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Some Maryland auto dealers targeted for closure are racing against time to save their businesses.

Several met with Montgomery County officials last week to ask them to lobby federal officials and Gov. Martin O'Malley (D) to block efforts by Chrysler and General Motors to replace them with consolidated dealers.

Rick Shaub, owner of Montrose Dodge in Germantown and one of the dealers who met with Montgomery officials, said his business has suffered since he was recently told by Chrysler that he had less than a month before the Detroit automaker terminates his contract. He said he hasn't been told what criteria Chrysler applied in including his dealership among the 789 nationwide with which it plans to end its relationship.

"There is no reason for this," said Shaub, whose grandfather established the family-owned dealership in 1945. "I've outsold the other Dodge dealerships in Montgomery County."

County Executive Isiah Leggett (D) and economic development director Steven A. Silverman pledged to work with the dealers to make sure the state upholds franchise laws and does not allow the manufacturers to just issue new licenses to other dealers. Federal officials should also review the process to see if it makes financial sense, Silverman said.

"That case really hasn't been made," he said.

Fifteen Maryland auto dealerships are among those on Chrysler's list. General Motors recently notified 1,100 dealers across the nation that their contracts will end, but that automaker is giving dealers until October 2010. GM's list is not public, as the company, unlike Chrysler, is not in bankruptcy court.

Maryland has about 100 GM-affiliated dealerships.

Dealers may not find federal officials too sympathetic. The Obama administration does not plan to tell Chrysler and GM what dealerships it can and cannot close, Treasury Secretary Timothy Geithner told the Senate Banking Committee last week. A federal auto task force is overseeing the restructuring of GM and Chrysler.

John J. "Jack" Fitzgerald Jr., founder and president of Fitzgerald Auto Malls, with some of its Kensington dealerships on Chrysler's list, also met with Montgomery County officials last week. "There is no justification for what they are doing," Fitzgerald said of the automakers.

Closing the Chrysler dealerships will further reduce the number of locations where owners of American vehicles can go for factory service, to about 13,000 from some 41,000 in the 1950s, he said.

It is important to get government officials to ask more questions about how closing dealerships will reduce costs for the manufacturers, said John O'Donnell, executive vice president of the Washington Area New Automobile Dealers Association.

"We don't think this plan will reduce costs," he said.

Closing the dealerships is the wrong move if the automakers want to recover as quickly as possible, as the dealers are not a liability to manufacturers, said Peter Kitzmiller, president of the Maryland Automobile Dealers Association.

Dealerships are the automakers' "link to the consumer that will play a critical part in the company's recovery and long-term survival," he said.

Chrysler cites

market conditions

Chrysler, which is in the process of being sold to Italian auto company Fiat, is closing about one-quarter of its roughly 3,200 dealerships nationwide, according to the company's list. Those dealers represent about 14 percent of Chrysler's domestic sales volume, executives said. The list includes two dealerships with Maryland addresses whose actual locations are in other states.

"With the downsizing of operations after the sale and reduction of plants and production, similar reductions must be made to the size of the dealer body," Jim Press, Chrysler's vice chairman and president, said in a statement. "We wish market conditions made it possible to keep everyone."

Chrysler said it will work to help the targeted dealers sell new vehicles and parts to remaining dealerships. The dealers on the list are scheduled to stop selling Dodge, Chrysler and Jeep vehicles around June 9.

Other Maryland dealers on the list are in Rockville, Frederick, Laurel, Baltimore, Randallstown, Pocomoke City and Cumberland.

Robert K. Phillips, an executive with Don Phillips Jeep in Frederick, which is on the Chrysler list, said in a letter to customers that the decisions are not final. He called on customers to contact federal officials to question them about why the companies are ending their relationships with successful dealers.

Don Phillips Jeep is, in fact, Chrysler-certified as a "five-star" dealer and has been performing above its sales quota for the past several years, including some months selling at a rate of 200 percent above that quota, Phillips said.

"We have consistently garnered good customer satisfaction scores and our customers' ongoing loyalty," he said. "Don Phillips Jeep does not cost Chrysler money, we make money for them."

This report originally appeared in The Business Gazette.