Isuzu dealers are closing their stores in droves. Isuzu had 436 dealerships on Jan. 1, 2004. Today it has 298. All but a handful are dualed with other franchises, giving dealers a financial cushion.
Maloney says the ideal number of Isuzu stores is 225 to 250.
Under various state franchise laws, companies must compensate dealers for certain assets when they terminate franchises. So with fewer dealers, Isuzu's bill will be lower if it does exit the market.
M'Lady, who also owns a Nissan store, owned an Oldsmobile dealership and was compensated when General Motors terminated the brand. "You can believe there's a squeeze play out there to force the dealers out," M'Lady says.
But Maloney, 57, says the allegation of a squeeze play is "unequivocally not true." He spent 16 years at American Motors before joining Isuzu in 1989. He has been president of Isuzu Motors America since 2002.
Says Maloney: "We're a niche distributor. We have a reason to stay in North America. We can offer a product at a lower price and a better warranty. The fact that (our product) is shared with another manufacturer doesn't matter."
But some former Isuzu sales reps say the exit signs are clear.
"They're starving the (dealers) out," says Dave Seaver, a 15-year field rep who says he was fired last April. "They have no vehicles and no ad support."
Seaver maintains that the company has no intention of bringing in new product.
"They told dealers about a new SUV from Thailand," he says. "They wanted the dealers to stay committed to final production of the Rodeo and Axiom," which ended in 2004.
Maloney told dealers in 2004 that there was a good chance the new SUV was coming from Thailand. But at the NADA convention in 2005, he told dealers the SUV had been canceled because it would have been too expensive to meet U.S. emissions standards.
Seaver also says that in 2004 the company began giving reps a list of dealers to avoid.
"In essence, we could drive right by a dealer and not see him," Seaver contends.
Because of cost, Maloney said, only small-volume dealers were not seen in person. He says reps serviced them by telephone.
Craig Haglin, a 20-year sales field rep who quit last July, sees it differently. He says not all of the dealers on the hit list were small, and he says he quit because he felt he wasn't being honest with the dealers.
"We had dealers calling on the phone asking what's going on, but we weren't allowed to tell them anything," he says. "If they were adamant, we were told to send a service field rep."
Haglin says that as recently as the mid-1990s, dealers were paying up to $1.5 million in blue sky for Isuzu stores. "Now you can't give them away," he says.
Haglin points out that wholesale sales are low, and many dealers cannot hit targets to qualify for co-op advertising dollars.
"The market support is very important for dealers," Haglin says. "It was the only money they had to play with."