NADA Applauds Chrysler-Fiat Alliance, Still Against Drastic Dealer Cuts

Following the the federal court's decision to approve the sale of Chrysler's assets to Fiat - which translates in the first major step made towards the alliance between the two - representatives of the National Automobile Dealers Association (NADA) stepped in front of the media and applauded the decision but, once again, criticized the American's company dealership cut. As you probably remember, Chrysler last month announced it will end contracts of 789 dealers in the United States, as part of a broader attempt to restructure the company.

Here's what NADA commented on the dealership cut revealed last month:

"Drastic and rapid closures of dealerships on this scale are not good for the industry or the U.S. economy. Furthermore, the treatment of the Chrysler dealers who are not part of the new company has been unconscionable and outrageous. By any measure, their treatment does not even meet minimal standards of fairness.

NADA urges Chrysler and the Obama Administration to move quickly to provide these dealers with fair and equitable consideration, especially when it comes to buying back vehicle and parts inventory and providing a reasonable amount of time for an orderly wind-down period. The bankruptcy court also should take special care not to trample on recognized rights under state franchise laws. These are independent business owners, men and women who have invested millions in their facilities and are the cornerstones of the economies in their local communities. They deserve much better treatment."

On the other hand, NADA praised Chrysler for the efforts it made to complete the alliance with Fiat, saying that the recent court decision is a major step towards the automaker's recovery.

"It is certainly our hope that the alliance between Chrysler and Fiat will lead to a new company that's highly competitive and profitable. The nearly 2,400 dealers that will be part of the new company are encouraged by the prospects of a much-stronger Chrysler."