NADA Pleased with Chrysler Dealers Reinstatement

After the announcement made by American manufacturer Chrysler that it sent letters of intent to 50 of the dealers rejected last year as a first step to their revival, the National Automobile Dealers Association (NADA) issued a statement expressing their support for the decision.

"The announcement by Chrysler today of its intent to reinstate 50 dealers is a move in the right direction. This, coupled with previous contracts or Letters of Intent awarded to 36 other closed dealerships, brings the total to 86 dealerships that could be reinstated," NADA chairman Ed Tonkin said.

"NADA views this as a good faith effort, and hopes that this carries forward in Chrysler's continuing settlement and arbitration discussions with the other terminated dealers."

Chrysler's announcement is pleasing, but it's not their merit entirely. Had it not been for the arbitration process approved last year, it's not clear the carmaker would have been so quick to reinstate its dealers.

Remember back in July 2009, Chrysler was screaming the reversal of the termination decision for the 789 dealers it tried to shed may lead to its "complete liquidation, with all of its dire consequences could follow."

That view changed was Chrysler had no choice but to approve o settle issues regarding discontinued dealerships amicably in December 2009, opening the doors to independent reviews for discontinued dealers.

Chrysler rejected last year 789 dealers, leaving it at the time with a network comprising 2,385 showrooms, 1,364 of which in rural communities, 592 in Metro areas and 429 in secondary markets.