Firesale at Chrysler Dealerships Across Nation

Cut loose by bankrupt automaker, dealers offer bargain-basement prices.

May 25, 2009, 7:14 PM

May 25, 2009 -- The fire sale is on.

The almost 800 dealerships that Chrysler is cutting loose are now looking to sell 44,000 Dodge, Jeep and Chrysler vehicles in the next two weeks, at bargain-basement prices.

The now-bankrupt auto company refuses to buy back cars from the 789 dealers it is eliminating, leaving owners with two options -- sell the cars by June 9 with government assistance on rebates and low-cost financing, or risk losing the cars to auctions and to Chrysler dealers that are surviving the cut.

Dealerships hoping to sell what they can before the June 9 deadline are lowering their prices to rock bottom.

"The deals are very good. They are steals, not deals," said Rob Engel, owner of Tenafly Chrysler in Tenafly, N.J.

At Engel's dealership, a 2009 Dodge Ram Truck with a retail price of $45,428 is selling for $28,392 -- after rebates, incentives and cash back from the dealer.

Emily and Josh Patterson left a dealership outside Chicago with a new Dodge Caravan they got for nearly $13,000 off the $40,000 sticker price.

"We came in just to look but when we found the deal we really went from there," Emily Patterson said.

Yet the buyers' gain is the dealers' pain.

"It is a financial disaster for us, not just the business, but personally," Engel said. "As the dealer and the owner, my brother and I always worry during a time like this, where we know they are not taking back the cars. But I am passively confident we are going to sell all the cars."

Auto analysts say that before Chrysler made the announcement that it wouldn't support the 789 affected dealerships or allow them to perform warranty repair work, they were earning about $825 less per vehicle than other dealerships. Now, that difference has climbed to approximately $2,700 per vehicle.

"I don't feel any Chrysler dealership is going to feel competitive after they've lost the support of that mother ship," said Karl Brauer, editor in chief at, an automotive information Web site.

Chrysler Dealerships Struggle With Closing

Some shoppers, smelling blood, have made offers that some dealers consider ridiculous.

"We did have one person who literally thought they could buy a brand new car for a thousand dollars," said Bob Ford, of Westminster Dodge in Boston.

At some dealerships, both owners and customers are lamenting over the loss of relationships built over years of selling and servicing Chrysler cars.

"I am not concerned with warranty," said Ed Prigge, a customer at Tenafly Chrysler. "I am concerned with not being able to use this dealership."

"We have an enormous amount of customer loyalty here, repeat business over 25 years, and that is the biggest disappointment," said Mark Struble, a salesman at Tenafly.

Engel said he and his brother, who started in the auto business when they were just 11 and 13 years old, fixing cars in their father's repair shop, would keep the dealership afloat by falling back on their service background.

"It is really a full circle," Engel said. "We are going to service as many types of cars as we can here -- and keep the business going."

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