Chrysler to pay nearly $1 million to settle LA dealer complaint image

Less than a year after opening a factory-owned dealership in Los Angeles the Chrysler Group has sold it and agreed to pay a $955,000 fine following a complaint from the California Department of Motor Vehicles.

Chrysler was accused of unfair competition by operating a factory store less than 10 miles away from several other Chrysler dealerships, thus breaking a California law. In September, the California Department of Motor Vehicles had filed an administrative action against Chrysler’s occupational licenses and Chrysler agreed to pay $750,000 in penalties and fines, $160,000 in reimbursements of investigation and legal fees and up to $45,000 for post-settlement audits.

Following the settlement, the automaker confirmed it had completed the sale of the 189,000-square-foot dealership to New Century Automotive Group of Los Angeles at the end of October. The terms of the sale were not disclosed.

Motor Village LA opened in January 2011 as a high-visibility showcase for Chrysler’s products, including Fiat, and new retail techniques. The dealership features a glass vehicle display tower that overlooks Interstate 110. Neighboring dealers and the California New Car Dealers Association complained in March to the California DMV that Chrysler was unfairly competing by operating a factory store within 10 miles of several other Chrysler dealerships.

“We hope other manufacturers will see what happened in this case and think twice about doing something similar,” Brian Moss, director of government affairs for the California New Car Dealers Association, was quoted as saying by the Automotive News.