Some General Motors Co. dealers in the area are hoping they’ll get a letter this week telling them they’ll keep their franchises past October.
And some former Chrysler Group LLC dealers are hopeful they’ll win back franchises in coming months.
But other dealers have concluded the fight isn’t worth it.
GM is sending letters this week to 661 of the 2,000 U.S. dealerships that were told last May that GM would cut its ties. The letters are the same preliminary agreements GM sends to dealers starting up franchises or taking them over, spokeswoman Ryndee Carney said Monday.
“It’s hard to predict how many of them will be reinstated,” Carney said.
Chrysler soon will open arbitration with the 789 U.S. dealers it cut in June.
The carmakers said they needed to cut their dealer networks to match declining sales and ensure high standards. Some dealers disputed the rationale but are unlikely to fight.
“We’re proceeding as if we’re going to become strictly a pre-owned store,” said Chris Hawley, managing partner of Preferred Chevrolet-Pontiac in LaGrange.
But other area dealers want to keep or restore their franchises.
Carney said dealerships getting letters will have to meet requirements for capital reserves, facilities, location and other factors.
“If they can comply with the terms, they can be reinstated rather quickly,” Carney said.
Dorais Chevrolet in Wabash appealed GM’s decision to end its franchise. Now, as he awaits a letter of intent from the carmaker, owner Dave Dorais is reluctant to comment on the process.
But Mendenhall-Roy Chevrolet in Grabill has given up on the idea of staying a Chevrolet dealer after October, said Ray Mendenhall, president of the dealership.
“Our attorneys advised us that the deck was stacked severely against us,” said Mendenhall, who estimated that it would cost $30,000 to $50,000 to fight GM’s decision to cut it as a dealer.
The 500 dealers who appealed GM’s decision but aren’t getting letters of intent can pursue arbitration, Carney said. She didn’t say how quickly that will be completed.
Chrysler hopes to begin arbitration hearings in early April and complete them in six to eight weeks, spokesman Mike Palese said.
Tomkinson Dodge Inc. in Fort Wayne is doing everything it can to show Chrysler that it has strong support. It has a Facebook page where people can become fans and it has a blog, RestoreTomkinsonDodge.com.
“Our Facebook page got over 800 fans in the first week,” General Manager J.R. Tomkinson said.
But for Grant Trier, arbitration’s not worth it.
“It’s too expensive,” said Trier, who estimated the process would cost $25,000 to $150,000.
Instead, Trier is concentrating on his Ford dealership in Columbia City.
