Chrysler to Cease Adding Dealers in Contested Markets until After Arbitration
AUBURN HILLS, Mich. — Chrysler Group announced this week that it will stop adding dealers in markets where there are arbitrating dealers as a "good faith" measure until the arbitrator makes a ruling.
In a statement Chrysler said, "While Chrysler Group has acted within its legal rights to grant sales points to qualified dealers — rights that have been upheld in both federal and state courts — Chrysler Group understands that the practice at this time may be cause of concern among policymakers and among arbitrating dealers.
"As a measure of good faith, Chrysler Group will not proceed with network actions that directly impact an arbitrating dealer until the arbitrator has had a chance to rule in that case, unless Chrysler Group is contractually obligated to take such an action," according to the management team.
The company noted that it voluntarily took a similar action from October until December 2009 while discussions for a non-legislative agreement with rejected dealers were underway.
"Restructuring of Chrysler Group's dealer network represented an exercise of sound business judgment and was vital to the company's viability in challenging market conditions," officials said in the statement.
"The alternative — liquidation — would have had far more devastating effects on our dealers, our communities and our business partners," they concluded.