• Mar 26th 2010 at 6:02PM
  • 12
A California-based Hyundai dealership has filed a lawsuit against Hyundai Motor America claiming that the automaker did not provide help to the struggling dealership despite contractual agreements and assurances that Hyundai would do everything necessary to help out the dealership during the economic downturn.

Estes Automotive Group, owner of Merced Hyundai in California, claims that the company treated them unfairly and did not act in good faith. The suit, filed in early March by Estes, seeks $30 million in losses that the dealership endured under promises from Hyundai that the company would help them weather the economic storm.

Estes claims that Hyundai strung the dealership out for more than a year promising to provided assistance as long as the dealership continued to operate. The dealership was instructed to go about its business as usual and Hyundai would take care of the financial situation. With these words, Estes continued to operate the facility at a loss counting on support from Hyundai which never came.

Hyundai Motor America has not commented on the matter, but has until the beginning of April to respond to the lawsuit. The suit is demanding a jury trial against Hyundai on the grounds of the company "engaging in a calculated scheme to bleed assets and operating capital, and ultimately destroying the business." Merced Hyundai closed its doors for good in January.

[Source: Automotive News - Sub. Req.]

I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.

    • 1 Second Ago
      • 5 Years Ago
      The truth is we have no idea as to what the contractual obligations were and what actions were taken. I'm not sure why there's even an article.
      • 5 Years Ago
      Well i guess he didn't sell enough cars, apparently business involves risk from time to time... Regardless of Hyundai stringing him along, the dealership seemed to be doomed. i mean if the poor economy is your excuse for not being able to sell economy cars (and good ones at that) then there seems to be something wrong.

      • 5 Years Ago
      Just hold out your hand, Obama will fill it full of money for you.

      Hmmmm, what do I hate worse, car dealers, or lawyers?
        • 5 Years Ago
        With zingers like that you are clearly on the high end of intelligence. Let me guess, you ARE a janitor.
        • 5 Years Ago
        I have a feeling you hate everyone that's smarter than you, including janitors and the brain dead.
      • 5 Years Ago
      "engaging in a calculated scheme to bleed assets and operating capital, and ultimately destroying the business."

      really?! haahahhaha damn lawyers.
      • 5 Years Ago
      LOL Merced, Ca? That place has one of the highest unemployment rates in California.

        • 5 Years Ago
        Not sure about the highest unemployment statistics--but Merced has been heavily affected by the economy with a third of its population at or below poverty line...It was one of those California towns where people making $20k were buying $400k homes... It would be interesting to see if the other auto dealers survived the economic downturn unscathed.
        • 5 Years Ago
        Sad but true.

        Unless there's something substantial to this lawsuit, every dealer in CA's Central Valley might as well sue for pitiful sales figures as of late.
      • 5 Years Ago
      Hyundai has been on fire as of late in Canada, heck they even openned up a 4th dealership in my tiny little of Winnipeg. Weren't they one of a handful of dealerships to increase market share last year?
      • 5 Years Ago
      So of all the Hyundai dealers in the U.S. they decided to "string along" this one particular dealer? Damn you Hyundai you evil bastards.

      What other brands are sold on this lot btw? Are they going to get hit with 30 mil suits too?

      And wasn't hyundai one of the few brands that held steady or slightly improved sales during the recession?
    Share This Photo X