Chrysler axes few local dealers; GM decision coming

"I wouldn't be surprised if 40 or 50 percent of the Atlanta GM dealers end up being closed when it's all said and done," said Jim Ziegler, an auto dealer consultant based in Duluth.

GM spokeswoman Susan Garontakos said the company on Friday will notify 1,100 "underperforming dealers" that it won't renew their contracts when they expire in Oct. 2010.

GM plans to slash another 1,500 of its 6,000 dealers by 2014 in a restructuring to recover from billions of dollars in losses and meet a June 1 federal deadline to draw up a workable business plan or join Chrysler in bankruptcy.

Chrysler on Thursday announced plans to end its relationship with 789 dealerships nationwide, or about one in four.

A bankruptcy court filing that lists the affected dealers includes five in metro Atlanta. But one of those was already closed, and another metro Atlanta listing appears to actually involve a dealership in Calhoun.

Those listed in the bankruptcy filing were John Cullen Dodge and Southtowne Motors, both in Newnan; Justin Dodge Chrysler Jeep in Acworth; Nalley Chrysler Jeep in Roswell; and Premier Chrysler Jeep-Dodge in Decatur, a dealership that closed last year and has been trying to reopen since.

The address given in the bankruptcy filing for the Acworth dealership appeared to be for a residence. A Justin Dodge Chrysler Jeep in Calhoun went into Chapter 7 bankruptcy -- normally a liquidation stage -- last fall.

Nalley Chrysler Jeep in Roswell is owned by Asbury Automotive Group, of Duluth, which confirned it is closing the dealership.

Atlanta area dealers got word of their fate as UPS trucks made their morning rounds and delivered overnight letters from the company.

For most, the letters brought relief after months of speculation.

Ryan Troncalli, general manager of Troncalli Chrysler Dodge Jeep Subaru in Cumming, and a third generation auto dealer in the area, said he had no doubts his business would make the cut.

"We feel good about our product and dealership," he said. "We're having a pretty good year."

At Landmark Chrysler Dodge Jeep in Morrow, Fred Brillanti, the state's highest volume Chyrsler dealer, said he's confident Chrysler will emerge from restructuring even stronger.

"We're part of the new deal, and we're very happy about it," said Brillanti, whose dealership has lost 30 percent of its sales in the last year, forcing him to lay off 35 of his staff of 160. "We're still making money, just not as much money."

Dusty Hayes, the 26-year-old sales manager at Hayes Dodge Chyrsler Jeep in Lawrenceville, said his family-run dealer will seize the moment as one of the "chosen" survivors.

The 38-year-old, family run dealership is buying ads to tell customers that Chrysler is alive and so is Hayes. "We don't plan on going anywhere," he said.

Even at one of the dealers Chrysler said it will close, John Cullen Dodge in Newnan, the owners vowed to carry on to keep its staff of 33 in jobs, though they may no longer sell Chryslers.

"They [the owners] are in meetings about the future right now," said spokesman Michael Coleman. "That will be a decision made among the partners."

Most car dealerships are independent businesses, but they must have contracts to sell automakers' products.

Cutbacks among dealers go far beyond the businesses themselves, said Bill Morie, president of the Georgia Auto Dealers Association, which represents the state's estimated 570 new car dealers.

"It's all about jobs," he said, noting that dealers employ about 33,800 sales people, mechanics and others.The group estimates car sales generate about $1 billion in taxes in Georgia a year.

He said all of the state's 130 GM dealers will be anxiously awaiting today's morning mail.

"Right now they're all sweating it," Morie said.

-- Joe Guy Collier, Leon Stafford, Rachel Tobin Ramos, Bob Keefe, Paul Donsky, and Shane Blatt contributed to this report.