Friday, July 27, 2007

Chrysler mailing takes tougher tone

Dealers told to meet sales goals soon

The Chrysler Group has warned 173 dealers, who have struggled to meet sales goals, to improve in six months or face losing their franchises.

"We're not going after any dealers to get rid of them," Steven Landry, Chrysler executive vice president for North American sales, said Thursday. "The notes that we sent out to 4% of our dealers basically is to say that you are under performing by a very high degree compared to other dealers in your market, and we'd like them to improve their performance."

Landry emphasized that the majority of Chrysler's 3,700 dealerships are doing well and that the company would be remiss not to address the low performers. About 20 letters went to dealers in the sales area that includes Michigan, a person familiar with the correspondence said.

Such letters have been used in the past to address dealerships with low sales, but this round is more aggressive as part of the company's turnaround plan announced in February that aims to return the company to profitability after losing $680 million last year.

Leo Jerome, who owns a Chrysler Jeep dealership in Lansing, said he received the letter earlier this month and plans to fight it. "It's a crazy thing," he said, adding that area dealers have struggled because of a nearby General Motors plant, and he doubts anyone new could do better. "I am ready to take them on," he said of Chrysler.

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