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Do IT this week: Layering
Six Chrysler franchises in Summit, Stark, Medina cut in bankruptcy action. GM sellers await word
By Jim Mackinnon and Cheryl Powell
Beacon Journal staff writers
POSTED: 08:04 p.m. EDT, May 14, 2009
First, hundreds of Chrysler dealerships got bad news.
Now it's General Motors dealers — including 13 in Summit County — who are waiting to see if they will be allowed to stay in business.
And Northeast Ohio is waiting for the economic fallout.
Today, the same day that 789 Chrysler, Dodge and Jeep dealerships nationwide were told their franchises will be revoked, General Motors mailed more than 1,000 letters to dealers that the Detroit manufacturer wants to close, said Terry Metcalf, executive vice president of the Akron Area Automobile Dealers' Association.
So, probably starting Friday those 1,100 or so dealers will learn GM wants to close them, Metcalf said.
''It's likely somebody [in Summit County] will get a letter,'' Metcalf said.
GM will not make public the list of dealers it wants to close, GM spokesman Tom Wilkinson said.
''We're not required to,'' Wilkinson said. ''We want to keep the conversation between GM and the dealers.''
General Motors executives say they need to cut as many as 2,600 of 6,200 dealers. The restructuring efforts of GM and Chrysler are being supervised by a newly created Obama administration auto industry task force.
Chrysler said it intends to close 25 percent of its 3,200 dealers, or 789 including six in the Akron-Canton area, by June 9, saying it has too many dealerships nationally. The dealers' names became public when they were filed with papers in U.S. Bankruptcy Court in New York City.
Local Chrysler dealers named are:
Axelrod Chrysler-Dodge Jeep, 900 Broad St., Wadsworth.
Kempthorn Dodge-Dodge Trucks and Kempthorn Motors, 1449 Cleveland Ave. NW, Canton.
Medina World Cars, 3926 Pearl Road, Medina.
Spitzer Autoworld Akron, 1535 Vernon Odom Blvd., Akron.
Montrose Chrysler, 2100 W. Main St., Louisville.
Waikem Chrysler Jeep, 3716 Lincoln Way E., Massillon.
Doug Waikem, an owner of Waikem Motors, said he wasn't surprised his dealership was listed.
By this afternoon, the dealership already was pulling Chrysler cars off the lot.
''We're almost relieved to get it over with,'' Waikem said.
Chrysler and Jeep vehicle sales account for only about 8 percent of Waikem's overall sales volume, which totaled roughly $150 million last year, he said.
Progressive Auto Group in Canton will be the Canton area's remaining Chrysler dealership, Waikem said.
Waikem said he suspects Chrysler opted to drop his dealership because it competes on an auto row with nine import dealerships.
''This needed to be done, and it was not easy surgery on Chrysler's part,'' he said. ''Did they make the right decision in every case? Probably not. But they did the best they could.''
The Waikem family acquired the Chrysler franchise in 1974. Chrysler narrowly escaped bankruptcy in 1979 and was rescued by a $1.5 billion U.S. government loan signed into law in early 1980.
''Fortunately, then, we had Lee Iacocca to guide us out of bankruptcy,'' Waikem said. ''I don't see that happening again. We have no more Lee Iacoccas in Detroit.''
The dealership doesn't plan to cut jobs as it continues to sell Fords, Nissans, Subarus, Hondas, Mitsubishis, Kias, Hyundais, Buicks and GMCs, he said.
Steve Parker, general manager of Medina World Cars, said his dealership also won't appeal Chrysler's decision.
''It's not completely surprising,'' he said. ''We're a smaller, lower-volume store.''
A manager at Montrose Chrysler in Louisville who declined to give his name said the dealership will consider appealing.
'' We're still open for business. We're still selling cars,'' he said.
The three other Akron-area dealers losing their Chrysler ties did not return phone calls today.
Chrysler largely singled out ''single point'' dealerships that sold only Dodge vehicles and in some cases Chryslers and Jeeps, said Gary Adams, president of the Greater Cleveland Automobile Dealers' Association.
''That's what they said they were going to do and that's what they did,'' he said.
The Northeast Ohio Chrysler closures likely will mean the loss of about 1,000 jobs in the region, he said.
Statewide, the pending closing of as many as 160 GM and Chrysler dealerships could mean as many as 8,000 job losses — 3,000 or so just in Northeast Ohio, the dealer group estimates.
Owners of surviving Chrysler dealerships expressed disappointment in the mass closings.
''It's awful. It may be the most historic day in the auto industry. It's awful,'' said Chuck Eddy, co-owner of Bob & Chuck Eddy Chrysler-Dodge-Jeep in Austintown. Eddy's Chrysler franchise was among the lucky ones that will continue.
Eddy joined other car dealers from Northeast Ohio to lobby Ohio's congressional delegation this week in Washington, D.C., to pressure the White House not to force dealerships to close.
''It's an awful day in the history of America,'' he said. ''It's emotional for me. I grew up with Chrysler. It runs in my blood.''
Eddy said the 789 dealerships that will soon lose their Chrysler Corp. franchises will lose between 30,000 and 40,000 employees. ''That's who I ache for,'' he said.
The upcoming closures will have other far-reaching economic impacts in their respective communities, Eddy said.
Others supported that conclusion.
Dealerships are major contributors to local communities and their loss will be significant, said Kim Hill, an associate research director with the nonprofit Center for Automotive Research in Ann Arbor, Mich.
''We've found their contribution to a community is not as great as a manufacturing plant . . . they still do generate action in the economy,'' Hill said. ''We've found for every job in the dealership, there's at least another job outside that's the result of that dealership being there.''
But a dealership's importance to a community, especially a smaller or rural one, extends beyond the economy, Hill said. Dealers are good community citizens, sponsoring Little League teams and serving as civic leaders, he said.
''If the dealership goes away, it's an indicator that the town in general is fading,'' Hill said.
Eddy said his dealership does business with perhaps 100 other subcontractors in the area — those kinds of businesses elsewhere will be hurt by the closures.
''Those [closed] dealers instantaneously stopped their spending budgets,'' Eddy said.
Some dealers that sell more than one manufacturing line, or who decide to convert to sell only used vehicles, may be able to stay in business, he said.
''Dealers are resilient. Dealers figure it out,'' Eddy said. ''We are venture capitalists. We decided to roll the dice on them [Chrysler]. On its best day, it was a gamble.''
Beacon Journal reporter Rick Armon contributed to this story. Cheryl Powell can be reached at 330-996-3902 or chpowell@thebeaconjournal.com. Jim Mackinnon can be reached at 330-996-3544 or jmackinnon@thebeaconjournal.com.
First, hundreds of Chrysler dealerships got bad news.
Now it's General Motors dealers — including 13 in Summit County — who are waiting to see if they will be allowed to stay in business.
And Northeast Ohio is waiting for the economic fallout.
Today, the same day that 789 Chrysler, Dodge and Jeep dealerships nationwide were told their franchises will be revoked, General Motors mailed more than 1,000 letters to dealers that the Detroit manufacturer wants to close, said Terry Metcalf, executive vice president of the Akron Area Automobile Dealers' Association.
So, probably starting Friday those 1,100 or so dealers will learn GM wants to close them, Metcalf said.
''It's likely somebody [in Summit County] will get a letter,'' Metcalf said.
GM will not make public the list of dealers it wants to close, GM spokesman Tom Wilkinson said.
''We're not required to,'' Wilkinson said. ''We want to keep the conversation between GM and the dealers.''
General Motors executives say they need to cut as many as 2,600 of 6,200 dealers. The restructuring efforts of GM and Chrysler are being supervised by a newly created Obama administration auto industry task force.
Chrysler said it intends to close 25 percent of its 3,200 dealers, or 789 including six in the Akron-Canton area, by June 9, saying it has too many dealerships nationally. The dealers' names became public when they were filed with papers in U.S. Bankruptcy Court in New York City.
Local Chrysler dealers named are:
Axelrod Chrysler-Dodge Jeep, 900 Broad St., Wadsworth.
Kempthorn Dodge-Dodge Trucks and Kempthorn Motors, 1449 Cleveland Ave. NW, Canton.
Medina World Cars, 3926 Pearl Road, Medina.
Spitzer Autoworld Akron, 1535 Vernon Odom Blvd., Akron.
Montrose Chrysler, 2100 W. Main St., Louisville.
Waikem Chrysler Jeep, 3716 Lincoln Way E., Massillon.
Doug Waikem, an owner of Waikem Motors, said he wasn't surprised his dealership was listed.
By this afternoon, the dealership already was pulling Chrysler cars off the lot.
''We're almost relieved to get it over with,'' Waikem said.
Chrysler and Jeep vehicle sales account for only about 8 percent of Waikem's overall sales volume, which totaled roughly $150 million last year, he said.
Progressive Auto Group in Canton will be the Canton area's remaining Chrysler dealership, Waikem said.
Waikem said he suspects Chrysler opted to drop his dealership because it competes on an auto row with nine import dealerships.
''This needed to be done, and it was not easy surgery on Chrysler's part,'' he said. ''Did they make the right decision in every case? Probably not. But they did the best they could.''
The Waikem family acquired the Chrysler franchise in 1974. Chrysler narrowly escaped bankruptcy in 1979 and was rescued by a $1.5 billion U.S. government loan signed into law in early 1980.
''Fortunately, then, we had Lee Iacocca to guide us out of bankruptcy,'' Waikem said. ''I don't see that happening again. We have no more Lee Iacoccas in Detroit.''
The dealership doesn't plan to cut jobs as it continues to sell Fords, Nissans, Subarus, Hondas, Mitsubishis, Kias, Hyundais, Buicks and GMCs, he said.
Steve Parker, general manager of Medina World Cars, said his dealership also won't appeal Chrysler's decision.
''It's not completely surprising,'' he said. ''We're a smaller, lower-volume store.''
A manager at Montrose Chrysler in Louisville who declined to give his name said the dealership will consider appealing.
'' We're still open for business. We're still selling cars,'' he said.
The three other Akron-area dealers losing their Chrysler ties did not return phone calls today.
Chrysler largely singled out ''single point'' dealerships that sold only Dodge vehicles and in some cases Chryslers and Jeeps, said Gary Adams, president of the Greater Cleveland Automobile Dealers' Association.
''That's what they said they were going to do and that's what they did,'' he said.
The Northeast Ohio Chrysler closures likely will mean the loss of about 1,000 jobs in the region, he said.
Statewide, the pending closing of as many as 160 GM and Chrysler dealerships could mean as many as 8,000 job losses — 3,000 or so just in Northeast Ohio, the dealer group estimates.
Owners of surviving Chrysler dealerships expressed disappointment in the mass closings.
''It's awful. It may be the most historic day in the auto industry. It's awful,'' said Chuck Eddy, co-owner of Bob & Chuck Eddy Chrysler-Dodge-Jeep in Austintown. Eddy's Chrysler franchise was among the lucky ones that will continue.
Eddy joined other car dealers from Northeast Ohio to lobby Ohio's congressional delegation this week in Washington, D.C., to pressure the White House not to force dealerships to close.
''It's an awful day in the history of America,'' he said. ''It's emotional for me. I grew up with Chrysler. It runs in my blood.''
Eddy said the 789 dealerships that will soon lose their Chrysler Corp. franchises will lose between 30,000 and 40,000 employees. ''That's who I ache for,'' he said.
The upcoming closures will have other far-reaching economic impacts in their respective communities, Eddy said.
Others supported that conclusion.
Dealerships are major contributors to local communities and their loss will be significant, said Kim Hill, an associate research director with the nonprofit Center for Automotive Research in Ann Arbor, Mich.
''We've found their contribution to a community is not as great as a manufacturing plant . . . they still do generate action in the economy,'' Hill said. ''We've found for every job in the dealership, there's at least another job outside that's the result of that dealership being there.''
But a dealership's importance to a community, especially a smaller or rural one, extends beyond the economy, Hill said. Dealers are good community citizens, sponsoring Little League teams and serving as civic leaders, he said.
''If the dealership goes away, it's an indicator that the town in general is fading,'' Hill said.
Eddy said his dealership does business with perhaps 100 other subcontractors in the area — those kinds of businesses elsewhere will be hurt by the closures.
''Those [closed] dealers instantaneously stopped their spending budgets,'' Eddy said.
Some dealers that sell more than one manufacturing line, or who decide to convert to sell only used vehicles, may be able to stay in business, he said.
''Dealers are resilient. Dealers figure it out,'' Eddy said. ''We are venture capitalists. We decided to roll the dice on them [Chrysler]. On its best day, it was a gamble.''
Beacon Journal reporter Rick Armon contributed to this story. Cheryl Powell can be reached at 330-996-3902 or chpowell@thebeaconjournal.com. Jim Mackinnon can be reached at 330-996-3544 or jmackinnon@thebeaconjournal.com.
Comments
Click here to post your comments
Orrville, Oh
Posted 10:33 PM, 05/14/2009
Until EVERY Automobile manufacturer in The Real World agrees to comply with demands of Natural Law (what Mother Nature, God, or Whatever Power decreed to be the reality of the real world), God, democracy, capitalism, the US Constitution, and free, fair, and affordable commerce.
Demanding every corporation, farmer, business, outsourcer sweatshop, and nonprofit, tax-exempt, organization and Church markets the cost in the wholesale and retail price of his or her product and service; Of every workers, consumers, and taxpayers living (including pension and health care). Enabling parents to love, nurse, nurture, discipline, protect, and provide, for every child (job) they conceive and fund schools, infrastructure, national security, government services, and etc.; with money derived from wages or independent business profit.
Closing EVERY dealership won’t enable Auto manufactures Foreign and Domestic Investors and Stockholders (money marketers) to market more stock dividends (money) quarterly in the wholesale and retail price of automobiles.
This is needed to measure and maintain the strength and growth of this unaffordable economy and distribute wealth into Chinese, Foreign and Domestic Investors and Stockholders portfolios!
Posted 10:46 PM, 05/14/2009
Wow, Loren, I don't know that I've ever seen so many words used to say so little. Take off the tinfoil hat -- maybe once the government rays get to your brain, you'll start to make sense.
kent, oh
Posted 12:52 AM, 05/15/2009
chris ... last name collins ?
Anti-Politically Correct & Anti-GOP, OH
Posted 08:05 AM, 05/15/2009
Wow, still no Fred Martin listed. That stinks!
Akron, Oh
Posted 08:13 AM, 05/15/2009
@Loren HUH?
Akron, OH
Posted 08:28 AM, 05/15/2009
@Loren You must be a politician.. you have managed to string a lot of words together and say absolutely nothing!!
@SPD I agree.. been to Fred Martin ... real bait and switch operation. Got out of there as fast as I could holding on to my wallet all the way ...
a, o
Posted 10:35 AM, 05/15/2009
best thing to do . . . is not to go to Fred Martin! You get me once shame on you, (I will tell others)- you will not get me twice!
Posted 11:35 AM, 05/15/2009
They're all a bunch of operators...
Good ridance!
Tallmadge, Oh
Posted 12:19 PM, 05/15/2009
@Loren does this for every single post they make on any and all subjects.
Posted 12:28 PM, 05/15/2009
Too bad some of the bigger less ethical dealers did not get hit. Several of the smaller dealers I trust are on the list. To Chrysler its all about volume. Well this long time Mopar customer will probably buy foreign next time. Oh wait! Chrysler will be Fiat, even worse.
akron, oh
Posted 12:29 PM, 05/15/2009
Why are people excited by the prospect of people losing their jobs? The key to capitalism is competition. The higher the level of competition the better it is for us as consumers. Competition forces companies to perform higher levels of customer services while keeping prices competitive. This is not only bad news for those losing their jobs but for all of us as consumers.
If you have ever dealt with some of the manufactures that do not have many dealerships (Infiniti - BMW - VW) they operate at a level of who cares about you Mr. Customer, we are your only option. Bad news people...this is very bad news!
Mogadore, OH
Posted 12:43 PM, 05/15/2009
The rumor mill says that Marhofer and Serpentini in Tallmadge recieved renewal letters (the good letters) Fred Martin had their letter delivered but the owners are not in today...Great way to treat your employees knowing that the announcement was today! Nice Job Guys!
Da ghetto of Fairlawn, OH
Posted 12:48 PM, 05/15/2009
@ Loren-please take your meds before you post.
@ sick of it all-couldn't agree more! Has anyone stopped to think of how many businesses support Chrysler & GM? When it is all said & done, I would not be surprised in unemployment hits 20%.
akron, oh
Posted 12:49 PM, 05/15/2009
First, hundreds of Chrysler dealerships got bad news.
It is very sad to read about the closings of the various dealerships. They knew it was coming, but did not it would be them. I hope they are able to get back on their feet soon.
Posted 01:04 PM, 05/15/2009
GOLRISH:
You're an idiot.
Mogadore, OH
Posted 01:08 PM, 05/15/2009
Margaret want to explain your comment?
akron, oh
Posted 01:10 PM, 05/15/2009
Don't worry people. Obama promises you compact fuel efficient cars from China and Fiat. Share the wealth, share the jobs.
Posted 01:14 PM, 05/15/2009
Lots of misinformation these articles and news stories. Like this
Statewide, the pending closing of as many as 160 GM and Chrysler dealerships could mean as many as 8,000 job losses — 3,000 or so just in Northeast Ohio, the dealer group estimates.
That is based on every dealer who lost their franchise closing, and letting go of every employee. That in spite of the fact that some dealers have clearly stated they will remain in business. Like Waikem Motors, where Chrysler only accounted for a small percentage of their overall sales. Or Axlerod whose owner said on the news last night that they will remain open and sell used cars, provide service and hopefully parts.
This isn't as bad as the media is making it out to be people. Its like the swine flu (H1N1 virus), they keep doing stories trying to get the public in a panic. But it was never a serious threat for an epidemic type outbreak.
PS Loren is a kook, I don't even read her posts anymore, just skip right over them.
Akron, Oh
Posted 01:52 PM, 05/15/2009
Everyone Credit Has Changed So The Banks Dont Want To Take A Chance So Dont Worry Be Happy
Posted 01:57 PM, 05/15/2009
sick of it all
akron, oh
Posted 12:29 PM, 05/15/2009 Why are people excited by the prospect of people losing their jobs? The key to capitalism is competition. The higher the level of competition the better it is for us as consumers.
In case you missed the current events of the last 6 months America voted for Socialism. You have no clue as to how far this is gonna reach into your life. The Government will soon be in every facet of your life. Welcome to the new Cold War which will actually be the Deep Freeze.
akron, oh
Posted 02:14 PM, 05/15/2009
@Loren
Uhhhh. You lost me at "Unitl......."
Mogadore, OH
Posted 02:22 PM, 05/15/2009
Margaret,
So you think it is ok knowing your staff is sitting there wondering what is going on and you decide to take the day off? Glad the owners can rest easy they are not the ones about to lose their jobs!
akron, oh
Posted 02:41 PM, 05/15/2009
@ real
I have not missed anything. I am just hoping that most of us open our eyes. Dig a little deeper. Look at the whole story rather glancing at just the surface. Every aspect of our lives are about to change. And all that we will be left with is "hope" that things may eventually get better.
Mogadore, OH
Posted 02:43 PM, 05/15/2009
spd333 you have just gotten your wish but it does not come true until 2010
Orrville, Oh
Posted 03:09 PM, 05/15/2009
Automobile manufacturers CEOs refusing to comply with realities demands They market the cost in the wholesale and retail price of every workers, consumers, taxpayers, paying for an automobile with money derived from wages or independent business profit. Makes it IMPOSSIBLE for auto dealerships Executives to collect the more stock dividends (money) Investors and Stockholders (money marketers) market quarterly in the wholesale and retail price of automobiles!
Da ghetto of Fairlawn, OH
Posted 04:54 PM, 05/15/2009
@ Steve
You may have a point on the dealership numbers but I respectfully disagree with most of what you stated. What about the suppliers to GM & Chrysler? Or the trucking companies which are already reeling from the economy? They employ a lot more than a handful of people. Additionally, don't car dealers pay tax on the unsold vehicles they have in their lots? Less vehicles means less revenue for the state & local govt. This isn't the media trying to stir everyone up-if anything, they are keeping it under wraps lest their beloved President looks bad. This is just the beginning of a total disaster. I hope I'm wrong-but I don't think I am.
Akron, OH
Posted 05:21 PM, 05/15/2009
Fred Martin is a good dealer. You just have to know how to negotiate. It's not for the squeamish. I've had 6 leases through FM, and other dealers can't even get close to their prices, AFTER you negotiate. It's too bad you have to play the game with them, but that's the way it is. The last deal I cut entirely over the phone. Don't bad-rap a dealer when you don't know how to buy a car. If you want someone to just hand you a good price, go to Target.
medina, oh
Posted 07:49 PM, 05/15/2009
Mall Rat
I have negotiated my last several car lease/purchases by fax, phone and internet, but I would never , ever do business with FM,
You can get a good, in fact a great price with other dealers without going through the bs.
akron, oh
Posted 10:25 PM, 05/15/2009
why aren't the auto makers closing the doors of dealerships with poor reviews? Big dealerships tend to have poor customer satisfaction rates. Yet, small town / high-customer satisfaction dealerships are losing their dealerships. Once again, government doesn't reward success.
AKRON, OH
Posted 12:39 AM, 05/16/2009
Loren Eberly - BACK TO COPYING AND PASTING THE SAME OLD DRIBBLE ?
Posted 07:37 AM, 05/16/2009
What you people do not understand whats this is all about! Bottem line, is WORLD GOV. What do we need a world bank for?
Cuyahoga Falls, OH
Posted 12:19 AM, 05/24/2009
@Loren
I've never seen anybody so psychotic spell so well (or at least have such an ability to use spell check?)
