LV dealers unlikely to participate in Daimler plan

Friday, Sept. 28, 2001 | 9:32 a.m.

SUN STAFF AND WIRE REPORTS

DaimlerChrysler AG plans to lift its long-standing restrictions on selling Dodge, Chrysler and Jeep brands under one roof in select markets -- but Las Vegas may not be included.

As part of Daimler's Project Alpha, selected Dodge and Chrysler-Jeep dealers will be invited to consolidate, DaimlerChrysler spokesman Mark Henretta said.

"We're looking for exclusivity with the best dealers with the best facility," Henretta said. But several of the 10 Las Vegas dealerships selling Dodge, Chrysler and Jeep brands said they probably won't be invited to participate in the program. While the Las Vegas dealers welcome the opportunity to sell more brands under one roof at a time when car sales are difficult, they said they won't likely qualify because of the number and the proximity of the dealerships to each other.

The Las Vegas Valley dealers include Towbin Dodge, Desert Dodge, Nevada Dodge, Chapman Dodge, Towbin Jeep Inc., Desert Chrysler-Jeep, Jim Marsh Chrysler-Jeep, Chapman Chrysler-Jeep LLC and Las Vegas Chrysler.

Rick Peet Chrysler-Jeep-Dodge in Pahrump is the only local dealership selling all three brands.

Jim Marsh, owner of Jim Marsh Chrysler-Jeep, said it's unlikely Daimler will implement the plan in Las Vegas.

"This plan would work in a smaller town where there isn't enough volume to justify separate dealerships. With so many dealerships so close to each other in Las Vegas, I doubt it's a likelihood here," he said.

Jon Dooley, manager of Desert Chrysler-Jeep, agreed, saying the dealer won't likely be part of the plan because of its proximity to Desert Chrysler-Jeep.

"Sure we'd all like to sell more cars. But we're right down the street from Chapman Dodge. It won't be fair to Chapman Dodge," he said.

Rick Peet, owner of Rick Peet Chrysler-Jeep-Dodge, said DaimlerChrysler is becoming more flexible in allowing dealers to represent more brands in big towns.

"There may be some markets where this is feasible. But in Las Vegas, it isn't because the dealerships are so large already," he said. "You don't put Wal-Marts next to another one. Las Vegas is already over-dealered."

But elsewhere, the news couldn't come at a better time, says Glenn Altobelli, sales manager at Bob Saks Dodge in the Detroit suburb of Farmington Hills.

"We're down 50, 60 percent for the month," Altobelli said. During a normal month the dealership sells 75 or 80 cars, he said. Only 35 cars have been sold this month.

"Having Chrysler and Jeep to sell would take a normal month and boost it to 130 or more," Altobelli said.

Bill Van Dam, sales manager at Extreme Dodge-Hyundai in Jackson, also was pleased with the news.

"We would have about 20 to 25 percent more business, and it would be easier on the customer to shop at one place," Van Dam said.

The process, however, is not automatic and may not be attractive to every dealer, Henretta said.

New consolidated dealerships are not permitted to sell another automaker's products under the same roof.

The exclusivity element of the plan is critical, Henretta said, because about one-third of the company's current dealerships also sell a non-DaimlerChrysler brand.

"It just makes sense for us to get rid of a dual dealership," he said.

"We're not looking to get rid of dealers," Henretta said. "We're just looking for a smarter way of doing business."

"This is a neat strategy," said Michael Flynn, director of the Office for the Study of Automotive Transportation at the University of Michigan. "If they get exclusivity, when a dealer sells a car, it's going to be one of theirs."

However, dealers who are dualed with another large car company like Ford Motor Co. or Toyota Motor Co. may not want to give up that relationship or build separate facilities, Flynn predicted.

But smaller dealers hungry for more customer traffic and larger product lines to sell would welcome the consolidation, Flynn said.

Even a large dealership, like Southfield Chrysler-Jeep would love to add the Dodge line to its stable.

"It would make us more diverse," said Paul Steel, general manager at Southfield Chrysler-Jeep.

The idea is being posed to dealers at meetings being held this month. Decisions on which dealers will be offered the chance to consolidate are expected "soon" according to Henretta, with the first of the combined dealers up and running by year's end.