May 17, 2009
Another local car dealership closes
Direct Auto Plaza in El Centro will be losing its Chrysler franchise.
In a another blow to the Imperial Valley economy, the Chrysler corporation has notified Direct Auto Plaza in El Centro that the Chrysler brand will no longer be sold at the dealership.
News of the loss of the Chrysler brand stunned the staff at the dealership.
Direct Auto Plaza will still sell and service the Honda and Hyundai brands.
Chrysler made the announcement last Thursday. The dealership, located at the corner of Wake Avenue and South Fourth Street in El Centro, sells Chrysler, Jeep, and Dodge models.
In all, Chrysler closed 789 dealerships across the country.
Robert Valdez, the general manager of Direct Desert Auto Plaza, which includes the Direct Auto Plaza facility, said news of the loss of the Chrysler brand stunned the staff at the dealership.
“Shock, for lack of better word,” said Valdez as he described reaction to news of the closure. “Disgust. Surprise. There was no forewarning and we did not even dream that morning that we would be getting that letter.”
General Motors also shut down hundreds of dealerships on Friday, although so far, Valdez said his company, which also sells the GM brand at a different location, has not been told of any planned closure by GM. Both Chrysler and GM are struggling to avoid bankruptcy.
The dealership closure here comes about six months after the Del Norte Chevrolet dealership in Brawley closed in December 2008.Valdez said the dealership employs about 48 people. He said he believes the loss of the Chrysler franchise will not have a significant impact on staffing.
“We actually anticipate minimal changes to our personnel,” Valdez said. “We also have Honda and Hyundai franchises, and we expect to focus on them a little bit more to pick up the lack of Chrysler vehicles being sold.”
Valdez said Chrysler sales accounted for about half of all the sales at Direct Auto Plaza. He said the service and repair aspects of the business would be the area most significantly affected.
“That's (service) the part that is going to be felt the most,” Valdez said. “We have 25,000 vehicles in the Imperial Valley that are Chrysler, Dodge and Jeep products. We are the only dealer in the county that services those products, so that is where it is going to be felt."
Valdez said roughly two-thirds of the service department at Direct Auto Plaza was dedicated to Chrysler vehicles.
The biggest impact here may be felt by customers who purchased Chrysler products that are still under warranty. Valdez said the warranties will still be honored, but since Chrysler is pulling out of the Imperial Valley market, Chrysler owners will have to go elsewhere for work done under warranty.
“We will be able to work on Chrysler vehicles ... we just won't be able to do any warranty work,” said Valdez. “If there's anything that requires warranty work, ... they'll have to drive a minimum of 120 miles to the nearest dealership.”
“We were ranked 109th out of 3,189 dealers in the nation." - Robert Valdez, General Manager, Desert Direct Auto PlazaValdez said he spoke with Chrysler officials in a conference call to find out why the dealership had been targeted by Chrysler.
“We were ranked 109th out of 3,189 dealers in the nation,” Valdez said. “The only reason(s) we were given from Chrysler directly – they referred to dealer performance – so assume that 109th is not good enough, and they referred to the fact that we are dual franchise.”
A dual franchise means that more than one brand is sold under one roof, and is a common practice in retail auto sales.
Valdez says he cannot see the reasoning for closing what he says he believes was a successful franchise.
“There is no way anyone can tell me that closing a dealership that is the only one in one of the largest counties in the country, with a population of over 180,000, (and) with a Chrysler customer base of over 25,000 is going to in any way, shape, or form help the ultimate outcome of Chrysler Motors,” Valdez said.