Autos: The Dodge Rebellion

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As part of its successful battle for a larger share of the U.S. auto market, Chrysler Corp.'s Dodge Division lately has been wooing buyers with ads in which an eye-catching blonde model suggests: "Join the Dodge Rebellion." Last week the rebellion spread to an unexpected quarter. In the New York City area, 58 of Dodge's 98 dealers publicly attacked the way the company treats them.

Banded together as the Metropolitan Independent Dodge Dealers Association, the auto retailers claimed to represent $60 million a year in sales, 5% of Dodge's total. They hired a pressagent, and as their lawyer they retained none other than Roy M. Cohn. Among their complaints: in its zeal to sell cars, Dodge has not only franchised too many dealers, but has unfairly gone into competition with established dealers through company-financed outlets.

The company, the rebels charge, also forced dealers to absorb the cost of remedying factory-caused defects and even to pay for advertising they find valueless. Said Yonkers Dealer Raphael Cohen, chairman of the group's steering committee: "We think Dodge makes a fine product, but we want equal treatment from our manufacturer so we can compete."

What seemed to irk the dealers most was a practice not confined to Dodge. Automakers rebate from $50 to $100 of the price of a new car to dealers who meet or top monthly sales quotas set by the factory. Because the quotas vary from dealer to dealer even in the same area, they complained, the rebates give low-quota dealers a price advantage over their competitors. On top of that, dealers who consistently fail to meet their sales quotas lose their franchises. Yet neither Dodge nor other dealers can sell a franchise without factory approval of the buyer.

Such pressures hold down the price the public pays for autos—but they squeeze a lot of dealers. Though some top outlets in big metropolitan areas show profits well over $100,000 a year, the average U.S. dealer netted a pretax return of only 2.4% on his sales volume during the first half of 1966, according to the National Automobile Dealers Association. Worse still, while auto manufacturers completed their second biggest model-year, 101% of their dealers ran in the red.

Many dealers besides the Dodge dissidents predict that the automakers are headed for trouble without knowing it. At week's end, insisting that they will go to court if need be to press their views, the New York Dodge dealers seemed ready to help make such forecasts come true.