By RICHARD BURGER

In what has become the uncertain world of domestic new-car franchises, at least one Yakima dealer is looking to regain what was lost to him last summer.

Jim Peterson, General manager of Lee Peterson Motors, said he is currently involved in arbitration with Chrysler Corporation to recover the Jeep franchise he lost as a result of the Chrysler bankruptcy.

Franchise closures were part of the restructuring of the company, which terminated 789 agreements in June last year.

It was a move that Peterson Motors president Lee Peterson characterized as “extremely brutal,” when it happened.

Jim Peterson said the loss of the Jeep franchise meant the dealership could no longer sell new Jeep vehicles, and also could not provide warranty work to the Jeep vehicles it had previously sold new.

That didn’t sit well with his customers, Peterson said.

“A lot of people are very unhappy,” he said.

He said some customers paid for warranty work that would otherwise have been done at no charge because they preferred to do business with his dealership.

Lee Peterson Motors had been a Jeep franchisee for 32 years when his agreement was terminated.

Hahn Motor Company’s franchise was also terminated. The dealership had sold Chrysler Corporation vehicles since 1925.

Hahn president Dick Hahn declined a request for an interview.

Jim Peterson said he was uncertain when his own arbitration with Chrysler would be concluded, but a deadline of July 15 has been set for all arbitration cases to be settled. 

It is also not clear what will happen to the Chrysler dealer mix in Yakima if franchise agreements are re-activated.

For example, the Jeep franchise went to another Yakima dealer when Peterson lost it. 

If Peterson prevails in arbitration and his franchise is reactivated, he said he doesn’t know whether there will then be an additional Jeep dealer in the Yakima market or if the transferred franchise will be terminated.  

Vicki Giles Fabre, Executive Vice President of the Washington Auto Dealers Association, said the termination and reactivation of dealerships in the state are an “undefined set of circumstances,” and issues related to those circumstances will likely be determined in court, on a case-by-case basis.

Chrysler’s bankruptcy and termination of franchises was governed by federal law, and “completely bypassed state law,” Fabre said.

On a related note, the Washington Legislature in March enacted a major overhaul of dealer franchise law, which will take effect in early June.

The revised law modifies provisions relating to franchise agreements between new motor vehicle dealers and manufacturers. 

Fabre said 33 Chrysler and General Motors dealers in Washington have filed for arbitration.

Area Chrysler dealerships that kept their franchises were Mike Olson Dodge in Yakima, Mid Valley Chrysler Jeep Dodge in Grandview, and University Auto Center in Ellensburg.