Car dealers don’t want more cars. They have them stacked up on their lots, many several months old and rusting. Most dealers are paying interest on that inventory. They borrowed to have them trucked in.
It is the goal of most dealers to sell what they have and not take what they cannot sell.
According to the AP, Chrysler Vice Chairman Jim Press told dealers "You have two choices," wrote the trade publication Automotive News. "You can either help us or burn us all down."
Another way to put that is that the dealers can help bail Chrysler out.
The request by Chrysler is evidence that the entire system of making and selling cars in the US is bankrupt. The auto companies sit at the middle of a huge disaster which now includes the UAW, creditors, suppliers, and dealers.
Car suppliers asked for $25 billion in bailout money to stay out of bankruptcy. If many of these firms disappear, The Big Three and some of their competitors will not have parts to build cars. That actually may help briefly because what can’t be built can’t be shipped to over-burdened dealers. But, the problem of missing parts would catch up to the industry
Next up for aid will be the dealers. They can get federal money so that they can buy more inventory from the failing car companies.
Douglas A. McIntyre
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