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Clearwater dealership could regain ties to Chrysler after winning in arbitration

CLEARWATER — A Clearwater Chrysler dealership that was dropped last year as part of one of the most massive dealer cutbacks announced by a Detroit automaker may get a reprieve.

An arbitrator has sided with Fitzgerald's Countryside Chrysler Jeep, a development that could make it possible for the Clearwater dealer to sell and service new inventory again.

Fitzgerald and 788 other dealerships nationwide lost that privilege when the former Chrysler LLC terminated their franchise contracts in June 2009 as part of a bankruptcy filing and merger with Italy's Fiat.

At the time, Chrysler said about one-half of the rejected dealers sold less than 100 vehicles in 2008. And a number of them housed other franchises. Fitzgerald, for example, sells Hyundai, Subaru, Suzuki and used cars. "They had other robust revenue streams," Chrysler spokesman Mike Palese said.

"The only alternative would have been complete liquidation (of Chrysler), which would have had devastating economic consequences — the closing of all 3,200 dealers, hundreds of thousands of lost jobs and the company defaulting on taxpayer loans."

Fitzgerald, along with 417 other Chrysler, Jeep and Dodge outlets, fought back and took their cases to an arbitrator. Customers wrote letters of support. They drove to Orlando to testify on Fitzgerald's behalf.

"If it weren't for our customers," said Jack Fitzgerald, who operates the Clearwater dealership and others in Maryland and Pennsylvania, "we wouldn't have been successful."

Federal law mandates that the new Chrysler Group LLC now issue Fitzgerald a letter of intent, which essentially amounts to a reinstatement offer. If Fitzgerald meets the terms of the offer, which has a host of financial requirements and conditions, then the dealership will have the opportunity to join the Chrysler Group LLC network and sell and service new Chryslers and Jeeps, Palese said.

Or, the two sides could reach some other kind of resolution, said India Johnson, senior vice president of the American Arbitration Association, the group that handled the 418 appeals.

"The dealer and the manufacturer could settle and say, 'Rather than restart, I might agree on some other type of settlement,' " Johnson said.

Fitzgerald said he had not heard from the automaker and "we don't know when we're going to hear from Chrysler." Fitzgerald would not discuss his ongoing negotiations with the automaker.

Times researcher Carolyn Edds contributed to this report. Rodney Thrash can be reached at rthrash@sptimes.com or (727) 445-4167.

Clearwater dealership could regain ties to Chrysler after winning in arbitration 06/11/10 [Last modified: Tuesday, June 15, 2010 5:14pm]
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