Talking to veteran Tampa car dealer Jerry Ulm about 20 years of selling Chryslers is like reading a tell-all book titled Everything You Wanted To Know About Chrysler Dealers But Were Afraid To Ask.
Face it, being married so long to Chrysler as a dealer who sells only Chrysler products is no picnic. Ulm and father worked for Tampa auto dealer icon Frank Morsani when he sold them his Chrysler dealership. That was back in 1990, when Ulm was 37 and charismatic Lee Iacocca ran Chrysler, a car company better known for flashy looks than craftsmanship. Earlier in the 1980s, the manufacturer already had begged for (and gotten) a federal bailout.
Since then, the car company has careened wildly among a strange mix of owners, starting with German Mercedes maker Daimler Benz. "Doomed from the start," says Ulm in hindsight.
Then hedge fund Cerberus (named for the three-headed dog guarding Hades) bought Chrysler with big turnaround ideas. "That was a tragedy," Ulm recalls.
Chrysler fell into the hands of U.S. taxpayers thanks to an April 2009 Chapter 11 bankruptcy and federal bailout. That's when the car company, forced to slim down, told 789 dealerships nationwide to go away.
The Jerry Ulm Dodge Chrysler Jeep dealership on North Dale Mabry survived. But many others, like Bob Wilson Dodge Chrysler Jeep in Tampa, did not.
Now Chrysler is owned by Italian automaker Fiat. Sergio Marchionne, Fiat CEO, will be in Orlando this week to meet with dealers. He knows what he's doing, Ulm says, as if it's been a long time since he could utter those words. "I feel so much better today about Chrysler's future."
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Jerry Ulm Dodge did just fine for a good 15 years. He added fellow Tampa dealer Jim Ferman's Chrysler Jeep business to his mix in 2006, not too long before the economic buzz saw hit.
As Ulm tells it, his Tampa dealership, like many others, hit a brick wall in October 2007. "It seemed to happen overnight," he says.
It got worse. Ulm's dealership suffered heavy losses in 2008 and 2009 from the nasty economic downturn combined with Chrysler's own chaotic collapse.
Ulm, 57, calls the specific period between Chrysler's bankruptcy until the end of 2009 "the most stressful and challenging" of his career.
I asked him during a long interview in his office: Did he think it would all fall apart?
"Absolutely," Ulm says. "I thought it would not work."
Chrysler, of course, isn't the only domestic car company to be raked over the economic coals in recent years. General Motors suffered Chapter 11 bankruptcy, too, while Ford skipped bankruptcy protection but still had to cut the size of the company dramatically. Sales of most automakers are off in this downturn.
Ulm says Chrysler, GM and other automakers forgot about the laws of supply and demand. They overproduced, pushed too many vehicles on their dealers and subsidized sales with heavy incentives until the declining auto market got overwhelmed.
Still, Chrysler has suffered more than most and probably has the biggest industry doubters out there about its future.
Bottom line, when Chrysler started to tank along with the U.S. economy, Chrysler dealers like Ulm got badly squeezed. Ulm's business owed $24 million in three basic operating loans — one to finance its inventory of new vehicles, one for real estate and one for working capital — to Chrysler Financial just as the lender imploded and demanded its money back. When Ulm started hunting for another lender, the timing was bad. He showed two consecutive years of losses just as the nation marched into a severe credit crunch.
When the federal government urged GMAC to step in and help Chrysler dealers, the new lender declined to loan Ulm the full $24 million. After all, there was a recession going on. Ulm's dealership suddenly had to ante up $1.7 million in cash to make the refinancing work with GMAC while paying off Chrysler Finance in full.
Ulm paid it. But other Chrysler dealers across the country, caught in the same financial bind, did not have that kind of money lying around.
Ulm credits his accounting background and a conservative business strategy for maintaining such a reserve. He's anxious to rebuild another reserve given the level of stress throughout the auto industry. In 2010, so far, Ulm says his dealership is profitable once again. He's even talking expansion (see item above).
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I first spent time with Ulm back in 1996 when he experimented with no-haggle pricing at his Dodge dealership. It was a trendy sales idea back then, but Ulm eventually ditched the concept. People, he recalls, say they do not like to haggle, but they really do.
Fourteen years ago, Ulm had brown hair and was clean shaven. Now he's added a salt-and-pepper mustache, goatee, and a lot of perspective. His son and one of his daughters have joined the business, making Ulm hopeful the dealership may be able to stay a family business.
I ask Ulm to show me his best Chrysler products on the lot. He beelines to the 2011 Jeep Grand Cherokee and describes its improved quality. Then he showcases the Jeep Wrangler — clearly for the outdoorsy crowd. There are, Ulm says, no more loyal customers than buyers of Wranglers.
"If this works out," Ulm says, "it will be nice being a Chrysler dealer again."
Even for a dealer battered by constant economic change, hope springs eternal.
Contact Robert Trigaux at [email protected]