published Friday, September 28th, 2012

Chattanooga adds second Chevy dealership

Brent Morgan discusses the opening of his new Integrity Chevrolet dealership Thursday at the current location of Kelly Infiniti in Chattanooga.
Brent Morgan discusses the opening of his new Integrity Chevrolet dealership Thursday at the current location of Kelly Infiniti in Chattanooga.
Photo by Alyson Wright.

Auto franchise roulette

Changes at GM's new car dealers since 2009

Brent Morgan

6025 International Drive; 2110 Chapman Road

* Saturn -- Shut down by GM

* GMC -- Acquired from Tim Kelly in 2010

* Cadillac -- Acquired from Tim Kelly in 2010

* Buick -- Acquired from GM during transfer of Kelly franchises

* Chevrolet -- Acquired from GM in Sept. 2012

Herb Adcox

5721 Lee Highway

* Chevrolet -- Franchise revoked by GM in 2009; Adcox joined anti-GM lawsuits in 2010 and 2011

Tim Kelly

2110 Chapman Road, 900 Riverfront Parkway

* GMC -- Transferred to Brent Morgan in 2010

* Cadillac -- Transferred to Brent Morgan in 2010

* Hummer -- Shut down by GM

* Saab -- Shut down by GM

(Kelly continues to offer new Infiniti, Subaru and Mitsubishi vehicles at his Chattanooga locations.)

Don Ledford Chevrolet

1900 Congress Parkway, Athens, Tenn.

* GMC -- GM initially revoked franchise in 2009, but changed its mind in 2010

* Buick -- GM initially revoked franchise in 2009, but changed its mind in 2010

* Cadillac -- GM initially revoked franchise in 2009, but changed its mind in 2010

* Chevrolet -- GM Granted franchise in 2011, opened in spring 2012

Source: Brent Morgan, Tim Kelly, Herb Adcox, Debbie Ledford Melton

Five auto executives wearing yellow bowties sat at a small table in the corner of a bare showroom.

The murmurs of final negotiations reverberated against the newly painted blue floor, as the men traded thick stacks of paper. A couple of feet nervously bobbed up and down under the table.

Then, with a final swish of his pen, Brent Morgan on Thursday won a citywide game of musical automobiles, bringing a second Chevrolet dealership back to the Scenic City under his Integrity Automotive brand.

On Monday, Morgan will open his new Chevy dealership at 2110 Chapman Road, a location he will share with Tim Kelly's Infiniti dealership. It's Morgan's second dealership after his existing spot at 6025 International Drive.

His purchase of the Chevy franchise brings a degree of stability to a market that has seen dealerships shuffled and shuttered amid recessions and bailouts.

"There will be no more movement of these dealerships," Morgan said. "Our intent is to operate for the long term."

A house divided, the left side of Morgan's 50,000-square-foot space will house Infiniti, while the right side will offer new Chevy cars and trucks. He and Kelly also will split the 34 service bays.

"The emphasis has been on downsizing the dealer network, so it's a significant change to open a new [dealership]," said Ted Bortner, district sales manager for Chevrolet.

Morgan bought the entire six-acre site for an undisclosed sum from Kelly earlier this week, and the two competitors said the shared arrangement is temporary until Kelly can find a new spot. Kelly had previously purchased the property for $4.68 million at the peak of the real estate market in 2007.

Morgan said he plans to sell between 750 and 1,200 cars in his first fiscal year and will maintain about 200 Chevy vehicles on the lot. In addition, he plans to offer between 75 and 100 used cars and employ about 50 new workers.

"We've had population growth in the Chattanooga area, and we're being put in place on auto row to better serve Chattanooga," Morgan said. "It's a win-win for everybody."

He said that, within a year, he will spend about $1 million to rebuild the dealership into the new Chevrolet image in a design called "the blue arch."

Following its takeover by the U.S. Treasury, General Motors yanked the Chevy franchise in 2009 from long-time Chattanooga dealer Herb Adcox, who is still locked in a lawsuit with the automaker.

Under its government supervisors, GM also canceled its remaining franchise agreements with Kelly, who in 2007 bought his Chapman Road location specifically to house the GM brands.

"The GM bankruptcy came and blew everything up, and the facility was always way too big for any of what I had to put into it," Kelly said.

After a year of arbitration, Kelly transferred his GM franchises to Morgan who, at the time, was the dealer for Saturn, which GM was in the process of winding down.

"In the cosmic sense it worked out because I have other franchises to go back on," Kelly said. "It's hard for me but I don't fault him. I'm happy for Brent, and I do think it's a really great outcome."

Morgan now sells the full line of GM vehicles in his Chattanooga locations.

Adcox, who claims to have sold as many as 2,000 Chevy cars and trucks per year at his Lee Highway location prior to his 2009 franchise revocation, said he looks forward to seeing how the Chevy-Infiniti pairing will work out.

"If they were going to give it to someone, I'm glad they gave the franchise to him," Adcox said. "Brent's a good friend."

Adcox now sells only used cars at his Lee Highway location, and Kelly continues to sell Subaru and Mitsubishi vehicles at 900 Riverfront Parkway.

Mountain View Chevrolet, owned by the Watson family, will continue to sell vehicles downtown.

about Ellis Smith...

Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...

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