Comiskey's lot flooded during Hurricane Katrina and he says it still has not received insurance money for the damages. (Kenneth Hawkins/NYT Institute)

 New Orleans auto dealer Mike Comiskey read the headlines and heard the warnings, but that didn’t prepare him for the news that his Chrysler dealership would close.

Comiskey’s Orleans Dodge Chrysler Jeep LLC in New Orleans East is set to become one of two Chrysler dealerships in the New Orleans area to close, joining another 15 across Louisiana. Madere’s Garage Inc. in Hahnville is also on the list. 

Comiskey’s shop, set on a three-acre lot with a reduced staff of 37, down from 68, is set to close in less than two weeks, on June 9. Only 16 Chrysler dealers will remain in Louisiana after that date, none of them in the New Orleans area. 

Although, his business will not be able to operate under the Chrysler, Dodge and Jeep brands, he plans to remain at his current location, where he has a six-year lease, possibly selling used cars.

On May 14 Chrysler LLC announced to Congress its plan to file for bankruptcy protection and close 789 of its 3,200 dealerships, one in four, in the United States. It reported a $16.8 billion net loss for 2008.

With a quarter of Chrysler’s dealerships scheduled to close by June 9, this will mean the job loss of more than 38,500 dealership and factory workers across the country, the company says. Earlier this month, Chrysler reported U.S. total sales of 76,682 units in April, a 48 percent decrease from April 2008. It sold 2 million units in all of 2007, a decrease of 3 percent from the 2.1 million in 2006.

Similarly, on May 15, GM announced plans to cut more than 1,100 dealers. GM officials said that cut is the first as it ultimately plans to close about 2,400 of its 5,969 dealerships, or 40.2 percent. GM plans to sell or shut down the Saturn, Saab and Hummer brands.

Both decisions are being made because of declining sales and a bad economy.

Three calls to Chrysler’s national press office seeking comment were not returned.

Although Comiskey received a confirmation letter from Chrysler notifying him of the impending closure on May 14, he is appealing this decision.

“I’m not giving up, but it’s an uphill battle,” Comiskey said, adding that he didn’t think Chrysler “has really given this a lot of thought.” 

Comiskey, 51, said he knows the pain of other dealerships and the struggles of the working man. 

Starting in high school as a car mechanic, Comiskey became a manager of a Chrysler dealership during the 1990s. Along with fellow investors, Comiskey bought the Southeast location on Interstate 10 Service Road in April 2005. 

Surrounded by other dealerships at the time, Comiskey said the area was ideal because it was affluent and it was filled with stable businesses, shopping centers and a diverse housing market.

Four months later, however, Hurricane Katrina floodwaters put his dealership five feet under water and destroyed a majority of his cars.

Comiskey’s was one of the first businesses in New Orleans East to get back on its feet, resuming operation in October 2005. He improvised by doing business out of trailers, powering his facility with generators to avoid inconsistent electricity and purchasing enough cars to rebuild his inventory. 

“We have represented the brand very well under the conditions we were allowed to operate,” Comiskey said. “We did the best with what we could at our disposal.”

Angela Shroyer, Comiskey’s comptroller, recalls the effect Katrina had on the dealership and how it has caught up almost four years later. 

“This place lost everything,” Shroyer said, “but these guys came back, helped gut this building and put it back together.”

Shroyer said she “sees no rhyme or reason”  to the way Chrysler put its list together.  Shroyer said that during Katrina his dealership provided fleet vehicles to police departments and fire stations in every parish of Louisiana that was affected. It also  provided vehicles for state and New Orleans entities.

Post-Katrina sales were on the rise because of those fleet vehicle sales. From April to December 2005, Comiskey’s dealership sold 1,167 new and used cars and trucks and brought in almost $25 million, he said. From 2006 to 2008, despite losing half of his work force after Katrina, sales increased each year, reaching a total of  more than 5,000 new and used cars and trucks for the three-year period. 

So far in 2009, the dealership has sold 211 new and used vehicles and brought in almost $5 million, putting it substantially behind sales rates of previous years.

Now, however, Shroyer said it has been difficult for the dealership to purchase cars because many of Chrysler’s assembly and component factories are scheduled to close across the country by 2010.

The dealership has vehicle orders dating to October 2008 that have not yet been delivered because of plant closings. Shroyer said the dealership is still waiting to receive 200 vehicles purchased by the state. 

“We don’t have the availability to get the product to sell,” Shroyer said. “We can do nothing but go up from here, as long as we got our product.”

Comiskey said the dealership would be in a better position, and perhaps not on the list of intended closures, if it had received the money he believes he is owed by his insurer for storm-damaged cars. In August 2007, the dealership sued the insurance company after the insurer said there was no way to verify that Comiskey lost as many cars as he claimed.  

Because of the decrease in sales, Comiskey released half of his staff, some with more than 20 years of car-sales experience.

“I’ve been in this position for quite some time, and I don’t even know I want to stay in the car business at this point,” Shroyer said.

“These are people you’ve worked with your entire adult life,” she said. “They’ve got families to feed.” 

Even though the cuts have been painful, she added, “We may have to make more.”

Jeffrie Schulpif, executive director of the  Greater New Orleans Real Car Dealers Association, said the reduction in auto dealers is the wrong move to make because dealers do not cost the manufacturers money.

“Dealers own their property and buy their vehicles from the manufacturer,” Schulpif said. “It’s the dealer’s investment to the dealership.”

Schulpif said she first  anticipated tough times for the auto industry when gas reached a record $4.08 a gallon last summer. She also said the current national unemployment rate of 8.9 percent is forcing families to hold back from making large purchases.

“There have been a lot of hard-working people that are being handled really badly,” Comiskey said.

“It’s like dancing with your feet tied together. You can’t do it.”