Utah dealers who lost their Chrysler and General Motors franchises last year are wary of a recent offer by the automakers to revisit decisions that forced the dealers to close new-car showrooms.
Facing congressional pressure and looming legislation that could force them to review last year's moves to trim their sales networks, GM and Chrysler hold out hope of a reprieve. They are offering to meet with affected dealers to explain their decisions, as well as binding arbitration if the dealers still want to challenge the decisions.
Yet not everyone is high on the offer.
"To me it is a completely political move that won't amount to a hill of beans," said Jim Hinckley, whose Hinckley Dodge of Ogden was on Chrysler's hit list while his Hinckley Dodge Chrysler Jeep of Salt Lake City was spared.
Hinckley doubts he will participate in talks with Chrysler, suggesting the automaker decided what it would do a year ago, and there is little hope of changing its mind.
"I have a hard time believing they are going to take back someone who they already have terminated and has been out of business for six months," Hinckley said. "Everyone would probably save a lot of money and pain if we would could just move on."
Hinckley Dodge of Ogden now operates under the Hinckley Automotive name. It services Chrysler automobiles, carries parts and also sells pre-owned cars.
In May, Chrysler announced it would terminate sales agreements with 789 dealers nationwide, including 10 of its 24 franchises in Utah. GM indicated it would terminate more than 1,200 dealers nationwide.
While Chrysler identified the dealers it intended to terminate almost immediately, GM never publicly posted a list. But it gave affected dealers until September 2010 to sell and service cars and get their affairs in order.
Utah automobile dealers James Painter, who lost his Chrysler dealership in St. George and his Chrysler and GM dealerships in Nephi, expects to participate in meetings but questions the need for arbitration.
"Why do we need to arbitrate?" Painter asked. "Neither one of them had any good reason to terminate me."
Earlier this year, GM and Chrysler indicated they needed to streamline their antiquated dealership networks because they had too many outlets competing against each other.
But Utah New Car Dealers Association Executive Director Craig Bickmore responded that dealerships hardly cost automakers anything. Dealers paid for the construction of their own buildings, and their parts' inventories. They hired their own employees and either purchased or financed all of the new automobiles on their lots, he said.
Commenting Wednesday on GM's and Chrysler's offer to meet with terminated dealers, Bickmore said many Utah dealership owners still are gathering information and have not made up their minds on whether to participate.
"They [Utah auto dealers] are being given an opportunity to go to arbitration, which is something they haven't had before," Bickmore said. "There may be an opportunity for some of them to get their stores back."
