The pending closure of Chrysler and General Motors dealerships in Maryland will mean job losses and financial hardships for sales associates, mechanics and other workers directly involved in the business.
But the closings also could hit the rest of the Baltimore region's economy, hurting other local businesses and communities that benefit from the auto retailers.
For Sean Lloyd, a barber at Theo'z Barbershop on Liberty Road in Randallstown, the shutdown of Antwerpen Dodge across the street means losing customers. Besides the employees at Antwerpen, Lloyd said, he would often get walk-in customers who were visiting the dealership.
Antwerpen Dodge was one of 15 Maryland Chrysler dealers on a list of those to be closed. But its owner said the dealership voluntarily closed the dealership a few weeks before Chrysler's bankruptcy filing.
"When people are over there, we have cards and fliers. When they come to buy a car, they see a barbershop across the street and say, 'Let's check it out,' " Lloyd said recently as he cut a customer's hair. "All that is going to come to a screeching halt."
General Motors Corp. filed for bankruptcy protection Monday that put it under government ownership as the automaker undergoes a restructuring that includes plant closings and thousands of job losses.
GM's restructuring plan comes less than a month after the company announced it will terminate 1,100 dealer contracts when they expire in October 2010, but it's unclear how many of the 95 dealerships in Maryland could be forced to shutter because the company did not release a list of dealers it has targeted.
GM wants to reduce the number of dealerships nationally from 5,969 to 3,600.
Meanwhile, Chrysler is closing 789 dealerships nationwide under bankruptcy protection restructuring.
GM sent letters to its dealership network on Monday, including the 1,100 dealers that were told of their franchise terminations, to inform them on how they would fit into the new GM, said Susan Garontakos, a GM spokeswoman.
For the 1,100 dealers expected to close, they were offered wind-down agreements that would provide compensation based on a formula and assistance in selling existing inventory, Garontakos said. Another 250 dealers received similar offers. The dealers have until June 12 to sign on.
GM plans to close up to 2,600 dealers eventually.
