June 01, 2009

Wyden Calls for Second Look at Chrysler's Decision to Close Dealerships

Oregon Senator also urges GM to reconsider decision to close dealership in Bend

Washington, D.C. - In an effort to protect as many Oregon jobs as possible, Senator Ron Wyden has asked the head of the White House's Automobile Task Force to determine whether the decision to close Chrysler dealerships is in the best interest of the state and the nation.

"It is inconsistent with American values to force business owners to secure financing with their homes and other personal assets and then turn around and shut them down and refuse to buy back their cars," Wyden said. "I'm also worried that some major population centers in Oregon won't be able to get their cars serviced or have their warranties honored."

Earlier this month, the financially troubled Chrysler announced that it was closing 789 of its nearly 3,000 dealerships on June 9, including six in Oregon.

In a letter to Steven Rattner, head of the Automobile Task Force, Wyden described the decision to close dealerships as "unfair and inconsistent with American values." He wrote: "If fully implemented as proposed, I am concerned that Chrysler will needlessly send thousands to the unemployment line and damage its brand for years to come."

General Motors, which is expected to file for bankruptcy protection next week, has said it intends to close 1,100 dealerships in October 2011 when their franchise agreements expire, including Bob Thomas Car Company in Bend.

In a letter to GM, Wyden asked the automaker to reconsider its decision to close the Thomas dealership. "If GM abrogates Bob Thomas Car Company's dealer agreement, it will have no distribution or service outlets in Central Oregon's largest city," Wyden wrote. "In short, terminating their GM dealership will negatively impact the Thomases, their employees, GM customers and the community at large."

In the letter to Rattner regarding Chrysler, Wyden wrote: "I ask you to investigate and determine whether the decisions are in the best interests of the American people. If you find they are not, I urge you to use your authority and swiftly act to resolve the issues."

In the letter, Wyden also raised concerns about how the financial implications for closed dealerships left with unsold cars and parts and Chrysler reported plans to shutter new, efficient facilities in the U. S. while purchasing or expanding facilities in countries with lower wages and environmental standards.

Wyden's Letter to GM: http://wyden.senate.gov/newsroom/gm_letter.pdf
Wyden's Letter to the Treasury Department: http://wyden.senate.gov/newsroom/treasury_letter.pdf