AAMCO Transmission Franchise: Bob Romano’s Story
Former AAMCO Transmission franchise owner Robert (Bob) Romano has shared his experience and his opinions of the AAMCO franchise and franchisor American Driveline, Inc. with the detailed account below.
(UnhappyFranchisee.Com) Written in the 3rd person point-of-view, Romano claims he is a victim of a corrupt franchisor that waged war on its own franchisees. He claims that “AAMCO’s mission is to run the old AAMCO Dealers out of business…one by one…by putting unjust financial strain upon them, take over their stores, create Profit and Loss Statements and Resell the stores to new prospects.”
Even after AAMCO successfully drove him from the chain, AAMCO continues to attack him by filing a non-compete suit against his wife’s small independent transmission shop 100 miles from his AAMCO location.
Here is the account Bob submitted to UnhappyFranchisee.Com in its entirety:
AAMCO Franchisee, Veteran Business Owner, Faces financial ruins at the Hands of Corrupt Franchisor AAMCO Transmissions Inc., and its Unscrupulous, Deceitful Business Practices!
Robert Romano, (Bob), became an AAMCO Transmission Franchisee in August, 1992. Bob opened his AAMCO Center in Hollywood, Florida. Bob invested everything he had, to open his new franchise. Through day to day hard work as a “Hands On” owner, he was able to gradually build a very successful Transmission Repair Business, with an outstanding reputation in the local community of Hollywood, and the surrounding communities. Within 5 years, Bob’s AAMCO Center reached Pinnacle Status within the AAMCO Franchise Chain. He was a highly recognized Dealer. Bob believed that treating his customers with respect and professionalism, in addition to properly repairing their vehicles, would build his business, one customer at a time. Each year Bob’s business continued on a successful path for many years. Bob believed that he had made a wise decision in partnering with his Franchisor, AAMCO Transmission Inc., when he began his business relationship with AAMCO in 1992. At that time, AAMCO Transmissions Inc. was family owned by the Morgan Family. During Bob’s early years with AAMCO, his business relationship with AAMCO and its employees was a mutually positive one. Bob considered AAMCO to be genuinely concerned for the success and longevity of its AAMCO Franchisees.
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In 2001, it came to Bob’s attention that a prospective AAMCO Franchisee was considering the opening of a location, just west of Bob’s AAMCO Center, in Pembroke Pines, Florida. Bob had great concerns of the impact this AAMCO could potentially have on his business in Hollywood. Through AAMCO’s , then diplomatic system concerning new AAMCO Centers and the proximity to existing AAMCO Centers, Bob was able to dispute and provide AAMCO with statistical facts of the potential, severe impact, that this specific location would have on his business. Bob then had a long telephone conversation with the then CEO of AAMCO Transmissions, to discuss this matter. After lengthy, detailed discussion of the specific facts, the two came to an understanding that to protect Bob’s business and its continued success, AAMCO would officially modify and relocate the Pembroke Pines Zone, further west and further away from Bob’s AAMCO Center. Bob received the official Zone revision in writing, from AAMCO, shortly thereafter. A few years later, that specific location became a Cottman Transmission Center. The new Cottman did in fact have some impact on Bob’s AAMCO Center, however, it was a competing company. At that time, Cottman Transmissions was considered to be a much smaller chain than AAMCO, the shop was a new business and it had its own small yellow page ad in the telephone book. Bob’s AAMCO was able to sustain this competition and really had no alternative, as it was considered to be “fair trade in the marketplace”.
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THE OFFICIAL ANNOUNCEMENT – March – 2006
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In March, 2006, the announcement was made via webinar to the existing AAMCO Dealer Body, that AAMCO Transmissions Inc, had been sold to American Driveline Inc., who also owned Cottman Transmissions Inc. The webinar represented that AAMCO and Cottman would somehow merge together and become “One big happy family”. It was also stated that the goal was to have the majority of the stores branded as AAMCO. It was further announced that the new CEO was to be the existing Cottman CEO, Todd Leff. Mr. Leff would be taking over the management of both chains and begin the extensive “merger”, or as many AAMCO Dealers refer to it as the “the Cannibalization of the AAMCO Chain”.
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After the shocking announcement, things quickly began to deteriorate. What was once a legitimate, professional company, was now on the path of a ticking time bomb. The existing AAMCO Dealers immediately expressed vast concerns of Cottman Centers, near to their existing AAMCO Centers. Not to mention the decline in equity to their businesses. All of AAMCO’s Fleet Accounts/ Customer Lists, telephone procedures, sales procedures, warranties, etc, were immediately shared with the Cottman Dealers. In the webinar for the Cottman Dealers, it was stated that AAMCO would provide funding to Cottman Centers, in order to assist in relocation, if the existing Cottman was too closely located to an existing AAMCO Center. The next day, Bob immediately notified AAMCO in writing of the revision of the Pembroke Pines Zoning and its proximity to the existing Cottman Center in Pembroke Pines. It was evident that the Cottman would need to be relocated further west into the official Pembroke Pines Zone, in order to convert to an AAMCO Center, and protect Bob’s AAMCO from devastating impact. AAMCO failed to respond to Bob’s telephone calls or letters concerning the Pembroke
Pines Cottman. The “new regime” completely ignored Bob’s concerns.
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The next immediate issue at hand for Bob was that he realized that his original Franchise Agreement was going to expire in about 15 months and he had heard that the new company would be making revisions to the existing AAMCO Franchise Agreement. The AAMCO Franchise Agreement required that “either thefranchisee orfranchisor must give written notice, more than 12 months prior to the expiration of the current Franchise Agreement, of their intention not to renew”. Bob immediately called AAMCO and requested his Renewal Franchise Agreement, in order to review its terms and conditions, so that he could make an informed decision, as to whether he would renew his Agreement for another 15 years. Bob had concerns as to if his AAMCO Center could remain on a successful path; and believed that the revised Renewal Franchise Agreement, and the terms contained therein, were the key factor to the success or failure of his business. AAMCO ignored Bob’s request, so Bob requested in writing,via certified mail, once again for the Franchise Agreement for his review. Finally, Bob received the Renewal Franchise Agreement, it had all of his pertinent information filled out, specific to Bob’s AAMCO Center in Hollywood, FL., Bob reviewed the new Agreement in its entirety, it had not been modified significantly, from his old Agreement, so he then decided to sign it, had a witness sign it and applied his corporate stamp to the Agreement. Bob returned it to AAMCO on June 27th 2006.
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On July 18th, 2006, AAMCO returned the signed Renewal Franchise Agreement back to Bob. Written across each page of the contract by AAMCO was ” VOID will not be countersigned by AAM CO”. Bob immediately called AAMCO to find out what exactly was going on? AAMCO stated that there were a few changes being made to the Franchise Agreement and that they would send him another Franchise Agreement shortly. Bob specifically reminded AAMCO that he needed to receive the contract prior to August l5t, 2006, in order to have time to review it once again and make a decision, based on the next contract that AAMCO would be sending to Bob. After repeated requests to AAMCO, they failed to provide a replacement renewal Franchise Agreement. The 12 month window passed. Bob was now operating his business without a franchise agreement. At that time, Bob concluded based on the” VOIDED , not Accepted by AAMCO” renewal Agreement and the failure by AAMCO to provide any replacement, confirmed that AAMCO, had in fact, given Bob written notice of their decision not to renew Bob’s Franchise Agreement. Bob continued to operate his business without a valid renewal Franchise Agreement.
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In the short months that followed, the owner of the Cottman Transmissions in Pembroke Pines, contacted Bob regarding AAMCO’s mandatory placement into Bob’s full page, yellow Page Ad, in the telephone book. Now, not only did Bob not have a valid franchise agreement, leaving him without rights to protect his business from AAMCO; He was also being forced to turn over 50% of his full page ad. Bob’s Ad took many years to earn front placement and now the converting Cottman Dealer, would automatically be receiving 50% of Bob’s customer contacts. AAMCO would not be relocating the Cottman further west, which was required, per the zone revision; instead, AAMCO permitted the conversion to take place, out of zone, and much too close to Bob’s AAMCO Center. Bob continued to call AAMCO to dispute this matter without success. The new regime’s policy was to never return phone calls to the franchisees. The only contact ever made to Bob’s AAMCO, was to demand Franchise Fees. It was clear to Bob that this new company, had deliberately manipulated the time factor of Bobs Renewal Franchise Agreement, in order to deceitfully manipulate Bob, during the Pembroke Pines Cottman conversion to AAMCO.
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The CORRUPTION CONTINUES ……..
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AAMCO Dealers have a local Advertising Pool, in which each AAMCO Dealer contributes to, in order to place local advertising, as a group, in the marketplace. Bob was the Ad Pool Chairman for many years in the Ft Lauderdale, Miami Market. The Ad Pool would periodically vote on and place different types of advertising,at the decisions of the local pool of AAMCO Dealers.
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When Cottman Transmissions came in and took over the AAMCO Chain as our new Franchisor, the Ad Pool also took a serious turn for the worse.
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The employees from AAMCO would come to Florida to attend the local Dealer Ad Pool Meetings. Actually …Control the Ad Pool Meetings. The AAMCO Dealers were specifically told by AAMCO’s employee, Brian O’Donnell, “that if they did not vote for the Television Advertising Package presented by AAM CO’s agency, and pa y the monthly assessments of $2200 per month to support it, that the Dealers would lose their businesses…One by One. AAMCO representative, Bruce Chinsey, also stated that “if any Dealer failed to pay, that AAMCO would pa y that Dealer a visit and it wasn’t going to be pretty. ”
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Bob read the “writing on the wall” ……The loss of business due to the Cottman /AAMCO conversion in Pembroke Pines, so near to his AAMCO, in addition to the $2200 mandatory, ineffective advertising assessment placed upon his company, and the fact that he didn’t even have a Valid Signed Renewal Franchise Agreement to protect his business, was devastating to his AAMCO Center. It could no longer sustain this disastrous situation. Bob continued to operate and pursue a Buyer for his business. He reduced the price and believed that he had to give it away, due to the brutal situation, that the “New AAMCO” had created from him. Bob sold his AAMCO, in order to sever any further business dealings with these unscrupulous people at AAMCO.
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AAMCO’s mission is to run the old AAMCO Dealers out of business…one by one…by putting unjust financial strain upon them, take over their stores, create Profit and Loss Statements and Resell the stores to new prospects. Bob watched this happen first hand, to many of his fellow, longtime AAMCO Dealers. Now it was Bob’s turn. Bob was actually fortunate to find a buyer, regrettably, most AAMCO Dealer’s lose their businesses these days. However, selling his business at age 53, was far too premature. He must continue to work for a long time ahead. Bob signed a non-competition Agreement with his buyer. It stated that Bob would not work in the Transmission Business for two years within Broward County, Florida. (Approximately a 30 mile radius around his previously owned AAMCO in Hollywood.) AAMCO Transmissions Inc. approved this non-competition Agreement in Bob’s Terms of Sale. Bob has and will continue to honor this agreement with his Buyer.
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THE BULLYING CONTINUES ……..
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When Bob left AAMCO, his credit was ruined from incurring so much debt from AAMCO. Bob, and his wife Linda, are trying to move on with their lives. They have moved almost 100 miles away from Bob’s old AAMCO Center, into Martin County, Florida. Linda has opened a small Transmission and Auto Repair Shop in an industrial park area. The business is new and struggling to succeed, as new businesses will …
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AAMCO has served a lawsuit upon both Bob, their ex-franchisee, and his wife Linda, in effort to shut her new business down. AAMCO states that Bob is now competing with the local AAMCO in Martin County. Its Bob’s conclusion that he has not had a valid Franchise Agreement, since Aug 2007, when his original contract expired. Bob is honoring his non-competition agreement with his buyer, AAMCO deliberately failed to carry out proper and timely franchise renewal procedures for Bob’s AAMCO Center, in a fraudulent attempt, to convert the Pembroke Pines Cottman Center to an AAMCO, which was out of zone, too close to Bob’s AAMCO and should have been moved further west, into the official Pembroke Pines zone.
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Bob wanted to share his experience of dealing with such deceitful, corrupt, people, as are these people at AAMCO. If you are considering the purchase of an AAMCO Franchise, please consider his Story. In addition, be sure to review the details of the AAMCO Dealers Class Action Criminal Lawsuit, against its Franchisor, AAMCO Transmissions Inc., Bob’s is just one story, of many financially devastated ex AAMCO Franchisees.
Further reading & discussion:
AAMCO Transmission franchise posts
AAMCO TRANSMISSION Franchise Complaints
AAMCO Franchise Called a “Financial Nightmare”
AAMCO Franchise Complaints: Terrible Site Selection
COTTMAN TRANSMISSION Franchise Complaints
ARE YOU AN AAMCO FRANCHISE OWNER OR FRANCHISEE? ARE YOU FAMILIAR WITH THE AAMCO FRANCHISE OPPORTUNITY? SHARE A COMMENT BELOW.
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