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Chrysler to halt sales at 4 area dealerships

May 14, 2009|By HEATHER KEELS

o Click here for the complete list of dealerships Chrysler plans to close

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At least four Tri-State area Chrysler dealerships are among those the company has announced plans to close as part of a bankruptcy-related restructuring, but Hagerstown's Hoffman Automotive will remain open.

"It was nerve-wracking for everyone, and my heart goes out to all the dealers that have lost franchises," said Jenny Stahl, operator of Hoffman Chrysler Jeep Dodge on South Edgewood Drive. "There were some very, very good dealers."

Tri-State dealerships on the company's list of those it plans to close are:

o The Union Sales Co. of Martinsburg, W.Va.

o Thomassen Ford-Mercury Inc. of Charles Town, W.Va.

o Don Phillips & Son Enterprises Inc. of Frederick, Md.

o Richards Auto Sales Inc. of McConnellsburg, Pa.

Many of the dealerships affected sell only one or two of Chrysler's brands, while Hoffman sells Chrysler, Jeep and Dodge vehicles, Stahl said. In addition, Hoffman restructured its company several years ago and put a stronger focus on sales and customer satisfaction, she said.

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I'm pleased that our hard work was noticed," she said.

B.A. "Buzz" Poland, general manger of Union Sales in downtown Martinsburg, said sales at his Dodge dealership were hit hard by high gas prices and the economic crisis.

"We've sort of seen this thing coming out of the other events that were transpiring," Poland said.

Poland's fears were confirmed Thursday morning when he received an express mail letter telling him he was losing his Chrysler franchise.

Poland said dealerships affected have an option to appeal the decision, but the process would be expensive and the chances for success would be slim.

Instead, he plans to shift his focus to his existing pre-owned car sales business and continue to maintain a professional service department.

"We just have to look at it as a turning point and move ahead in a slightly different direction," he said.

His company had been reducing its number of employees through attrition and several rounds of layoffs over the past six months, Poland said. He said he does not expect to have to lay off any additional employees.

Union Sales has been in business since January 1915, making it one of the oldest operating dealerships of any brand in West Virginia, Poland said.

"Evidently, to have survived 95 years, we've treated a lot of people in the Tri-State area very well over the years, and we have every reason to expect to continue that in the future," Poland said. "It just will not include the Dodge brand."

Chrysler, in a motion filed with the U.S. Bankruptcy Court in New York, said it wants to close 789 dealerships by June 9. Many of the dealers' sales are too low, the automaker said, with just over 50 percent of dealers accounting for about 90 percent of the company's U.S. sales, The Associated Press reported.

The restructuring will mean changes for the remaining Chrysler dealerships, area managers said.

Sam Hall, general manager and vice president of Tate Chrysler Frederick Inc., said he currently sells only Chrysler vehicles, but expects to be issued Jeep and Dodge franchises due to the closure of Frederick-area Jeep and Dodge dealerships.

"I'm so shocked at the fellow dealers that have lost their stores," Hall said, adding that some were personal friends. "I'm just grateful that we're one of the ones they decided to keep."

Hall said he wasn't sure of the criteria that was used to decide which dealerships to keep, but he thought location might have been a factor.

Hall also said he expects the volume of new vehicles of all three brands to be reduced, so the company may be consolidating single-brand dealers.

Stahl said another change for remaining dealerships will be the addition of the smaller, more fuel-efficient vehicles made by Fiat, the Italian automaker merging with Chrysler.

"Chrysler all along has had larger vehicles," Stahl said. "Now we're going to add to that portfolio."

Stahl said she hopes the changes will bring some relief from the "snowball effect" of economic conditions that all car dealers are facing.

"I think those that remain with this new, improved Chrysler Motor Company are going to be very strong," she said. "It's a remarkable product that we offer, and I think It's going to be priced competitively, finally."

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