Having Lost Hope in Chrysler, Sheehy Closing Upper Marlboro Location
Monday, October 12, 2009
Paul Sheehy walked out of the empty showroom and into the lot at his sprawling Chrysler-Jeep-Dodge dealership in Upper Marlboro. Two 2009 Chrysler 300s and 25 used cars were all that remained of an inventory that in better times had numbered more than 300 vehicles.
Thursday will be his last day selling new Chrysler vehicles. After 11 years in the Prince George's County location, Sheehy and his older brother Vince will briefly focus on clearing away their used-car inventory before shutting down the dealership next month.
The Sheehy brothers, third-generation auto dealers, run one of the largest new-vehicle enterprises in the Washington area with 14 stores, 23 brands and annual sales of $900 million. They survived the darkest days of the recession, endured Chrysler's bankruptcy and escaped the automaker's list of 789 terminated dealers. Even after seeing a modest surge in sales from the government's "Cash for Clunkers" program, the Sheehys say they are giving up because they lost confidence in the company's ability to produce cars that consumers want to buy -- a perception the automaker will have to overcome as it goes through yet another reincarnation.
The Sheehys' decision also reflects the difficulties that still buffet the industry as it tries to climb out of the recession.
Sheehy Auto Stores has long been in growth mode, recently adding Hyundai and Mazda to the lineup, and this is the first time since the late 1970s that the family shed a dealership in the Washington area because of sluggish sales.
More than any of their other stores, the Upper Marlboro dealership received a double-dose wallop from the auto slump and the near-collapse of two of the Big Three. Besides the Chrysler franchise, the Sheehys for most of their time at the location sold the Chevrolet brand, too. For several tense months, they observed the pre-bankruptcy drama unfolding at the parent companies of both franchises, General Motors and Chrysler, and worried whether their business would survive. In February, they opted to drop Chevrolet and focus exclusively on Chrysler, believing it would fare well because there were few dealers selling the brand in the area.
But looking down the road, they say, their prospects for making money remained dim. A succession of different Chrysler corporate parents did not invest much in new product development, they said, and the truck-heavy automaker failed to offer the type of vehicles that would attract the value-conscious consumer.
"The only new product that we're aware of is the 2011 Jeep Cherokee," said Paul Sheehy, general manager of the dealership. "Where is the broad array of vehicles competing with the Ford Focus and Toyota Prius? We just don't see that on the horizon."
"I've been through Daimler purchasing Chrysler, Cerberus purchasing Chrysler and now Fiat purchasing Chrysler," he added. "We're skeptical of another company takeover."
Asked about the Sheehys' vote of no confidence in the new Chrysler Group, company spokesman Gualberto Ranieri said Fiat intends to return the automaker to profitability in 2011. The company, he said, will discuss its new products in a five-year restructuring plan that will be introduced Nov. 4.
"There is a very strong commitment to the success of Chrysler and the success of its brands," Ranieri said.
But as they head into the traditionally slower winter season, Paul Sheehy said he and his brother can't afford to "wait to see if [Fiat] could change Chrysler."