Governor Donald L. Carcieri today sent a letter to President Obama respectfully urging the Administration to reconsider the Chrysler reorganization plan, citing the economic impact on the State of Rhode Island and its largest Jeep dealer, Tarbox Jeep.
Recently, Tarbox Motors, a third-generation, family owned business, received a letter from Chrysler cancelling their franchise agreement. The cancellation of the agreement and closing of the dealership will result in a loss of 55 direct jobs, $3,000,000 in payroll and more than $2,200,000 in sales tax to the state. “With Rhode Island’s unemployment rate topping 11% and our state facing a critical budget deficit, this reorganization plan is creating serious and avoidable problems at the state and local level. The only winners appear to be members of the UAW while the losers are the secured creditors, franchisees and employees of the hundreds of dealers across the country.
In the letter, the Governor also cited concerns about the legality of the plan and the unprecedented intrusion by the federal government into a private business enterprise. “While you have stated this plan will give Chrysler “a new lease on life” what it does is favor the UAW by giving them 55% majority ownership of this iconic American automotive company. Government and unions should not be in the business of running companies; the marketplace should decide which dealers survive during these difficult economic times,” wrote Governor Carcieri.
The letter concluded with, “I respectfully ask you to reconsider the Chrysler plan and allow the current bankruptcy laws to prevail in the reorganization of this company going forward. Successful auto dealers, like Tarbox Jeep, are where the rubber truly meets the road. This plan bypasses their rights and deprives them and their hardworking employees the opportunity to compete for their share of the American dream.”
