Chrysler seeks to close dealerships, but Bemidji dealership remains strong
Chrysler wants to break contracts with 789 of the 3,188 dealerships nationwide, including 19 in Minnesota.
But Bemidji Chrysler and Park Rapids Chrysler owned by Jim Fankhanel of Bemidji are in no danger.
"We've been having a great year," Fankhanel said. "We plan to continue serving customers."
He said sales and service have been strong in 2009, but he expressed sympathy for the owners on the list.
"It's unfortunate for the dealerships forced to close," he said. "Many have been working hard all their lives."
The plan to close some dealerships was outlined in court papers filed in U.S. Bankruptcy Court in Manhattan, N.Y. U.S. Bankruptcy Judge Arthur Gonzalez must first approve the cuts before they take effect, according to a story in the Duluth News Tribune.
Fankhanel bought the business in 1999 and changed the name from Dave Walters. He added the former Ness Motors of Park Rapids in 2000. He also bought the Honda of Bemidji franchise in 2006 from the former Spaulding Motors.
Bemidji Chrysler opened in 1952 when Jim's grandfather, Walt Fankhanel Sr., opened a John Deere implement dealership. In 1957, he added Nash-Rambler, which became American Motors. Jeep was also part of AMC at the time, so he sold those vehicles, too.
According to a list compiled by Minnesota Public Radio, the Minnesota dealerships to close are:
E Boe Chrysler Center, West Concord.
E Denny Hecker's Chrysler Dodge Jeep, Pine City.
E Factor Motors, Le Center
E Fury Dodge Chrysler, Lake Elmo.
E Iron Trail Chrysler, Virginia.
E Marchant Motor Co., Spring Valley.
E Bill Mason Chrysler Jeep, Excelsior.
E Nereson Jeep, Detroit Lakes.
E North Star Garage, Milaca.
E Paul Busch Auto Center, Wabasha.
E Miller Hill Chrysler Jeep, Duluth.
E Salem Motors, Crookston.
E Salmon Motors, Tracy.
E Scholtes Auto World, Worthington.
E Scott-Preusse, Redwood Falls.
E Sonju, Two Harbors.
E Stillwater Motor Co., Stillwater.
E Wally's Auto Service, Orr.
E Walser Dodge, Hopkins.
The Chrysler dealer contract rejections are to become effective June 9.
General Motors Corp., the largest U.S. automaker, had said last month it plans to reduce its dealer network to about 3,600 from the 6,200 outlets it operated at the end of last year, according to a story in the Duluth New Tribune.
The U.S. government, which provided emergency financing to both automakers, found that target insufficient.
Chrysler said in court that it wouldn't make incentive payments to dealers it wouldn't keep, which lowered its budget for such payments by 25 percent.
The case is In re Chrysler LLC, 09-50002, U.S. Bankruptcy Court, Southern District of New York (Manhattan).