DETROIT (Dec. 29, 2009)—Terminated Chrysler Group L.L.C. dealers have until Jan. 25 to notify the car maker of their decision to seek arbitration, according to a letter sent last week to owners of all 789 rejected dealerships.
The letter, sent by Chrysler pursuant to the timetable in legislation mandating the arbitration, does not spell out the criteria used to reject the 789.
Chrysler will outline those criteria in individual letters to dealers that it will be sent before Jan. 16, according to Chrysler spokeswoman Kathy Graham.
The car dealers lost their franchises June 9 at the end of Chrysler's six-week government mandated trip through U.S. Bankruptcy Court.
The arbitration process was signed into law Dec. 16 by President Barack Obama as part of a $446 billion appropriations bill. The legislation also affects General Motors Co., which is terminating 1,350 dealerships.
The legislation requires that arbitration must be wrapped up in six months.
Earlier in December, Chrysler had proposed its own binding arbitration process to keep Congress from getting involved. But the negotiations ended with the introduction of the legislation.
CEO Sergio Marchionne said Chrysler's offer would have “guaranteed a disgruntled dealer the opportunity to air its concern. Having said this, if Congress wants this, Congress gets this. And we'll live with the consequences and react accordingly.”
Tammy Darvish, a co-chair of the Committee to Restore Dealer Rights, said, “It's a shame the time and the money that Chrysler and GM have spent to fight this for absolutely no reason at all.
“If somebody can come back, just let them come back. Why are they going to spend millions more dollars to fight this?”