Requiem for a Chrysler Dealership...

When the list of dealerships that Chrysler had terminated became public, I became curious if the small dealership in NJ that my parents have been buying cars from for the last 20 years was on the list. The dealership, Belle Mead Garage, is on the list.

I can understand that Chrysler wants to eliminate some of it's dealerships, and some of the ones on the list have bad reputations - one was accused at one point of taking the keys to a customer's trade and locking them in an office. But many are small, local dealerships that didn't sell huge numbers of cars, but stayed in business because they had a reputation for individual service that bigger dealers don't.

That includes Belle Mead. When I turned 17, my parents wanted to get a used car for me to use. They didn't really find anything appealing, and my brother - a part-time DJ- had designs on their minivan. So they decided to buy a new van, sell my brother the old one, and give me my brother's old car. But my dad wanted the new van configured a certain way, which meant he had to order it - but I needed a new car now. So Belle Mead gave him a loaner, free of charge, for the two months or so until his new Voyager came in. Granted, the loaner was a well-worn used minivan, but it's still hard to picture too many other dealerships doing that.

When my dad's '95 Neon was totaled, he decided to buy a used car of similar value. The salesman came up with a few to test drive - and knew the age and gender of who had traded in each of them, plus what they traded it for. Once again, not the kind of service that you get at CarMax.

One of the commenters on the story I linked commented that he had bought cars at Belle Mead because of the owners, not because they were Chryslers. I suspect the same is true for a lot of people, and Chrysler may find many of their sales don't move to their remaining dealerships.

The other thing is that they way dealerships are being eliminated seems like it was designed not only to knock down the eliminated dealerships, but also kick them in the nuts. Because they are in bankruptcy, the list is public, so everyone knows which dealerships are closing - so who wants to buy a car from a dealership that will be gone in a month? Chrysler will not be buying back cars or parts inventory from the eliminated dealerships, and the dealerships can't legally sell the cars themselves after June 9 when their franchises are terminated. Which means many of the dealerships will probably have to declare bankruptcy themselves.

I realize Chrysler is broke, which makes it pretty hard for them to buy stuff back. Still, this too might end up biting them in the ass, because if those cars don't get bought back by other dealers, they will probably be auctioned off in bankruptcy auctions - meaning Chrysler will be competing with cars selling at auction for a fraction of the price, some of which probably will end up in the hands of sleazy used car dealers or tent-sale car liquidators - not great for Chrysler's brand image - the brand image that this whole thing was supposed to fix.

I don't want to be one of those people who gripes that "if we can bail out x, then we should bail out everything". I see the case for bailing out banks, although I don't like the way it's been done - a somewhat stable financial system is necessary for our economy to function. I'm not so willing to tolerate the bailout of GM and Chrysler, which seems like a giant handout to the union. But it's interesting that the unions get a huge wealth transfer from taxpayers, while a bunch of small business owners get the shaft. As the media has pointed out, this will have ripple effects - not only people laid off, but lower local property (and in some cases, sales) taxes and a glut of vacant dealerships - and if dealers end up declaring bankruptcy, probably some pretty significant pain for their suppliers.

Well, RIP Belle Mead Garage - 1927-2009.