The arbitration will take place at an international court in London, Hamamatsu-based Suzuki said today in a statement to the Tokyo Stock Exchange. Volkswagen said the process can’t force it to sell its 19.9 percent stake in Suzuki, reported Bloomberg.

Each company has accused the other of breaching the cooperation agreement, which was meant to supply Suzuki with technology and provide VW with access to the Indian car market. The carmakers have been at odds since VW described Suzuki as an “associate” in its 2010 annual report. Suzuki said on Nov. 18 it had terminated the partnership with the Wolfsburg, Germany- based automaker, which failed to yield a single joint project.

Suzuki’s move “can be seen as a step toward reaching a conclusion on the partnership,” said Satoru Takada, an auto analyst at TIW Inc. in Tokyo. “If the arbitration process takes long, it may affect the relationships Suzuki and VW have with their other business partners.”

Suzuki rose 0.9 percent to 1,533 yen in Tokyo, compared with a 1.8 percent drop in the benchmark Nikkei 225 Stock Average.

VW has rejected allegations from Suzuki that it broke the cooperation agreement and sees “no legal basis” to return its holding, Eric Felber, a VW spokesman at Wolfsburg, said today in an e-mailed statement.

“We’re confident and look forward to this arbitration procedure with calm,” Felber said.

Suzuki is prepared for the arbitration process to take up to two years to complete, Executive Vice President Yasuhito Harayama said Nov. 18.
“While an arbitration will be legally binding, we think our relationship with Volkswagen may resolve in a friendly manner,” he said.

The statement by Chrysler spokesman Michael Palese sought to correct a report in The New York Times last week that said the company’s settlements averaged about $500,000, citing “people with direct knowledge of the terms.”

Chrysler settled 151 of the 418 arbitration claims filed by dealerships closed as part of the company’s bankruptcy proceeding last year. “Many” of these settlements involved cash payments, Palese said.

“It makes good business sense anytime we can settle a case for an amount significantly below the cost of litigation,” he said in an e-mail today. “This enables Chrysler to focus more resources into what’s truly important — developing outstanding products.”

The figures would put Chrysler’s overall costs for settlement payments at “significantly below” $15 million. Palese declined to be more specific.

Dealer lawyers said Chrysler started making settlement offers in April, usually for $25,000.

Those offers increased somewhat as the arbitration process continued through July, though they never approached the typical size of General Motors’ offers, the lawyers said.

GM spokeswoman Ryndee Carney declined to disclose the company’s average settlement or total settlement payments.

Dealer lawyers said the differing settlement payments by the two companies, as well as what they described as GM’s more respectful overall treatment of arbitrating dealers, would have an impact going forward.

GM “was willing to settle for an amount more closely aligned with the value of the franchise being taken from the dealer,” said lawyer Richard Sox of Tallahassee, Fla., whose Bass Sox Mercer firm represented both Chrysler and GM dealerships.

He added: “Although both sets of dealers are approaching the relationship cautiously, our Chrysler dealers are much more wary of expending capital on their franchises as compared to our GM dealers.”

Chrysler’s Palese said the company’s dealers “are already enjoying increased profitability and are making significant investments in their dealerships.”

These investments are “on track with” the $500 million investment objective in Chrysler’s November business plan, he said.

Dealer lawyers said GM commonly offered settlements of two to three times the wind-down money it paid to dealerships to close by October.

Dealerships received as much as $1 million in wind-down money depending on their size, Jim Bunnell, GM’s general manager of dealer network support, said earlier this year.

That would mean some rejected GM dealerships received as much as $2 million in settlement payments, an amount consistent with reports by dealer lawyers.

GM reached individual “resolutions” with 408 of its 1,176 arbitrating dealerships. Most of these resolutions led to the store winding down in October, as originally planned. Carney declined to say how many of these resolutions involved settlement payments.

GM announced final results of a process that began with enactment of a federal arbitration law in December and ended with final decisions handed down last month on claims by dealers tagged for elimination during the company’s restructuring, reported Automotive News.

Most of the 1,176 arbitration claims filed in January never reached a decision, the company said in a statement. GM offered letters of intent that spelled out conditions for reinstatement to 702 dealerships or 60 percent of those that filed claims.

With 23 dealerships prevailing in arbitration, GM offered letters of intent to a total of 725 stores, Carney said in an interview. That’s 62 percent of the dealerships filing claims.

Most if not all recipients of letters of intent have signed them, Carney said. These stores can start selling cars as soon as they meet the conditions in the letters.

“A strong, profitable dealer network selling and servicing the world’s best cars and trucks is a genuine market advantage,” GM North America President Mark Reuss said in the statement.

GM also said today that it had reached 408 individual resolutions with dealers that filed arbitration claims.

These resolutions consist of settlements, an undisclosed number of dealership continuations that will receive letters of intent, and claim withdrawals and dismissals, Carney said.

Most of the 408 resolutions involve dealer terminations, GM said.

Still, dealer lawyers have said GM paid cash settlements in dozens of these cases — sometimes as much as several million dollars.

During the summer of 2009, GM notified 2,064 dealerships of plans to terminate at least one of their franchises by October 2010. GM’s goal was to pare its dealer network from 6,049 stores to about 3,600.

That network is now likely to be about 25 percent larger than originally planned, with about 900 more stores — making a total of about 4,500.

While GM declined to give a dealership breakdown, Carney did provide a breakdown by franchise for the new network.

In November, there will be about 3,100 Chevrolet franchises, 2,100 Buick franchises, 1,750 GMC franchises and 925 Cadillac franchises, she said.

About 1,000 of the continuing stores are scheduled for “a major facilities upgrade” by the end of this year, the statement said. Included in the upgrades will be work areas with phone and laptop computer outlets, Wi-Fi and a cafe area with refreshments.

Chrysler claims it should be allowed to withdraw a letter of intent to a dealership if nearby stores protest its reinstatement The condition has been in at least 82 letters offered to dealerships that filed arbitration claims after being closed during the company’s bankruptcy last year.

Only 29 dealers have signed the letters of intent, although that number could grow because many of the others are in talks with Chrysler in an attempt to get the requirements eased.

Dealers who haven’t signed have argued that several requirements in the letters — including the one granting Chrysler withdrawal rights if a nearby store protests — are more stringent than those in letters given to stores that weren’t closed.

The letters of intent contain requirements — such as minimum levels of capital and credit, as well as showroom upgrades — that a dealer must agree to before being reinstated.

Chrysler’s suit, filed in U.S. District Court in Detroit, contends Michigan dealer law trumps the federal law, enacted in December, that created an arbitration process for rejected Chrysler and General Motors Co. dealers.

“Chrysler Group is simply seeking clarification of the rights and legal responsibilities of the company and affected dealers,” the automaker said in a statement.

The Michigan Dealer Act requires Chrysler to notify existing dealers of its intent to establish a new store within six miles and give them the right to file a legal challenge within 30 days, the automaker’s suit says.

Chrysler wouldn’t say definitively whether it would file similar suits in other states but has “no plans to file elsewhere at the moment,” company spokesman Michael Palese said.

Rejected Chrysler dealers who prevailed in arbitration have filed suits in Florida and Missouri challenging the letters of intent they received.

Arbitrators sided with the company 73 times and with dealerships 32 times. Chrysler rejected 789 dealerships in bankruptcy last year.

Many arbitrators that ruled for Chrysler deferred to the company’s Genesis strategy of consolidating all four of its brands — Chrysler, Dodge, Jeep and Ram — in each dealership, Automotive News reported. But the size and speed of Chrysler’s cuts were called into question last week in an audit by the inspector general for the U.S. Troubled Asset Relief Program.

“The decisions to select dealers for the company’s optimized dealer network were carefully considered as part of Chrysler’s Genesis Project,” the company’s statement said. “The decisions of a great majority of the arbitrators reflect the belief that the company’s dealer network decisions were not only appropriate but essential to its future success.”

Some lawyers representing dealers disagreed.

They said many more dealers would have prevailed in arbitration if inspector general Neil Barofsky’s audit had been released while arbitration cases were still going on rather than after the process was completed.

“Chrysler had absolutely no proof that dealership closing would save Chrysler a nickel,” said lawyer Mark Ornstein of Orlando. “Had this report been available at arbitration, I believe all the dealers would have been successful in arbitration. All Chrysler relied upon was unproved theory and tried to dress it up as fact. It was the king’s new clothes.”

While Chrysler’s arbitration decisions are final, the number of dealerships that have signed letters of intent with conditions for their reinstatement is not.

A total of 29 rejected Chrysler dealers have signed letters of intent thus far, the company said. That figure will grow as post-arbitration settlement talks between Chrysler and dealers continue, Chrysler spokesman Michael Palese said.

“Chrysler Group is complying fully with the letter and intent of the federal dealer arbitration statute by issuing a customary and usual Letter of Intent to prevailing dealers and looks forward to engaging in constructive discussions with these dealers,” he said.

The 29 signed letters of intent will increase the company’s current 2,300-dealer network by 1 percent.

They come from a pool that includes the 50 dealerships that were offered letters of intent in March, the 32 dealers that prevailed in arbitration, and 150 that settled their arbitration cases with Chrysler.

Most dealerships that received letters of intent after winning in arbitration have rejected them thus far, some dealer lawyers said.

The decisions were a victory for Chrysler’s Project Genesis strategy, which has largely but not completely carried the day in other arbitrations.

Fitzgerald’s dealerships in suburban Washington each carried one or two Chrysler brands but not all four.

“I found little evidence that the dealer had a well-thought-out and sound business plan for fitting within the Chrysler business plan, which I considered as itself well-thought-out and sound, having been developed by experts in the field,” arbitrator James Constable wrote yesterday in four identical decisions.

He echoed Chrysler’s rationale for Genesis: that it may increase per-dealer sales and create jobs.

In a twist, the arbitrator’s reasoning clashed with the decision of a Florida arbitrator last month to grant Fitzgerald’s bid to reinstate his Clearwater, Fla., store.

The Florida arbitrator challenged Chrysler’s Genesis plan and said it wasn’t in the public interest for the company to close Fitzgerald’s store.

Chrysler hopes to have 100 percent of its dealerships house all four brands by the end of next year.

Fitzgerald is unconvinced that Genesis is working, and he cited both national and local sales figures to buttress his argument.

“Genesis is a failure,” he said in an interview today. “It has promoted fewer sales and fewer jobs.”

Fitzgerald said a competing Genesis dealership in suburban Maryland was selling substantially fewer vehicles than his terminated stores had sold.

Fitzgerald, 74, is one of three leaders of the Committee to Restore Dealer Rights, a rejected-dealer group that successfully led the fight in Congress for legislation to set up arbitrations for rejected Chrysler and General Motors stores.

Chrysler Group said in a statement that it is “pleased” with the arbitration judgments.

“The decisions to select dealers for the company’s right-sized dealer network were carefully considered as part of Chrysler’s Genesis Project,” the statement said. “Placing all four brands under one roof in modern, well-located facilities has already resulted in enhanced profitability for the Genesis dealerships.”

Fitzgerald’s Maryland dealerships were in Silver Spring, Gaithersburg, Kensington and Frederick.

The arbitrator said all four failed to meet Chrysler’s sales criteria.

Fitzgerald said that the arbitrator was “confused” and that only one of the four didn’t perform adequately. The Gaithersburg store, in fact, was the top-performing Chrysler dealership in Montgomery County, he said.

Separately, Fitzgerald has reached settlements with General Motors Co. to maintain two of his dealerships that had been on the company’s wind-down list.

“It’s bittersweet,” McDonald said today after learning of arbitrator Tracy Allen’s split decision. “I am excited about winning one, but I though we could win both of them.”

McDonald becomes the third former Chrysler dealer to prevail through arbitration. The other two are Bill Hahn of Village Chrysler-Jeep in Royal Oak and Bruce Campbell, who plans to reopen his Dodge showroom in Redford Township.

The only woman owner of a Chrysler, Jeep or Dodge franchise in metro Detroit, was among the 789 dealers Chrysler terminated in June as part of its government-backed restructuring. She also had closed a Chevrolet dealership in Farmington Hills.

She said she employed about 125 people between her Chrysler-Jeep and Dodge businesses. Initially she plans to hire between 40 and 50 to reopen Livonia Chrysler-Jeep on Plymouth Road to get sales and service departments up and running.

Chrysler said that of 418 arbitration cases initiated, more than 125 were dismissed or withdrawn and 150 were settled. Of 97 arbitrators’ decisions rendered so far Chrysler prevailed in 69 cases, dealers won 28. Nine decisions are pending, including that of Joe Ricci, whose Dodge dealership in Dearborn has closed. Only one case has yet to be heard.

“The decisions of a great majority of the arbitrators validate that our dealer network plans are not only appropriate, but essential to Chrysler’s future success,” the company said in a statement.

From 3,200 dealers before it filed for Chapter 11 bankruptcy on April 30, 2009, Chrysler now has 2,315 dealers, said spokesman Mike Palese. The automaker intends to have 2,300, each selling Chrysler, Dodge, Jeep and Ram truck models by the end of 2011.

The American Arbitration Association has said it wants to resolve all Chrysler dealer arbitrations by the end of July.

Medved Autoplex in Castle Rock and the Phil Long Jeep-Chrysler dealership in Denver would rejoin Chrysler’s dealer network if they meet standard requirements for dealers, Chrysler said.

“That’s outstanding news,” Colorado Automobile Dealers Association President Tim Jackson said.

Dealership representatives weren’t immediately available for comment Monday, but Jackson said he expected both dealerships would try to rejoin Chrysler’s network.

Chrysler said the Medved dealership in Jefferson County lost at arbitration. Earlier, the automaker won cases involving two other Colorado dealers and settled with King Auto Group in Longmont.

Century Motor Corp., of Wentzville, contends that dealerships seeking reinstatement have to meet conditions not required of the thousands of Chrysler dealerships that were never terminated.

The requirements also were not imposed on dealerships awarded franchises after bankruptcy and before the arbitration law was enacted in December, according to the complaint, filed Thursday, June 17, in U.S. District Court in St. Louis.

The suit says letters of intent given to terminated dealerships that filed arbitration claims should be the same as those given to stores that survived Chrysler’s bankruptcy.

Chrysler confirmed today that the suit was the first filed over a letter of intent received by a terminated dealer in arbitration. The automaker, controlled by Fiat S.p.A. since its government-sponsored bankruptcy a year ago, declined additional comment.

“We were outraged by the letter of intent,” Kevin Mock, Century’s general manager, said in an interview with Automotive News. “We have 20 years and millions and millions of dollars invested in this franchise, and we couldn’t just sit back and wait for something to happen.”

After receiving the letter of intent, the dealership and its lawyer tried to negotiate with Chrysler over the terms but were “stonewalled,” Mock said. The dealership, located in a suburb of St. Louis, is owned by John Mock, 62, and his brother Frank, 54.

A year ago, Chrysler closed 789 dealerships, or a quarter of its dealer network. In January, about 400 of the rejected stores gave notice of their intent to file arbitration claims.

The latest letters of intent violate the federal law’s mandate that they be “customary and usual,” Century Motors’ suit alleges.

Under the arbitration law, Chrysler and General Motors have seven business days after an arbitration loss “to provide the dealer a customary and usual letter of intent to enter into a sales and service agreement.”

“Chrysler is intentionally, knowingly and willfully thwarting the law,” claims the seven-page suit filed by Century’s attorney, Allen Press of the Green Jacobson law firm in St. Louis.

One different provision in the new letter of intent would nullify the letter if an existing dealer protested the addition of Century and this protest were not dismissed or denied in 30 days, the complaint alleges.

Another provision would forbid Century to protest if a new dealership were added to its market, the suit claims.

Dealerships must sign letters of intent if they are to be reinstated via franchise agreements, also known as sales and service agreements.

Chrysler has issued letters of intent to two sets of rejected dealerships that filed arbitration claims: the 50 that were given these letters in March and April, before their arbitration hearings were held, and many of the 11 that have won in arbitration since April.

A number of the 50 that received letters of intent this spring said at the time that they didn’t intend to sign them because of some of the same provisions cited in Century’s suit.

Rep. Boehner, R-Ohio, issued a statement Monday that omitted the opening sentence of his earlier release that said he had been told by GM that Rose Chevrolet “has prevailed in arbitration with GM.”

However, the latest statement continued to maintain that GM told the House’s top Republican that Rose Chevrolet of Hamilton, Ohio, will “remain in business.”

Boehner’s new statement did little to clear up the dealership’s confusion.

The owner of Rose Chevrolet, Ed Larkin, said he hasn’t heard yet from GM or the arbitrator about the resolution of his case.

“If GM wants us to be part of the network, that’s what we want,” said Larkin, 39, whose family has owned the dealership since 1984. “But going back to last June, there have been some very peculiar, very strange things happening.”

Since the dealer arbitrations began in April, rarely has a congressman — let alone a party leader — gotten involved in an individual case. Instead, the arbitrators have been left to make their decisions, and GM and Chrysler Group have been allowed to pursue settlements or reinstatements as they saw fit.

Boehner stepped in last week after a courtesy call from GM in an attempt to have the dealership informed of what seemed to be favorable news as soon as possible. Instead, the dealership’s fate remains unclear.