Local car dealers await word of dealerships’ closings

By Don Shilling

Two car dealers expect few local dealerships to be closed, but one fears a larger impact.

Area car dealers are bracing themselves as troubled automakers prepare to close dealerships.

Reports say Chrysler will tell 800 dealerships today that they are no longer needed, while General Motors will cut loose 1,000 dealerships by Friday.

Two local dealers, Greg Greenwood and Dave Sweeney, said they don’t expect many closings in the Mahoning Valley, but Shorty Navarro said he thinks the number could be larger than many expect.

“I think we could be surprised by who is closed,” said Navarro, who owns the Stadium dealerships in Salem and Boardman.

He said the impact of the lost jobs would hurt a local economy that already is struggling.

All three dealers said they expect their dealerships to survive.

“My hope is that if there are dealership closings in this area, they will be very minimal, but I don’t know,” said Greenwood, owner of a Chevrolet and Hummer dealership in Austintown and a Chevrolet dealership in Hubbard.

Greenwood noted that this area has had attrition over the years. Dealerships that used to line Wick Avenue in Youngstown have either closed or relocated, and other dealerships have closed in Canfield, Poland and Struthers, he said.

Sweeney, who is the co-owner of two General Motors dealerships in Boardman, said he is guessing that the Mahoning Valley won’t suffer too many closings.

He said he expects most of the closings to be in large cities, such as Cleveland, where large dealers remain in areas that no longer have much retail traffic and in smaller towns that are on the outskirts of metropolitan areas.

The dealers said GM is looking to close dealerships that aren’t profitable, have poor customer service, low sales volumes or are in nonretail areas with older buildings.

Greenwood questioned the wisdom of the closings, which are being forced on the automakers by a government task force.

The dealers are not extensions of the automakers, he said. They are franchise operations that buy and sell cars at their own financial risk.

“We pay our own bills. We don’t get any money from those guys,” he said.

States have laws that protect dealers from being closed without compensation, but lawsuits appear useless because of the financial condition of Chrysler and GM, Greenwood said. Dealers that are closed could win a legal judgment, but they couldn’t force Chrysler to pay because it is in bankruptcy and GM appears certain to follow suit, he said.

Greenwood’s brother, Terry, owns Greenwood Chrysler Jeep Dodge in Cortland. He has been told that Chrysler dealers are to receive notices today that indicate if their franchises are being renewed, Greg Greenwood said. His brother could not be reached to comment.

Sources told The Associated Press that Chrysler will file a list of dealers it wants to retain with the U.S. bankruptcy court. Chrysler has said that news reports of 800 closings are speculation. Chrysler has 3,200 dealers.

GM has said it will close 3,600 of its 6,200 dealers by next year.

Greenwood said GM has told dealers that it will make an initial round of 1,000 closings this week, so most dealers are expecting those notifications today or Friday.

Included in the dealerships to be dropped by GM are those selling Saab, Saturn and Hummer, which are brands that GM will no longer offer. GM is under negotiations to sell those brands.

Greenwood said he hopes Hummer is sold, but a closing would not affect him greatly. A receptionist is the only person at his Hummer dealership who doesn’t also work in the adjacent Chevrolet store.

shilling@vindy.com