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Mexican Dealers Travel to Chrysler Headquarters, Demand Meeting with CEO

August 24, 1995

DETROIT (AP) _ Disgruntled Chrysler dealers from Mexico, where the peso crisis has savaged the automobile business this year, have been showing up at the company’s headquarters demanding to meet with top executives.

``We want to talk with Mr. Eaton or Mr. Lutz,″ Antonio Palacio, a Mexico City dealer, said Thursday. ``We spend whole days sitting in the lobby at Highland Park, with nobody giving us any news.″

Chrysler officials said at least eight dealers showed up Wednesday and were told that they could not meet with Chairman Robert J. Eaton or President Robert Lutz.

The dealers are being told to work with managers at Chrysler de Mexico, who the dealers say they are fed up with. The dealers want Chrysler to do more to help them deal with Mexico’s economic crisis.

``We are losing money,″ Palacio said.

They want Chrysler to cut the interest it charges dealers for the money they borrow from the company to buy cars from Chrysler’s factories. They also say Chrysler has set selling prices that are too high and dealer profit margins that are too low.

The company is spending $250 million this year to help shore up its Mexican dealer network as its sales in that country have dropped 67 percent, Chrysler officials said. The aid has included $65 million in low-interest loans to dealers. It is comparable to measures being taken by the other automakers that operate in Mexico.

Palacio said 18 dealerships were represented in the group that had gathered in Detroit by Thursday, and that at least two dozen more were expected by Monday. If the numbers are accurate, the group represents a significant piece of Chrysler’s business in Mexico, where it has about 145 dealers.

``We’re not going home until we get a meeting,″ Mario Cervera Ortiz, president of the Chrysler dealer council in Mexico, told The Wall Street Journal.

Overall car sales in Mexico for the first seven months of the year were down 61 percent from 1994, according to the Mexican Auto Dealers Association.

Palacio said his 21-year-old dealership, which sold about 1,000 vehicles last year, has sold ``300 maybe″ in 1995.

Said Chrysler spokeswoman Rita McKay: ``Its a tough market. The cost of money is high, interest rates are high. We are convinced that the market has bottomed out, that it will come back. But the recovery will be slow.″

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