Chrysler Dealers Scramble In Fire Sale

Dodge dealer Greg Signore calls it an impossible task: sell off 5,000 parts and the $500,000 worth of cars on his New Jersey lot…And he has just three weeks to do it.

"It's just not going to happen," Signore said. "They have to give us more time."

After more then 40 years, Chrysler is ending its relationship with Elm Dodge. It's one of 789 dealers Chrysler is letting go.

On those 789 lots are 44,000 vehicles that dealers must sell by a June 9 deadline. The company is not buying back the cars because it's in bankruptcy, according to the Associated Press.

"I would have been in much better shape if I had done something illegal -- if I had done a fraud against Chrysler or gone bankrupt," Signore said.

"The dealers that got the termination letters in many cases were surprised by it, they weren't prepared for this and then they have really a month now to deal with the situation. It's really awful," said automotive analyst John Wolkonowicz.

A dealership near Los Angeles is stuck with 138 cars worth $4 million. The liquidation started Monday. Markdowns are occurring all over the lot with cars marked at prices that seemingly can't be beat.

For example, a Chrysler 300 is normally $37,000. The dealer is now asking for $22,000.

Dealers could lose thousands on each car, forcing some into bankruptcy themselves.

Chrysler is floating loans to its remaining dealers so they can buy unsold inventory from dealers being shut down. But with cars already sitting on their own lots for months, it's unlikely they'll be in a buying mood.

Another problem is a glut of low priced Chryslers on the market pushing down resale values. They've dropped 6 percent in the past month and are expected to fall even more as the fire sales continue.

"With these prices we're going to be having the next two or three weeks it's going to be very affordable for just about anybody," said Doug Swaim, of Star Chrysler.