Chrysler faces California New Motor Vehicle Board today
(September 27, 2011) LOS ANGELES — Although the California Department of Motor Vehicles and the New Motor Vehicle Board continue their actions including a meeting today on the charges that Chrysler improperly operated a factory owned store, Chrysler Group has reached an agreement to sell its factory-owned dealership in Los Angeles.Motor Village Los Angeles held its grand opening last November, just prior to the LA Auto Show as a showcase for its vehicles including the first Fiat store in the U.S. after a 27-year absence.
The prospective buyer is New Century Automotive Group, a North Hollywood, Calif., group that owns three Volkswagen dealerships and single BMW, Mini and Infiniti stores. New Century is owned by Dennis Lin.
Chrysler hopes to close the deal with New Century in October.
Regarding the allegations, Kisiel said: "We are continuing to work with the DMV. We hope we will find a resolution for all parties that are potentially affected." The fact the store is scheduled to be sold to a private investor may not hold off a decision against Chrysler for its actions.
Chrysler is trying to reclaim lost market share in California, where it has a 4.38 percent share statewide. In Los Angeles, Chrysler's share is even lower -- 3.89 percent. Chrysler's U.S. share was 10.2 percent for the year through August.
The dealership is housed in a 189,000-square-foot building on Figueroa Street in downtown Los Angeles that overlooks Interstate 110. The facility that has been owned by Chrysler for years was totally refurbished for Motor Village and features a unique multi-level glass auto display that rises above the building and is visible from the freeway.
Lin is buying only the dealership. Chrysler Realty will continue to own the land and the buildings, which are very expensive in downtown Los Angeles. That may continue to be a point of contention with the Chrysler dealers that are within the 10-mile radius of the downtown location, who brought the original charges against Chrysler through the California New Car Dealers Association to the DMV.
Peter Welch, president of the CNCDA, notes that the rent that Chrysler will charge the new dealer needs to be in-line with downtown real estate pricing in order to forestall an unfair advantage to the detriment of the nearby Chrysler dealerships. Welsh estimates that the monthly rent for the property should be near $200,000.
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