Automotive News reports that the California Department of Motor Vehicles may still seek to fine Chrysler even after the automaker reached an agreement to sell its factory-owned Los Angeles dealership. Chrysler garnered the ire of the DMV by infringing on California franchise laws, though the automaker hoped to avoid any censure by selling its Motor Village of Los Angeles showroom. Now, CDMV is reportedly saying that the company made false statements regarding the dealership's ownership. If a settlement is reached, Chrysler could wind up paying restitution to private Chrysler dealerships within a 10-mile radius of the factory-owned store.

If both sides can't reach an agreement, Chrysler will be forced to endure a hearing on the matter. Chrysler has already reached a tentative agreement with Dennis Lin, the owner of New Century Automotive Group, to purchase Motor Village LA from the automaker. The deal is set to close this month. Chrysler has told the California New Motor Vehicle Board that the automaker has already put steps in place to ensure nothing like this happens again in the future.


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    • 1 Second Ago
  • 9 Comments
      jbm0866
      • 3 Years Ago
      Factory owned dealerships shouldn't be fined...it should be the STANDARD. Cut out an extra layer and costs will go down for consumers...of course I understand why the factories like having a middle man to buy large quantities of their products.
      Kumar
      • 3 Years Ago
      Factory stores should at least be standard (allowed) in every state that has a factory for that auto maker. And yes, Cali probably doesn't have a Chrysler plant, but several other states do. Why not try to replicate the programs that Benz/BMW have used for European delivery? It would also give an extra incentive to visit the plant to pick up your new car, and cut out the salesperson if you don't need their services.
        reattadudes
        • 3 Years Ago
        @Kumar
        if you were familiar with automotive history, you'd be aware that every US automaker offered factory delivery for their products in the past. if disappeared in the late 1960s. it was just like the European delivery you give as an example. it was discontinued here for lack of interest. if you've even done one of the European delivery programs, you'd know that it is merely picking up the car at their delivery center. the actual paperwork and deal is completed at a franchised dealer, NOT the factory. we are extremely fortunate in North America with the way business is done with regard to purchasing an automobile. in most countries outside North America, you pay the list price, and there is absolutely no negotiating or incentives of any kind. cars sold in the United States, regardless of country of manufacture, are always more competitively priced than anywhere else in the world. just ask our neighbors to the north. for example, today (10/11/2011) the US and Canadian dollars are near parity. $25,000 in US dollars would be $25,700 in Canadian dollars. however, the pricing of vehicles is much different. let's look at a base Cadillac SRX FWD: US base price with freight: $35,815. Canadian base price with freight: $41,950. incentives: US: $6,000 in cash incentives, or 2.9% for 72 months. Canada: $2,500 rebate, or 5.79% for 72 months. this is just an example, but this pricing disparity between the US and Canada exists on all vehicles. we're very fortunate here in the US.
      rlog100
      • 3 Years Ago
      Franchise owners defend against the practice vehemently because they know they can get away with substandard treatment of customers and the 'factory' or the company takes the blame. Or put another way, a new customer (sucker) walks in based on a reputation of the auto maker, and the franchise dealership uses that to take advantage. Say, they burn that customer. The dealership's reputation is damaged but so is the automaker's. Because people move around, there's always a new sucker and the old suckers leave town. So the dealership isn't that hurt by his individual action. But the burned customer takes his grudge against the automaker with him to the next town. 'Factory' or automaker owned dealerships have a much more vested interest in keeping customers happy.
      • 3 Years Ago
      [blocked]
      Clipper44
      • 3 Years Ago
      Aah, the cost of doing business in California...
      HoeyHimself
      • 3 Years Ago
      The problem is, not all dealerships are going to cover the replacement of a toasted engine, nor should they or the manufacturer have to if the owner didn't take the time to consider driving with a blown radiator hose could kill their engine. That was nice of you to cover the $5,000, but that is not what all dealers would do, there's now way to standardize the practices of dealers, and for every good service department there are 10 crooked sales departments. Factory owned dealerships may cut some of the unnecessary kindness, but if could also affirm that the experience and practices of dealerships are all the same, and cut out the swindlers. Don't dare complain about a nicer factory owned dealership coming in and competing, if the customer gets a better deal, service, and experience at the factory owned dealer, it sounds like you feel they deserve less for the sake of keeping the unnecessary middleman in the equation.
      stickshiftn69
      • 3 Years Ago
      California sucks, Chrysler shouldn't pay them one penny