate showrooms that continue to sell only one or two of the automaker's three brands - Chrysler, Dodge and Jeep - into single, so-called Genesis shops. Thirty-seven of these all-brand showrooms have opened since the beginning of the year, and today, Genesis retailers account for 58 percent of Chrysler's 3,488 remaining retailers.

Tags: Chrysler, Dodge, Jeep

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4 Responses to “Chrysler Cuts Dealerships”

My point of you is the more you have dealers to cover the market, more you have chance to sale your cars.

Other way to see it is more dealers, more stock sitting in dealerships, means more discounts…If you overcapitalise on dealers then they end just taking sales from each other. McDonalds tries to keep a market patch for each of its “dealers” and has suffered in the past (as is Starbucks now) having too many shops in a similar location. They just takes sales from each other. if you can keep sales volume about the smae, with les dealers makes those dealers more profitable. Makes sense to me.

The problem is nobody wants a Chrysler car or truck. Their products are boring, and if anything have only become MORE targeted to a certain segment of the market than ever (and its a segment that has no money).

Everybody else looks at their cars and laughs.

The trucks are particularly bad, how much higher were they going to raise the hood on their trucks trying to sell the tough guy image? The hoods probably cost all buyers 5mpg on the freeway.

They are cutting dealers because they make a product nobody wants. Period.

Obviously the Jeep (wrangler and liberty) & sprinter products are still seeing demand, but the rest?

And really, just how many different models of JEEP suv and crossovers did they think the market would support?

The problems at american car companies are so obvious, its amazing nothing has been done about it. Lutz is doing the best of the bunch, but he’s taking way too long to do it.

The *
** brewing industry
** gasoline retailer
** clothing retailer
***food store chains[etc]
~~~ So FORTH AND SO ON!!!.

You name: it is ; the same old same old all over again.

Consolidate, gobble up , disperse amongst a very few business buds and partners.
Than crash it all to the ground, then, lets repeat over and over again, with what ever business and industry BIG MONEY can get it’s hands on.
Than !: destroy and start the processes all over again:
*** BUY AND DESTROY CYCLES **.
** OVER AND OVER AGAIN.***