Dealer Accuses Fiat Chrysler of Falsifying Sales

Aaron Cole
by Aaron Cole
dealer accuses fiat chrysler of falsifying sales

An Illinois dealer said in a lawsuit filed Tuesday that Fiat Chrysler Automobiles, through its regional sales offices, was intimidating and bribing dealers to report bogus sales at the end of the month to reach inflated sales targets. Automotive News reported first on the lawsuit.

The lawsuit filed by dealers of the Napleton Automotive Group accuses FCA of conspiring to inflate sales numbers through payments of tens of thousands of dollars to the dealer in co-op advertising accounts to disguise the practice. The lawsuit says FCA uses bogus third-party data from J.D. Power and Urban Science to falsely “verify” the sales figures and report publicly that the automaker has continued monthly sales growth since it emerged from bankruptcy in 2009.

The news of the lawsuit and its allegations sunk shares of Fiat so far that trading on its stock was halted in Europe, according to the Wall Street Journal.

The lawsuit alleges that dealers participating in FCA’s Volume Growth Program, which is a performance program that rewards sales, were enticed to falsify sales through an “earn and turn” program that would reward dealers that “sold” popular models with more of the same model. The lawsuit alleges that those sales were falsified at the end of the month, then backed out, to receive more popular selling models.

The lawsuit alleges that FCA asked the dealership group to falsely report sales of dozens of cars in exchange for $20,000, credited to the dealership’s advertising account.

FCA didn’t immediately comment on the lawsuit.

Last year, a dealer accused FCA-owned Maserati for falsifying nearly half their December 2014 sales by “punching” models that hadn’t yet been delivered.

Napleton ranked No. 41 in the top 125 largest auto dealers in the U.S. by Automotive News. It has filed several lawsuits against automakers since 1996, including lawsuits against Ford in 2001 and Volkswagen in 2010 for reasons unrelated to its current complaint against FCA.

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  • Vulpine Vulpine on Jan 14, 2016

    Two things wrong with this lawsuit: 1) Why is it just two dealerships that are owned by a single franchise that are filing this suit? 2) Why is this not a criminal investigation and only a civil suit? Whether true or not, these two questions bring the whole lawsuit into question. Could it be that the franchise itself is the one that's been doing questionable accounting?

    • See 3 previous
    • Vulpine Vulpine on Jan 15, 2016

      @Scoutdude #1 Maybe they are the only ones to have the guts to do so or they are the only one that is ethical enough to do so. -- Highly unlikely since this is almost guaranteed to cost them the franchise no matter how it comes out. -------------------------------------------- #2 Because they can’t file a criminal case you need a gov’t prosecuting attorney to do so. If this lawsuit has merit then it is highly likely that a criminal case could be filed. -- Which is exactly why this is questionable, as a legitimate complaint should go to government investigators. The fact that it didn't means these dealerships (one franchise) are after money, not justice.

  • And003 And003 on Jan 16, 2016

    Speaking for myself, until Napleton produces proof beyond a reasonable doubt that FCA is engaged in such activities, I have to regard their claims as suspect.