http://news.cincinnati.com/article/20090511/BIZ01/905110307/Chrysler+dealer+fears+raw+deal+

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HAMILTON - After 16 years selling cars here on Ohio 4, Chuck Smith, owner of Hamilton-Fairfield Dodge-Jeep, thinks he's being railroaded.

Smith believes his dealership, which employs 15, will be one of up to 800 Chrysler dealerships nationally the automaker plans to eliminate through the government-led bankruptcy reorganization under way in New York.

Chrysler told the bankruptcy court last week it would only pay price discounts and sales incentives to dealers it plans to keep after exiting bankruptcy.

Jim Press, Chrysler vice chairman, told the Wall Street Journal on Thursday the automaker had "no active plan" to drop dealers, but is working on "contingencies" to do so.

Because his dealership is in an older location in a smaller city, Smith says he expects to be notified by Chrysler as soon as this week that his dealership agreement will be terminated as part of the bankruptcy reorganization.

There are about a dozen Chrysler dealerships in the Cincinnati-Northern Kentucky area. The automaker hasn't indicated how many dealerships here could be eliminated, but Smith estimates only a few like his are on the bubble.

Tim Doran, president of the Ohio Automobile Dealers Association, estimates there are about 50 Chrysler dealerships across the state, employing as many as 2,500, that could be eliminated in the bankruptcy process.

While he doesn't dispute that Chrysler needs to restructure and probably has too many dealers, Smith argues that the Obama Administration's plan using federal bailout money and federal bankruptcy laws to allow Chrysler to cut dealerships is unfair.

''They're using the bankruptcy law in a way that it wasn't intended to be used," Smith said.

Said Robert Reichert, owner of the Kenwood Dealer Group, which includes Kings Chrysler Jeep Dodge at the Kings Auto Mall: "Many dealers could end up getting a truly rotten deal.''

As a higher volume sales location, Reichert expects his dealership will survive, but he says: "What benefit does Chrysler get from eliminating dealerships? It doesn't cost them anything."

Fewer dealerships means fewer jobs, less convenience for customers needing service and more difficulty for dealers in locating repair parts, Reichert said.

Reichert said he hopes Chrysler will offer some compensation to the dealers it cancels.

The National Automobile Dealers Association, fearing the elimination of more than 3,000 dealerships between Chrysler and General Motors employing at least 150,000, launched a public relations campaign last week, arguing the cuts are excessive.

The association plans to meet with federal lawmakers and Obama's auto task force this week to press its case.