DETROIT (AP) — So your local Chrysler dealer is slated to close, and a nearby General Motors dealer could get the ax too. What happens if you need service on your car?
It's a natural question in the changing automotive landscape, as those two U.S. automakers attempt to restructure in and out of bankruptcy court.
In bankruptcy court filings, Chrysler said Thursday it would shutter 789 of its dealerships — about 25 percent of them — across the country. GM dealers are awaiting word on which 1,100 of them will not see their contracts renewed when they expire at the end of September 2010.
If you live in a major metropolitan area, you could simply drive to another dealership to get your car serviced, even if it is a few extra miles away. However you might have some difficulties if you live in a rural town, or in an area where there are no other dealerships.
Here are some questions and answers on how the Chrysler dealership closings may affect car owners and buyers.
Q: Is my Chrysler warranty still in effect?
A: Yes. Your vehicle is still covered under whatever bumper-to-bumper and powertrain warranty you received when the car was purchased.
Chrysler Vice President Steven Landry said the company will be notifying the 3.5 million customers who bought their vehicles from the affected dealerships where they'll need to go now to service their vehicles. They hope to do this by early June.
Q: Will another dealer honor my warranty?
A: Your warranty will be honored by another certified Chrysler dealer. It won't be honored by another automaker's dealership. And Chrysler said it will not pay its closing dealerships for repair work done under warranty after June 9.
Q: Regardless of my warranty status, can I go to another automaker's dealer to get my car serviced or repaired?
A: That depends — and if you can, you'll have to pay for it.
While almost any service department can do routine vehicle maintenance, such as tire rotations and oil changes, complex repairs might be a challenge, particularly with problems that are detected by running an electronic diagnostic test on the vehicle.
"When it comes to diagnostic equipment and specific tools, our dealers would not be set up to handle that," said Honda Motor America spokesman Ed Miller.
However, at Bob Maxey Ford in Detroit, service manager Wayne Dallwein says he has a diagnostic tool that allows mechanics to test any automaker's vehicle. He said not all dealerships have that kind of equipment, but many independent mechanics do.
"People need to find out from their closest dealer if they have the tools and technology and the expertise to work on your Chrysler," he said. "Go in and see what their capabilities are. You want to establish a relationship with a new dealership before your car needs a repair."
Q: Is this a good time to buy a new Chrysler? Will closing dealers have a fire sale?
A: Perhaps. But while "everything must go," the dealers still need to make money.
Chrysler already has some of the most generous incentives in the industry. According to Edmunds.com, a site that offers information to car shoppers, Chrysler offered $4,383 in incentives per vehicle in April, down from $4,889 in March but up from $3,795 in April 2008.
Cook Chevrolet Inc. in Craig, Colo., which also sells Chryslers, was notified Thursday that its agreement to sell Chrysler's Jeep vehicles was discontinued. Scott Cook, who owns the business with his father, said the dealership has about 18 Jeeps to sell or move to other area Chrysler dealerships.
Cook said he hasn't decided whether to hold a fire sale. Either way, he said he'll explain the warranty situation to potential buyers.
"We'll disclose there's a strong possibility that we wouldn't be able to do warranty work here, but area Chrysler dealerships can do the work," he said.
—For more ways to save, spend, invest and borrow, visit MainStreet.com.